Who is willing to take pay cuts this round of BKs?

[AA767AV8TOR]

I will start thinking paycut when all our managements return back to the company every single penny they have milked out of the industry over the last three years in bonuses and executive compensation while I was surviving off a 23.5% paycut in 2003 and 1.5% annual increases since.

Besides a 10-20 percent paycut will do little to make this thing work at $135 per barrel. We would have to pay them to come to work to make it truly work.

At some point, the Airlines will have to learn to start charging an appropriate price for their product to cover their costs. Even LUV will have to lean this lesson next year as their cheap hedges run out. They’ve gotten away with it for the last four years as they have put the hurt on the rest of us.

The only thing that will save this industry long-term if the price of oil stays up around $130 per barrel is either re-regulation or foreign ownership. You’re kidding yourself if you think a 10-20 percent paycut will really make a difference except for selling out your future.

Too bad that LUV, in the process of protecting itself and destroying all the competition, might very well annihilate the entire industry and damage itself in the process since they control domestic pricing.

AA767AV8TOR

 

[PeanuckleCRJ]

As much as I hate to admit it, LUV's hedges will never run out as long as they have a proactive management team. Hedges are not a "subscription" that runs out...they are a continual practice. Sorry, AA.

 

[AA767AV8TOR]

As much as I hate to admit it, LUV's hedges will never run out as long as they have a proactive management team. Hedges are not a "subscription" that runs out...they are a continual practice. Sorry, AA.

Perhaps, but they lose a bunch at the end of this year. All they will end up doing is driving the rest of us into bk. In the long-term, is that good for LUV or the rest of the country if they succeed in wiping out the rest of the industry?? We'll probably get to find out in 12-24 months if gas prices stay high.

AA767AV8TOR

P.S. Why the rest of the industry hasn't at least mirrored or stayed in the ballpark with LUV is beyond me!

 

[AA767AV8TOR]

For all those contemplating giving something back to the company during this next crisis, please read the following from our APA President – Lloyd Hill:

AA pilot union president takes a look at things

9:35 AM Tue, Jun 03, 2008

Terry Maxon

Lloyd Hill, president of the Allied Pilots Association, addressed the union's board of directors Monday on the first day of its spring meeting.

His underlying message: American Airlines management is looking after management; the pilots have to look out for the pilots.

Below, his prepared text.

It's been an exceptionally busy year for the Allied Pilots Association.

As management endeavors to overshadow anything and everything with their highly publicized financial woes, and as management has suggested that APA put aside management's repeated pilot floggings so we can help them out with their problems, I think it's noteworthy to reflect on the broader picture.

Last week I testified at a termination arbitration. Even though I've sadly seen it many times, it was incredible to see the vigor and cost AMR expended to persecute employees for perceived infractions. A high-priced law firm, complete with AMR interns, was on hand for the bloodletting. Other than the pilot we were fighting for, and who has been without pay for months, all I could think about was the fact AMR spends tens of millions of dollars every year on Human Resources and Employee Relations, yet they can't counsel anyone. They refuse to build a reasonable due process, as the non-negotiated Company Rules of Conduct are decided in a management star chamber without APA or the accused present. It's a management internal-only process, a kangaroo court where good employees don't stand a chance. And when the death sentence comes, money is no object for AMR when it comes to upholding the slaying. The whole thing made me reflect about something I've known for a very long time. The problems at AMR are not about money. They're about management's 2 maligned mindset. It's all about intimidation and control at any cost, even when they are losing millions of dollars every day. It's about a relentless management campaign that knows no bounds and never ends no matter the backdrop. Never.

We needn't go back far for more poignant lessons learned. Where is "shared pain, shared gain" or "pull together, win together?" What about Joint Leadership Team, also known as JLT? When was the last time you heard about any of this? What benefit, if any, did APA enjoy from these management crusades? Did management uphold their end of these bargains? Or were they nothing more than management strategic campaigns designed to prey upon labor?

Assuming for a moment that management's intentions had been true, the need to continue those programs should be just as necessary today as they were in 2003. Yet any attempt to reinvigorate them would fall on deaf ears. Why? Is it labor's fault? Are we to blame?

With the dust settled from those campaigns, we can analyze what those management mantra programs did for APA.

Management significantly stepped up and broadened their intimidation campaigns against sick, disability, military leave, D1/D2 travel, intrusion into the union hall, terrorizing union advocates and so on. Divisions were merged, crew qualifications 3 were removed and Flightscape is a full-blown camel in the tent. In addition to the 2003 contractual gutting, under the guise of "getting along" and "building a relationship or partnership," all it truly amounted to was a successful management campaign to lessen resistance for their true mission of cost cutting and pilot persecution.

And for those who remain naysayers, what else happened during this time frame?

In repeated stunning fashion, management took hundreds of millions of dollars just in bonuses, the first of which occurred even before AA enjoyed its first profitable quarter in years. And when employees questioned this abhorrent behavior, management's indignant responses included "we have to retain our managers" and "employees just don't understand management compensation."

As has been done many times in the past, management's excessive greed triggered a relationship collapse with employees. As profitability became reality and as management continued to more than make up for the bonuses they had forgone, they continued to vie for labor concessions. Despite the fact management had squeezed more than they had ever hoped for out of the pilots, and maybe it was finally time to throw the pilots a bone, management did not relent. If there is something to take away from this, it would be management's ingenuity and relentless focus to deceptively extract from labor while giving the appearance of a collaborative effort toward an end that management never intended for labor to enjoy.

For all of the ballyhooing to get labor onboard the JLT wagon, and for all of the seemingly necessary joint sacrifice, in the end it was nothing more than a management campaign. While many at APA probably thought the unions were doing something worthy and necessary with JLT, in reality management maintained their disciplined strategy of relentless assault. Theirs was truly a campaign based on deception. And during this ruse, well intentioned as some may have been, APA lost its focus, the cost of which has been astronomical. And when management mantras lost their effectiveness, they disappeared - vanished into the night. And so did any semblance of a positive working relationship with the employees. And why? Because those mantras and programs had served what management wanted them to serve rather than what management wanted us to think they were meant to serve. And so their usefulness was exhausted, and the subterfuge was ours to figure out.

The above serves as important lesson. Not a new lesson. Just another in a long line of lessons. What can APA take away from this?

First off, stay focused and don't swim with the piranhas. Management doesn't want your help, they don't need your help and history has shown any attempt to solicit your help is just scam. Management looks out for management and only management. Labor is merely a cost challenge to be neutralized. It isn't personal. It's business. And 5 if management has done nothing else, they have demonstrated this particular timehonored business 101 strategy with startling regularity.

Secondly, management does what's good for management or possibly what they perceive is good for the Company. Vendors, labor and everything else is only considered as a cost effect on management's plans. Management understands it's about them first and the Company second. There are no other considerations, except in the context of contemplation of impact on those two. Management negotiates solely for these two entities at all times and without exception.

We represent a pilot union - not an airline management team. What we can learn from management is to adopt their focus and never, ever lose sight of this. While there may be some benefit in having a thorough understanding about the Company's fiscal fitness, how, when and where we use this information should be solely for the membership's benefit. As with management's strategy, this should be without exception.

And lastly, no matter what management publicizes, what you read in the press or hear at this meeting, APA can't fix management's problems - even if they truly wanted our help. Whether we are successful in our contractual endeavors, maintain a contractual status quo, or even if we work for free, we can't begin to fix the problems. We can debate what the problems are, ranging from business model deficiencies, significant oil 6 price increases, failing to charge a price even remotely commensurate with the cost of their product, market share, the impact of open skies, or anywhere in between. But at the end of the day, even foregoing our entire payroll won't fix the problems. It's a business problem that requires a business fix. Management gets it, and so should we.

APA's responsibility is to let management know how much it's going to cost to man airplane cockpits. Management doesn't seem to have any problem whatsoever validating their own quite significant management costs, even over just the past few weeks. APA needs to be tone deaf toward everything else. Management negotiates for management, and APA needs to negotiate solely and relentlessly for its constituents - the APA membership.





</SPAN>

 

[PCL_128]

For all those contemplating giving something back to the company during this next crisis, please read the following from our APA President – Lloyd Hill:..................

The more I hear from this guy, the more I like him.

 

[The Victors]

Perhaps, but they lose a bunch at the end of this year. All they will end up doing is driving the rest of us into bk. In the long-term, is that good for LUV or the rest of the country if they succeed in wiping out the rest of the industry?? We'll probably get to find out in 12-24 months if gas prices stay high.

AA767AV8TOR

P.S. Why the rest of the industry hasn't at least mirrored or stayed in the ballpark with LUV is beyond me!

You don't know what you're talking about. LUV is 70% hedged in 2009 and through 2012. If you want to be pissed about fares, why dont you throw a little at companies like Va and Allegiant. They charge nothing and their employess happily work for peanuts. Swa has to compete with these losers, but still pays a good wage and benefits. Now back to the thread.............

 

[Tanker Clown]

If taking a cut keeps the job I love then I am willing.

This guy must work for Delta.

 

[AA767AV8TOR]

You don't know what you're talking about. LUV is 70% hedged in 2009 and through 2012. If you want to be pissed about fares, why dont you throw a little at companies like Va and Allegiant. They charge nothing and their employess happily work for peanuts. Swa has to compete with these losers, but still pays a good wage and benefits. Now back to the thread.............

Actually LUV fuel hedges through 2012 from their annual report:

• 2008 over 70% at $51 per barrel;
• 2009 55% at $51 per barrel;
• 2010 30% at $63 per barrel;
• 2011 over 15% at $64 per barrel;
• 2012 over 15% at $63 per barrel.

Like I said before, LUV starts losing their major fuel hedges after this year. By 2010 their advantage is basically eliminated. The question is whether the rest of the industry will be in bk by then.

AA767AV8TOR

 

[Tanker Clown]

Yeah, but when those hedges run out, they will be pretty screwed.

 

[The Victors]

Yeah, their hosed. I'm sure ual will be back on top after all those hedges run out.