Peer Level Wages: MESA and Comair...

[Sam Fisher]

The "absolute" size of the savings ($20 million vs. $200 million) is immaterial to management with regard to the two labor groups. They will be looking at things on a peer-to-peer level. Managers always compare things to industry averages.

The absolute size is most certainly not immaterial Heavy Set. Furthermore, you have yet to explain to me why it is ok for a pilot to be on the WIC program. Don't know what that is? It stands for the Woman Infants and Children program and is a federal subsidy program for low income earners. Newsflash: We have first officers (some of them 5th year) who not only qualify but are utilizing the WIC program. It is sad. A DL FO takes a cut and he goes from $150,000 to $120,000. Definitely not going to ruin his life. Not the same for the Comair guy.

Comair pilots aren't going to push Delta into bankruptcy. Delta pilots will. If cash goes down to $1.5billion (roughly), DL will most certainly file. Their management is not going to watch a perfectly good airline go down in flames because one of the expense lines is so way out in left field that it causes a perfectly good ship to sink. Make no mistake about it - DL management WILL file...if they need to. It is rational to them and emotional to the pilots.

Sam

 

[enigma]

Samfisher, and any other Comair/ASA pilot. I appreciate your plight, but econ101 says that you will eventually earn the same as your peer group. It's about to happen to mainline, then it will come for you. Your groups (regional and mainline) benefit from the protection of a legal contract negotiated on your behalf by ALPA, so you will at least get to have some say in your future, but the ax will fall. The only question is, how hard does it fall?. BTW, your peer group is every pilot in country flying the same number of seats as yourself. You may convince your management that you are worth more than some others by showing them that you are more productive, more profitable, etc; that's what negotiations are for. Lastly, you aren't the only group subject to market pressures, Skywest, et all, will also have to prove to their bosses that they deserve above average pay.

Next thought. I make a decent living, and my employer is profitable, but I make far less per seat than does a Comair pilot. Does it surprise you to find that most Spirit FO's make less than $48K before OT? I wish it wasn't so, but that is what the true market pays.

Finally, the whipsawers here are the ones who expect mainline to get cut, yet demand that they don't do likewise. I imagine that mainline will remember that stand for a long time to come.

enigma

 

[Pez D. Spencer]

Well, none of us want to see Delta file. Then, a judge could force all of us into whatever wage bracket he thought was appropriate -- union, non-union, pilots, FA's, rampers, mechanics, management, etc. For some, that may mean they have to walk away from the job. He could also have CMR and ASA spun-off for cash.

If they do file, I blame Grinstein for not being at the table negotiating. Not the Delta pilots who have shown the willingness to bargain.

I agree that Heavy Set and Six are not getting the picture with regard to our current wages. They may be the top of the regionals, but really... it's not that great. For them, it's been a long time since they earned that little -- they can't remember how tough it is to get by. I also think it's a detriment to enjoin in the whipsaw. No matter what the level of participation.

Just out of curiosity, Sam -- noticed the EMB-145 on your profile -- are you with a DCI carrier?

 

[Sam Fisher]

Samfisher, and any other Comair/ASA pilot. I appreciate your plight, but econ101 says that you will eventually earn the same as your peer group. It's about to happen to mainline, then it will come for you. Your groups (regional and mainline) benefit from the protection of a legal contract negotiated on your behalf by ALPA, so you will at least get to have some say in your future, but the ax will fall. The only question is, how hard does it fall?. BTW, your peer group is every pilot in country flying the same number of seats as yourself. You may convince your management that you are worth more than some others by showing them that you are more productive, more profitable, etc; that's what negotiations are for. Lastly, you aren't the only group subject to market pressures, Skywest, et all, will also have to prove to their bosses that they deserve above average pay.

ExpressJet will top Comair in compensation. That is a fact. Call it chest beating but it is the truth. The only reason why we are having this discussion amongst the 50 seat guys is because several airlines "bought" growth. They will have buyer's remorse in about 3 years when the movement stops over there and they realize they have 5th year FO's making $34/hour.

I'm well aware of Econ 101, but let's face it, this isn't a "true marketplace." Not by a long shot. Especially given the fact that small jet airlines operate under these "fee for departure" and "power by the hour" profit-guaranteed contracts.

Next thought. I make a decent living, and my employer is profitable, but I make far less per seat than does a Comair pilot. Does it surprise you to find that most Spirit FO's make less than $48K before OT? I wish it wasn't so, but that is what the true market pays.

Wrong. Spirit just signed its first contract. You guys shouldn't be paid any less than SWA or JetBlue, but you are. That will change over time I imagine. Pay Per Seat doesn't always hold water. I can guarantee you that the Comair pilot's RASM is far superior to the Spirit pilot's RASM. Their yield is higher, so that argument doesn't hold water.

Sam

 

[cptsesso]

All I keep hearing is peer level wages, peer level wages. That is a bunch of bull. Who defines what the peer level wages are?

It is the pilots who are willing to sell the Aviation Profession out the most.

Everyone here is all worried about what Delta pilots make compared to AA or United or whomever. Better yet what Comair makes compared to Mesa or Chq.

Most of you are missing the big picture here. Lets say Delta and Comair take big pay cuts to align themselves with "Peer Level Wages". Management comes back and says "well that was not enough. We are still in financial trouble we want more." So now Delta and Comair bend over and take even more pay cuts. Now the bar has been lowered again.

Now Delta and Comair pilot will come back to this board and bitch like you have about peer level wages. AA and United and other management will come to their pilots and say "well Delta is only paying $xxx for their pilots we should do the same in the name of competition with the LLC's".

Now the bar has been lowered again. It will be a never ending downward spiral until we are all paid in peanuts like Circus elephants.

You all need to sit back and look at the airline industry as a whole over the last 20 or 30 years. Is it the pilot's fault for todays troubles? Or maybe it is the fa's fault or mec's fault. Or maybe, just maybe it was the mismanagement from the supposed experts in the home office???????

Management put the aviation industry in the situation it is in today. I am sure it was not intentional, but they have made some really bad calls and lined their pockets in the process.

Many blame Sept 11 for all of the troubles. The truth is Sept 11th was just the crack in the dam of a large dirty lake which allowed the water to start flowing. Now management is scrambling to fix a problem which has been building up for years at the expense of its employees.

Do the legacies need to compete with the LCC's? Maybe maybe not. With the existing infrastructure at the legacies, they can't possibly compete. The LCC's were smart and took a good hard look at the airline industries troubles and trimmed all of the "fat" and took a different approach.

Back to the original topic peer level wages. If the Delta pilots fold, who is going to be the next AA or Mesa to start the ball rolling again? No disrespect to Mesa or AA, I have not walked in their shoes.

Everyone of us should be supporting the pilots at Delta and Comair for holding the bar up just a little higher. No more of this childlike bickering amongst us or else this downward spiral will never end.

 

[enigma]

I'm well aware of Econ 101, but let's face it, this isn't a "true marketplace." Not by a long shot. Especially given the fact that small jet airlines operate under these "fee for departure" and "power by the hour" profit-guaranteed contracts.

Wrong, it is a true marketplace. You mistake the pilot market with the seat market. Management buys pilot services from the total pool of available pilots. "Fee for departure" and "power by the hour" carriers may not sell in a true market, I'll grant you that; but they dang sure buy their resources in a true market. We, the pilots, are a resource. The managers will never agree to buy above market rates. Do you buy all of your auto fuel at the highest priced station in town just because you happen to be able to pay for it?, or do you buy quality fuel at the lowest price? I'll bet that you buy quality fuel at the lowest price available. In my local, gasoline ranges from between $1.57 (Sams Club) and $1.69. Some drivers choose Exxon because of it's perceived quality, but most buy from the cheapest source. Why would anyone expect airline managers to do any different?

Wrong. Spirit just signed its first contract. You guys shouldn't be paid any less than SWA or JetBlue, but you are. That will change over time I imagine. Pay Per Seat doesn't always hold water. I can guarantee you that the Comair pilot's RASM is far superior to the Spirit pilot's RASM. Their yield is higher, so that argument doesn't hold water.

Sam

Second contract. We make what the market would bear at the time of our negotiations. It was danged hard to get the raise we did, in a time when thousands of pilots are/were out of work. The company fair structure had much less an impact on our pay than did the ready availability of replacement pilots.

BTW, our negotiators may disagree(edit: our negotiators my disagree with my position. They may believe that they won pay based upon what Spirit could pay.), but they were not the ones who voted on the contract. It was voted in by pilots who understood that their services were worth almost nothing in the market, and choose to keep what we had. (another edit addition: We didn't vote on it because it was the most the company could offer. Most were convinced that the company could pay significantly more, but recognized that we just had zero bargaining power in the current market.
Additionally, Spirits subsequent growth proves that the company could have paid more. Now we just have to hope that the pilot market has improved when we next negotiate)

enigma

 

[enigma]

enigma,
That's weak. Shameful.

Maybe, but it's true. 70% of the Spirit pilot group decided that 2003 was not a good year to be looking for a job. More later.

enigma

 

[Pez D. Spencer]

yeah, I took the post down. I don't like getting personal. But at least you agree.

 

[enigma]

yeah, I took the post down. I don't like getting personal. But at least you agree.

Pez, sometimes I don't do a good job of differentiating between my analysis, and my desires. It is my analysis of the situation that says pilot wages are set by what other pilots are willing to work for. It is my desire, that we could be paid according to the profit we produce.

It is my analysis, so be it slightly underinformed, that Comair/ASA will end up taking some kind of cut. I don't wish it upon them, I just don't see any way to avoid it as long as a oversupply of pilots exists.

enigma

 

[AFELLOWAVIATOR]

[ It is my analysis of the situation that says pilot wages are set by what other pilots are willing to work for.





Not a very good analysis. If it were true, we would not be having this discussion. Since our contract was signed before mesa's, or chawawas, if your analysis held water, they would be making at least what we at Comair make.

 

[Holy Shiite]

Comair is wildly profitable. Before the buyout, Comair was the most profitable airline in the history of aviation. I'm pretty sure the same still holds true today. We made 44Million last quarter. That FAR exceeds what Jetblue made.I love the argument that Comair only makes that much money because Delta has to pay all the marketing costs etc., That is bull pure and simple. Look back to the balance sheets before the buyout to get a true view of just how high the profit margin is. Huge is an understatement.

As far as us taking a paycut, there is no way. We fly on average 85-90 hours a month. No retirement. No real trip/duty rigs. No crewmeals. We are already a "C" scale airline and the Delta pilots say we should should share the pain?? Comair is a lean, profit making machine that brings in way more revenue to Delta than any of the "codeshare" partners.

 

[Heavy Set]

Doesn't Delta cover some of Comair's expenses already? I admit that I don't know the specifics like some on this forum (General Lee, FDJ2, and others) but it was my understanding that Delta covered a number of expenses (which would contribute to a high "profit" for the Comair unit). What about RJ financing (is there a guarantee involved)? What about marketing expense - Comair doesn't pay for its own marketing (because it is a Delta partner). Independence Air will be fully paying for its marketing/advertising in the near future - Comair doesn't have a similar expense since it is a Delta partner.

Can someone provide a list of Comair and ASA expenses covered by Delta? I don't know the specifics myself. Anyone venture to guess how Comair's profit level would change if it had to independently pay these expenses?

Happy Easter.

 

[Holy Shiite]

Before the buyout, I am sure that the comair annual stockholders report had all this info. Maybe somebody can dig this up?
As I said before, comair is wildly profitable. I saw 4 stock splits in 5 years before the buyout. That is huge. I don't know who is feeding you Delta guys this crap about all the fees that comair is not paying but its a farce. Am I supposed to believe that delta is cooking the books to show a big loss while comair and asa are showing huge gains just to get the delta pilots to take concessions?

As I said before, look at the historical data about comair and you will see huge profit margins akin to microsoft corporation. If you choose to believe otherwise, keep chugging the kool aid.

 

[AFELLOWAVIATOR]

Comair has always had to pay for the services Delta provided. I remember back in 1995 at an employee meeting, our then President said Delta was increasing the charges by around $50,000,000. per year.

I recently ask our VP of flight ops about this and he said we pay Delta for every thing they do for us, including airplane leases. The airplanes are owned by DCI and leased to us. And in places like SDF, where we handle all ground operations for Delta, we are paid by Delta for those services.

I don't know where these people get their info, but it is incorrect.

 

[enigma]

Afellowaviator, et al. I am always willing to learn. In order to do so, I have to come to grips with certain questions that I have. One such question would be this: How is Comair wildly profitable? and, How is Comair able to be profitable when others are struggling? If Comair is wildly profitable, then Mesa should be even more profitable, are they?

enigma

 

[General Lee]

There are plenty of things mainline pays for that help DCI appear more profitable. Like reservations, buying kiosks that Comair or ASA passengers use daily, insurance---all under the Delta insurance umbrella, and there are more Delta stations that ASA/Comair use than the reverse. Also, since the RJs have been put on a lot of mainline routes that could now sustain a mainline aircraft---the DCI aircraft shows a profit--but Delta itself could make even more revenue had it not parked all of it's planes. (like 727s and larger) Now the full RJs bring in less passengers to the hubs than mainline sized planes could have done, and that limits the revenue stream potential---especially since this Summer will supposedly be busier than the Summer of 2000. Instead, we have more RJs clogging up the system, resulting in more VFR holding patterns, longer congo Takeoff lines, and still bringing in less passengers and less revenue due to the lower fares. Sure, DCI is full and profitable, but hurting Delta at the same time.....Maybe it will all be better with a pilot pay cut.......(It probably would help---but we will still make less revenue without more mainline sized aircraft)

Bye Bye--General Lee

 

[Heavy Set]

RJs are NOT good in an LCC environment

My understanding is that Grinstein does NOT like RJs very much. We'll see how his opinion of RJs impacts DAL's plans going forward...

It's time to order a 100 seater to take advantage of an economic rebound and more demand for CHEAPER SEATS in midsize markets. Jetblue seems to understand that pretty well with the EMB-190. You should not use RJs in a LCC environment in which fares are declining but can't be spread among 50-70 seats profitably... Sure, there will always be a need for 50-seat aircraft on the really thin routes (bring profitable connecting traffic from Green Bay, Traverse City or Macon to the hubs for onward flights), but flying RJs between hubs or between hubs and mid-to-larger size cities (CRJs from Salt Lake to San Diego????) is not very logical. Instead, it reduces profit (with competition reducing fares) and it limits the revenue UPSIDE with limited seats per flight...

 

[XRMEFLYER]

Well there you have it.

It's the proliferation of the RJ and those who are flying them that is the problem!

I'm so ashamed of myself. Maybe I should take that pay cut afterall.

NOT!

 

[General Lee]

Xremeflyer,

It is true---they clog up the skies (like at ORD and ATL) and bring in less revenue when people are starting to come back to fly. Right now Delta needs all of the revenue it can get, and when you limit the number of people you can bring into the hub---it can result in lower load factors on the mainline jets at the hubs. But, this is a planning problem---not to be blamed on DCI pilots...Pre-9-11 quite a few of the RJ routes were mainline routes--and they need to be again. Marketing, which is incharge of this, needs to shorten turn times and make the planes more productive---not just flying them 7-8 hours a day. Southwest flies their planes 11-12 hours per day. I just read a memo from our VP of flt ops that stated that decreasing turn times on some of our flights to selected cities (like the RDU experiment) has resulted in an extra 9 airplanes worth of flights each day in ATL. Those extra flights should be used on some RJ routes now.

Bye Bye--General Lee


PS--If you read Grinstein's interviews, besides cutting our wages, he says we will need to EARN our way back to health. You can't do that on 50 seat RJs when fares are low. You need larger planes with more seats.

 

[ATR-DRIVR]

General,
Why do they not put mainline planes on some of the routes that are ALWAYS over-sold, at least on alot of my ATR routes. MGM, PFN, VPS, LEX, GPT. Some of those would easily support either a 200 or a G.