Pinnacle Files for Bankruptcy

[Flyer1015]

Those "niave and inexperienced" ALPA representatives you talk about got me $13k in my 401k and snapback wages during the last bankruptcy. And that $13k was on the very low end of what most Mesaba pilots got at the time. Many guys actually came out ahead wagewise from the last bankruptcy.

That was Wychor and gang, not JH and gang. Total opposites. And besides, your bankruptcy of 2005 was during a time the aviation industry had a positive outlook in terms of lots of hiring, at the majors and regionals. The economy, cost of oil, all external factors were favorable. Today, it's literally the opposite for every single external factor. I wouldn't count on this bankruptcy to look anything like your last bankruptcy.

This may be Sean Menke's second airline bankruptcy as CEO but guess what, its not Tom Wychor's first rodeo either. I'm glad he is at the helm of our local ALPA branch for this bankruptcy. Seans got some tuff competition

No, Menke doesn't have any competition. Delta will tell Menke what to do, and the bankruptcy court will allow it. You don't think they file for motion 1113 to void the JCBA in bankruptcy? It's already done at Eagle (the initial filing).

 

[Dumb Pilot]

So sorry this is happening, I met some great guys and gals on my time at PCL and made some very good friends there, all the best in this tough times.

 

[doug_or]

I would rather drink my own piss than get a free drink or wing from you.

Well then. Two PBRs for the lovebirds at table eight.

 

[DoinTime]

Actually, they are "owned" by the lessor.

All three of you are wrong. They are "owned" by PNCL with a lien from the mortgage holder. They are not on lease. If PNCL defaults on the loans, then the mortgage holder may repossess them.

 

[Whataboutbob]

That was Wychor and gang, not JH and gang. Total opposites. And besides, your bankruptcy of 2005 was during a time the aviation industry had a positive outlook in terms of lots of hiring, at the majors and regionals. The economy, cost of oil, all external factors were favorable. Today, it's literally the opposite for every single external factor. I wouldn't count on this bankruptcy to look anything like your last bankruptcy.


No, Menke doesn't have any competition. Delta will tell Menke what to do, and the bankruptcy court will allow it. You don't think they file for motion 1113 to void the JCBA in bankruptcy? It's already done at Eagle (the initial filing).

I agree that the bankruptcy laws favor the companies position and they will plead their case to the judge that they need this and that in order to stay in business. You are right the judge will probably allow it since his job is basically to give them what ever relief they need to keep the doors open and the lights on. But I think the union has some cards in their play book as well. It's going to get ugly and the company probably will file a motion to void contracts but they have to bargain in good faith before that. And filing the motion doesn't mean there actually going to use that card. Actually imposing their own terms and voiding contacts is a pretty serious move that even the boldest CEO's have to carefully consider. Neither side wants it to come to that I don't think. It will end up being a show down until the last minute. Maybe the judge will let us walk if Menke imposes terms on us. Who knows how this will all go down. But statistacally in bankruptcy the chips are in the companies favor. I think part of shrinking us down is you end up with the most senior part of the work force still hanging on who are more likely to vote through the payouts to live and fight another day....is it only day 3 of this mess. Feels like a week already.

 

[suupah]

All three of you are wrong. They are "owned" by PNCL with a lien from the mortgage holder. They are not on lease. If PNCL defaults on the loans, then the mortgage holder may repossess them.

ARe we not there yet?

 

[rbav8r]

Tell me how a CEO can run a company into bankrupcy and get a pay raise from $425,000 to $675,000 and then ask the Pilots to take a 9% pay cut when first year pilots are only making $1950 a month - before taxes. Many words come to mind and integrity is not one of them.

 

[WMUSIGPI]

It was not resolved when Mesaba went through the first time,and I am not sure if it ever has been. IF the company does use the 1113c to void the contract and impose terms there is the posibility of immediate release under the railway labor act for self help (strike).

 

[suupah]

It was not resolved when Mesaba went through the first time,and I am not sure if it ever has been. IF the company does use the 1113c to void the contract and impose terms there is the posibility of immediate release under the railway labor act for self help (strike).

that would be awesome! btw did you put that avatar up during the xj bnkrptcy? my gawd i've been at this too long.

 

[Abernathy]

Tell me how a CEO can run a company into bankrupcy and get a pay raise from $425,000 to $675,000 and then ask the Pilots to take a 9% pay cut when first year pilots are only making $1950 a month - before taxes. Many words come to mind and integrity is not one of them.

Menke didn't "run" the airline into bankruptcy. It was already on its way there before your current CEO got there. Trenary and Co. negotiated idiotic rates with your mainline partners and got you where you are today. If you should be ticked with anyone, it should be your former management team. I don't really see how he had a choice. If the airline lost money every time a Q400 left the gate, I don't see how that would have lasted much longer.

As far as how the CEO can get a raise when the company files for Ch.11, I'd imagine it having to do with the fact that very few airline executives are going to go through managing a bankrupt airline making much less, especially one who just went through it with Frontier. Sucks, but that's just how it works.

The whole regional model needs to change otherwise this is going to start happening to all the regional airlines, one by one. The bidding wars and race to the bottom is destroying the industry. The only thing that will fix it is much tighter regulations and something to level out the playing field like minimum wages for pilots based on equipment types. If we're going to be bound by the RLA, then there needs to be better protection for the airline workers. Everytime the price of fuel farts, someone's going bankrupt.

This industry needs heavy regulation.

 

[sinkrate]

that would be awesome! btw did you put that avatar up during the xj bnkrptcy? my gawd i've been at this too long.

To my knowledge no pilot group has had a contract imposed by a BK judge. In every case I am familiar with the judge has told them to keep bargaining until they reach a consensual Agreement. That is not neccessarily good for pilots. In this case if the pilots drag it out Delta will take more AC from them. This puts a tremendous amount of pressure on both management and pilots. Whether a labor group can stike if a judge imposes terms is not clear. It is simply a legal theory that has not been tested in court yet. The fact that no one has tested it tells me labor lawyers are afraid they will lose.

In the 05 Mesaba BK it appears that MAIR, after they realized the jets were gone and they were left with 50 SF3's and an expensive labor agreement, was seriously considering closing the doors on Mesaba. If Anderson (NWA) hadn't decided to 'go to the well' one more time on a 'dress it up and sell it IPO' things could have been much different for Mesaba pilots.

Each BK is unique. There are multiple players with different objectives. When NW entered BK in 05 they pushed Mesaba into BK by not paying them what they contractualy owed them. They did not do that to PCL. Why? Mesaba had a year old labor agreement with the highest rates in the industry and most restrictive/expensive reserve language in the industry.

In Skywests/ASA's agreement with Delta there is language specifing that their labor rates can be no higher than a certain percentage of the cheapest operator Delta has a contract with. Both ASA and Republic are well into section 6 negotiations. Delta will be calling all the shots in the PCL BK. What will their objecive be and what are they willing to risk or pay for that objective? For Delta it has nothing to do with 'fair or right', it is simply a bullies power play. What will the remaining PCL pilots be willing to accept?

 

[xjhawk]

I agree with you on many of the points you made. Delta will be calling the shots, that is why they provided DIP financing. But I disagree with you on the fate of mesaba and NWAs (Anderson) actions and plan then and now. The Bankruptcy of Mesaba was planned as was the removal of the Avros (to $$$) and the reduction of the labor costs. I would suspect that the acquisition was either planned or a side benefit as they did not have to pay profits to MAIR for managing Mesaba (remember the $600 million they had in the bank?).

There is another plan in the works but first they need to do a couple things to make their plan work. I do not know what the plan is but I can see that it is leaning in the direction of being a Delta show.

The way I see it there are some key factors involved here. here are some

Amazing the timing of Delta trying so hard to get their pilots to renegotiate their contract and scope a couple years before its up. I would not be surprised if Delta creates a new company with "b scale paid delta seniority pilots" for the 76 and 100 seat aircraft. of course Delta pilots would think they are doing regional pilots a favor-but a huge pay increase just may make the giving up scope bitter pill go down easier-but after all-those B scale pilots are delta pilots-too bad they are seat locked for ____ so many years.

This bankruptcy is going to push a number of factors that Delta wants

They want controld-heck they are providing DIp financing so they are in a place to guide the bankruptcy

They are getting United and US Airways out of the picture

Pilots will be among the lowest paid in the industry

When the 200 numbers are slashed, there will be a lot of pilots ready to man teh 100 seat positions and will be happy to be at year 1 pay instead of on the street (those senior 20 year guys will not be as happy)-

Unlikely? If you create a B scale delta seniority pilot seat locked for X amount of time, and those pilots are forced to "flow" or lose their job and take year 1 pay-how much money would that save Delta?

I am not saying this will happen-but something along these lines will occur. One thing is for certain-this has Andersons dirty little finger prints all over it. and they will make a lot of money, they will get some relief on 100 seaters and they will come out of this smelling like roses

 

[NWaviator]

Well stated and thoughtout. Now if that all happens is up in the air but you do have a point.

 

[jynxyjericho]

I agree with you on many of the points you made. Delta will be calling the shots, that is why they provided DIP financing. But I disagree with you on the fate of mesaba and NWAs (Anderson) actions and plan then and now. The Bankruptcy of Mesaba was planned as was the removal of the Avros (to $$$) and the reduction of the labor costs. I would suspect that the acquisition was either planned or a side benefit as they did not have to pay profits to MAIR for managing Mesaba (remember the $600 million they had in the bank?).

There is another plan in the works but first they need to do a couple things to make their plan work. I do not know what the plan is but I can see that it is leaning in the direction of being a Delta show.

The way I see it there are some key factors involved here. here are some

Amazing the timing of Delta trying so hard to get their pilots to renegotiate their contract and scope a couple years before its up. I would not be surprised if Delta creates a new company with "b scale paid delta seniority pilots" for the 76 and 100 seat aircraft. of course Delta pilots would think they are doing regional pilots a favor-but a huge pay increase just may make the giving up scope bitter pill go down easier-but after all-those B scale pilots are delta pilots-too bad they are seat locked for ____ so many years.

This bankruptcy is going to push a number of factors that Delta wants

They want controld-heck they are providing DIp financing so they are in a place to guide the bankruptcy

They are getting United and US Airways out of the picture

Pilots will be among the lowest paid in the industry

When the 200 numbers are slashed, there will be a lot of pilots ready to man teh 100 seat positions and will be happy to be at year 1 pay instead of on the street (those senior 20 year guys will not be as happy)-

Unlikely? If you create a B scale delta seniority pilot seat locked for X amount of time, and those pilots are forced to "flow" or lose their job and take year 1 pay-how much money would that save Delta?

I am not saying this will happen-but something along these lines will occur. One thing is for certain-this has Andersons dirty little finger prints all over it. and they will make a lot of money, they will get some relief on 100 seaters and they will come out of this smelling like roses

Yes but you are forgetting the most important part, how will the mainline pilots blame the regional guys for this?

 

[xjhawk]

ha! good point. Sorry for the spelling and grammar errors. I wrote that while juggling feeding my kids lunch and cleaning up after them. I do not know what will happen through all of this but I am assuming given Andersons past performance in these matters he will come out on top. The coincidence of Delta and their pilots negotiating scope and Detlas actions in this bankruptcy are fishy. I must say, that it may just be getting rid of the 200's as they did the Saabs. That would be even worse for Pinnacle pilots.