So was B19 right or wrong?

[brokeflyer]

like I said, they can AFFORD a CBA that is twice as much as the current one.

room to grow.

 

[B19 Flyer]

Get the facts straight...

B19 blames all the industries woes on unions. I think it's pretty clear from the numbers above that he is wrong and is just a union hater.

This statement is not true.

I have never blamed all of the industry woes on unions.

I am not a union hater. I've repeatedly stated, if you want to work for a union, go to work with a company that has one. However, don't force a union on a company that doesn't have one and doesn't want one.

I am realistic on the negative impacts unions bring to any company, airline or otherwise. When times are good, unions are great and everybody is happy.

I've always said, when the economy tanks, that is where unions fail. They don't react in a timely manner and drive companies into the ground twice as fast as what would have happened if a union wasn't there. Management can 't react quickly enough when a union is restricting them.

The financial model that keeps getting thrown around is meaningless. It's how the union acts that is the issue. B737, you are spot on with your observation, and what you have stated is what I believe. All of these NJ guys have touted how what is happening now will never happen.

It has happened, and the cycle will continue all the way through like it always does when times are tough. The union will sit there while the company sheds elsewhere until there is no more to shed, then the union will force the company to burn cash at a rate that is not recoverable until somebody's hand is forced to do something. The union will never step up to the plate on it's own.

Get the facts straight on my opinions.

 

[B19 Flyer]

Cost structure is meaningless.

B737Dvr,

You make some excellent points. However, you're missing at least a couple good ones yourself.

The biggest point you're missing is that we are NOT an airline. Our costs are structured quite differently. There are lots of areas I could talk about here, but considering what this thread is about, let's just focus on pilot salaries and bennies.

Pilot salaries are built right into the management fees we charge our owners. It really is that simple. And our management fees do not go up and down with the economy (as airline prices typically do). Therefore, as long as they're collecting the management fees with the pilot costs built in, our salaries are not a burden for the company.

So why are we furloughing? Easy, because we have lost many owners, and therefore the management fees that went with them to pay the pilots. The choice then becomes get rid of the pilots that we aren't collecting management fees to support, or everyone takes a big pay cut so that the remaining management fees will still pay for all the pilots. The latter choice seems viable at first, until you remember that with the loss of owners, we also lose airframes, and a need for pilots to crew them. So while everyone may now be making less, there still really isn't a compelling reason to keep enough pilots to crew, say, 500 aircraft when we now only have 400 aircraft. We're still paying pilots to just sit around, even if it would be at half salary, or something along those lines.

So we furlough the pilots we simply don't have work for. But what about the remaining pilots? Well, if the furloughs are done correctly, the remaining pilots are now proportional to the number of owners paying management fees. And since our salaries are built into those fees, there is no reason for any paycuts or concessions. The revenue stream that covers our salaries remains constant, in good times and in bad. Again, I don't mean number of owners, I just mean the amount of the management fees the owners pay.

Now compare that to the airlines. The revenue stream they generate the money to pay pilots from is NOT constant. Sure, passengers come and go, same as our owners, but the AMOUNT the remaining passengers pay varies greatly, depending on the economy, time of year, competition, etc.....So sure, during times of sustained economic downturns, the airlines lose money like crazy, and they furlough pilots, same as all of us. But trouble is, the remaining revenue stream will also fluctuate, usually in a down direction (lower airfares) when there's a lot of need to get people back in the seats, so there's less money available to pay pilots with.

We, at Netjets, do not suffer from that same problem. Our remaining owners' management fees do NOT go down.

Now, once the furloughs occur, will we make money again? That remains to be seen. Whether the company makes money or not simply is not dependent on what our salaries are. If the company needs to subsidize its operations by asking the pilots for donations (ie, concessions), then there are far bigger problems than what our CBA provides us.

Anyway, for now, this is all a moot point. Management has NOT approached us for concessions. Some of you would add "yet". Fine. I'm a never say never kind of guy myself. Anything is possible. But because of the way the management fees are structured to cover pilot costs (based on appropriate crew ratios to airframes), I think it will be much harder to get concessions thru than it would be at the airlines.

Just IMHO.

The method of revenue is meaningless in the conversation.

What is important is that the union will not react in a timely manner, NJ will shed everything else it can first while the union stands idle. If the union shed costs with the rest of the company it would be different, but we both know it's not going to happen. Cost is cost, revenue is revenue.

It's how the reaction to fix it occurs, and the union will act identical to the airline unions, you watch and see if it doesn't.

 

[B19 Flyer]

Obviously you have no clue about what happened at Eastern. Lorenzo was stripping assets from Eastern to his other holdings (Continental particularly). Eastern was already doomed. The pilots decided to die fighting rather than let Lorenzo gut the company and then kill it. Management had decided that Eastern was not going to survive long before the end.

It's clear that you don't have a clue as to what happened at Eastern either. The only true statement you make is that Eastern was already doomed before Lorenzo got there.

The only chance Eastern had for survival was Lorenzo. He would have done the exact same thing as he did with all the other airlines that are still flying today. Lorenzo had success too, nobody ever talks about that.
How many pilots are at CAL now? Every one of them can thank Frank for saving the airline along with all the other ones that were folded into it.

 

[B19 Flyer]

I guess I did forget what the title of this thread was!! Thanks for reminding me. I just read some very interesting posts from some who are very ready to dig in their heels and thought that I would offer some words of caution. I don't think that unions are the reason why a company will go down. Unyielding positions that fail to take into account economics are the reasons why companies fail. The eastern guys stood for what they believed their worth to be to the very end and basically ensured the demise of the airline. To be clear, there were many other factors and some horrible management, but in the end only a certain union there refused to give one inch forcing the inevitable. Whether or not they were within their right or were right is not my point, just simply what they chose to do in light of the economics at the time. Period.

Can a union negotiate great lofty wages and working conditions? yes it can. Is it merited? Yes it is. However, what is not debateable here is that aviation is highly cyclical and when times get tough (these times are horrendously tough) the strain of industry leading wages will cause un-intended consequences when the revenue streams cannot support it indefinitely. Perhaps NJ thought things would turn around by now and delayed this decision until its cash position could no longer support it, I don't know. In the absence of being able to negotiate, the company has no choice but to cut costs and next to fuel, labor is the highest cost there is. If the contract were a crappy one, perhaps less would be laid off, but layoffs nonetheless are inevitable great contract or not. What is debateable here is whether or not industry leading pay excaserbated these conditions. The union is not at fault here. Times simply have changed and what the company's management as well as what the union does GOING FORWARD is what is critical. Could this turn into round 1 of many or simply be it and things turn around.....that depends on the proactivity of all parties involved in sitting down for the mutual benefit of all.

I can't think of any previous time where there were this many corporate guys laid off in a single time. This 495 number is similar in scope to airline numbers. Make no mistake about it everyone......this big number has the potential to turn pilot layoffs into a multi-year event for alot of people. We are all going to be affected here.
BTW, I am not ex-AT&T. I am ex-too many freaking place to list and getting tired of it.

What I stated has materialized, pretty much exactly as I said it would if the economy tanked, which it has.

Don't believe all the crap they are saying about my opinions. What you have stated in your posts is nearly identical to what I've been saying that they all said couldn't happen.

As far as the title on the thread, the answer is yes I was right on the money with what has happened.... I stated that the union wouldn't react in time and before it was over, the contract would be opened again.

That's the cycle, a union is a union and they are all the same. None of the "Industry Leading Contracts" signed by the majors still exists, and I don't believe the NJ one will either. We'll see, but that is the last piece of the puzzle. The question is, when will it happen... after the threat of bankruptcy or after the bankruptcy actually occurs. If the union isn't proactive, more jobs will be lost and the union will be the one to blame. Oh, and the jobs I'm talking about will be non-union as well... You know, those ones that had choices to be pilots like NJW said? Those rank and file workers? Yeah, they will get hurt too.

Speaking of which, boy... where is NJW now???

Boy, did she bail out when she found it she was wrong.

 

[Myster79]

What I stated has materialized, pretty much exactly as I said it would if the economy tanked, which it has.

Don't believe all the crap they are saying about my opinions. What you have stated in your posts is nearly identical to what I've been saying that they all said couldn't happen.

As far as the title on the thread, the answer is yes I was right on the money with what has happened.... I stated that the union wouldn't react in time and before it was over, the contract would be opened again.

That's the cycle, a union is a union and they are all the same. None of the "Industry Leading Contracts" signed by the majors still exists, and I don't believe the NJ one will either. We'll see, but that is the last piece of the puzzle. The question is, when will it happen... after the threat of bankruptcy or after the bankruptcy actually occurs. If the union isn't proactive, more jobs will be lost and the union will be the one to blame. Oh, and the jobs I'm talking about will be non-union as well... You know, those ones that had choices to be pilots like NJW said? Those rank and file workers? Yeah, they will get hurt too.

Speaking of which, boy... where is NJW now???

Boy, did she bail out when she found it she was wrong.

B19 you are wrong! If Options can't afford to pay us (pilots) then they need close the doors. Sorry... but that is the way it is!

 

[Willy21]

You think Lorenzo saved Continental? I guess you have never heard the story of Gordon Bethune. If you read the book "From Worst to First" you might see that Bethune is the reason that CAL is still around. If a guy runs one airline into the ground you might, and that might is a stretch, be able to make the argument that it was a bad situation and that he could do nothing about. Lorenzo had more than one chance and he failed the companies and the employees.

I am sure you will find someway to spin this but at the end of the day Lorenzo, in all of his airline management glory, was a failure. Makes you wonder why he isn't still running an airline doesn't it?

 

[realityman]

It'd be nice if you folks would quit quoting this guy.
He's on my ignore list, and it's not helping to have his postings keep showing up in other people's posts.

But since this last one DID get quoted, then for the record, he is WRONG!

Almost NOTHING has happened the way he said it would. He's trying to draw conclusions without anywhere near all the facts. I guess it makes it easier to try and slant things to his point of view. But it's certainly not accurate.

Let's see, he claims the union didn't react quickly enough to prevent furloughs. It's not proactive. This would be the first, and perhaps biggest, lie of his post. The union has been pointing out massive amounts of waste to management for years. Really! And until very recently, we were almost completely ignored by management. We set up waste forms to be filed, both by fax and online. We've got links to our various committees to send in ideas on how to save money on the road. We've set up ways for pilots to report sales leads to the company. ALL of which was meant to be proactive in making Netjets a leaner, and better run business so EVERYONE, union and non-union alike, could have job security for years to come. The funny thing is, it's not the union's job to help run the company. But we felt it important to be proactive where our futures were concerned. And do you know how much credence management paid to the info about waste and ways to improve? Zero! The attitude we got from management was "Hey! We're making money like we're printing it. You guys just stick to the flying, okay?". Sales leads we provided weren't being followed up on. Sad. Of course, NOW that the bottom has dropped out, all of a sudden our ideas seem to mean a bunch more. So who wasn't being proactive? Hint: the answer isn't "the union".
And in line with this theme, back when the economy started slowing, our union saw bad things coming. Back in March of '08, we approached the company about their hiring practices when things were obviously slowing. Again, the union was being proactive while management told us to go pound salt. It was at that time that the union realized what could happen, and began working on furlough-mitigation techniques, as well as preliminary plans on how to aid our pilots should the worst come to pass. All this while management assured us everything was fine. So who was proactive, and who wasn't? You decide,

Bur perhaps B19 means we weren't proactive in that we didn't quickly up and volunteer concessions when things started slowing. I tell ya, if this guy can't make it in the aviation world, he has a great future as a circus clown, because he's darn funny! Typical management thinking. Dismissed any and all ideas from the rank and file, and the only idea he can come up with himself is that we should take pay cuts. Well, perhaps that may become necessary. Meanwhile, I find it interesting that as things started slowing greatly within our company, we didn't hear a peep about any pay cuts management would be taking. Hmmmmmmm..........so B's thinking is that the workers should all be 'proactive' by giving up pay and benefits to save the company, or at least some jobs, but management themselves shouldn't have to give up anything. Gee, I wonder where we see this theme repeated over and over again in America? I wonder why he isn't pointing out management's lack of being proactive?

So let's recap: The UNION has been pointing out wasteful practices for YEARS prior to any of this even happening. Management said 'we don't care' and allowed things to proceed status quo.

The UNION has formed committees (travel, scheduling, safety, etc......) to improve QOL for the pilots while saving the company MILLIONS and improving efficiency. While management agreed to what these committees put forward, they didn't lift one single finger to initiate any of these things themselves.

The UNION pointed out problems with the rate of hiring when things started slowing. Management assured us everything was fine.

The UNION began developing furlough mitigation techniques a year before they became necessary. Management assured us everything was fine.

The UNION started (and funded through donations) the NJFF (Netjets Family Foundation), a nonprofit organization to help out employees who have hit hard times (yes B19, union employees AND non-union employees) and need help. Management (the previous team) agreed to match funding, and then promptly welched on the deal.

The UNION brought the furlough mitigation package forward for consideration when it was obvious what was going to happen. Management FINALLY sat down with us to discuss it, and admitted that things were NOT fine.

The UNION brought it to management's attention that pilot sales leads were being ignored. Management ignored us until things got really bad. Now all of a sudden our sales leads will get 'special' attention, and be followed up on.

The UNION convinced many of its members to voluntarily give up work (money) in order to try to save jobs. Management never volunteered one thin dime of their own money to save anything.

But according to B19, our union isn't proactive?! Oh brother.

I think that makes B19 a liar, completely misinformed, or totally ignorant of what's really been going on at NJ's for YEARS.

But I'm sure we'll here him respond to my post with blah blah blah, union's fault, blah blah blah. Or, the more likely scenario, since I've actually presented FACTS about what the union has accomplished, and they aren't negative, he'll ignore my post and make up some of his own 'facts' about what's been happening at NJ's.

As for his "prognostication" that bad things would happen if the economy hit the skids, well, that was a tough one to make. Gotta admire him for that. I mean, things getting bad for us if the economy tanked. Wow! Kinda like forecasting that after night is over, it'll be getting light out. Not obvious at all! Way to tell it like it is, B!

Good luck to everyone in the industry right now!

 

[jonjuan]

Just wait until he finds a union at his company, avantair. Then what will his logic be?

 

[gutshotdraw]

Damn realityman...how many times have I told you that accurate recounting of the facts are forbidden by the FI terms of service????

 

[B737Dvr]

Oh Boy......

B19......somewhere in the middle of your posts I can faintly see some economic relationships as well as some possible truths. Your message is getting lost in the rhetoric of extremism. You are absolutely certain that NJ will fail and that the union is to blame. I am sorry but the books haven't been written on that yet! NJ is far from being in the danger zone.

I can agree that they find theirselves at a crossroads and what management and the union and everyone else there in a position of decision making does going forward is the important thing. Of equal important is the timely dissemination of information for cool and logical heads to act upon. That is my position. The union and the company indirectly affect all of us, because unless my memory does not serve me now, there has never been any time in general aviation history that 495 pilots have been furloughed at one single time into an already oversupplied condition of labor! This scares the crap out of me and is very unnerving!!!

Now I have to say that your comments of Lorenzo are so crazy that I can't believe that someone would cite any good that he has done. It is like saying that Madoff was a very smart person who made alot of money. It is like saying that Bernie Ebbers was very talented and did good at worldcom!!! Holy cow man, Lorenzo was probably the worst thing that ever happened to all of aviation! He single handidly destroyed companies and used labor like pawns in a meaningless game of chess. If he was any good why then did the FAA ban him from ever owning an airline again? If he was any good why is there the "Lorenzo clause" in bankruptcy code that says that a company actually has to be bankrupt to declare it!

I believe everyone is up in arms because of your inflamatory remarks against an organization that has yet to do anything good or bad! I can also say that berkshire hathaway has also owned companies that have unions on the property long before the NJ acquisition. NONE of these companies have ever gone bankrupt. This pretty much disproves your theory that unions are the root of a company's demise.

Economically speaking, things tend to move slower with unions, unyielding contracts can be overly rigid during times where proactivity is required and management relations with labor isn't the best otherwise a unions would never be on the property. There are what you typically see, but to nail NJ or its Union to the wall based on a furlough announcement without giving time to either for laying out a go forward strategy is way premature, and based only on circumstanial evidence.

On the airline side SWA has a leading industry contract and they have been managing fine. not as well as they did before, but they are far from being in trouble. Perhaps the actions there warrant a closer look for all of us in trying to find a new model for how to deal with economic challenges rather than making inflamatory remarks that serve no one any good.

I for one, hope that SWA or NJ figures a way to move ahead in a profitable manner while also recognizing labor's worth and compensating them in a fair and equitable manner.

 

[AftCG182]

Just wait until he finds a union at his company, avantair. Then what will his logic be?

First of all, I need to make it clear that I'm speaking only on MY behalf.

Two questions:

1) Why are you dragging my company into the turmoil being felt at Netjets and Flight Options? The pilots at Avantair have done nothing but wish our brothers and sisters at those companies the best of luck in their struggles. Please don't try to stir the pot over here at our happy little company.

2) I have no idea who this B19 person is. How do you know who he is, and how do you know that he actually works here?

One last item before I climb off of my soap box. At this point in Avantair's development, we're trying to remain sustainble while taking on additional aircraft, hold a small new-hire class, and keep the Owners happy... the last thing that we need to do is bring a union on board. Your point about how Avantair will feel after being unionized is not a valid one. If we unionize, the next thing you know our company will be bled dry by the union and we'll be declaring bankruptcy and be in the same sinking boat as the rest of the Fractional industry. Again, just my opinion.

The vast majority of the Avantair pilot group is here for the long haul. I plan on arguing with you guys when I'm 70 (I'm 42 now) and taking up a seat that some 20 year old feels that he deserves more than me.

 

[realityman]

If we unionize, the next thing you know our company will be bled dry by the union and we'll be declaring bankruptcy and be in the same sinking boat as the rest of the Fractional industry. Again, just my opinion.

Not sure how you figure our union is "bleeding the company dry". In case you missed my above post, forget it. I'm not typing it all over again. In summary: Our union has done nothing but try to help NJ's SAVE money AND operate more EFFICIENTLY. And do it all WHILE paying a professional wage. When times were good, the company was making plenty of money while paying our wages and benefits. With the economy lower than I've ever seen it (I'm 40), the company is losing money. The only thing that changed was the economy. Not our CBA. So I'd have to say the economy is bleeding us, not our union. It also doesn't explain why the non-unionized fracs (Avantair excluded) are ALSO furloughing and losing money. Methinks it's simply not a union thing.Our UNION, not management, just renegotiated yet ANOTHER hotel deal that will save the company $2.1 million while preserving the pilot's QOL on the road. I'm sure you'll claim we did it by offering to stay in Motel 6, but nothing could be further from the truth. There's nothing wrong or 'lower class' about Doubletree hotels. At any rate, I wouldn't crow too loudly about how well Avantair is doing compared to the rest of the frac industry. As some of our own pilots on here have discovered, things can turn around VERY quickly. Personally, I hope Avantair continues to thrive and be profitable. It'd be very good for the whole industry. And while the game isn't over yet, so far as I've seen, not one major Fractional player has declared bankruptcy yet.

The vast majority of the Avantair pilot group is here for the long haul. I plan on arguing with you guys when I'm 70 (I'm 42 now) and taking up a seat that some 20 year old feels that he deserves more than me.

Funny stuff!:beer: Those age arguments with the younger crowd ARE kind of fun! Best of luck to you and Avantair!

 

[cherry20's]

First of all, I need to make it clear that I'm speaking only on MY behalf.

Two questions:

1) Why are you dragging my company into the turmoil being felt at Netjets and Flight Options? The pilots at Avantair have done nothing but wish our brothers and sisters at those companies the best of luck in their struggles. Please don't try to stir the pot over here at our happy little company.

2) I have no idea who this B19 person is. How do you know who he is, and how do you know that he actually works here?

One last item before I climb off of my soap box. At this point in Avantair's development, we're trying to remain sustainble while taking on additional aircraft, hold a small new-hire class, and keep the Owners happy... the last thing that we need to do is bring a union on board. Your point about how Avantair will feel after being unionized is not a valid one. If we unionize, the next thing you know our company will be bled dry by the union and we'll be declaring bankruptcy and be in the same sinking boat as the rest of the Fractional industry. Again, just my opinion.

The vast majority of the Avantair pilot group is here for the long haul. I plan on arguing with you guys when I'm 70 (I'm 42 now) and taking up a seat that some 20 year old feels that he deserves more than me.

JonJuan is a tool, so don't worry about anything he says... The only thing he has going for him is that Avatar...

 

[HiSpeedFlyer]

2) I have no idea who this B19 person is. How do you know who he is, and how do you know that he actually works here?

If we told you that, It would ruin the surprise now.