So much for the huge growth rumor at SW

[Fubijaakr]

Lear, you realize the article states the leases go out to 2024 right?.

You do know that leases can be renegotiated and/or terminated with a payment, right?

 

[Lear70]

You know as I read this thread, I can't blame the AT guy's for what thier MEC is doing. Nor blame them for the fear they have. They are just CYA'ing them selfs. That is fair enough.

I appreciate that. Truly.

We aren't bad people, we are a fun loving group of hard working pilots who just want to get past this and get on with making a bigger and better Southwest. We just want to make sure ALL of us make it over and it goes as advertised.

If it takes a little extra time to get it worked out, it just takes that time, but as long as it DOES get worked out, it's all good.

 

[madjack]

fudgepacker,

Of course you are right, arbitration and furlough protection are in the best interests of AAI...I would expect ALPA to fight for both...the only problem is that SWAPA/SWA will negotiate the pay rates for the 717...the AIP ensures that the payrates for the 717 are the same as the 737...

No one knows if Mr Kelly has any intention of furlough...economic conditions and the survival of the company will dictate...Will Mr Kelly continue to operate the 717, if it cannot be made profitable in the SWA system? Who knows...will he furlough 717 pilots in the next 30 months because we are losing money on that aircraft? So I completely understand the desire of the AAI pilots to share the "furlough pain" with the SWA pilots now, instead of 30 months from now...I guess we will see of ALPA Airtran was able to secure the furlough protections they desire...

 

[gearup5]

Fly-Diver, you guys frequently ask Lear for his opinion on this stuff. When he (politely and articulately) presents some specific items he has concerns with, he's suddenly a "bad guy" and you want to "play HR" with him?


I think Lear has valid concerns...but I would also state that this deal cannot be risk free...just .02c:

- Mr Kelly bought AAI to eliminate a competitor, grow relatively quickly and with less capital expenditure and risk
- Mr Kelly (and Wall St) are not sure that SWA can operate the 717 profitably in our sysem at the SWA pay rates
- There is risk in arbitration for the AT pilots, SWAPA and SWA will negotiate the 717 pay rates...

The AIP as it stands has one pay rate for all SWA aircraft, that deal was bought to the table by Mr Kelly during negotiations...that deal comes off the tabel if we go to arbitration.

Sure there is risk for SWA pilots at arbitration, especially if the seniority list goes DOH to relative seniority, but arbitration is not a slam dunk or risk free venture for the AAI pilots either...

All other points aside, this argument about how they can not operate 717's profitably is BS. Pilot pay is a tiny percentage of operating cost. If you increase hourly rates by 100/hr that is less than $1/ticket on the 717. Fuel by far is our largest expense. With access to Southwest fuel hedges we will be more than able to offset the operating cost increase.They just really do not want three aircraft types going forward. See it for what it is, public negotiations with Boeing.

 

[Secret Squirrel]

. See it for what it is, public negotiations with Boeing.

And ALPA.

 

[jonjuan]

All other points aside, this argument about how they can not operate 717's profitably is BS. Pilot pay is a tiny percentage of operating cost. If you increase hourly rates by 100/hr that is less than $1/ticket on the 717. Fuel by far is our largest expense. With access to Southwest fuel hedges we will be more than able to offset the operating cost increase.They just really do not want three aircraft types going forward. See it for what it is, public negotiations with Boeing.

You cannot increase fares unilaterally. Costs are already high and you better believe GK doesn't look at a 1% increase in costs as "tiny." Do you know how fuel hedges work? Do you understand that hedging fuel/heating oil, et al costs a significant amount of money? What if you hedge at $110 a barrel and oil is $85?

 

[On Your Six]

All other points aside, this argument about how they can not operate 717's profitably is BS. Pilot pay is a tiny percentage of operating cost. If you increase hourly rates by 100/hr that is less than $1/ticket on the 717. Fuel by far is our largest expense. With access to Southwest fuel hedges we will be more than able to offset the operating cost increase.They just really do not want three aircraft types going forward. See it for what it is, public negotiations with Boeing.

GK said in the Q2 report that SWA is paying more for gas than most airlines.


OYS

 

[gearup5]

You cannot increase fares unilaterally. Costs are already high and you better believe GK doesn't look at a 1% increase in costs as "tiny." Do you know how fuel hedges work? YES Do you understand that hedging fuel/heating oil, et al costs a significant amount of money? YES What if you hedge at $110 a barrel and oil is $85?You loose money.

While I don't believe I said 1% was tiny. In the big picture we are a small part of the equation. Fuel Makes up 60+% of the per hour operating cost while crew typically comes in less than 6%. Is it easier to "shave" from the 6% or the 60%. Other than the sharp drop in late 2008 most airlines have been on the correct side of the hedging equation. Some have just hedged more than others. Yes you must control cost but 1% in salary increases is not the difference in that aircraft making money or not that is all.

Southwest knows this. That is why they have invested signifigantly in a large hedging program. Much of the cost advantage that Southwest has had over the last decade is because of the foresight of managment to tie up capital in hedging and for the most part come out way ahead of the competition.

 

[scoreboardII]

You do know that leases can be renegotiated and/or terminated with a payment, right?

How many early termination fee's has Gary and company ever paid? I'll help you, none.

 

[scoreboardII]

With access to Southwest fuel hedges we will be more than able to offset the operating cost increase. .

Not true, SWA hedges for the jets they have, the AT jets are as yet unhedged under the SWA banner. Going forward maybe, today, not so much.