Pressure on NWA pilots for 70 seaters

[CWASaab]

... But do you really expect them to spend their negotiating capital to protect the airlinks? ...

Well, foolish optimist that I tend to be, yeah. Why else would they have been blowing so much brand scope, red tail family smoke up our rear ends? If they kept telling us how much they supported us and how the red tail family was going to be different, better, than the rest because of our support for each other, but never intended to back any of that up with meaningful action, then I guess I feel even more sold out than before. How is an Airlink pilot ever to trust or believe the NWA MEC or pilot group again?

...What if they took additional pay cuts as a trade to protect the airlinks, then 9E, starts flying for other carriers, then 9E decides they do not want to fly for NWA any more? Or either of them filed chapt. 7? Or NWA terminates their contract with either one?

I am not asking the NWA pilots to take any cuts or suffer in any way for Airlinkers. The NWA MEC are the ones that have been beating the brand scope drum. I just don't want to hear anymore of this rah-rah brand scope, were a big family BS from Duane, the NWA MEC or any mainline pilot unless they actually back it up in action, when it counts.

If 9E were to start flying for other carriers, I think NWA would benefit, as I believe they still hold considerable shares in the spun-off company. For the same reason I think it is totally unrealistic to think that 9E, or XJ for that matter, would ever walk away from NWA. There is just way too much cross contamination, from the board rooms down through management for that to ever happen as a result of 9E or XJ initiative.

Now, if NWA wanted to end the relationship that is another matter. They can take their planes and go home, just like they did during the XJ negotiations. To think that NWA would allow 9E or XJ to use those subleased planes to make money for anybody else is a real stretch. Heck, NWA wouldn't even let XJ go out and buy their own cargo Saabs to make money on the side.

It is also a stretch that either 9E or XJ file for bankruptcy, under any chapter. We both know that the current Airlink Agreements do a fine job of making sure that XJ or 9E keep enough of the money to report some profits. And to think that NWA would let one of the two disappear, through bankruptcy or by NWA kicking one out, is incorrect. Why would NWA ever put all its Easter eggs in one basket? It should be obvious now that NWA wants more, not fewer, chances to use the whipsaw. And the NWA MEC and pilots have obliged.

Bottom line: I don't want to hear any more altruistic crap when the truth is NWA pilots are only going to look out for themselves and only intend to look out for themselves.

Not that there is anything wrong with that.

...I guess my point is, this business is really unstable. It would not be wise to spend negotiating capital on things that are out of their control.

MS

I don't know anything about the plight of the NWA FAs and their dues check off, so I can't comment on that, but I will say that if you think that this is beyond the control of NWA pilots, it may be. But only because they are unwilling to bare the costs (negotiating capital) and believe it to be so (resignation). The NWA pilots have had this type of control in the past. The agreements with both Continental and Delta required pilot approval to become real. The marketing agreement with Alaska requires exemption from scope, as does Horizon's operation of Q400s and CRJ700s. The NWA pilots have the tightest hold of scope, and who their company can partner with, amongst their peers. And despite what they have said in the past about brand scope and the red tail family, only the NWA pilots will benefit as they negotiate away anything that protected XJ or 9E.

Not that there is anything wrong with that, the industry certainly is unstable.


edited: for spelling, more than once. I really need a better proof reader.

 

[Lear70]

The facts are really quite simple:

1. The NWA MEC relaxed several scope provisions, INCLUDING the addition of a third "Airlink" (regional affiliate).

2. The new provisions ALLOW Northwest to provide financing for 50-seat aircraft to this third, as yet unnamed, Airlink. That means your money is going out the door ANYWAY.

3. The new provisions RESTRICT Northwest from using the gains to finance aircraft for 9E or XJ in the event another carrier folds and Northwest wants the flying, i.e. Northwest can't simply swoop in and finance all the RJ's from the failed carrier's affiliate and staff it with 9E or XJ but they CAN do that for the 3rd Airlink.

So, to recap, NWA pilots signed an agreement that simultaneously says 9E and XJ can't grow using Northwest money gained from the concessions but another 3rd Airlink CAN. That pretty much defines the phrase "predatory bargaining" to me.

I agree Northwest pilots have every right to protect their own flying, but that's not what happened here. Northwest pilots GAVE PERMISSION for Northwest to start a 3rd Airlink to whipsaw the existing Airlinks even further; anyone who tries to argue that very basic point is simply ignoring facts and logic.

"Brand Scope", "We're all in this together", "Rah Rah Duane Woerth"...

 

[mjs]

The facts are really quite simple:

1. The NWA MEC relaxed several scope provisions, INCLUDING the addition of a third "Airlink" (regional affiliate).

2. The new provisions ALLOW Northwest to provide financing for 50-seat aircraft to this third, as yet unnamed, Airlink. That means your money is going out the door ANYWAY.

3. The new provisions RESTRICT Northwest from using the gains to finance aircraft for 9E or XJ in the event another carrier folds and Northwest wants the flying, i.e. Northwest can't simply swoop in and finance all the RJ's from the failed carrier's affiliate and staff it with 9E or XJ but they CAN do that for the 3rd Airlink.

So, to recap, NWA pilots signed an agreement that simultaneously says 9E and XJ can't grow using Northwest money gained from the concessions but another 3rd Airlink CAN. That pretty much defines the phrase "predatory bargaining" to me.

I agree Northwest pilots have every right to protect their own flying, but that's not what happened here. Northwest pilots GAVE PERMISSION for Northwest to start a 3rd Airlink to whipsaw the existing Airlinks even further; anyone who tries to argue that very basic point is simply ignoring facts and logic.

"Brand Scope", "We're all in this together", "Rah Rah Duane Woerth"...

You are totally incorrect on all three points. The only scope NWA MEC relaxed was to allow 50-seat aircraft to be flown, converting 60-44 seat aircraft and adding 40 additional aircraft. NWA is NOT allowed to finance the additional 50-seat aircraft. The TA allows them to contract w/ someone. That "someone" has to take the financial risk of operating the aircraft.

Instead of thinking with emotions and misinformation actually look at what the TA contains. This comes directly from Mesaba MEC. It was originally posted 10-29-04 by VC10 as "scope questions for NWA pilots"





Mesaba ALPA MEC Special Hotline

October 27, 2004

Dear Fellow Mesaba Pilot:

Many questions and concerns have arisen in connection with the NWA Bridge/Investment Agreement that is currently being reviewed and voted on by the NWA pilots. Given the potential impact of some of the terms of that agreement on Mesaba Airlines, we thought it prudent to review the key points, and share our perspective on the potential consequences.

The NWA MEC views the TA as a "bridge" agreement that effectively ends their Section 6 negotiations. It is being labeled as a "bridge" because of its relatively short duration, and because it is designed to allow NWA management time to implement other cost cutting measures, including the negotiation of oncessions from other work groups. The NWA MEC concluded that the TA'ed concessions
were necessary at this time to assist NWA in securing additional financing and credit during a time when the airline continues to experience significant losses. The concessions negotiated in the Bridge agreement require that all anagement employees take pay cuts as well.

The Tentative Agreement reduces all pay rates by 15%, caps sick-leave accruals, and requires the pilots to pay 20% of their health and dental premiums (NWA pilots currently do not pay any part of the premium for their medical insurance). All told, the cost reductions outlined in the TA result in $300 million in annual savings. The NWA pilots will receive 4.05% of outstanding shares in NWA stock on option, and have guaranteed profit sharing in line
with other NWA employee groups.

The TA also includes concessions in Section 1, the Scope provisions. The TA allows for the conversion of up to 60-44 seat jet aircraft into 50 seat jet aircraft, whereas under the current agreement, the operation of additional 50 seaters was prohibited. Additionally, and this is the provision that is probably of the greatest concern to Mesaba pilots, the TA explicitly permits NWA to add up to 40 more 50 seat jet aircraft, provided that such aircraft are not flown by Mesaba, Pinnacle, or any other NWA affiliate.

The idea behind this provision was to give NWA the ability to take advantage of an opportunity to expand into markets where another airline was reducing or eliminating service (such as UAL or USAir), and to do so on an expedited basis. If, for example, UAL drastically cuts service in a certain area, the United Express carriers would have an excess of aircraft and crews, and would likely be interested in signing a code share agreement with NWA to perform the same
flying. NWA is concerned that if it does not fill the vacuum created in the event of an exit of any carriers in NWA's "Heartland Markets", other carriers will beat them to it. As a result of this relaxed scope provision, NWA would get a turn key operation, without any of the ramp up costs associated with bringing in its current code share partners to do that flying. In addition, if the transition were made quickly, it would increase NWA market share and feed, and result in increased revenue.

This new provision in the NWA contract is obviously at odds with the whole idea of "family or brand scope" because the addition of these aircraft is contingent upon bringing in another Airlink carrier. No one on our MEC welcomes this move. At the same time, we think it is important to put this new development in perspective, and keep in mind the level of concessions being made by the NWA pilots.

First, there has never been a prohibition in the NWA scope language on adding additional Airlinks. That could have occurred 3 years ago when we started negotiations, and it could occur today without this new language. Put another way, NWA has been free to contract with other carriers to fly all the 44 seat jets it wants, without limitation. This new provision simply says that another 40 jet aircraft may be flown with 50 seats - an incremental change of 6 seats.

Second, it is understandable that the NWA MEC does not wish to allow NWA to finance additional jet aircraft that would not be flown by its pilots, especially in light of the very large number of Northwest pilots who remain on furlough. Combined with a 15 % pay cut, which is not insignificant, we believe it is understandable the NWA MEC opted to agree to this provision. No pilot would willingly agree to cut his own pay only to have those cost savings go to finance another airline's operation.

Scope provisions necessarily impact the job opportunities of
others. In many respects, we faced similar issues when we elected to limit Big Sky to 19 seat turbo prop operations. We did so because we wanted to protect the viability of Mesaba Airlines, and the careers of our pilots. Put yourself in the shoes of the NWA MEC and consider what you might have chosen, given the various alternatives. Keep in mind that the threat of bankruptcy still looms, and that is a development that we should all view with extreme alarm. If NWA files a Chapter 11 petition, it will have the right to ask the bankruptcy court to void all of its contracts -including its contract with theNWA pilots and including its code share contract with Mesaba. If the Bridge Agreement helps to avoid a bankruptcy filing, that is to our very great advantage.

There will likely be many hard choices and difficult decisions for all ALPA MEC's before the industry comes back around. We must and should view our fellow pilots as our allies --- even if we have disagreements about the best course of action.

Fraternally,

Tom Wychor
Mesaba MEC Chairman

 

[Lear70]

Instead of thinking with emotions and misinformation actually look at what the TA contains. This comes directly from Mesaba MEC. It was originally posted 10-29-04 by VC10 as "scope questions for NWA pilots"

First, I'm not a Mesaba pilot and have no intention of listening to what Wychor puts out after that debacle he calls a T.A.

I HAVE read the T.A. (the sections that pertain to Pinnacle), and cannot find ONE SINGLE SOLITARY limit on Northwest financing those aircraft or assuming the leases if they were to act on the provision.

But, since you want to use Mesaba's kool-aid, I'll point out a few things:

Additionally, and this is the provision that is probably of the greatest concern to Mesaba pilots, the TA explicitly permits NWA to add up to 40 more 50 seat jet aircraft, provided that such aircraft are not flown by Mesaba, Pinnacle, or any other NWA affiliate.

Predatory bargaining. Plain and simple.

NWA would get a turn key operation, without any of the ramp up costs associated with bringing in its current code share partners to do that flying. In addition, if the transition were made quickly, it would increase NWA market share and feed, and result in increased revenue.

True, no "Ramp-up" costs, but no limit on assuming the lease liabilities for the aircraft either.

This new provision in the NWA contract is obviously at odds with the whole idea of "family or brand scope" because the addition of these aircraft is contingent upon bringing in another Airlink carrier. No one on our MEC welcomes this move.

BINGO!

Put another way, NWA has been free to contract with other carriers to fly all the 44 seat jets it wants, without limitation. This new provision simply says that another 40 jet aircraft may be flown with 50 seats - an incremental change of 6 seats.

And a not ignorable difference in CASM. Again, a gain for NWA management garnered by DELIBERATELY EXCLUDING the existing Airlinks.

Second, it is understandable that the NWA MEC does not wish to allow NWA to finance additional jet aircraft that would not be flown by its pilots, especially in light of the very large number of Northwest pilots who remain on furlough. Combined with a 15 % pay cut, which is not insignificant, we believe it is understandable the NWA MEC opted to agree to this provision. No pilot would willingly agree to cut his own pay only to have those cost savings go to finance another airline's operation.

Of course it's understandable. Now... show me IN THE NWA T.A. where it SPECIFICALLY says they cannot finance or assume the lease note and payments in the event this happens? Anyone? Remember, if it's not in writing, they can do it.

Scope provisions necessarily impact the job opportunities of
others. In many respects, we faced similar issues when we elected to limit Big Sky to 19 seat turbo prop operations. We did so because we wanted to protect the viability of Mesaba Airlines, and the careers of our pilots. Put yourself in the shoes of the NWA MEC and consider what you might have chosen, given the various alternatives.

First, no offense, but I don't really give a d*mn about Mesaba's contract because, quite frankly, I think they sold out and should have gone on strike. Additionally, I wouldn't EVER have agreed to a pay cut if I were at mainline for ONE very good reason - the carrier is going to go bankrupt anyway and there's nothing anything can do to stop it.

Keep in mind that the threat of bankruptcy still looms, and that is a development that we should all view with extreme alarm. If NWA files a Chapter 11 petition, it will have the right to ask the bankruptcy court to void all of its contracts -including its contract

with theNWA pilots and including its code share contract with Mesaba. If the Bridge Agreement helps to avoid a bankruptcy filing, that is to our very great advantage.

WAKE UP! EVERY legacy carrier will file bankruptcy and void their contracts within the next 18 to 24 months. Once UAir and UAL were allowed to void their contracts during BR, they gained a competitive advantage that eventually will have to be matched. Somehow I doubt any of the legacy carrier pilots are going to voluntarily give up their pension...

The strategy here by management at EVERY legacy carrier is very simple: if you start with full pay and file Ch. 11 you end up with far less in cuts than if you slowly whittle down pay over an extended period of time BEFORE you file Ch. 11, then go into BR discussions with a lower starting pay point. Happening everywhere, might as well say "full pay to the last day", can't be any worse than what the DAL pilots are about to go through.

Bottom line: there is nothing to keep NWA management from assuming the financing of a failed legacy carrier's regional RJ leases, or at least nothing I read in the T.A.

 

[Jimdandy]

MJS your incorrect the additional 50 seaters can't be flown by anyone who wants to pay for them becuase even if xj or 9e pay for the planes on their own they still can't get them. Only a company without the name 9e or xj - why you may ask?

SO we can whip saw the crap out of each other and work for slave labor to pay for your over inflated pay check

But we ain't falling for it if you want to survive you will have to give back money - and butt loads of it so have fun man. Recommend you try and get the Mechanics to give back some too.

HAHAHAHAHAHA

 

[mjs]

Of course it's understandable. Now... show me IN THE NWA T.A. where it SPECIFICALLY says they cannot finance or assume the lease note and payments in the event this happens? Anyone? Remember, if it's not in writing, they can do it.

Section C.9.g.(3):
Up to 40 Regional Jet aircraft to be operated under the NW code designator by an air carrier other than Pinnacle, Mesaba or any affiliate of the Company may be added to the 104 maximum set forth in subparagraph C.9.c. above, provided that each such additional Regional Jet must be a Regional Jet which is not (a) operated under the NW code designator as of October 11,2004, or (b) on order or option to the Company or any affiliate of the Company as of October 11, 2004, or (c) ordered or leased by Northwest or any affiliate of the Company after October 11, 2004, or (d) financed in any way by Northwest or any affiliate of the Company. If such aircraft are operated by an airline which also operates, or which has an affiliate which also operates, aircraft certificated with a maximum passenger capacity of 60 seats or more, the airline may operate these Regional Jets using the NW code designator notwithstanding the provisions of Section 1.C.2.

 

[Lear70]

Section C.9.g.(3):
Up to 40 Regional Jet aircraft to be operated under the NW code designator by an air carrier other than Pinnacle, Mesaba or any affiliate of the Company may be added to the 104 maximum set forth in subparagraph C.9.c. above, provided that each such additional Regional Jet must be a Regional Jet which is not (a) operated under the NW code designator as of October 11,2004, or (b) on order or option to the Company or any affiliate of the Company as of October 11, 2004, or (c) ordered or leased by Northwest or any affiliate of the Company after October 11, 2004, or (d) financed in any way by Northwest or any affiliate of the Company. If such aircraft are operated by an airline which also operates, or which has an affiliate which also operates, aircraft certificated with a maximum passenger capacity of 60 seats or more, the airline may operate these Regional Jets using the NW code designator notwithstanding the provisions of Section 1.C.2.

Daaaayuuumm... SMACK! That section didn't appear on the T.A. excerpt that is making its way around ops... I stand corrected on the financing. I still believe it predatory to exclude PCL and XJ, especially if they could finance their own and not use NW to foot the bill; that way it wouldn't have hurt NWA pilots at all? Still can't figure out why the NWA pilots agreed to that harsh of a provision.

A question with the end of that section ('cause I hadn't seen that either): If UAir goes under (just an example here), and NW decides to swoop in and suck up an operator that uses, for example, EMB 170's and 190's, under the provisions listed in that paragraph, not only could NWA operate additional 50-seaters, they could possibly use all 40 RJ options to operate the 90-seat Embraer's??!!

That doesn't sound good... Is there anywhere I can read the T.A. as a whole document? I'm very curious what else I haven't seen about it that could affect not only us but all NW affiliates...

 

[furloughed dude]

Some of you guys kill me. You expect NWA ALPA to negotiate on your behalf? While NWA furloughs 900 pilots and Pinnacle gains about this many? While mainline flying is being lost while the airlinks gain flying? While NWA is in dire need of pay cuts at the same time are purchasing 100 CRJs? Now you are complaining that you can't fly 70 seaters or your upgrade time to captain may exceed two years?

 

[Lear70]

Not me complaining about the hiring or flying... Check my history, you'll see that I don't believe it's right for us to be growing while you're furloughing. A simple flow-through / flow-back arrangement back when life was good would have fixed that though...

Uh-oh... he said the "F-word"!

I don't believe NWA pilots should be negotiating FOR us, but I also don't believe NWA pilots should actively negotiate AGAINST us and for some 3rd, unknown, unnamed carrier and it ESPECIALLY surprises me that they would allow a way to get 70- and 90- seat RJ's in through a "back door" as that clause appears to allow them to...

 

[CWASaab]

A question with the end of that section ('cause I hadn't seen that either): If UAir goes under (just an example here), and NW decides to swoop in and suck up an operator that uses, for example, EMB 170's and 190's, under the provisions listed in that paragraph, not only could NWA operate additional 50-seaters, they could possibly use all 40 RJ options to operate the 90-seat Embraer's??!!

Actually I don't think it would allow this. Under the previous scope NWA would not have been able to put its code on those 50 seaters (or any other plane for that matter) if the company also operated larger planes, atleast not without exemption from the pilots (CAL, DAL, Alaksa, Horizon). Now, under this bridge agreement NWA management does not have to seek approval from its pilots to do this, and the pilots cannot influence who the partner would be, as they could before.

Some of you guys kill me. You expect NWA ALPA to negotiate on your behalf?

I assume you mean me?

To answer the question, NO. But I do expect them to be men of their word, you know, to be honorable. My problem is they produce a great deal of talk about brand scope and the red tail family but apparently this was all talk. When the going got tough, they abandoned their family values and looked out for only themselves, and then went ahead and sold out the pilots of 9E and XJ.

As I have often said: Not that there is anything wrong with that.

If you won't back up or own talk, keep your mouth shut.

Oh, and by the way, I currently have no horse in this race. I used to, as a Mesaba pilot, and I had already upgraded and was flying the Avro, so a quick upgrade for me is not the motivation. I left XJ for a better life, only to find myself furloughed. However, this all happened right as I was leaving, and it still makes me sick to the stomach to think how the NWA pilots left my friends at XJ out to dry when they could have achieved their goals without doing so.

 

[xjhawk]

this may be a dumb question, but why does not NWA make a low cost carrier using their furloughed PIlots and 70-90 seaters, at compettive rates in pay etc? It would get the guys and gals off the street, make NWA more competetive, maybe fill in the FO positions with "FAmily" and a flow through? sounds simple? everyone would be happy......hahaha that could never happen

 

[Lear70]

this may be a dumb question, but why does not NWA make a low cost carrier using their furloughed PIlots and 70-90 seaters, at compettive rates in pay etc? It would get the guys and gals off the street, make NWA more competetive, maybe fill in the FO positions with "FAmily" and a flow through? sounds simple? everyone would be happy......hahaha that could never happen

Because it wouldn't be "Low Cost".

Labor makes up one of the three largest parts of the "cost" equation, and if Mainline pilots are flying it, so our mainline F/A's, mainline ground workers, mainline mechanics... It's in their contracts and I don't blame NWA one bit for wanting to keep that flying.

If mainline wants to run those aircraft, they can do it at existing contract rates and charge more for the tickets. Otherwise... p*ss off!

 

[Schwanker]

I don't believe NWA pilots should be negotiating FOR us, but I also don't believe NWA pilots should actively negotiate AGAINST us and for some 3rd, unknown, unnamed carrier and it ESPECIALLY surprises me that they would allow a way to get 70- and 90- seat RJ's in through a "back door" as that clause appears to allow them to...

The contract specifically defines an RJ as having 45 to 55 seats. This limits NWA from bringing in 70/90 seaters under this clause.

On a side note, I believe you will see 70 seaters as a new hire (or currently furloughed) position. These 70 seaters will have a limit determined by narrow body aircraft to prevent the ability to replace DC-9s with the 70 seater. The pay and benefits on the 70 seater likely won't be great - industry average. Many furloughees will pass up this option and wait for a "mainline" aircraft to become available instead of flying under the up and coming B-Scale. Of course, this is my prediction based on rumblings I'm hearing. A flow-through / flow-back would be nice for many, although egos will get in the way with seniority issues. Not betting on this. Expect a third NWA feeder - NWA70 - with mainline pilots on a industry standard "B-Scale."

Sorry for rambling on.

Schwanker

 

[8HRRULE]

I don't believe NWA pilots should be negotiating FOR us, but I also don't believe NWA pilots should actively negotiate AGAINST us and for some 3rd, unknown, unnamed carrier and it ESPECIALLY surprises me that they would allow a way to get 70- and 90- seat RJ's in through a "back door" as that clause appears to allow them to...

I heard the new 70 and 90 seaters will go to xj. What do you think the BIG ANNOUNCEMENT is all about.

 

[Flyer1015]

Training, what happened to you and your buddy who saw the E170, with the, "Operated by Pinnacle Airlines" sticker???



Do me a favor and go back to flying Gulfstream B1900s on FSIM-2004.

 

[QCappy]

I have read all the posts on the contract language and all the bantering back and forth. Interesting. But an honest question:

Is there anything that would now prevent NWA from contracting, say Horizon--who already has the exemption and is flying 74 seat Q400s codeshared with NWA--to fly Q400s out of their hubs, in NWA colors or in Horizon's?

 

[CWASaab]

...But an honest question:

Is there anything that would now prevent NWA from contracting, say Horizon--who already has the exemption and is flying 74 seat Q400s codeshared with NWA--to fly Q400s out of their hubs, in NWA colors or in Horizon's?

Yes. There is something that would prevent this. Mesaba's Airlink Agreement (I think signed in 1996/1997 and good for ten years- for the Saab Operation) provides Mesaba exclusive rights to turbo-prop feed in MSP and DTW. Back then Express (now pinnacle) flew saabs in MEM, so MEM was not a part of the deal. Based on summer 1997 being the beginning of Express' exit from MSP I would guess that july 2007 is when the deal expires, although I freely admit that I am not certain on the dates associated with the Agreement.

This is not to say that NWA couldn't come to Mesaba's spine-less puppet of a management team and demand (and get) an amendment to the Airlink Agreement removing the exclusivity. But as far as I know this has not happened.

And, I almost forgot:

Another limit (from the NWA Contract scope exemption that allowed the fokkers, crj700 and Q400) was/is the requirement that flights with the NW code operated by horizon(/alaska) originate or terminate in specific cities. Basically horizon/alaska hub cities are allowed, but MSP and DTW are not.

The one caveat with this is that I have no idea if the NWA "bridge agreement" changed this language in any way. My perspective is that the bridge agreement negotiated away the considerable influence the NWA pilots held in choosing who their management could partner with for code sharing and airlink services, and this language might have been changed.

 

[QCappy]

CWASaab,

Thanks for your insight.