Southwest Fuel Hedging Explained (hopefully)

[mach zero]

Smell the Jet A,

The reason I mentioned unions is to point out that most of our work groups are under contract with increases in pay based on years of service. Many of these employees have many years of seniority with the company. Yes we are feeling the crunch to. Although we are hiring F/A's and Pilots, other divisions have stagnated and are even laying off (CSA's, Reservations, etc.) Our company has reaccomodated some of the affected into other departments (ie. CSA's to Inflight). To imply that our airline is made up of mostly junior people at low wages is wrong.

M 0

P.S. leave Lowecur out of it. He needs no encouragement.

 

[smellthejeta]

Smell the Jet A,

The reason I mentioned unions is to point out that most of our work groups are under contract with increases in pay based on years of service. Many of these employees have many years of seniority with the company. Yes we are feeling the crunch to. Although we are hiring F/A's and Pilots, other divisions have stagnated and are even laying off (CSA's, Reservations, etc.) Our company has reaccomodated some of the affected into other departments (ie. CSA's to Inflight). To imply that our airline is made up of mostly junior people at low wages is wrong.

M 0

P.S. leave Lowecur out of it. He needs no encouragement.

Will do about what's his face. Sorry for bringing him up. With response to your last statement about implying that your airline is made up of mostly junior people... NO NO NO ABSOLUTELY NOT!!! What I wrote earlier was a statement that your growth continues to add lower paid people to your pay rolls, which by nature helps lower your average labor costs, especially when comparing them to the legacies who have furloughed their junior employees. The ONLY assertions I am making are that 1) Lower paid people exist on your pay rolls, and 2) Lower paid people really don't exist on payrolls at the U's. I then draw the conclusion that you enjoy a cost advantage because of that. Is it large? I have no idea. But it's there. And that is only a part of the big equation of things that you guys do right that makes you a successful airline.

Since you're bringing up other departments, could you tell me what the top pay in reservations and and customer service is? I looked at some jobs working on the ramp at BWI, and the starting pay of $8.25 wasn't all that apealing to me. The relevance is that your pilot costs make up the plurality of your labor costs, so anything that happens to that particular labor will have a greater impact on the bottom line.

 

[apdsm]

Re: WN and labor costs. Yeah, WN has pilots close to retirement, but if you take an average of the seniority of all the employees at WN and compare them to the same employees at both U's, you will find that the average seniority at the U's is much higher. WN does enjoy a cost advantage because of the COMPARATIVELY (or RELATIVELY) younger age of their employees.

Really? Can you back that up with some sources?

 

[smellthejeta]

Really? Can you back that up with some sources?

Send me the seniority lists. Crunching the numbers won't be too hard. The most junior pilot at USAirways was hired when I was in kindergarten, IIRC. The most junior pilot at United was hired, what, in '99 or '00? What percentage of WN's pilots were hired before '99? You also have to consider that both U's are shifting jobs off of the property, which is something that WN doesn't have the mechanism to do. That means that absent wage concessions, the U's are stuck paying their employees more on average than they would have had they not furloughed. When they're trying to reduce their CSM's, being stuck with higher seniority employees doesn't help, hence the concessions. Does it suck? You bet. Inevitable? Most likely.

 

[apdsm]

Send me the seniority lists. Crunching the numbers won't be too hard.

That was my real question I guess. I was curious if someone had actually crunched those numbers.

 

[bestpilot]

So, what's the fianl verdict?

 

[Whale Rider]

I've said it before and I'll say it again. The United States is the riches country in the World........we should be able to get everything else off of oil so the planes can fly more cheaper.

Turbine technology and Aerodymaics are only going to take us so far. Its obvious that planes are going to need Jet A unless the "Beam me up Scottie" era arrives or they pull a solar powered jetliner out of their 4 pointer contact.

We need to take control of the spiket away from OPEC and call the shots ourselves.

The internal combustion engine is going to have to go away for the Big birds to survive and little ones too. I'm sure glad I won't be around by the time they start talking about getting rid of the turbine engine.

HAPPY LANDINGS BOINGTON!!!!!!