Peer Level Wages: MESA and Comair...

[Ty Webb]

I know that, GL. I think you guys have reasonably concluded to give the company some relief, but they aren;t taking it, and they won't talk to ASA either, which is why I think you need to force their hand.

With the recent lowering of your debt rating to CCC+, blamed on pilot wages, it seems the company is trying to blame the pilots for everything, which is why I am advocating throwing down the gauntlet in full public view, and forcing them to "fish or cut bait".

TW

 

[DDpaysoff]

DDpaysoff,

I don't think SIX is a management person---just someone who is sick of hearing it "both ways." He said he constantly hears Comair and ASA people blaming the Delta pilots for having such a large pay difference between their peers (UA and AA), when the same could be said about Comair and ASA(maybe not so much) compared to regionals with equivalent size--like MESA. I don't think it should be that drastic, but he does bring up a point about the bitc_ing. I know that I personally hope we over here get some sort of cuts---but not draconian cuts only for the pilots....

Bye Bye--General Lee

I have personally not met one person at Comair that blames DAL pilots. Frankly, it really is none of our business. We have our own problems to deal with right now. I understand that you are the last ones holding up the bar in your group and we are the last ones in ours. The fact that AA is getting 7% back this summer is reason alone not to give in to managments 30% paycut proposal. I don't blame you guys at all.
What you do now may very well determine what kind of contract I walk into at a major (in about 10 years or so). Please understand we are more than happy to sit down at the table w/ Delta the problem is we can't. We are forced to negotiate w/ an entity that really has no power to get anything done. I'm just tired of all the finger-pointing. This is playing right into managments hands and showing them that the whipsaw is working. If we ever had all pilots agree on something collectively we could have a hell of a healthy airline with bright futures for all of us. Granted, we don't have much in our contract, but we do have about 1800 people who will fight like hell to keep what we do have, escpecially when it "appears" we are in the black.

 

[FDJ2]

United and American are good peer groups for Delta, because they are the top 3 airlines./B]

Well UAL is in Chapter 11 and AMR was on the court house steps when they voluntarily took a greater paycut than UAL did in BK when AA was threatened with BK. DAL is not in the same situation. Hence a DAL solution to a DAL problem makes more sense. I would say that a better peer group for DAL is NWA, and there the pay differential is between 11%-17%. The DALPA offer of a 13.5% paycut seems more than reasonable. Grinsteins insistance on a take it or leave Chapter 11 contract is not.

 

[chperplt]

Originally posted by chperplt...............What expenses of CMR/ASA is DAL paying? Is it in the 40-50 mil range per quarter?

FDJ2

Much of what you list as expense is a DAL expense. IF CMR/ASA were selling tickets on CMR/ASA, then I would expect them to absorb those expenses. With the exception of paying for ones own catering expense, everything else is the cost of business for DAL.

With or without CMR/ASA those costs are going to be there. Does CHQ or ACA pay DAL for passenger commissions or the cost of advertising or non fleet expense?

Does DAL advertise for CMR/ASA? I've never seen an ad that says fly CMR/ASA.. It says fly Delta. When you go to a kiosk and take care of business, you are taking care of business that adds to DALs bottom line.

If the cost of doing business was cheaper for DAL to pay another carrier to do its flying, there wouldn't be a CMR or ASA. The fact is that both of these companies are generating very nice profit statements for it's parent company, DAL.

 

[:-)]

FDJ2

Much of what you list as expense is a DAL expense. IF CMR/ASA were selling tickets on CMR/ASA, then I would expect them to absorb those expenses. With the exception of paying for ones own catering expense, everything else is the cost of business for DAL.

With or without CMR/ASA those costs are going to be there. Does CHQ or ACA pay DAL for passenger commissions or the cost of advertising or non fleet expense?

Does DAL advertise for CMR/ASA? I've never seen an ad that says fly CMR/ASA.. It says fly Delta. When you go to a kiosk and take care of business, you are taking care of business that adds to DALs bottom line.

If the cost of doing business was cheaper for DAL to pay another carrier to do its flying, there wouldn't be a CMR or ASA. The fact is that both of these companies are generating very nice profit statements for it's parent company, DAL.

Well,well, looks like we've found another business genius boys.

Hey Chopper, do you ever stop to think,..............disregard, I've vowed to never disagree with uninformed people.

Arrivaderci

 

[chperplt]

Since you're so informed, why don't you take me to school. Inform my dumb ass.

I guess if you had a solid thought in your head, you would have done that in your original post.

 

[FDJ2]

FDJ2

Much of what you list as expense is a DAL expense. IF CMR/ASA were selling tickets on CMR/ASA, then I would expect them to absorb those expenses. With the exception of paying for ones own catering expense, everything else is the cost of business for DAL.

Chperplt, you are right, that is the expense of doing business, but it also points out that just because ASA/CMR are profitable, that does not mean they are profitable for DAL, since DAL must pick up the additional costs associated with getting those passengers on those RJs. Likewise, the mainline is very profitable, all the way up until you start adding all those additional expenses. Like I said, CMR and ASA only pay for their direct operating costs, but DAL picks up the rest of the bill.

You are also right about Chautauqua and Skywest, DAL also has to pick up that tab aswell, although DAL didn't sink $3B into buying Chautauqua or Skywest, so there is less of an issue over getting a return on investment or paying off that $3B debt. Just my hunch, but I suspect contracting out to independent small jet providers versus wholly owned might be more appealing going forward, since mainline carriers would prefer to reduce their debt and maintain their liquidity instead of adding more debt to the ledger. CAL spun off a WO'ed recently, it might not be a bad idea for DAL to do the same, particularly when the small jet lift is cheaper from the non wholly owned.

At the end of the day all the contract carriers can be profitable, but that doesn't mean they are profitable for DAL, since the cost of doing business is significantly higher than just direct operating costs.

 

[Pez D. Spencer]

FDJ2,
Could be mistaken, but didn't Delta buy some cash in that deal too (for Comair, that is)? Also -- as for ROI, Comair and ASA are assets, as you mentioned... which can be turned into profit, and have been grown since their purchase -- equity, so to say, for Delta. So, we really do have a different ball game here with regard to the contractors v. wholly owned's. In other words they didn't just buy a money pit.

I'm pretty sure Comair would also fair quite well independent from Delta. They did before. Interesting anyway, and probably just a matter of time before it actually does occur. Could be sooner than later... hmmm... I'd buy stock in that.

 

[Dash8301]

I congradulate the Comair and ASA for standing their ground and demanding to be paid fairly. Just beacuse the Mesa lowlife are willing to fly for free (actually they would probably pay to fly thier precious jet), doesn't mean the whole industry should stoop to thier levels. On Your Six just because your furloughed doesn't mean you should incourage lowballing everyone elses contract. You talk like comair guys are freaking billionaires. When in reality the waited for a very long time furloughed guys and hung in thier to improve the quality of life for thier pilots. People like you are the reason Mesa a*sholes get away with this S*@t in the first place.

 

[FDJ2]

as for ROI, Comair and ASA are assets, as you mentioned... which can be turned into profit, and have been grown since their purchase -- equity, so to say, for Delta. So, we really do have a different ball game here with regard to the contractors v. wholly owned's.

Pez, you make a good point. DAL has invested a great deal into ASA/CMR. CMR has seen 85% growth since its acquisition, not bad. If they were spun off DAL would get some equity out of its investment. I'm not sure if DAL would get all of its money back, but I'm sure DAL would get a good cash infusion. That might be something Grinstein will be looking at closely as he does his "strategic review." Is it better to buy or rent in these tough economic times? Renting small jet lift and getting some equity out of either ASA or CMR or both might be a smart play. It will be interesting to watch.

 

[:-)]

Since you're so informed, why don't you take me to school. Inform my dumb ass.

I guess if you had a solid thought in your head, you would have done that in your original post.

tell you what dumb bum, rules are made to be broken, so I'll break my own just this once. I'll keep it simple for ya, eh. It take's a certain amount of money to put a passengers bum in a seat. Comair isn't spending it, Delta is. You can play politician and twist words all you want, but the truth remains, Delta subsidizes Comair.

arrivaderci

 

[General Lee]

Pez,

Easy now. You may be right that Comair COULD be spun off and given a 10 year agreement like Skywest. That could happen. But, for Comair to expand to other carriers--they would have to COMPETE for the business---which means they would have to become cost competitive. That means huge pay cuts and try to look like Chatauqua. Face it, some other Major may want to use you---but still make money off of you. And, if you did have a ten year agreement with Delta---you wouldn't be able to compete on your own---ala ACA and Independence vs the WORLD.

Bye Bye--General Lee

 

[Pez D. Spencer]

General,
I realize there would be challenges. But, right now all of our aircraft are utilized heavily for Delta. We would have to expand to cover other flying, and expansion takes time. Delta would have a large stake in the operation, and would likely want to see a profit from it. That's way out there in the future though, but being spun-off is a realistic possibility that we, as pilots, must consider. Personally, I think we would do fine.

 

[General Lee]

Pez,

I never said you wouldn't do fine--I am sure you would. But, WE WILL ALL BEING MAKING LESS MONEY. That, I believe, is a realistic view of our collective futures.......I am not happy about that at all...

Bye Bye---General Lee

 

[wil]

5 Year Capt rate for ASA should be 85.00 per hour, minimum. This is the rate I'm willing to negotiate from, no less. Work rules and trip rigs are a given. Comments?

 

[wil]

I forgot to mention that I have saved 8 months (and counting) of mortgage payments just in case. Save now!!
It might be time to nut up so I want to let my Brothers know if we need to be ready to walk .
The economy has turned around and we are making money. It is not our fault if Mainline is bleeding cash. But, we may be blamed due to Mainline's inability to deal with the truth. Their inability to be cost effective is not our problem.

 

[On Your Six]

The point of this entire thread was that if DAL mainline pilots will be potentially forced to accept "peer" level wages due to poor financial results attributed to lowsy management decisions, then the regional pilots should also be brought to "peer" level wages.

Peer to peer. Regardless, expect DAL management to be A LOT LESS GENEROUS with internal RJ growth in the future when so many low-cost alternatives exist. The bar has been lowered (thank you MESA) and everyone has noticed...

 

[BoilerUP]

The bar has been lowered (thank you MESA) and everyone has noticed...

Hasn't that horse long been beaten to death? The same could be argued at "mainline" about the raping the APA took from Carty, but at least it kept their company out of bankruptcy.

If DAL's industry peers are AMR and UAL, then CMR's peers are Skywest and ACA. Comparing Comair to Mesa is almost like comparing Delta to an LCC like AWA or AirTran, and that's an apples to oranges comparison.

Delta pilots are worth every penny they are able to negotiate, as are Comair's pilots. I believe if DALPA made a public presentation of just how much $$$ the company would save with an immediate 25% cut in pilot pay, Wall Street would eat it up. In return, ask for an equal reduction in management compensation, a contract extension and a deadline for return of all furloughees to Delta (mainline or DCI) flying. Demand a comprehensive plan from mgmt to return Delta to profitability and growth, and I think public opinion from within the financial world would put a fair amount of pressure on management to accept your offer.

I think long-term, DALPA has much more to gain from working with the WOs than fighting against them, and vice-versa. But what do I know.......

 

[DDpaysoff]

5 Year Capt rate for ASA should be 85.00 per hour, minimum. This is the rate I'm willing to negotiate from, no less. Work rules and trip rigs are a given. Comments?

I hope you guys realize how important ASA and Coex's new contracts are. We are about to go back to the food stamp days. That Ornstien guy must be a genius, look what he started.

 

[XRMEFLYER]

The point of this entire thread was that if DAL mainline pilots will be potentially forced to accept "peer" level wages due to poor financial results attributed to lowsy management decisions, then the regional pilots should also be brought to "peer" level wages.

This discussion has raged for some time now, and a question has been put to those of you who think like you do that "fair is fair" and "if we have to take a cut then they should too" and it has yet to be answered.

I put it to you(any of you who believe that is the answer here) again.

If what the Delta pilots seek(among other things) is an end to the outsourcing of "their" flying then is it not cutting off their noses to spite their face so to speak to insist upon lowering DCI costs ala pilot wages and thereby perpetuating the problem.

 

[nimtz]

I hope you guys realize how important ASA and Coex's new contracts are. We are about to go back to the food stamp days. That Ornstien guy must be a genius, look what he started.

Nah no genius. He's got guys flying for him who have both no balls and no clue what the future is for this profession. All he had to do was go for the anal rape and they took it in stride. Hopefully things will go different for Xjet. I'll sit out on strike until they take the airplanes away. F*ck it let the flight school kids have my job and my pay if that's all this profession will offer down the road. I really don't care.

 

[XRMEFLYER]

The silence from the "fair's fair" crowd is deafening.

 

[GogglesPisano]

I am an outsider in this here debate. However, since the CMR and ASA pilots can only negotiate with their respective managements, and their accounting books are closed (they are privately held -- owned by another company) the pilots should tell management to pound sand. There is no way management can convince them that ASA or CMR is on the brink of bankruptcy. That is all those pilots should be concened about.

As for the DAL pilots, they should worry about DAL, not what the pilots at CMR and ASA make. There is no operational integration, no seniority integration, separate lists. It is none of their business.

 

[Sam Fisher]

This is a ridiculous argument in my opinion.

Bottomline is this, gentlemen:

Delta pilots take X percentage pay cut and they still can pay their mortgage and feed their children (provided they aren't living beyond their means).

Comair pilots on the other hand take a similiar pay cut percentage-wise and they are on the WIC program and on food stamps. Since when is even $22,000 per year starting a fair wage? Even $70,000 to command a 50 passenger jet is lunacy but it is still better than the $55,000 that Mesa gets.

When does the madness stop? This isn't about "peer carriers." It is about raising the floor of compensation levels of this industry and maintaining a standard at the top end as well. Has zero to do with "peer carriers." That is a shallow and silly methodology by which to analyze this situation.

Newsflash Delta pilots: You want the Comair and DCI guys to be as well paid as possible so as to remove any financial incentive to use an RJ over a 737/MD80 on a route simply because the labor costs make it cheaper to operate that flight using small jets instead of larger ones.

Sam

 

[Heavy Set]

I tend to agree with On Your Six on this issue. It's true that Delta pilots are paid more than their peers at UAL and AA. Comair/ASA pilots are paid more than their peers at Mesa and Chautaqua. The pay difference for each group is the money left "on the table" that could help Delta's recovery. If one group is expected to reduce its costs TO PEER LEVEL, the other should do the same... That's perfectly logical for a parent company in a so-called death spiral - chapter 11 could force the issue anyway...

If you are a proponent of "peer" level wages for the mainline group, you can't have it both ways and not expect the regional group to maintain "above-peer" level wages. The urge to outsource to other cheaper carriers would be too great given the tight finanical situation (notice UAL and ACA situation)...

 

[Sam Fisher]

I tend to agree with On Your Six on this issue. It's true that Delta pilots are paid more than their peers at UAL and AA. Comair/ASA pilots are paid more than their peers at Mesa and Chautaqua. The pay difference for each group is the money left "on the table" that could help Delta's recovery. If one group is expected to reduce its costs TO PEER LEVEL, the other should do the same... That's perfectly logical for a parent company in a so-called death spiral - chapter 11 could force the issue anyway...

If you are a proponent of "peer" level wages for the mainline group, you can't have it both ways and not expect the regional group to maintain "above-peer" level wages. The urge to outsource to other cheaper carriers would be too great given the tight finanical situation (notice UAL and ACA situation)...

Heavy Set,

Are you aware what a 20% pay cut is to the Comair payroll? It would be $20 million back to Comair. Now Comair would have to funnel that savings back to Delta, with an amendment to their internal operating agreement. Either way, do you realize the magnitude of $20 million vs hundreds of millions that Delta is asking for from its pilots? Your argument doesn't hold water.

Sam

 

[Pez D. Spencer]

Heavy Set,
Management thanks you for promoting the whipsaw atmosphere. Good job, and keep up the good work.

 

[Caveman]

Comair and Delta and ASA are separate companies.

There is no operational integration.

If I wanted to be a part of DAL I must apply and interview like everyone else.

Sound familiar?

That's why CMR/ASA shouldn't have to take a pay cut.

 

[Heavy Set]

I am not an advocate for DAL's management and I am not in favor of huge pay cuts. Everything is negotiable. I am just pointing out to the Comair/ASA folks that their argument is the same as the mainline pilot argument - get it? It's the same rationale. Nobody wants a serious pay cut. However, the parent company is in financial trouble and cost cuts seem inevitalbe to compete better with AirTran, JetBlue and SWA.

You Comair guys are becoming defensive about preserving your incomes - just like General Lee. But wait - Mesa pilots are paid much less (maybe 20-30% less) than Comair and ASA pilots flying the same equipment. Senior American 767 pilots are also paid 20% less than their counterparts at Delta. Now you understand his point of view and why he becomes defensive - he is protecting his negotiated salary and the size of the eventual cuts.

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. If you don't think DAL management will be looking for ways to reduce regional flight pay then you are smoking something. On Your Six is right about this one, potential Comair/ASA growth in the future will be determined on a cost basis with CHQ, Skyway and Skywest willing to do things cheaper.

I just think the expectations of peer-level wages for just one labor group is assinine and unrealistic....

 

[XRMEFLYER]

You know, I don't think that one regional pilot on this forum is a "proponent of peer level wages" for Delta or anyone else. What difference would it make to us? If anything we would like to see higher wages there on the off chance we should ever get to join them.

The question remains for those of you who feel that what is good for one is good for the other.

Would it not make DCI a more desirable alternative to "your" flying if our costs were to be lowered?