Mesa

[wmuflyguy]

During the Bankruptcy concession talks at Mesaba the Mesa contract was constantly being refered to by management as their goal. At first they were crazy enough to ask for Mesa -5%. Just another example...

Same at Comair. Maybe I can find some of the graphs and charts they waived in our faces saying how overpaid we were and then used Mesa as the industry standard.

 

[SilverandSore]

I new someone would misinterpret what I wrote. I'm talking about a debate. Not violence. You know my facts against his opinion sort of thing via this web board, not the parking lot.

I'm incredibly tired of the ignorance from some pilots. I neither signed that last contract nor voted for it. I was here shortly after it was signed. I went to MAPD. Of which I'm proud of, was an excellent school- I'm sure still is. I had a chance to go to the original Freedum. I did not. I waited in Farmington for a good long while until the contract was settled and Mesa was hiring. Paying my student loans and washing anybodies airplane who would let me fly with them. Some did not make this choice. Those people will be on that list forever. That is their punishment. It is those pilots who deserve your scorn. And to the degree that you don't make this distinction the list becomes valueless. The people who are responsible are never held liable. We have one CAPT on the ERJ. ALL OTHERS on the ERJ are not A listers. Said CPT is not JFK based.

What really pisses me off though since I was put on the Freedum Cert is the treatment I get from other pilots. As if Freedum A was alive and well. When in fact I, and many others, stayed away from Freedum. Yet we are painted with the same brush. In addition we got raped on our last contract to win back scope. You have no idea what it is like to suffer under JO. We have at times stopped his BS other times not. My opinion not enough. Flying 737 s for nothing etc...We also suffer with ambiguous language in our contract that has been terribly exploited. We were awarded a decision that would have stopped line holders being arbitrarily pulled from there flying. But of course that is contested.

I have never understood that hatred some feel for Mesa pilots. Because were perceived as letting JO do what ever he wants. A scape goat you use to blame your own negotiating failures. Human nature. All three, I don't know. I'd like to see what your pilot group could do against him.

That being said it will not be the same scenario during these negotiations. People who quite have. Some are with family and mortgage and can't just leave for any where. Others have just been upgraded and would be foolish to leave before there thousand. New hires know what there getting into usually. I challenge you haters to rethink your resentment and place it where it belongs. Pointed at JO and his A list enablers.

Spell check can't catch everything...

 

[Poahi]

During the Bankruptcy concession talks at Mesaba the Mesa contract was constantly being refered to by management as their goal. At first they were crazy enough to ask for Mesa -5%. Just another example...

If Mesa seeks Chapter 11, Mesa will reorganize, seek concessions and emerge with no debt. You guys sure you want that?

 

[CFI2766]

If Mesa seeks Chapter 11, Mesa will reorganize, seek concessions and emerge with no debt. You guys sure you want that?

In the past, yes. However, I believe that the changes in bankruptcy laws have decreased the likelihood of that outcome.

I get your point, though. The important issue here from a pilot's standpoint should be the possibility of preventing the next 'Mesa' from breaking ground.

Everyone here in the regional board is salivating at the potential of the demise of JO and Mesa, but what lessons are being learned? Mesa has the lowest costs from a labor standpoint, but they are still not able to make a stable going concern to present to the BOD. WHY?

There's clearly more to the story here. Losing a lawsuit, and generally irritating your main customers (the legacy 'partners', not the fare paying passengers) are likely contributing factors, as is $100 bbl. oil, but why is Mesa on death's doorstep while others are not? The common denominator seems to be JO. Take him away, why isn't Mesa working?

As much as we, as pilots, dislike this idea, somewhere, possibly in a cockpit or a cubicle, there is someone who is dissecting the demise of Mesa and trying to create a business model using pay-rates and work rules at or below Mesa's.

 

[USCtrojan]

If Mesa seeks Chapter 11, Mesa will reorganize, seek concessions and emerge with no debt. You guys sure you want that?

And how will Mesa possibly do that? There IS NO INCOME. All the Mainline partners are dumping them. go! Hawaii seems to be there only selling point that's losing money. What's there to reorganize? If your lender wants to foreclose on you, but you negotiate with your lender to work something out, what's the first question asked? HOW MUCH INCOME ARE YOU ACCUMULATING? Assets/liabilities.....If you don't have a job, no income, there is no lender in their right mind who will loan you money. They'll sell the house at a severely discounted price so they can minimize their losses. Investors will want the same with Mesa. They'll want whatever's left over.

Even if Mesa landed another small contract, is it enough to offset their costs of operating? I doubt it. JO is a dirtbag, I do feel for the employees of his dirtbag company, but he's reaping what he sowed. He'll still end up with millions at the expense of his employees. He's a dirtbag, and he won't lose an ounce of sleep over it, guaranteed.

When a Mainline Carrier files Chapter 11, they get rid of all the little bad Contracts around they formed when the Company was doing well. They are losing money because of those bad Contracts. The revenue stream, however, remains constant. And that's what allows them to survive. Mesa doesn't have a revenue stream. Well they do, but it's backwards...

Trojan

 

[Poahi]

And how will Mesa possibly do that? There IS NO INCOME. All the Mainline partners are dumping them. go! Hawaii seems to be there only selling point that's losing money. What's there to reorganize? If your lender wants to foreclose on you, but you negotiate with your lender to work something out, what's the first question asked? HOW MUCH INCOME ARE YOU ACCUMULATING? Assets/liabilities.....If you don't have a job, no income, there is no lender in their right mind who will loan you money. They'll sell the house at a severely discounted price so they can minimize their losses. Investors will want the same with Mesa. They'll want whatever's left over.

Even if Mesa landed another small contract, is it enough to offset their costs of operating? I doubt it. JO is a dirtbag, I do feel for the employees of his dirtbag company, but he's reaping what he sowed. He'll still end up with millions at the expense of his employees. He's a dirtbag, and he won't lose an ounce of sleep over it, guaranteed.

When a Mainline Carrier files Chapter 11, they get rid of all the little bad Contracts around they formed when the Company was doing well. They are losing money because of those bad Contracts. The revenue stream, however, remains constant. And that's what allows them to survive. Mesa doesn't have a revenue stream. Well they do, but it's backwards...

Trojan

Mesa has contracts with Delta, UAL and Airways. Delta wants out of the ERJ contract, but not the Freedom flying with the 900's. The remaining contracts are capacity agreements which are profitable with the exception of the United contract. UAL is telling Mesa that they will trade 700's for anywhere from 3 to 8 200's. The losses from the UAL contract are being minimized. In the end, though, that will leave Mesa with a boat load of 200's which have no homes.

What's hanging over Mesa's head right now is excess aircraft, debt and training costs. If you look at Mesa's financials, you'll see that despite the losses, Mesa has an operating profit. They will use that to convince a bankruptcy judge to grant relief on debt and aircraft leases and other obligations.

The reported loss associated with the Hawaiian judgement is a sunk cost. Mesa will never see that money unless it wins on appeal. Any loss associated with the Aloha case will likely discharged in bankruptcy and Aloha knows this. It's the key reason they are delaying the trial (in addition to their inability to pay legal fees). By waiting for Hawaiian to win their case, they shot themselves in the foot. Mesa can't pay Aloha if it doesn't have the money. It's as simple as that.

In addition, the creditor that takes the Aloha claim will have to incur legal fees to prosecute the case. They will either have to find a contingent fee lawyer or a deep pocket investor.

A far deeper concern for Mesa's leadership, and no one seems to be interested in talking about this, is the effect of a Airways, United or Delta bankruptcy. That would allow the majors to cancel the Mesa contract and would put Mesa in to Chapter 11 overnight.

 

[asayankee]

Mesa has contracts with Delta, UAL and Airways. Delta wants out of the ERJ contract, but not the Freedom flying with the 900's. The remaining contracts are capacity agreements which are profitable with the exception of the United contract. UAL is telling Mesa that they will trade 700's for anywhere from 3 to 8 200's. The losses from the UAL contract are being minimized. In the end, though, that will leave Mesa with a boat load of 200's which have no homes.

What's hanging over Mesa's head right now is excess aircraft, debt and training costs. If you look at Mesa's financials, you'll see that despite the losses, Mesa has an operating profit. They will use that to convince a bankruptcy judge to grant relief on debt and aircraft leases and other obligations.

The reported loss associated with the Hawaiian judgement is a sunk cost. Mesa will never see that money unless it wins on appeal. Any loss associated with the Aloha case will likely discharged in bankruptcy and Aloha knows this. It's the key reason they are delaying the trial (in addition to their inability to pay legal fees). By waiting for Hawaiian to win their case, they shot themselves in the foot. Mesa can't pay Aloha if it doesn't have the money. It's as simple as that.

In addition, the creditor that takes the Aloha claim will have to incur legal fees to prosecute the case. They will either have to find a contingent fee lawyer or a deep pocket investor.

A far deeper concern for Mesa's leadership, and no one seems to be interested in talking about this, is the effect of a Airways, United or Delta bankruptcy. That would allow the majors to cancel the Mesa contract and would put Mesa in to Chapter 11 overnight.

Fortunately, as someone mentioned earlier, the bankrupty laws have changed dramatically. A company can't just "write off" their debt in BK court anymore. They are still responsible for them. The can renegotiate some contracts, etc.....but debt doesn't just dissappear anymore! That's a good thing

 

[USCtrojan]

What's hanging over Mesa's head right now is excess aircraft, debt and training costs. If you look at Mesa's financials, you'll see that despite the losses, Mesa has an operating profit. They will use that to convince a bankruptcy judge to grant relief on debt and aircraft leases and other obligations.

Interesting about operating profit. What will happen to that profit when the Contract with Delta is done, I wonder? You're right, they have a ton of excess aircraft that have no home. That was the primary reason, I believe, investors started pulling out initially.

Trojan

 

[Poahi]

the bankrupty laws have changed dramatically. A company can't just "write off" their debt in BK court anymore.

They can if they can show they can't operate going forward with that debt. Most of the 'harsher' changes had to do with personal bankruptcies and abuse.

There are going to be several airline bankruptcies this year we will all be experts on this soon.

 

[Poahi]

What will happen to that profit when the Contract with Delta is done, I wonder?
Trojan

Let me try this again. That 'profit' from the loss of the Delta contract will be erased by financial obligations on the aircraft and overhead. Bankruptcy addresses those types of costs.

Here's another thought. Part of the reason the stock tanked is that with a new stock issue, each share of existing Mesa stock is diluted. That is to say, that if it's done, there will be more shares of stock while the company is shrinking. It's kind of like Mesa is selling part of the company and not paying existing shareholders for the sale.

 

[jetracer5]

As of 3:30 Mesa stock dropped below a buck to 0.96 cents!

http://www.marketwatch.com/quotes/mesa