The Southwest Way

[Whataburger]

Airline Stocks: Sector ekes out gains; Southwest makes third fare hike this year

Lets see, gas goes up - fares go up. Why is it that only a couple of mgmt's figure this out?

 

[Stan]

Airline Stocks: Sector ekes out gains; Southwest makes third fare hike this year

Lets see, gas goes up - fares go up. Why is it that only a couple of mgmt's figure this out?

Because for the last 4 years you guys were paying a lot less for fuel than anyone else. Southwest set the low fare bar. In doing so it created more problems for the rest of the airlines in this country. Those airlines came after labor because they couldn't lower cost anywhere else. Now Southwest has the highest labor costs in the industry.

In short what was a competitive advantage for Southwest (fuel hedges) in the long run will be bad for their pilots.

 

[mynameisjim]

In short what was a competitive advantage for Southwest (fuel hedges) in the long run will be bad for their pilots.

It was bad for everyone else's pilots, but how can it be bad for Southwest pilots?

 

[The Victors]

well first of all, stan, fuel hedges has nothing to do with the price anyone pays for the gas going into the wing. and next, swa costs are still the lowest (except maybe airtran) even with the highest paid employees. just about every pilot group out there is screaming for higher pay, which will increase their airlines costs while swa stays the same. Swa mgmt has said that they view pay cuts as mgmt's failure (what a concept). I think swa pilots will be just fine.

 

[SWA/FO]

In doing so it created more problems for the rest of the airlines in this country.

Bingo! Marketshare anyone?

 

[vixin]

Now Southwest has the highest labor costs in the industry.
In short what was a competitive advantage for Southwest (fuel hedges) in the long run will be bad for their pilots.

I think you need to get your facts correct. Just because we get paid more doesnt mean we cost more. We are way more productive with our labor group. It is all about how you utilize the employees. The cost of fuel will be just as bad for everyone else. We are still hedging, just not at $20/barrel. Are the other carriers able to hedge what SWA can today?

 

[Stan]

I think you need to get your facts correct. Just because we get paid more doesnt mean we cost more. We are way more productive with our labor group. It is all about how you utilize the employees. The cost of fuel will be just as bad for everyone else. We are still hedging, just not at $20/barrel. Are the other carriers able to hedge what SWA can today?

You guys have the highest labor cost as a percentage of total cost. If you don't think that eventually management is going to come after that then you live in a fantasy world. Your company is great you have great management but the other airlines are still there with much lower LABOR costs. I know your costs are still lower overall but your labor costs are higher. You are right you are very productive but in reality how much more productive can you get for the same money.

I am just saying don't stick your head in the sand and think you are immune to the labor issues that have affected almost all the other airlines in this country. You are the pay leaders now please keep it that way.

 

[vixin]

AAHHH guys he just doesnt get it. He must be from the school of genital lee. Peace out!

 

[GFunk20]

That's not true. The other airlines forced their pay down due to greedy management taking advantage of a frightened atmosphere. Their management didn't want to come up with other ways to earn revenue, they wanted the pilots to fund their bonuses and help them sail through rough times.

When did you ever hear AMR/UA/DL say "we must come up with additional ways to earn revenue"....instead it's always been "We must reduce $300 million in labor to avoid going under".

There is money everywhere at every airline. Management chooses to strip away pensions, pay, and work rules to stuff their own pockets at a time when employees are vulnerable.

 

[General Lee]

AAHHH guys he just doesnt get it. He must be from the school of genital lee. Peace out!

Thanks Colleen Barret. Anyway, we all thank you guys for raising fares, which in reality will help all of the legacy carriers. Recent articles have stated that Southwest is starting to look for alternate revenue streams to try to curb rising costs (a la fuel hedges getting smaller), like assigned seating for business travellers with extra costs for certain seats, and maybe installing VNAV in your planes so you can save some fuel costs (computers do it better than manual throttle useage---if you want to do it manually fly your C150 from Conroe). Well, thanks again for thinking of us, and make sure you do keep those high wages so we can have a shot at getting back some of ours someday. It is only fair, we set the bar for you to attain yours. Great day.


Bye Bye--General Lee

 

[FlyBarneyJets]

It is only fair, we set the bar for you to attain yours.

More like your bar fell off the uprights...

 

[Smellycat]

When are you all gonna hire some sexy flight attendants. Female ones.

 

[General Lee]

More like your bar fell off the uprights...

I tend to think you have no clue what you are talking about. After BK we all actually got claim money as creditors, I got about $300,000 before taxes ($88,000 of that was put into last years and this year's 401K) and a load of cash. Plus, I get an 11% raise this year because the 401Ks are full and they still are contributing to the accounts. Even our bottom furloughed guy got a couple hundred thousand, and he was furloughed the whole time.


Bye Bye--General Lee

 

[momalley81]

and maybe installing VNAV in your planes so you can save some fuel costs (computers do it better than manual throttle useage---if you want to do it manually fly your C150 from Conroe).

VNAV doesn't control the throttles of the airplane.

 

[canyonblue]

Recent articles have stated that Southwest is starting to look for alternate revenue streams.........

Bye Bye--General Lee

Remind me again, where did Delto look for alternate revenue? Oh yea, your pocket. :laugh:

 

[canyonblue]

Because for the last 4 years you guys were paying a lot less for fuel than anyone else. Southwest set the low fare bar.

No, everyone else decided to match, or beat, our fares sending themselves into bankruptcy. Why is it that Southwest must always be the one to raise fares? How about the rest out there start trying to make a profit, or is that just too difficult for them to comprehend.

 

[GuppyWN]

Well, thanks again for thinking of us, and make sure you do keep those high wages so we can have a shot at getting back some of ours someday. It is only fair, we set the bar for you to attain yours. Great day.


Bye Bye--General Lee

And there, Stan, is what will happen to your view of lopsides wages at SWA. Every carrier is looking for their money back - and rightfully so. Won't be long before our % looks like their %, therefore once again expanding the SWA advantage.

Gup

 

[Stan]

And there, Stan, is what will happen to your view of lopsides wages at SWA. Every carrier is looking for their money back - and rightfully so. Won't be long before our % looks like their %, therefore once again expanding the SWA advantage.

Gup

If thats the case. Why don't you guys man up and be the leaders in the profession rather than the followers.

I've never said your wages are what helped bring down the wages everywhere else. It was Southwests efficiency and for the last few years fuel hedges that did it. SWA is the largest domestic airline now. Like it or not you guys are going to be targets for the forces in this country that look at labor as the enemy.

 

[GuppyWN]

Stan,

Did you read the first article? Gary Kelly specifically stated that wage cuts would mean a failure at the management level. We fly more block hours with fewer pilots than our peers. We are the definition of effeciency. The company will look to wring more effeciency from it's pilots. They always have. Therefore, IMO, they will NOT ask us for pay cuts.

SWA has ALWAYS hedged fuel. Why do you point the finger at us for other airlines to cut pilot wages? Was it our fault in '91? Or '94? Our fuel hedges simply allowed us to spend our money growing the fleet instead of paying market rate for fuel. (actually we do because our "fuel hedges" are actually heating oil contracts which closely mirror jet fuel prices) We continue to hedge fuel at a much higher rate than any other airline.

I'm not sure what you mean by asking us to "man up and be the leaders." Dude. We have always been the leaders in the LCC arena. If "manning up" means get huge wages right up to the furlough then let my brothers spend 5 or 6 years on the street then I'll pass.

Gup

 

[Noserider76]

I was kind of hoping the other carriers wouldn't go along with WN. Payback for all the other attempts that weren't matched. I think it would be smart for the other major carriers to regain control of the price they charge instead of letting one or two carriers control whether a price increase sticks.

 

[klr1395]

N-76-

You just really do not want this industry to recover do you. Nice attitude instead of trying to improve the bottom line in your own house. Cheers...

 

[cole]

I find it amazing that people start bashing SWA when they start to look at something and make a change in their operation. Most airlines just go for pay cuts, but SWA will see something and adapt. This industry isn't a straight line, there and highs and lows and airlines that can change with the tide will survive.

 

[Noserider76]

N-76-

You just really do not want this industry to recover do you. Nice attitude instead of trying to improve the bottom line in your own house. Cheers...

Well, you can argue that WN has expanded their market share at the expense of the other major carriers who had large fixed pensions, facilities costs, expensive contracts etc. Many of the costs that a relatively new carrier like WN did not incur. Just take a look at what happened to US Air in BWI. When fuel costs were spiking and price increases were attempted in the last few years, most times they could not be adjusted in markets WN served because they would not match. They were trying to use the cost advantage they had to drive one or more carriers from the scene. There is no question that the LCCs took advantage of the major carriers weakness post 911 to take market share.

I'm saying that now that many majors are able to get increased revenue from international flying and have dramatically reduced costs, it may be time to break the cycle of letting WN set the price in domestic markets.

 

[SWA/FO]

Delta attemped to get extra revenue by sending General Leigh onto the streets of ATL with a pair of knee pads . When that didn't bring in the desired $$$$ - they went to plan B = paycuts for all.

http://www.usatoday.com/travel/flights/2007-07-09-southwest-fare-hike_N.htm?loc=interstitialskip

The news, for now, is good for an industry battling high fuel costs, Parsons says. "When Southwest raises fares, every major airline from giant American on down is dancing in the streets. They know the fare increase will stick."

(except Delta they don't know how to manage or dance)

imp: SWA/FO

 

[Tejas-Jet]

If thats the case. Why don't you guys man up and be the leaders in the profession rather than the followers.

We always have been leaders....in 1993, when SWA started service into BWI with just 6 flights per day...US Airways went into panic mode....When SWA announced they wwere expanding service into SJC...AA announced a pulldown at the SJC hub->The very next day !!!

We've been leaders in doing things our own way....obviously you and others don't like it...and maybe it'll always be that way....but...

...we don't have employee groups filing grievances against me when I decide to help out...

...don't hire just up to the start of furloughs...

...don't have employees giving up pay and benefits just to pad the next round of bonus checks for the CEO...

...Don't have airplanes sitting at the gate for 55 minutes to over an hour at the "hub"...

...Pilots don't have scheduled 3-4 hr sit arounds at the "hub"...

...A management team that the employees trust and believe in...

Now that I've set the bar....we're leading...still wanna follow?...or are you part of the "taking it back" crowd?

 

[Stan]

We always have been leaders....in 1993, when SWA started service into BWI with just 6 flights per day...US Airways went into panic mode....When SWA announced they wwere expanding service into SJC...AA announced a pulldown at the SJC hub->The very next day !!!

We've been leaders in doing things our own way....obviously you and others don't like it...and maybe it'll always be that way....but...

...we don't have employee groups filing grievances against me when I decide to help out...

...don't hire just up to the start of furloughs...

...don't have employees giving up pay and benefits just to pad the next round of bonus checks for the CEO...

...Don't have airplanes sitting at the gate for 55 minutes to over an hour at the "hub"...

...Pilots don't have scheduled 3-4 hr sit arounds at the "hub"...

...A management team that the employees trust and believe in...

Now that I've set the bar....we're leading...still wanna follow?...or are you part of the "taking it back" crowd?

Your management is great and they are leaders. All of your above points are how management has set up an efficient airline.

Now tell me how SWAPA has been a leader for the pilot profession.

My favorite is your pushing for a change in the age 60 rule because you didn't have a defined benefit plan.

By default you guys (SWAPA) are in the position to raise the bar and be leaders in the profession, please do something with it.

 

[Hose A. Jiminez]

There is no question that the LCCs took advantage of the major carriers weakness post 911 to take market share.

There is also no question that most "legacy" carriers were in dismal shape and bleeding like a civ during most of the year BEFORE 911.

911 was another nail, and a convenient scape goat for mgmt.

My point is that if indeed the "LCCs" were taking advantage of weakness. It was not weakness due to an unforseeable outside event (911). It was just plain weakness.

 

[SWA/FO]

My favorite is your pushing for a change in the age 60 rule because you didn't have a defined benefit plan.

Age 65 has nothing to do with a defined benefit plan. It has to do with guys wanting to make 220,000 a year buying $hit, those who experienced bad airline management and who are paying off ex-wives.

Besides the fact that almost NOBODY has a defined benefit plan please name one that would payout 220,000 a year and provide 100% medical???

thought so............imp: the SWA/FO

 

[Uniform Shop]

VNAV doesn't control the throttles of the airplane.

It would if you had Auto Throttles.

 

[Stan]

Age 65 has nothing to do with a defined benefit plan. It has to do with guys wanting to make 220,000 a year buying $hit, those who experienced bad airline management and who are paying off ex-wives.

Besides the fact that almost NOBODY has a defined benefit plan please name one that would payout 220,000 a year and provide 100% medical???

thought so............imp: the SWA/FO

Your right, however SWAPA was the only official group that was actually lobbying to change the rule. SWAPA used membership money to actively support the age 65 change.