Retirement plans at AA

[k2774]

Does anyone have any idea on what the retirement plans look like at AA?

Also, when will there be another wave of "off the streeet" hiring?

Thanks

 

[herewego again]

Also, when will there be another wave of "off the streeet" hiring?

2014

 

[STL717]

AA is still furloughing.

On march 3, 2004 AA will furlough 233 more pilots bringing the total to 2,458.

 

[General Lee]

I thought they just waved those last furloughs? Anyway, they are going to furlough 1300 FEWER total than originally expected, so that is good news atleast. And, it sounds like their cost cutting methods worked....

Bye Bye--General Lee

 

[G4G5]

AA has one of the highest attriation rates of any of the majors.

04-144
05-238
06-386
07-426
08-509
09-402
10-355
11-343
12-370
13-?

This equates to 3173 total pilot retirements in the next 10 years. It's also acceptable to expect this number to be increased by 10% for medical/unexpected retirements.So it it conceivable that AA will retire almost 3,500 pilots in under 10 years.

This can be explained by all of the expansion in the 80's with Crandall's purchase of the MD80's.

So, even though 2,458 pilots seems like alot (it is) and it feels like you will never get called back (my number is one of the 233 in March). The reality is that all the pilots will be back prior to 2010 (just on attrition alone). This also assumes that all 2,458 choose to come back(they won't). This also assumes zero growth.

Once AA decides to recall (IMHO next spring), a rate of recall of 30 pilots per month would bring back 360 a year. As you can see from the above numbers, by 2006 that's not going to be enough to cover the retirements. Then AA needs to cover the vertical pilot movement. So at 40 a month or 480 a year, it will take 5 years to get everyone back. I hope

 

[STL717]

So, even though 2,458 pilots seems like alot (it is) and it feels like you will never get called back (my number is one of the 233 in March). The reality is that all the pilots will be back prior to 2010 (just on attrition alone). This also assumes that all 2,458 choose to come back(they won't). This also assumes zero growth.

What about negative growth?????????

I guess you don't expect AA to continue to shrink. More shrinkage and recalls will be delayed acordingly.

 

[G4G5]

It works both ways. Could they shrink, most definatly. That's why I used numbers based upon zero growth and zero shrinkage, because anything else would just be speculation on my part.

But, when you think about it as long as they don't give up the 70 seat flying how much more do you think they can shrink after 2,500 pilots? Try to keep in mind, they just shrunk 20% and the economy is starting to recover.

Conversly, AA could also grow. What happens if one of the other legacy carriers goes ch7? Surly that would translate to some market share growth for AA. What happens if AMR mgt decides to place an ERJ-170/195 order? Anything above 70 seats goes to mainline. The airline can't continue to operate with only 25 CRJ 70's. They neesd to purchase something to fill the 50-129 seat(MD80) void. I fully expect that my recall could be into the right seat of an ERJ195.

How many of those 2,500 do you think will actually come back? For many of those furloughed, they are done with AA. I seriously doubt that some one would give up the chance to up grade at JetBlue or Airtran only to be the bottom fo at AA. How many will walk away from SWA or a descent second career, to come back to AA?

 

[80drvr]

I thought they just waved those last furloughs? Anyway, they are going to furlough 1300 FEWER total than originally expected, so that is good news atleast. And, it sounds like their cost cutting methods worked....

Bye Bye--General Lee

This "1300 fewer than originally expected" is pure APA spin. The actuall number was about 311 few than forecast. This is an improvement, just not as grand as APA advertised.

 

[pilot141]

Well, to answer the OP:

One of the few things "untouched" during the 2003 concessionary contract was the retirement. The figuring of the retirement numbers was not changed, but the income that goes into the figuring was reduced, so retirement numbers will be reduced.

That being said, AA's retirement consists of a fairly standard A-Fund (Years of service-1 x "High 5 years" income x mortality tables x interest rates, etc). It is still currently available as a pension or a lump-sum payout.

There is also a B-Fund which is 11% of earnings deposited into a managed account. The B-Fund is payed as a lump sum upon retirement.

You can also do a self-directed 401(k) up to federal maximum limits. In addition you can contribute after-tax money to your B-Fund.

Required caveat: There is no retirement out there that is "absolutely secure". The A-Fund can vanish faster than you can say "Chapter 11", and the lump-sum payout option is constantly under attack. The only money that cannot disappear is money tied to your SSN: the B-Fund and your 401(k).

Hope this helps.

 

[TCAS]

In the not too distant future I forsee the APA Board of Directors and its membership being faced with the dilema of a choice offered by AMR... Continued contributions to the B-fund or the EMB-190. Having both will not be an option.

This is the type of dilema that AMR loves to put it's unions in because it is so divisive to the membership.

Ladies and gentleman it's going to get ugly...

TCAS

 

[pilot141]

Once more before I go to bed....

TCAS your post seems to epitomize AMR's whipsawing of labor, but I ask again: how does this help the OP?

This IS the "Majors" forum, but must every request from a new pilot be greeted with such cynicism?

This used to be a place where someone could find amazing information on flying for the airlines. Since the furloughs started it seems like a place to hear amazing bitching about the airlines.

Life is a journey. Admire the people in front of you, and how they got there. Envy the people behind you, and the experiences they will have to reach you.

Enjoy the time you have in between.

 

[G4G5]

I don't see the main line retirement going anywhere, for the short term. AMR mgt is well aware of how the pilots feel about it, just look at the concessions that were made during the potential BK. If mgt couldn't get to it then getting to it when times are better will be much harder.

I fully expect to see them recreate the B scale of the 80's with the ERJ. Arpey will come to the unions with the same deal that worked for Crandall with the MD80's. The pay rate will be easy. Arpey will say, "here it is, this is what the Jet Blue and USAir pilots are flying it for".
Arpey will then offer much less then the 11% to fly the B scale and the union will cave.

 

[80drvr]

In the not too distant future I forsee the APA Board of Directors and its membership being faced with the dilema of a choice offered by AMR... Continued contributions to the B-fund or the EMB-190. Having both will not be an option.

This is the type of dilema that AMR loves to put it's unions in because it is so divisive to the membership.

Ladies and gentleman it's going to get ugly...

TCAS

Actually, AMR prefers the B fund (defined contribution). If they went after anything it would be the A fund and they hope that congress will do the dirty work for them.

With the current debt load, I don't see the EMB-190 coming anytime soon. Also, there is still plenty of capacity in the MD-80 and 737 fleets to absorb growth for the next few years.

 

[Draginass]

If you're a young guy in this business, you can kiss A funds goodbye. In fact, it I were a young guy, I wouldn't be in the airline business.

 

[furloughfodder]

If you're a young guy in this business, you can kiss A funds goodbye. In fact, it I were a young guy, I wouldn't be in the airline business.

I know a lot of old guys in this business who have kissed their A funds goodbye also.