jetblue EMB-190 pay??!!!

[G4G5]

Lowcur,


Now this will really put pressure on WN. The 190 will absolutely destroy WN when B6 begins to match up on routes in probably 2007. This plane will be used against WN out west between OAK and LAS at first, and they will spider web the routes out of LAS as they grow. These routes will also put tremendous pressure on AWA's bid to survive.

It's gonna be a great future for Embraer. [/QUOTE]
Lowcur,

I think that you are a liitle off base here. The mgt of LUV has already looked at the 190RJ issue and they have decided that at this point it makes little sence(but they did leave the backdoor open). The 190 is a new airframe and a new motor combination. LUV has no intension of becoming the guinea pig. It's just not worth it for them.

How did B6 do the last time they tried a West coast fare war? Did you notice that LUV has a sale going on
http://www.southwest.com/jp/hotfares.shtml?src=PR%5fsale%5f070604

How much yeild is Jetblue going to make on the 190 when they are filling seats at $39 going againsta full SWA 737 at $39. This sounds to me like the stupidest thing that they could do with the 190.

The 737 still has tremendous adventages over the 190. Their is no cheaper commercial aircraft in the world to do maintenance on. Due to the large numbers of 737's flying the economies of scale create huge pricing pressure on aircraft parts and supplies. Sure the 190 will be under warranty but how long will it take to get a spares supply built up around the country (like the 737). What about the earning curve associated with the introduction of a second type. How many Certified Repair stations at various airports around the country are going to have trained maint techs who can repair the 190? This is not Boeing tech support, no it's 1800 call the jungle to see if they have the spare. I could go on and on. It's extremely clear that LUV has done the research and decided that this is not a good idea (for them).

An engine overhaul, brakes, rotables and spares will be cheaper on the 737 for years to come. Training costs for a single type are lower, LUV pilots come with their 737 types. LUV still can leverage fuel contracts better then anyone in the industry. Flying one type still makes more sence. At a time when USAir and the other majors are ripe for the picking LUV has placed their largest 737 orders. What had B6 done? Gone after the smaller 190 market. Where is the higher yeild? Attacking USAir in PHL or starting a west coast fare war?

 

[G4G5]

What will be interesting is how DL, AMR, and SWA will handle this? Arpy and Greenjeans have been waiting to see what B6 will do, and now they will be able to sit down with the pilot groups and see who will fly the 190. My guess is the rates for both DL and AMR will be about 10% higher than B6. I believe the plane will be flown by mainline in both cases. They don't have a choice in the matter, they will have to buy the plane and fly it cheaply.

I believe that you hit the nail on the head. AMR will no doubt enter the 190 game. It's quite clear that they need a replacement for the Foker. By this time next year AMR will only have 30 CRJ700's, that's only 30 aircraft to fill the gap between 50 and 119 seats.

Dave and his boy's in an effort to be CHEAP may have just put the nail in their coffin. The rates they have established will no doubt set the presedence for the industry. When Arpey comes calling to Hunter he will get the pay rates he wants. For those of you who don't know, Hunter is the new APA President that has already signaled that he is willing to cave in on the 190 and the pay rates. Just ask any AA pilot. If Hunnibel had been elected I would feel different but he was not and Hunter was. The bottom line is someone at AA will be willing to fly the 190 for those rates, (the same thing will no doubt happen at DAL).

AMR mgt is licking their chops at the very thought of being able to fly coast to coast in a 190 at the Jet Blue rates. Consider this the 190 holds 115 seats. AMR MD80's hold 119 seats. AMR has approx 325 MD80's. Can anyone else think of a better replacement? How many additional aircraft will be needed to fill the void created by the retirement of the 74-F100's? See my point Dave has just invited a whirlwind of competition in the 190 market with those rates. If he had set them at $5-10 dollars below current market 717, DC9, MD80 rates he would have been able to flood the market with the 190's and no one woul have cared. These rates will make the majors stand up and take notice.

AMR is in a far better position the Jetblue to get the 190's at sub par rates. Sure Dave can jump and down and say he got them for cheaper. The reality is Embraer knows where their bread is buttered. How long has AMR been purchasing Embraer products? When Embraer's largest customer comes calling with a 300-400 aircraft order, economies of scale will dictate that AMR gets the best price. FYI the last time I checked AMR had over $3.5 BILLION in cash.

The reality is that AMR could have done this with the 717 but they would have had to pay the current contract 717 wages. Their are no contract pay rates for the 190. Which means they have to be negotiated. Dave has just set the pay rate so low that when Arpey sits down with the APA, what leg do they have to stand on?

This will also be an easy sell to the current pilots. It will never effect them. Anyone know how many AA pilots retire within the next 10 years? Over 3,500!!
Approximatly the same number of MD80 pilots that AMR has. Arpey can eaisly sell it to the union. He can replace the MD80's with 190's at the same rate of pilot retirements. The current MD80 pilots will fill the void creatd by the retiring pilots, never having to fly the 190. The furloughed pilots get recalled into the 190. Arpey can get preff bidding whatever he wants. In exchange for a slight pay raise on the larger equipment. The money saved by replacing the MD80 pay rates with Jetblue 190 pay rates will eaisly cover this. This will pass with little objection because the current AA pilots will never be effected by this, they will still move up and get a raise. The 3500 retiring will no doubt want 2500+ dues payers back on the real estate. They will also be happy to be getting a pay raise.

That' what I ment about the nail in the coffin. The 800 pound guerilla has just been invited to the dance.

 

[8vATE]

+++++++++++++
As for my solution, it is quite simple and quite obvious........do the right thing and pay our EMB pilots a decent wage!

++++++++++++

I can certainly agree to that....

Emotions around the board are very high... There are a lot of upset people.
I came through the commuters, major airline freight, major airline furlough..
I have empathy for those that are upset....I have friends at the regionals, at cargo carriers and furloughed...

Everyone is upset that the 100 seat EMB rates are low...
No disagreement from me... But everyone forgets that the 156 seat A320 rates are low... And those of us that accepted employment at B6 knew that..

Hopefully, the additional compensation of profitsharing and CSSP and stock options make up some for that... And the job security and the way we are treated by our leadership.

This industry is in upheaval.... I'm amazed that according to the financial experts the airline industry has lost more than it has earned in its entire history...

Some people seem to forget that jetBlue IS in fact an LCC..
We are not paying industry leading payrates... and we are not even paying industry average rates for 100 seaters.....

Hopefully things will improve... for everyone...
eventually..

 

[SpeedBird]

180+ posts and everyone has whipped this issue into a nice frothy lather of emotional extremes and knee-jerk assumptions about the motives of David & Dave, jetBlue pilots, and either the shared or individual culpability to the shock of the EMB-190 rates and its supposed impact on the industry going forward.

I think everyone (most especially every jetBlue pilot) should take a step back from the issue, take a deep breath, and let things develop internally at jetBlue under its own course. There is still a lot of time to properly handle this issue without going off the deep end here and do something really stupid, especially on the ill-advised inputs of some folks here who have absolutely no stake in our future. This is an issue to be resolved between the jetBlue pilots and management, and ONLY jetBlue pilots and management.

Tony your comments serve no useful purpose at this point since you don't have a horse in this race. The only thing you share with jetBlue pilots is the same the airspace our airplanes fly in and that's it. BTW it's Mr. "Neeleman" unless you think you're being witty with that overdone "Needleman" thing. I expect better from you based on your overall postings on this forum.

JetBlue pilots: Before you think David & Dave is unilaterally going to take away your next born from under your noses let's give them the benefit of the doubt that they may have made a couple of bad assumptions and are willing to listen to our concerns about some of the unintended consequences of this announcement.

Let us BKADers not forget that the competition is pulling out all the stops to try and put this young airline out of business...and nothing less. To believe otherwise is just wishful thinking. Now thanks to the astute business plan designed and executed by, and the nimbleness to adjust this plan to the external threats of the competition, David and Dave have done nothing short of amazing to keep the wheels on the wagon. Yes, the airline has maintained a respectable level of profitability and has grown at a healthy clip while most others have lost copious amounts of money and significantly reduced pilot numbers. HOWEVER, I believe the next 24 months will be crucial to the long-term success of failure of this airline.

JetBlue is now on the threshold of moving away from a start-up national airline to a major airline this year. While that may seem like good news on first pass, it comes with many new extra costs to the airline; costs like building expensive new infrastructure (like jetBlue U, mx support hangars, sim training facilitities, and the new JFK terminal); the EMB-190 will be brought on board, and the airline will have to deal with possibly several operational/training/maintenance issues as a result; finally the airline is squarely in the competitive bulleye of just about every major legacy carrier and this has reduced margins and yields at a time when jetBlue (and everyone else) cannot raise fares. The only way to maintain profitability is keep the delta (spread) between CASM and RPMs as large as possible. This is what has carried jetBlue this far in this business, and this is what will keep it one step head of the competition going forward for at least the next few years. I am sure this is what David & Dave are pre-occupied with and what may have served as a basis for establishing the EMB-190 rates.

Now with that said, the old saying that a "good defense is a good offense" also applies here. I expect that the EMB-190 will be used as a big club by David & Dave going into the next round of the LCC vs Legacy bout. Right now (on the domestic front) the smaller regional markets have been largely ignored by the LCCs, and as a result has given legacy carriers some financial breathing room while hemorrhaging in the more competitive LCC battleground markets. While we pilots look at the EMB-190 payrates in a certain light (i.e., bringing down the pay and QOL of pilots throughout the business), I'll bet David & Dave based rates with an offensive mind-set on how to kick the competiton's rump. By using similar payrates on the 100-seat 190 that are used for 50-70 seat aircraft, this will allow the labor costs to be zeroied out between the EMB-190 and the aircraft it will compete with (not other 100 seat aircraft but CRJs and other 50-70 regional aircraft).

JetBlue will have have a CASM advantage of at least 50% over its competition and this will have as big or bigger impact on its bottom-line as it did during 2002 & 2003 with the A320s (lower prices and better service). I believe that unlike the A320 market yields in this new market will be better than we've had historically with the Airbii. The other difference is that this market segment is four or five times larger than the one the A320s operate in. If this works it should create a significant financial windfall for the airline, the shareholders, and the employees for several more years.

Okay, so what should the jetBlue pilots be doing now. I think we need to be talking in a more organized and thoughtful manner, and more importantly talking with management in the same way and letting them know how we initially view these new payrates. Then let's us shut-up for a minute and listen to their response. I believe there is a fruitful middleground between managing growing costs in a cut-throat operating environment and letting jetBlue go after the juglar of the competiton (I believe it will be found with the improved yield environment using 190s). If a union or other organized entity must come from this process then so be it, but let's not get our collective panties in a wad because everyone else outside of our little ol airline is crying that the sky is falling and that we're responsible for their emotional insecurities.

To put in pilot terms we can all appreciate; let's just hack the clock and smoke our figurative pipes now that the master-caution light has illuminated....cause the "airplane" isn't gonna fall out of the sky in the next five minutes.

****edited to remove excessive profanity****

 

[bayoubandit]

G4G5 is right on

The deal will be struck to bring back the furloughed guys, at least that is the way they will make it look. A win for Hunter & co in their minds!!!

APA will have no choice in accepting these rates or else a way will be found to farm out the 100 seat flying. I never doubted that APA would have to settle for less than F100 rates on the E Jet if they want to preserve jobs, but I don't think that is their interest anyhow.

I wonder in the case AMR does take on the the E Jets, how junior will Cpt. go. I can't imagine any one on bigger equipment upgrading for a paycut.

 

[blahshmah]

I nominate Speedbird to go talk to David & Dave, good luck!

 

[catIIIc]

G4G5,, Bayou Bandit,


While I agree that we will not be flying the new E-Jets at Fokker rates I do not believe that we will fly them at the low Jet Blue rates. I may be overly optumistic but look at the eagle 70 seat rates they are pretty close to the Jet Blue rates.

Anyway if they do fly them at Jet Blue rates their still will not be any recalls because as guys retire they will just park that many MD80's and replace with E190's: displace and bump no recalls.

Happy days
CatIIIc

 

[G4G5]

G4G5,, Bayou Bandit,


While I agree that we will not be flying the new E-Jets at Fokker rates I do not believe that we will fly them at the low Jet Blue rates. I may be overly optumistic but look at the eagle 70 seat rates they are pretty close to the Jet Blue rates.

Anyway if they do fly them at Jet Blue rates their still will not be any recalls because as guys retire they will just park that many MD80's and replace with E190's: displace and bump no recalls.

Happy days
CatIIIc

How do you figure no recalls? If an equal number of 190's replace the retirig MD80s (some over 20 years old) and AA retires 3500 pilots the replacements have to come from somewhere.

I am not saying that the rates will be as pathetic as JetBules. AA has always maintained that they can justify 15-30% premium in their pricing. I would no doubt think that AA rates will be 15-30% better. This is still quite a savings for Arpey and gang over the existing F100/MD80 rates.

Does anyone know how to edit a post. I have been in Africa on a 2 week trip and my clock is a bit off (so in my spelling, the key boards in Mauritius are quite different). The edit function is not on any of my previous posts.

 

[bayoubandit]

CatIIIc

You must be having a blond moment? I guess the humidity has clogged yo brain I would also think we would get better than the JB rates if they get them. Time will tell.

I would think there would be recalls also if the fleet size remains the same. Weren't you telling me it won't be too much longer.

In the mean time, we're living the dream!

Bayou

Ps. G4, I think I read on hear that you can't edit a post after 10 minutes due to the the new format or something of that nature.

 

[catIIIc]

My bad I guess I was figuring if eagle gets the 190, I think if we see any growth at all next year it will be for China and the 26 MD80's coming out of the desert.


I hope something big happens soon I am going deaf and sweating more then any human should down here.

Take CAAre
CatIIIc