JetBlue to land in ATL

[FlyDeltasJets]

Albie,

You are comparing captain pay to F/E pay. Tying compensation to advancement is a slippery slope. We shouldn't have accepted it when mgt promised growth in return for a B scale, and we shouldn't accept it now. It is a invalid comparison, just as comparing your MD-11 captain pay to the A320 captain pay would be invalid. You need to compare apples to apples, and when you do so, the shine comes off a little.

Also, I would caution you about advocating letting "market forces" alone dictate our contracts. None of us would like the probable outcome.

P.S.
Sam Kinison RULED. I saw him live once and he was insane. Although I don't agree with your point, anyone who can use Kinison in an airline economic discussion is OK in my book!

 

[FlyDeltasJets]

It is the job of your Negotiating Commitee to deal with the company when determining wages relevent to your peer group. The low cost airlines do NOT fly the same aircraft to some of the same places that most "network" carriers do.(ie:International) For ALPA or any other union to go into negotiations with the company using SWA, jetBlue, Airtran, or ATA as a "peer group" is a problem that your membership should address to your MEC. As a former Negotiation Commitee member at an ALPA carrier I remember the company trying to lump us in with "different" model carriers. We would throw up the BS flag and put a halt to that crap, perhaps so should alot of other Majors. If pilot pay is being dictated by LCC's, you're airline is in alot more trouble than you think.

Canyon,

You are correct, and our negotiating committee has attempted to do the same. We have been successful in the past, and are still working to hold on to what we have. The current environment, including forces I previously discussed, are making it very difficult. I know you wish us luck (seriously).

 

[AlbieF15]

FDJ,

When I compare airlines to other airlines, I don't compare apples to oranges. As a 37 year old guy when I started, I study potential career earnings. (Or...pineapples to cantelopes)

For instance....American had a good contract when I was applying...but (waaay pre 9/11) being 13,000 on their list was NEVER going to get me a 777 Captain job for a significant (or maybe any) period of time due to my age. So....its true the Delta MD11 wage or the UAL 777 Captain absolutely blows away a SWA 737 or JB A320 captains hourly wage.

I would also argue that the point is entirely moot. What matters is the company's growth rate, fleet expansion, profitablity, and the "model" career you can expect based on those factors. If you can't fly the 777 as a Captain...who cares what the pay rate is? What can YOU hold and expect to fly in your career?

Another horrific point. All our ALPA created retirement systems....pensions, ESOPS, B-plans, etc can be CRUSHED by bankruptcy and other economic factors...including management fraud.

Back to my point. If I were 35-45, looking for a profitable, lucrative career....I'd look at SWA, AirTran, and JB. If Delta called me up today and said "we know you always loved us...we are here for you...and the DAY the last furloughee is back you are FIRST guy in class" I'd still likely be hurting--not because Delta's contract isn't great but because in 3-5-7 years I'd still be behind a huge bowwave of recallees. Those high numbers for 777 look great....but what if "I can' t get there from here?"

So...take a look at CAREER earnings for a JB, SWA, or AirTran type guy. While my Delta bros are out making ZERO on f-word, my new A320 JB captains are making 135-150k per year. It will take a LOT of extra hours at the higher Delta rates to make up for the lost time on f-word. Additionally, for some of us not starting in our careers, the time to earn is 14-22 years...not the 25-30 career some other spring chickens may have. So...don't look at a paychart--look at what you expect to make each year then add the totals. Don't forget the time value of money, either. I'd gladly take 140k today over 200k 10 years from now.

One more rebuttal...our retirement systems. I LOVE my FDX A and B plan...I mean LOVE them. However...company has to be there to pay them. Not sticking a poker in anyone's eye...but look at the US Air mess and the ESOP debacle at United. Once you go into Cht 11/Chpt 7...your pensions can be decimated. The options and 401ks at the LCCs aren't as good on paper as the majors plans...but unfortunately they ALL have market risks. If you suffer on furlough for 5 years so you'll have an industry leading retirement plan when you are 60...well...you may just have a terrrible surprise waiting down the road. I love my A plan...but I'm saving and investing like it won't be there...hoping that when it is its just a very nice bonus.

As for comedy....back in 88-89 my UPT roommate had an HBO Dangerfield special with Kinnison, Andrew Dice Clay, Rita Rudner, Louie Anderson, and a couple others...absolutely the funniest show I ever saw. Almost everyone on that tape went on to have great solo careers as headliners.

And thanks for keeping it professional....trust me when I say I have no axe to grind...and I want to make as much money as possible in this line of work without overly mangling our golden goose. I had dinner last week with a FedEx poolie, a SWA poolie, a United furloughee and a Delta pilot with some very sore fingernails from hanging on to the cliff. I would like to see ALL of us working healthy, happy, and prosperous very soon....

 

[General Lee]

Jeff G, Blue Bayou, and Speedbird,

I have to admit that I was surprised reading the headline that Jetblue was starting LGB--ATL. That was smart on your CEO's part. Good move. But, in reality, there is one major blocking point to Jetblue ever getting "big" in ATL----the lack of gate space. Even Airtran is hampered by lack of gates--they are stuck in the southern half of the C concourse, and some of their RJ's are over at the end of the D concourse. Besides two or three other gates per airline, Delta operates all other gates. So, I think Delta has its grip on ATL---which is good for us. I think this is all a response to us putting 36 757's on your routes---and I also think there may be a market for you in ATL. Maybe this will help Delta see that they have to compete all over---not just the NE to Florida. I am sure that we will have more than 36 757's on Song, I have heard closer to 60 (out of 120 total 757's). But, overall this was a good move on your part and I think Leo Mullin will be looking at this one closely.

Bye Bye---General Lee

 

[Kid Charlemagne]

Why? Would you like me to permanently loose my job? How would this help you? Like I have said before, it's getting harder and harder to root for you guys.

Ranger,

I don't want to see anyone lose their job. But what about my job? What do you think the whole point of Song is if not to put me out of my job? I'm not too worried, as I know that will not happen - our leadership team at JBLU is too smart and savvy to let it. But just knowing that's the whole purpose of Song's existence ticks me off. Look back at the posts over the last couple months. See for yourself all your compatriots from DAL salivating over the prospect of "hurting JetBlue". That's OK huh? But when I say something similar now, that's not cool? Reminds me of the old saying about those who wanna dish it out....

To be honest, I always looked up to DAL in the past...thought they were one of the best airlines. But not anymore. It's not just because Song will "compete" with JBLU on NE - FLorida routes. It's because they are an exact replica, a clone, a carbon copy of JBLU. It's like if you were back in school and spent a whole semester working on a research paper...put your heart and soul into it. And some idiot in class who wasn't smart enough to write his own paper just copies yours, word for word, and THEN GOES AROUND BRAGGING ABOUT HOW MUCH SMARTER HE IS THAN YOU!!! How would you feel about that???????

BTW, to those who keep reminding us blue suiters that "two years ago you all wanted interviews with DAL, AMR, UAL, U, etc"- WRONG!!!!! I made up my mind I wanted to work for JBLU as soon as I heard about them in detail (early 2000) and I applied to them immediately. Yes, this was well over 1 1/2 years before 9-11 and all the majors were hiring. And no, I didn't even APPLY to any of the majors because I knew JBLU was the kind of company I wanted to spend the rest of my career at. So this nonsense about us JBLU'ers all wanted to go to United or Delta once upon a time will hopefully be put to rest....cause it just ain't so!

Finally, about our pay being so low. I can assure you the average captain here does just fine. Would I like to see a raise? You bet! And I feel confident that will happen at some point if we continue to be profitable....and sooner rather than later. But you must remember we are a 3 year old airline. How many years (decades) did it take to get DAL payscales were they are today? So lets be fair and compare apples to apples. And yes, I would like to see more low fares out of ATL - it would benefit the flying public greatly. That's the whole point of our profession ...providing a service to satisy our customers ....remember? "It's the customer, stupid"

 

[SpeedBird]

2002:

Labor costs:

$77 million in wages, salaries, and benefits (includes profit sharing)

Aircraft Costs:

$8 million in leased aircraft rents
$38 million for jet Fuel
$17 million landing fees
$4 million routine maintenance
$78 million on current liabilities on long-term debt for new aircraft

Total aircraft costs for 2002:$145 million


As a final note, from 2001 thru 2007 jetBlue is going to spend over $2.3 billion (excluding interest) on 60 new A320 aircraft. This is what the long-term debt is for. In 2002, jetBlue financed $416 million in long-term debt for new aircraft purchases.

Based on just 2002 costs, jetBlue could have given all employees a 75% increase in wages, and it would still be 25% less than the current year cost of aircraft ownership. Of course, if jetBlue had done so it would have resulted in a break-even year for net income. I appreciate your sarcastic advice about brushing up those books, but it wasn't necessary. I thought it would have been apparent to you as well, but that's what I get for assuming that other professional airline pilots out there can pull out rudimentary financial statement information when needed.

BTW, when you quoted jetBlue's aircraft rent costs as a ratio of their CASM, you failed to understand that this cost only covers the lease costs, and nothing else. As you should know, this is barely scratching the surface of the the total cost of aircraft ownership by an airline, as I've outlined above.

I obviously offended you and apologize for doing so, since this is not my desire. I guess I'm somewhat frustrated by the lack of business knowledge so many pilots have. Yet the stone doesn't get advanced any further when supposedly objective discussions take place.

I'll admit I see some things with "colored" lenses, but I feel that I have a very good understanding of the basic drivers in this business. While you and others may feel adamant about what's right for the "profession" and quickly remind everyone of ALPA's talking points, and about maintaining industry-leading wages, and the critical value of RLA collective bargaining standards, it neglects one simple fact. You work as an employee of a business that isn't a public utility or government bureaucracy. It must sustain itself financially and make money to keep you employed. If they can't do that, then you'll be out of a job.

Based on what I've observed in this business over the last 23 years, I'm willing to trade off some of that gold for more stability, peace of mind, and long-term growth for the engine that feeds my company's financial future. Despite what you think, our two companies are not the same, and will therefore never be compared in the way you'd like it to be.

I have as much right to feel that way, as you do about your position. You have no moral superiority over me in this way. I've been accused of being a jetBlue kool-aid drinker, but its no worse than being an ALPA kool-aid drinker. I really hope you get back to work soon, but don't blame me, or the jetBlues of the world, for your current personal financial recession.

This profession has demonstrated time and time again how quickly it will turn on itself, eat its young, and create a caste system, all for the convenience of those have the advantage to do so. Please don't feed me that worn out old line that "we're all in this together" for the good of the fraternity of professional pilots. I stopped believing in the tooth fairy a very long time ago.

 

[dgs]

Competition

Competition is a wonderful thing. It is one of the things that has made America great and strong. While people are defending their airlines and others are flaming the competition, just remember that as long as it is good natured, it is perfectly natural.

Does anybody on this board cheer for their favorite sports team and belittle the competition? Is it all gentlemanly and professional? Rarely. There are stong emotions on both sides of these issues as everybody is rooting for their favorite team. Delta threw down the gauntlet with Song and JB responded to the challenge. I say "cheers" for both sides. Competition will make everybody sharper. Imagine how out of shape football players would be if all they had to do is walk out onto the field, pick up the ball, and walk it to the endzone for a touchdown. Why work out? Why polish your game? Why develop a play book? Who would want to watch that? The stands would be empty! If everybody is focused on providing the customer a better product, then more people will participate.

I think this will be win-win in the long run, but there will be some growing pains along the way. Providing a great product to our customers will lure them back in the air.

In the mean time, let's all have a little fun. It's not a matter of bragging, gloating, or tearing down the other guy's team. It's all part of the process. It's one of the things we do best as Americans. Let's embrace it, keep it all in perspective, and have fun without taking everything so personally.

BTW, I applied at jetBlue and SWA. I had no desire to work for any other major because I wanted to be excited about having fun every time I went to work--not just when the paycheck came in the mail. I think jetBlue is more like the airline you read about in Nuts than SWA is today. It was the perfect match for me and I'm thrilled to be here. GO TEAM!!

 

[NYRANGERS]

Ranger,

I
To be honest, I always looked up to DAL in the past...thought they were one of the best airlines. But not anymore. It's not just because Song will "compete" with JBLU on NE - FLorida routes. It's because they are an exact replica, a clone, a carbon copy of JBLU. It's like if you were back in school and spent a whole semester working on a research paper...put your heart and soul into it. And some idiot in class who wasn't smart enough to write his own paper just copies yours, word for word, and THEN GOES AROUND BRAGGING ABOUT HOW MUCH SMARTER HE IS THAN YOU!!! How would you feel about that???????

Are you serious?! This is getting regodamdiculous, your airline did not part the red sea. However I will tell Leo that he will get detention for "copying" JB. Aside from the TV,( of which many of our a/c had personal units well before your existance), I really don't see the similarity. I think Song will offer a far supperior product, but time will tell.

Anyway, I can see you are proud of your airline and thats great, but some of you are getting a little silly.

NYR

No longer rooting for you guys.(I am sure you are crushed)

DGS, I had a blast every time I went to work. Delta provided me with a job at age 27. I enjoyed every day, heck I still can't believe I was hired by Delta (my first choice). Even though I am furloughed, I am confident Delta will be around for quite a while, with or without JB (I really don't care). I am looking forward to a great career when I get back. If I can survive till 60 I will retire number 22. (Not bad for someone who had the misfortune of always wanting to fly for a major global airline.)

 

[General Lee]

Kid Charlemange,

I think it is great that you think your company is the Sh!T. Good for you. You said you "used to " look up to Delta. Well, you still will---the lime green 757's are higher up (in height) than your A320's. A lot of people think Delta may be over it's head when it comes to the LCC model. We started with Delta Express, that did pretty well but had the wrong aircraft. So, Delta learned from that experience and is trying something new---somewhat copied from your success. You have to remember that this whole Song thing wasn't conceived in the back of some warehouse---it was thought out by people probably smarter than you and me---by those high priced McKinsey guys, Leo, and Fred Reid (an Ex Lufthansa Chief). We've put good people in charge and have the cash to follow it through. You and I can ponder what comes next with Song, but I beleive that we have some pretty smart PROVEN people behind us, and that is what we can count on. But hey, we'll have to see what happens. Just watch out for those lime green 757's-----with the possibility of having 60 of them flying coast to coast within the next two years, Song could be bigger than Jetblue, with a better entertainment system to boot.

DGS,

I personally have a lot of fun flying to Europe most every week, with some South America flying to keep it interesting every once and a while. All of the flight attendants (mostly senior hags) are all friendly and seem to enjoy the job. The passengers seem fine with everything and smile as the deplane. Having fun is really what you make of it. I am sure flying for Jetblue and Southwest can both be fun and tiring---not always one or the other.

Bye Bye---General Lee

 

[FlyDeltasJets]

Speedbird,


Your labor costs for 2002 were not 77 million as you claim, but $162,191,000.

Actually, all of the numbers you quoted were incorrect. You quoted the year over year increase from 2001 to 2002, not the total costs. Perhaps you don't know your 10k "far better" than I do. Perhaps you haven't "forgotten more about financial statements than I'll ever know."

I thought that the above numbers would be obvious, but, like you said: "that's what I get for assuming that other professional airline pilots out there can pull out rudimentary financial statement information when needed. "


Now that that's out of the way, let's address your point:

You brought fuel, interest, maintainance, landing fees, etc into the discussion. I am not sure why you did, but it is not accurate. If you wanted to add all the costs of owning and operating airplanes, why stop there? Crew costs would have to be factored in, as airplanes cannot fly without a crew. Taxes would have to be added, as the gvt would take your airplanes if you didn't pay taxes. The list is endless.

Break your costs down. (costs...not liabilities...I'm sure that you know, there is a difference). Of all of those costs, employee wages and benefits are by far the largest. The chart below, taken from your third quarter 10k illustrates that.




Operating expenses: (per available seat mile)
Salaries, wages and benefits 1.87
Aircraft fuel .95
Aircraft rent .45
Sales and marketing .53
Landing fees and other rents .53
Depreciation and amortization .31
Maintenance materials and repairs .12
Other operating expenses 1.65


Even your most recent full year 10k agrees with me. The following quotes are taken from it:

"Fuel costs are our second-largest operating expense"

"Fuel costs constitute a significant portion of our total operating expenses (14.4% for the year ended December 31, 2002)."

" Our business is labor intensive, with labor costs representing 30.6% of our operating expenses for the year ended December 31, 2002. "

If fuel is the second largest expense at 14.4%, and labor costs were 30.6%, what do you think was the largest expense? I'm not the financial wiz that you claim to be, but I think it's labor.

I guess we'll have to agree to disagree. No hard feelings.