Frontier secures DIP!

[Newf Dog]

"Has anyone stopped to think about what those "certain other conditions" might be. If this gets past the BK court, the company is going to come a 'knocking" for some more concessions."

You bet they are....and that's the $75 million question. This DIP deal could significantly alter F9. SM already stated that the makeup of the BOD will change. Holding onto our contract will be paramount. The "good will" of the employee groups can only go so far even amongst the thirstiest of Kool-Aid drinkers.

 

[fam62c]

Good luck to all at Frontier, I hope you make it. The only downside I see here is that if you come out the other side a private equity company will own 79.9% of you. Ask the folks at Midwest what it's like to be owned by a private equity shop, these people are ruthless. The "conditions" to get the money may prove to be draconian.

 

[USMC319]

Yes, even if it meant I were on the street.quote]

Pipejockey,

Who do you think you are fooling? Maybe yourself, but don't try to sell that BS to the rest of us.

If you think you should be the decider of the surviving carriers, and recommend that all employees of such carriers fall on their swords so that you can enjoy the rest of your...what 25 to 30 years was it? Maybe we ought to make that retroactive and have all the carriers that were in bankruptcy in the past just go away, afterall according to your logic they are the ones that drug the industry into its current state. Maybe all the pilots from any carrier that used the bankruptcy proccess should just shut quit for your career's sake. BTW, why would you want to take some of the most quality capacity out of the industry by recommending F9 go away. Why don't you recommend capacity from the crappy service carriers go away instead...or whould that adversely affect you?

 

[pipejockey]

I already said, if it were my carrier so be it!! Any of us who do this for a living should be able to be successful elsewhere, as I will be. And as far as deciding who survives and who doesn't, shouldn't the ability to make enough money to be a going concern dictate that? If a company falls into bankruptcy then obviously they are not successful enough to survive. And sure, lets not limit it to 2 bankruptcy, lets eliminate all this bankruptcy protection period!!! I'm all for that. It's high time prices are charged for a service or product that at least covers costs, these fares have got to stop!!

Half of the flights I operate have standbys. Some days the standbys run up to 100 if there is just 1 cancellation due to weather and the ATC incompetence that is surely to follow. Yet our fearless leaders continue to pi** on our legs and tell us it's raining, saying they just cannot raise fares. I call bullsh*t!!!

 

[Toobdrvr]

so who do you work for....

 

[FlyWolf]

Great news guys, all the best, I really hope you make it. Frontier is a class act airline and a group of pilots.

 

[Golden Falcon]

He's a cheese-head give him a break

 

[armani]

This is great news to hear F9 has a great product along w/ many of my Laker buddies working there. I wish you giys the best.

 

[PinnacleDude]

Congratulations to the Frontier folks on the DIP. Someone I know from SWA asked me to say thanks to the F9 guys for the ride to GEG the other night. He also said the word on Denton Drive in DAL is that SWA management thinks F9 will be around. Take it FWIW.

For everyone else trashing on the F9 guys, why rain on their good news? It it doesn't turn out it will become obvious enough and we will read about it in USA Today. Until then we are all pilots and lets hope for the best.

 

[McNugget]

They need RAH 170s to survive.

Was a great product for a great company

 

[AnimalTale]

He also said the word on Denton Drive in DAL is that SWA management thinks F9 will be around. Take it FWIW.

Thanks for your nice words Pinnacle!

Tell your friend over at all-knowing, mighty & most importantly humble SWA that the "folks" over at TOWER RD say, "Everybody will pay the Piper, sooner or later".

CYA

 

[greenbayfan]

But I guess question remains, is the industry as a whole better off for those who remain and those who depend upon it for their living, when carriers continue to go in and out of bankruptcy?

Wow, someone on FI that gets it! I hold no ill will towards Frontier, Spirit, or any other airline. I just would like to see the weakest in the industry cease to exist to get the airline industry back to where it should be....turning a profit.

Everyone on FI preaches fighting for what our profession deserves in terms of pay and benefits, but sacrifices need to happen for the airline industry to get to that point, and quite frankly those sacrifices are lost jobs in the form of a downsizing industry. We as pilots have no leverage when airlines aren't making money, and the only way airlines will start making money is for some to fail to get reduced competition.

So while losing a job sucks, quit thinking of the short term. For the long term health of our profession, we need airlines that are having liquidity issues right now to go by the wayside so these pilots can come back to a profession that pays what it should....

 

[DeucesWild]

we need airlines that are having liquidity issues right now to go by the wayside

Uhhh, that would mean everyone but Southwest would go by the wayside. That would be a wonderful industry wouldn't it? Does Southwest go to Fargo??

 

[greenbayfan]

Uhhh, that would mean everyone but Southwest would go by the wayside. That would be a wonderful industry wouldn't it? Does Southwest go to Fargo??

I said liquidity issues my man! i.e. those in BK are there not because they are losing money, but because their losses compared with their cash position have forced them into that postion.

 

[stratus72]

"Has anyone stopped to think about what those "certain other conditions" might be. If this gets past the BK court, the company is going to come a 'knocking" for some more concessions."

You bet they are....and that's the $75 million question. This DIP deal could significantly alter F9. SM already stated that the makeup of the BOD will change. Holding onto our contract will be paramount. The "good will" of the employee groups can only go so far even amongst the thirstiest of Kool-Aid drinkers.[/quote



I knew it was coming, but you did call it. We learned of this through the local newspaper and not our Union or management. Again, no suprise but an official announcement of these talks would have been nice.

Frontier loan spurs union talks
More cost cuts
By Greg Griffin
The Denver Post
Article Last Updated: 07/28/2008 11:13:10 PM MDT



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Frontier Airlines has begun contract negotiations with unions representing its pilots and mechanics, a requirement of its new $75 million loan, the company said Monday.
"We're going back and talking to all of the unions again with regards to the Perseus deal," Frontier spokesman Steve Snyder said. "We've started talking with them about specifics."
Perseus LLC, a Washington-based private-equity firm with an Evergreen office, agreed Friday to lend bankrupt Frontier $75 million in two installments in return for a future equity stake.
To receive the second installment, Frontier must obtain from the pilots and mechanics "new or revised collective bargaining agreements or amendments . . . containing concessions necessary to meet labor cost reductions."
The pilots and mechanics unions agreed to temporary wage and benefit reductions in May. The pilots' pay cut was 14.5 percent.
It's not clear if Frontier seeks to make those reductions permanent or whether it wants additional concessions.
Local leaders of the Frontier Airlines Pilots Association and the International Brotherhood of Teamsters Union could not be reached for comment Monday.
Frontier has about 700 pilots and 430 mechanics and related employees. But the airline is laying off about 150 pilots and about 50 mechanics and related workers among its 600 announced job cuts.
Under the agreement with Perseus, Frontier will receive $40 million next month. Perseus will supply the remaining $35 million no later than Nov. 15 if new contracts are reached. Frontier must pay annual interest of 16.5 percent on the loan.
The deal requires Frontier to cut costs to meet Perseus' monthly operational cash-flow targets over the next year. Frontier must be cash-flow-positive each month except November and December.
Perseus' definition of cash flow includes net income before interest, taxes, depreciation, amortization and other one-time, nonoperational gains and charges such as Chapter 11 restructuring costs. Perseus also requires Frontier to have at least $90 million in cash reserves before it receives the $35 million.
At the end of May, the most recent month for which Frontier has reported financial results, the company had $110 million in cash.
The carrier lost $38 million in April and May, as fuel prices hit record highs. Frontier chief executive Sean Menke said Friday that June results were "greatly improved" because of cost reductions made since Frontier entered Chapter 11 in April.
Menke estimated Frontier's cost savings at $40 million to $50 million this year. Greg Griffin: 303-954-1241 or [email protected]