Pilots at Airtran pick up open time???

[gt1900]

OK Secret..... Tell AAI when to hedge then... When do they pull the trigger and buy hedges??? Do they buy them now at $100 a barrel?? Or do they wait until it hits $50 a barrel?? Is it going to hit $50 a barrel, or go back up to $140??

Read this link... You will learn something.. Maybe you forget that there was a price collapse of oil in 1986. Just 7 years after oil had hit an all time record of almost $70 a barrel, it then dropped to below $15 a barrel. Lets say SWA would have bought oil at $35 a barrel to fend off another price increase.. Once oil dropped to $15 a barrel SWA would have been losing tons of money since the current oil prices would have been only $15 a barrel.. You seem to think that hedging is so simple... Well in isn't. I can show you tons of articles where hedging has hurt DAL, CAL, AAI etc.. SWA has been very LUCKY to get the hedges they have.. But, if oil starts a landslide and hits $35 or $40 a barrel again then they are going to be in trouble. Its not nearly as easy as you seem to think it is. Nobody expected the recent rise in oil prices.. At least not to the extent that they occured. Ya, some analysts predicted $200 a barrel, but I just don't see that happening.. Heck, $147 a barrel has almost bankrupted Ford and GM.. Look at how badly its hurt them. Economys would collapse at $200 a barrel. Heck, ours started to collapse at $147 a barrel.... You can expect oil prices to continue falling now in order for the oil company's to get us all hooked on oil again.. When gas drops to $1.50 a barrel we will all be buying Humers again and gas guzzling SUV's... Trust me, the oil company's want you hooked on oil. And thats why the oil prices will continue to drop... Its just a matter of how far...

http://www.wtrg.com/prices.htm

Ty... I agree.. But what do they care?? They will get their money.. Look at Hoksema.. How much money did he make from inflating the price of MEH and causing a bidding war.. IMO it was brilliant. Sucks for the employees, but for the stockholders it was genious.. He has his money, so what does he care what happens to MEH after that.... The difference is that AAI mgmt needs to get AAI stock up. So they need to do things efficiently in order for that to happen.. I don't agree with it at all, but I understand it. I don't like thier tactics, but I also understand the hard handed tactics are the only way they can get what they need. I don't take it to heart, and I don't let it get to me.. Its just business, and we are just pawns...

 

[PCL_128]

The whole conversation is moot anyway, because we don't have the cash to purchase hedges on a large scale. It ain't cheap. SWA has billions in cash reserves. Makes it a different game for them.

 

[Secret Squirrel]

The whole conversation is moot anyway, because we don't have the cash to purchase hedges on a large scale. It ain't cheap. SWA has billions in cash reserves. Makes it a different game for them.

There are many different ways to hedge fuel. SWA has been doing it for some 15 years or so. Before they had Billions in the bank. I would argue that is why they have billions in the bank.

 

[Secret Squirrel]

OK Secret..... Tell AAI when to hedge then... When do they pull the trigger and buy hedges??? Do they buy them now at $100 a barrel?? Or do they wait until it hits $50 a barrel?? Is it going to hit $50 a barrel, or go back up to $140??

Read this link... You will learn something.. Maybe you forget that there was a price collapse of oil in 1986. Just 7 years after oil had hit an all time record of almost $70 a barrel, it then dropped to below $15 a barrel. Lets say SWA would have bought oil at $35 a barrel to fend off another price increase.. Once oil dropped to $15 a barrel SWA would have been losing tons of money since the current oil prices would have been only $15 a barrel.. You seem to think that hedging is so simple... Well in isn't. I can show you tons of articles where hedging has hurt DAL, CAL, AAI etc.. SWA has been very LUCKY to get the hedges they have.. But, if oil starts a landslide and hits $35 or $40 a barrel again then they are going to be in trouble. Its not nearly as easy as you seem to think it is. Nobody expected the recent rise in oil prices.. At least not to the extent that they occured. Ya, some analysts predicted $200 a barrel, but I just don't see that happening.. Heck, $147 a barrel has almost bankrupted Ford and GM.. Look at how badly its hurt them. Economys would collapse at $200 a barrel. Heck, ours started to collapse at $147 a barrel.... You can expect oil prices to continue falling now in order for the oil company's to get us all hooked on oil again.. When gas drops to $1.50 a barrel we will all be buying Humers again and gas guzzling SUV's... Trust me, the oil company's want you hooked on oil. And thats why the oil prices will continue to drop... Its just a matter of how far...
http://www.wtrg.com/prices.htm

They buy hedges always, it is a part of any good proactive company to try to stabilize the costs of their raw materials for a certain length of time so they know how to price their product. MANY companies do it with everything from food products to precious metals, to Crude oil.

Did you read the link? If I was management of a company I sure would want to stabilize my costs with such a unstable commodity. And do YOU actually know what fuel hedging is? There are at least 4 ways that companies can hedge fuel costs. And the way Southwest does it (for like 15 years or so) they can make money on the upswings and the down swings. And I am not arguing that you can lose money hedging fuel, we are going to have a neat little charge this quarter for loss on hedging fuel. Just another example of bad management decisions.

Is our management Proactive or reactive, taking responsibility for their actions or constantly blaming others for their poor decisions, uniting or dividing its employee groups? These, along with many other reasons, are why I believe your earlier statement that AAI management has made good decisions is incorrect. My opinion and you are free to have yours.

 

[gt1900]

If SWA is ALWAYS buying fuel hedges how come they haven't bought any in almost 2 years??? Like I said before.. If you know so much about hedging, why don't you tell everyone how and at what price to hedge fuel at??? Its easy to point blame.. Im asking you to make " a good business decision".. At what point should AAI buy hedges.. Any kind of hedges... If your going to bash AAI managment about hedges you better be able to back yourself up, and tell them how to do a better job. Otherwise you do your job and let them do thiers. Stop armchair quarterbacking them...
Like I said.. Tell everyone here at FI what price oil is going to drop to and when airlines should hedge.. If its that simple, you should be able to do it very easily... BTW.. Read the below article, especially the last couple paragraphs... Even GK has said that the hedges have only bought SWA time. If they don't find additional revenue they will be in the same predicument everyone else is in...

http://www.msnbc.msn.com/id/25419436/

 

[Secret Squirrel]

If SWA is ALWAYS buying fuel hedges how come they haven't bought any in almost 2 years??? Like I said before.. If you know so much about hedging, why don't you tell everyone how and at what price to hedge fuel at??? Its easy to point blame.. Im asking you to make " a good business decision".. At what point should AAI buy hedges.. Any kind of hedges... If your going to bash AAI managment about hedges you better be able to back yourself up, and tell them how to do a better job. Otherwise you do your job and let them do thiers. Stop armchair quarterbacking them...
Like I said.. Tell everyone here at FI what price oil is going to drop to and when airlines should hedge.. If its that simple, you should be able to do it very easily... BTW.. Read the below article, especially the last couple paragraphs... Even GK has said that the hedges have only bought SWA time. If they don't find additional revenue they will be in the same predicument everyone else is in...

http://www.msnbc.msn.com/id/25419436/

Your own article says they have not bought any in several months, not years. SWA fuel heading has brought them almost 4 billion dollars in the last 5 years. IT IS NOT MY JOB TO FUEL HEDGE. IT IS MANAGEMENTS JOB, NOT PILOTS. A GOOD MANAGEMENT DECISION IS TO HEDGE THEIR FUEL. And you have brought up another problem where our GOOD management has not done a good job. Where is the additional revenue? They did not even raise ticket prices from last year to this by INFLATION!! Every other airline has brought up their per ticket revenue but US.
So how about YOU start telling me the GOOD decisions managment has made? Sounds like the only thing they have been doing is trying to take money FROM THEIR EMPLOYEES!!!!!!!!!!!!!!!!!!!!

 

[BSkin]

I personally was in favor of the reduced line values to keep everyone on the property (and even started the thread on the NPA forum after I heard how Jetblue was handling their block hour reduction from a Jetblue jumpseater).

However, don't blame Mike Best. If it would have went to a vote, I am sure at least 50% of the pilot group would not have said yes to a 25% reduction in average line credit. Too many guys living paycheck to paycheck or not worried about the junior guys. Mike was just going with what he thought the majority wanted.

I only blame MB if what you previously said is true! IF IT WOULD'VE GONE TO VOTE? Give me a break. The majority of our pilots were hired in the last 4 1/2 years, I know because I'm right at the middle. Lots of the younger guys with more seniority would probably have liked the chance to vote on that. That's the main thing that's f-d up with the NPA -- deciding what is best for the group without confiding/puting out to vote what is best in the group! Tell me why all these board members quit? There needs to be a spine in the NPA and it doesn't seem to be present!

 

[BSkin]

And, I also was in favor of reduced LVI, as long as it was in writing from the mgmt that it was only temporary!

 

[BSkin]

Also, Maxblast, you're essentially implying that Mike personally put our pilots on the street without a vote. That should go over well!

 

[eyeamthechosen1]

There could be one guy on the senority list and as long as it's him he will continue to have that attitude. This is the type of guy when the company bends him over he asks for vaseline.