Ual

[kennedy8]

Any bets on who UAL is going to pick for feed.?

I say there are going to be a lot of rj's being repainted and a lot of crews waring new wings.

Thoughts?

 

[JBcrjca]

Not only will a bunch of RJs be repainted, but there will be a lot more regional pilots on the street too. It's gonna be a mess, with all of the shuffling that's going to happen. Current UAX carriers are gonna feel a heck of a pinch with all of the lowball bidding that must be going on.

When does UAL start making decisions and awarding contracts, any ideas?

 

[kennedy8]

ual

I just read some bits at google.con under Mesa air news.

IT said that UAL will dismiss AWAC, unless they can lower costs.

I think in the next few days the news will come out and suspect that if UAL offers too low a contract , some regional are going to decline.

Why will anybody sell a product bellow cost?

The very best thing that could take place right now is the Easternization of UAL, and let the rest of the industry breath.

Just check stock movements for ACAI, MESA and SKYW.

Some body gonna get hurt.

 

[46Driver]

Where exactly did you see that news? I couldn't find what you were talking about.

 

[kennedy8]

www.billingsgazette.com

 

[kennedy8]

http://www.denverpost.com/Stories/0,1413,36%7E26385%7E1438078,00.html

 

[Mayday911]

Your an idiot if you believe anything you read on this forum, or any other for that matter, that is in reference to an airline's business choices. Pilots don't know squat when it comes to the behind the doors stuff, despite what the check airman told you that he overheard the other day on the bus.

Nobody knows what will happen execpt the people making the decisions, and doubt that they even know!!!

Mayday

 

[avrodriver]

No Love

"The very best thing that could take place right now is the Easternization of UAL, and let the rest of the industry breath."

I apologize if I am wrong, but I'm betting that your job doesn't depend on the survival of UAL. This is the new standard......."let someone else get screwed so my job will be more secure"......you see it within companies where senior guys sellout junior guys, between Cpt and F/O's, you see it between regionals, you see it between majors v.s. regionals (both ways), and now with people saying crap like "the best thing that could come out of this (for who, the thousands of people who's jobs are on the line???) is if this all just falls apart".

The employees of United, AWAC, Skywest, ACA, and now our newly beloved brothers of Mesa thank you for your support. AD

 

[JBcrjca]

Yeah, UAL going Ch 7 is a great idea, it'll save the industry...right! Just what the industry needs...9000+ more pilots on the street, untold thousands of FAs, mechanics, CSAs, dispatchers, etc. out of work, several hundred more airplanes parked in the desert. And that's just at UAL, not to mention all of the Express carriers that would be hurting. Uhhh, how does that help the industry? Oh yeah, the seats on the remaining airlines would be full so you could forget about non-rev travel or commuting. Great attitude...think next time before you post something so stupid. Maybe we should all wish something bad upon your company just for spite.

 

[big dog1]

Aviation Week & Space Technology
Regional, Major Balance May Be Shifting
By Frances Fiorino
June 4, 2003


Imbalance of Power?


The outcome of Atlantic Coast Airlines' regional contract
negotiations with United Airlines, and its move to revise the
delivery schedule for 42 RJ aircraft, could signal the final upheaval
in the balance of power between legacy carriers and their regional
partners.


Under Chapter 11 bankruptcy protection, United began new contract
negotiations with United Express regional program operators,
including Atlantic Coast Airlines (ACA), Air Wisconsin and SkyWest.
(ACA operates as both a United Express and Delta Connection carrier,
with a fleet of 142 aircraft, including 112 RJs, to 84 destinations
in the Eastern and Midwestern U.S. and Canada.)


ACA said it entered talks with United and submitted proposals that
included cost-cutting initiatives such as curtailing wages and
bonuses for management and salaried employees. In addition, ACA and
the Air Line Pilots Assn. reached a tentative wage agreement
scheduled to become effective on completion of a revised United
Express contract.


THE SNAG IN CONTRACT talks: ACA's pursuit of a 2003 rate adjustment
from United. The regional claims United is not in compliance with the
terms of the United Express agreement because it delayed establishing
2003 rates. ACA avers that it is operating a schedule as agreed with
United, although United is paying ACA based on 2002 rates.


United last month filed a motion seeking to prevent ACA from
terminating the contract--a move ACA considered "unnecessary" because
it was not, after all, trying to end the agreement. ACA said it will
look to the bankruptcy court for resolution.


Rick DeLisi, ACA director of corporate communications, said that
while there is no deadline, ACA is hopeful of reaching a
resolution "before too much longer," emphasizing "the long-term
future of the United Express program is in United's hands."


An April report by J.P. Morgan regional airline analyst Jamie Baker
agrees. "The negotiating leverage in the long run belongs to the
major carrier, which is responsible for compensation and growth
levels--and has historically taken all the risks, with regionals
simply having to show up and fly." It maintains that regionals owe
their existence to the majors and "not the other way around," as many
in industry argue, "a fact that significantly alters the balance of
power."


Regionals face many risks. United Airlines as well as Delta Air Lines
are looking at a major reduction in the cost of regional feeds. The
report points out that the United Express regional operation resulted
in a $255-million loss for United in 2002, and now the major carrier
is hoping for a $170-million yearly reduction in regional feed costs,
which is equal to a 10-12% reduction in departure rates.


The report states that United bankruptcy filings corroborated
estimates of $3,140 to ACA for each CRJ departure and $3,570 to
SkyWest--and added that an immediate reduction in rate of this
magnitude would be "devastating to ACA and SkyWest."


The report further states that while aggressive cost cuts by
regionals may partially offset lowered rates, operating margins are
ultimately expected to compress by as much as 50%. ACA and SkyWest
derive 100% of revenues from United and Delta. The prospects of
regionals finding new partners in Continental, Northwest, American,
US Airways or Delta are ranked as "unlikely."


Baker outlines one of the greatest threats to regionals--legacy
carriers achieving a 20-30% reduction in aggregate mainline pilot
costs. The reduction is predicted to occur gradually, carrier by
carrier, starting with those in Chapter 11, over the next two years.
But ACA and SkyWest could not achieve a similar level of wage
reduction "that may otherwise preserve the current arbitrage."


As majors succeed in reducing costs, the more regional jet orders
will be deferred, canceled or replaced with narrow-body aircraft,
according to the report, which states the RJ revolution is drawing to
a close.



ACA was a prime example. Due to uncertainties surrounding United's
entering bankruptcy protection, ACA and aircraft manufacturer
Bombardier last week agreed to the revised delivery schedule for the
remaining 42 CRJ200s on a firm order for 121 aircraft. Originally, 35
aircraft were to be delivered in the 2003-04 fiscal year and nine in
the 2004-05 fiscal year. Now, six are to be delivered immediately,
two in the fourth quarter, six in the fourth-quarter 2004 and 28 in
2005.


FINANCING, OR LACK thereof, was behind the decision. One of the legal
rights of a party in bankruptcy protection is to terminate a contract
with its regional partners. "With that possibility dangling out
there, ACA announced earlier this year that obtaining acceptable
aircraft financing for future deliveries had been extremely
challenging for us," said DeLisi.


ACA therefore arranged for an interim contract extension with
Bombardier to delay deliveries scheduled in March, April and May.
That agreement expired last week and a new delivery schedule was
devised. If ACA and United reach a satisfactory arrangement, he said
the Bombardier agreement is flexible enough to cover aircraft
scheduled for delivery after this year.


But again, "until the situation is completely resolved, in terms of
United Express and United's bankruptcy, we think financing is still
going to be very tough," said DeLisi.