NetJets common carrier

[AeroBoy]

Publisher,

Read Buffett's letter to shareholders more closely. He said the losses by NetJets Europe "largely offset" the profits made by the U.S. operation. "Largely" doesn't mean "fully." The Oracle of Omaha knows the pilots are in contract negotations and want more money, so he said between the lines (wink, wink) that NetJets overall is in the black. Coming out and saying this plainly would jeopardize NetJets management's bargaining position.

He also said that the European operation has been more expensive than anticipated. This is not the pilots' fault; this lies right on management's doorstep. So the big question is this: should the pilots be paying for management's miscalculations, in the form of lower than industry wages?

 

[El Chupacabra]

diesel was not reading the part about the rights of employees when it comes to unions. I believe what it says is there are various ways where you can have the card but not pay the full dues. In an earlier post, I wondered how that related to seniority. .

This is like the people who advise others to renounce American Citizenship to avoid paying income tax.

OK go ahead and don't pay the dues. You don't get to VOTE! I wonder where the voting members are going to want to see pay distributed in a new contract...

 

[Publishers]

Gee I think the point was that there is much to labor law that might not all be understood and perhaps some research would be well advised. Part of it was to point out that even where you are forced to join the union, you may not be forced to participate past a certain level in the dues paying.

Aeroboy I am not smart enough to have seen enough to make a judgement as this was but part of an article and I do not even know if it includes all parts and EJI or what.

It has been indicated to me on many occassions that the financial success of Netjets is totally dependant on selling enough aircraft shares. In short, the actual operation of the aircraft is not profitable according to the people telling me. I do not want to indicate that I know that because I have only been told that.

On the times that I was asked to look at other peoples fractional operation (relatively small operations), I had trouble seeing where you made any serious money.

For those of you familiar with ILFC and their takeover of the leasing business of commercial jets many years ago, the opportunity to capture significant profit by large orders from manuafacturers allowed the leasing company to make the money that large airlines used to buying aircraft for themselves. That approach is what Netjets did to some extent. The actual operating of the aircraft has all the headaches and little reward. In order to make it work, you have to provide the level of service that the customer would receive if he had his own aircraft. To do that, you have a bunch of crews, a bunch of dead-heading, a bunch of positioning hours, a devalued aircraft, a bunch of purchased charter, and a bunch of support employees.

George Batchleor for those of you who know the business often said there was a ton of money in aviation as long as you did not try and fly the things. A great point.

Bill Lear Jr. said something to the effect that we look at Europe like it should be like us. It is not. It is hardly bigger than Texas.

Netjets should have been paying attention.