CAL EWR B737
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- Sep 10, 2005
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The Magenta Line for Thursday, July 30, 2009
“I’ve been around this industry for a long time and there aren’t any examples of confrontational labor tactics providing long-term benefits to any pilot group...” - Captain Fred Abbott in the July 2009 issue of the Flight Operations Update.
Maybe your long-suffering pilots are just tired of being abused, Fred, and we like the idea of confronting you.
Today is Thursday, July 30, 2009 and there are 12 items for discussion.
Item 1: Fuel Hedging: The Gift That Keeps on Taking
$4.00 fuel may be a distant memory—like last year’s “best staffed summer ever”—but while the spot price of fuel may have dropped, we carry the pain and cost forward—just like this year’s “best staffed summer ever”.
Due to the magnificent planning and market savvy of our fuel hedging department under the steady hand of, well, let’s just call him Mr. Fuel-Hedge-Manager-Guy, we paid an additional 49 cents a gallon premium for the 358 million gallons of fuel Continental Airlines bought during the second quarter of 2009. This additional 175 million dollar expense was the difference between a second-quarter operating profit of 21 million dollars and the 154 million dollar loss we reported instead.
To be fair, Mr. Fuel-Hedge-Manager-Guy isn’t the only incompetent occupying a nice office down on Smith Street. There is no “I” in TEAM and it takes quite a team to turn the best, and most consistently profitable domestic airline “From First to Worst”—and their work is now complete.
Under our current TEAM, led by “Lame Duck” Larry Kellner, we finished the second quarter of 2009 with the WORST operating margin of the five remaining legacy airlines, toting up an amazing -4.9% operating loss. USAirways, the airline we love to point at and giggle, came in on top with a +4.6% operating profit. Mr. Kellner, who will soon be gone with more millions of our money and a special Award for Lifetime Achievement, couldn’t even beat USAirways despite having the second cheapest pilot costs among the major airlines. We sure would not like that on our tombstones.
But getting back to Mr. Fuel-Hedge-Manager-Guy, we cannot think of any other single person at Continental Airlines directly involved in the loss of hundreds of millions of our dollars. In addition to Mr. Fuel-Hedge-Manager-Guy’s fuel-hedging fling—which has cost us 442 million dollars since the beginning of 2008—our understanding is that he also bears responsibility for our spectacular “A” Fund losses; he supposedly sits on the retirement investment committee who oversaw the loss of about half of our “A” Fund. We can only imagine the conference calls that went on among the committee members as the stock market slid into the abyss:
“So, you back from lunch yet?”
“Nah, I’m on my third martini—probably take the rest of the afternoon off. You?”
“I was thinking about getting a manicure but maybe I’ll get the Beemer waxed instead."
“I got the Porsche done yesterday—maybe I’ll go buy a new suit. I saw this gorgeous Armani at Neiman’s.”
“I think the Armani cut makes me look fat.”
“Nah, you don’t look fat—maybe what you need is wider collars.”
“Maybe. Speaking of collars, did you see that heating oil collar I bought last week go straight into the tank? Jeez—I never saw that coming. Fuel’s gonna cost us about 10 bucks a gallon if I keep it up.”
“Yeah, well, you know what they say: ‘Bonuses all around!’—so, market’s down about 1500 today.”
“Think we should do anything?”
“Yeah—I think I’ll have another martini.”
Honestly, we look at each other, puzzlement on our faces, and wonder: how can people who collectively lose HUNDREDS OF MILLIONS OF DOLLARS over a period of a few years still be employed here and still be entrusted with even more money? It’s truly a mystery for the ages.
The pilots of Continental Airlines have given everything we possibly could—and beyond. We have sacrificed our pay rates, our retirement, our work rules, our family life, our vacations, our days off—and our health—and sometimes our lives. We train on days off, we fly two duty periods in one day, we work long overseas flights with no IRO safety-net—and we awake to the news that mismanagement has cost us another 442 million dollars—and we know that another demand for concessions will shortly follow.
Our message to management: you aren’t getting another DIME from us. If you can pay for 442 million dollars in fuel-hedging losses, then you can pay us. And you will.
ALPA: The Pilots Union
“I’ve been around this industry for a long time and there aren’t any examples of confrontational labor tactics providing long-term benefits to any pilot group...” - Captain Fred Abbott in the July 2009 issue of the Flight Operations Update.
Maybe your long-suffering pilots are just tired of being abused, Fred, and we like the idea of confronting you.
Today is Thursday, July 30, 2009 and there are 12 items for discussion.
Item 1: Fuel Hedging: The Gift That Keeps on Taking
$4.00 fuel may be a distant memory—like last year’s “best staffed summer ever”—but while the spot price of fuel may have dropped, we carry the pain and cost forward—just like this year’s “best staffed summer ever”.
Due to the magnificent planning and market savvy of our fuel hedging department under the steady hand of, well, let’s just call him Mr. Fuel-Hedge-Manager-Guy, we paid an additional 49 cents a gallon premium for the 358 million gallons of fuel Continental Airlines bought during the second quarter of 2009. This additional 175 million dollar expense was the difference between a second-quarter operating profit of 21 million dollars and the 154 million dollar loss we reported instead.
To be fair, Mr. Fuel-Hedge-Manager-Guy isn’t the only incompetent occupying a nice office down on Smith Street. There is no “I” in TEAM and it takes quite a team to turn the best, and most consistently profitable domestic airline “From First to Worst”—and their work is now complete.
Under our current TEAM, led by “Lame Duck” Larry Kellner, we finished the second quarter of 2009 with the WORST operating margin of the five remaining legacy airlines, toting up an amazing -4.9% operating loss. USAirways, the airline we love to point at and giggle, came in on top with a +4.6% operating profit. Mr. Kellner, who will soon be gone with more millions of our money and a special Award for Lifetime Achievement, couldn’t even beat USAirways despite having the second cheapest pilot costs among the major airlines. We sure would not like that on our tombstones.
But getting back to Mr. Fuel-Hedge-Manager-Guy, we cannot think of any other single person at Continental Airlines directly involved in the loss of hundreds of millions of our dollars. In addition to Mr. Fuel-Hedge-Manager-Guy’s fuel-hedging fling—which has cost us 442 million dollars since the beginning of 2008—our understanding is that he also bears responsibility for our spectacular “A” Fund losses; he supposedly sits on the retirement investment committee who oversaw the loss of about half of our “A” Fund. We can only imagine the conference calls that went on among the committee members as the stock market slid into the abyss:
“So, you back from lunch yet?”
“Nah, I’m on my third martini—probably take the rest of the afternoon off. You?”
“I was thinking about getting a manicure but maybe I’ll get the Beemer waxed instead."
“I got the Porsche done yesterday—maybe I’ll go buy a new suit. I saw this gorgeous Armani at Neiman’s.”
“I think the Armani cut makes me look fat.”
“Nah, you don’t look fat—maybe what you need is wider collars.”
“Maybe. Speaking of collars, did you see that heating oil collar I bought last week go straight into the tank? Jeez—I never saw that coming. Fuel’s gonna cost us about 10 bucks a gallon if I keep it up.”
“Yeah, well, you know what they say: ‘Bonuses all around!’—so, market’s down about 1500 today.”
“Think we should do anything?”
“Yeah—I think I’ll have another martini.”
Honestly, we look at each other, puzzlement on our faces, and wonder: how can people who collectively lose HUNDREDS OF MILLIONS OF DOLLARS over a period of a few years still be employed here and still be entrusted with even more money? It’s truly a mystery for the ages.
The pilots of Continental Airlines have given everything we possibly could—and beyond. We have sacrificed our pay rates, our retirement, our work rules, our family life, our vacations, our days off—and our health—and sometimes our lives. We train on days off, we fly two duty periods in one day, we work long overseas flights with no IRO safety-net—and we awake to the news that mismanagement has cost us another 442 million dollars—and we know that another demand for concessions will shortly follow.
Our message to management: you aren’t getting another DIME from us. If you can pay for 442 million dollars in fuel-hedging losses, then you can pay us. And you will.