After The Speech

[700UW]

Fleet Service does not get a snap back this year, can't speak for AFA and CWA or ALPA, the mechanic and related get a 2% snap back.

See it is not a raise because none of the employee groups are back to the salary levels that were pre-bankruptcy.

 

[MarkMyWords]

I was using the term snap back because that is what PitBull was calling it. It was a raise negotiated to incrimentally return the wages of the employee group to their former pay over the course of several years (or the life of the contract). If the IAM did not negotiate such a raise, then you have no one to blame but yourselves. All of the other contracts contained those provisions and the IAM knew there were the same provisions provided for the MSP, non-contract and clearical employees.

The merrit raises provided to the workers above also do not restore them to their previous pay levels and are then technically not raises either.

 

[BoeingBoy]

All,

The discussion of whether the 4% is a "raise" or a justified "snap back" is meaningless in the abstract. What matters in this discussion is simple - what was given up by these folks vs what is being given. Someone that had a 10% reduction and now stands to get a 4% increase is not getting a raise. Conversely, someone that had a 2% reduction but is now getting a 4% increase is indeed getting a raise.

Does anyone know how much these folks gave up relative to what they're getting back?

I know in my case I lost 35% pay, relaxed work rules, and lost my DB pension. I'm scheduled to get a 1% snapback in pay only. Would I like 4% - you bet. Do I think any of those getting the 4% gave up more than me to justify the higher snapback - no.

Jim

 

[SVQLBA]

For those that say that they have not seen anything in the presentation that shows what "the plan" is, perhaps you should listen to it again.

- we are reevaluating our entire fleet seat configuration.
- we are simplifying fares
- we are rolling the PHL hub
- we are changing the entire management team in PHL (see the COB releases)
- we will redeploy our assets with the introduction of additional MDA assets
- we are going to transform ourselves into an HP or AS.
- we are going to stand and compete - WE HAVE NO CHOICE
- Dave will toss the golden parachute and accept LCC type contract and pay
- Daves executive team will also change their compensation
- we will change the web to be more user friendly
- we will invest in more technoloogy
- we will increase flight frequencies with the addition of MDA aircraft
- we will add cities as more mainline aircraft become available
- we will replace turbo prop aircraft
- we will update mainline a/c with a new IFE
- we will update our facitilites with things such as wireless web access
- we will increase aircraft utilization
- we will increase employee productivity
- we will increase point to point flying
- we will increase internet sales
- we will grow the fleet and the network
- we will continue with our alliances with UA and Star
- we will change the company culture



Let's wait and see what happens....

Let's look at this list and classify these as

A) We have a plan and this is what we're doing

Nothing in the list fits this category

B We know where we want to be, we haven't quite figured out how to get there

- we are going to transform ourselves into an HP or AS.
Not even close to understanding what AS and HP did. Certainly didn't start with a presentation like this. With HP, it was systematically and aggressively addressing all the issues, from ops, to network, to pricing

C) There seems to be a plan, but it's not clear where it's heading

- we are simplifying fares
No details given -- certainly no recognition that, if done right, this could increase revenues (AWA) AND reduce costs (business simplification). Dave said the move will reduce revenues -- it will if they're dumb about this. He doesn't get what is happening with pricing in the market
- we are rolling the PHL hub
No detail on benefits of doing this, what this allows you to do with the network, etc etc.
- we are changing the entire management team in PHL
Too little too late?
- we will change the web to be more user friendly
He actually said there'd be a new site in the summer. Why the complete lack of urgency? He said they could be done by June? Again, why wasn't this done a year ago? Earlier??
- we will increase flight frequencies with the addition of MDA aircraft
- we will add cities as more mainline aircraft become available
- we will replace turbo prop aircraft
OK -- finally we know what they'll do (kinda) with the RJs, but really, what's the network strategy? What's the market strategy? Are they going after the business traveler? Leisure traveler? Both? (Using crude over-simplistic segmentation)

D) Something else

- we are reevaluating our entire fleet seat configuration.
Paralysis by analysis. Why haven't they figured this out yet? Just saying this will scare off FF's afraid of losing seats.
- we will redeploy our assets with the introduction of additional MDA assets
This could be a C) if they have a plan on where to deploy them. The presentation was very vague on where everything will go an what the network (even in broad terms) will end up looking like
- we are going to stand and compete - WE HAVE NO CHOICE
Bet that really rallied the troops
- Dave will toss the golden parachute and accept LCC type contract and pay
A gesture that's too little, too late and doesn't impact company performance diddly-squat
- Daves executive team will also change their compensation
Ditto
- we will invest in more technoloogy
Pure aspiration -- where's the money (or the plan) to do this. For what purpose? IFE? Ops?
- we will increase aircraft utilization -- aspiration -- rolling hubs shoudl help, what else?
- we will increase employee productivity -- aspiration-- rolling hubs shoudl help, what else?
- we will increase point to point flying -- but what's the network vision? Is it pt-to-pt? Leisure or business markets? Earlier you said the focus was increasing frequencies
- we will increase internet sales -- how? What's the distribution strategy and marketing strategy (other than a new web site several years too late)
- we will grow the fleet and the network -- where the heck is the capital for this
- we will continue with our alliances with UA and Star -- you wonder if they could even execute this
- we will change the company culture -- how? To what? What sort of culture do you want?


On a public broadcast I don't expect them to detail the network plan and schedule for the next three years, but the complete lack of anything to PUT in category A is what makes me believe that Dave and the team have no clue. The several over-simplistic or plain wrong "analyses" that Dave used added to the worries (unit cost comparison, impact of reduced fares, what happened in CA vs BWI, lessons from HP and AS etc etc)

Guys and gals ... I'm sorry for you. I hope MarkMyWords faith that there is a plan behind the sound-bites is proven right, but on the evidence presented, a neutral observer wouldn't believe so.

 

[RowUnderDCA]

well, I didn't want to say it, and I'm too lazy to do what SVQ did, but I'm sorry to say that I agree with that assessment. I would have expected a bit more certainty and vision.

 

[MarkMyWords]

Jim -

Agreed it is all relative to what each employee group gave up. I would never, ever belittle the tremendous sacrifices that ALPA members made. My point was that 1) the merritt raises or returns should not be tied to the future concessions, just as your 1% token raise wasn't. 2) Every union knew that these provisions were in the works when they signed their contracts.

The MSP, non-contract and clerical concessions were relative to what they made. There was a percentage taken for the first 30K, a higher percentage for every 10K over and above that. So their concessions were based on total compensation. Somone makeing 30K only took a minimal paycut, but someone that made 100K took a much more substantial paycut.

 

[BoeingBoy]

MmW,

Agreed. The banter back and forth was becoming a little tiresome to me - like kids arguing ("You did." "Did not"). Just wanted to throw in my 2 cents worth.

Take care,

Jim

 

[OldpropGuy]

I love the way Dave suggested that it was a personal decision for all employees to decide to vote yes or no, whether they could accept more cuts or not. Then he added, that if you wanted to vote no, you shold vote yes and then quit, as it's easier to find a job while you have one.

Am I missing something here? I've had enough!!!!!

Ashamed to have had the poor judgement to end up here!

 

[funguy2]

SVQLBA:

Excellent, Excellent Post. Clear, Precise, and well said. I could not have done it better (and I tried...)

 

[MarkMyWords]

SVQLBA -

Excellent response and you bring up some very valid points. If I may I would like to hit on some of my thoughts/thinking.

- we are reevaluating our entire fleet seat configuration.

I believe that the reconfiguration of the B757 was a test to see what would happen to revenues if we reconfigured the fleet type. When you put this aircraft against a DL Song type aircraft, would the benefits of a reduced F/C cabin help make the flights profitable? I think we learned a valuable lesson with MetroJet and not having F/C seats on those routes. Our FF's were ticked to say the least. I think the reconfiguration will happen with reductions in F/C seating on the A321 and A320. I believe that we will maintain our F/C product because it does lead to customer loyalty and does differentiate our product from WN while keepign us competitive with AS and HP.


- we are simplifying fares

I agree that not a lot of details were given and I am sure we are only simplifying fares as a market by market competitive response. Take PHL-LAX as an example. Prior to Frontier annoucing service to LAX, our full Y fare was 2400.00 roundtrip (ridiculous). With the announcement that WN is coming into the market, our full fare price will be reduced to 600.00 max! So in a market where we had ticket prices varying from 200.00-2400.00 we will now only have a variance from 200.00-600.00. The flights were full then, they will be full now, but there will be a loss of revenue and if things stay the way they are now, there will be no reduction in expenses.....how do you compensate for that loss of revenue?

- we are rolling the PHL hub

Rolling the PHL hub is huge! The cost saving tremendous. Imagine a PHL with less ATC delays, less fuel burn as 60 airplanes wait for take off in a long conga line. Imagine planes that don't sit on the ground for 90-100 minutes, but become more productive as they are only on the ground for 30-40, thus allowing you to increase the total number of flights flown per aircraft per day without adding to the fleet count. Crews and ground employees become more productive with less sit time. This is being worked into the upcoming schedule changes.

- we are changing the entire management team in PHL (see the COB releases)

You say to little to late....I say better late then never!

- we will redeploy our assets with the introduction of additional MDA assets
- we will increase flight frequencies with the addition of MDA aircraft
- we will add cities as more mainline aircraft become available
- we will replace turbo prop aircraft

Are we going after the business or liesure customer? I actually don't think there is a difference anymore. Business customes have become just as price conscious as liesure travelers. I think we are after customer period. What will our route structure look like....in all seriousness....I would probably say that you will find that most smaller out stations will have more frequent service with smaller aircraft and the jets will run as they do on Saturdays. Jets will be deployed to the long routes to the west coast and Caribbean, and on high density routes such as FL, BOS, LGA, DCA and ORD. We will add more cities such as PDX and SMF. Did Dave spell that out, no. Can you see the writing on the walls? Yes. Look at stations like MCI as an indicator of what is likely to come with the influx of RJ's about to flood our airline.

- we are going to transform ourselves into an HP or AS.

Even though he may not have told you how we are going to get to the HP or AS business model.....look at the entire list as your plan to get to that type of airline cost structure and model.

- we are going to stand and compete - WE HAVE NO CHOICE

I agree.....Dave is NOT a motivational speaker by any means. He does need to find someone in the executive ranks that can pick up this ball and run with it. Rally the troops to fight the common enemy. His speech did little to motivate anyone to come together to defend our turf.

- Dave will toss the golden parachute and accept LCC type contract and pay
- Daves executive team will also change their compensation

Again, you say to little to late, I say better late then never. Knowing Dave is willing to take a 50% paycut - on top of the previous 20% - may not soften the pain I am going to feel, but it sure does go a long way in symbalizing that he is willing to make bigger personal sacrifices to ensure our long term viability. His next step in this process would have to be to prune the top of the tree too.

- we will change the web to be more user friendly

Changing our web design isn't something that can happen overnight. Granted, this is something that should have been in the works for quite some time, but it is getting done. I want to know that the 1st day the new web is up and running that it is working at 100%. If it takes an extra month of testing and planning, then so be it. I would rather it work 100% off the bat then to have problems that will skew the users impression of it from the get go.

- we will invest in more technoloogy

We are investing time and money into getting gate readers, better IFE's, improving the ability of the Kiosks, and much more. With all of the advances in technology will also come eventual job losses. As the Kiosks improve their functionality and the gate readers are installed, there will be job losses. It is very unfortunate and sad, but it is a reality of the market place and the drive to reduce costs from the bottom line. Do I like it, no. I have way to many friends that will lose their jobs because of these technology improvements - but we have to be able to compete much more efficiently.

- we will update mainline a/c with a new IFE

A must if we plan to compete with JetBlue. WN doesn't have anythig similar and when they start competing more and more, things like IFE could give us (and JetBlue) the advantage over WN.

- we will update our facitilites with things such as wireless web access

Again, the more bells and whistles we can offer the custome, that differentiates us from the competition, the better off we will be.

- we will increase aircraft utilization

Increasing aircraft utilization is huge! It means being able to do more with what you have, without the added cost of procurring additional assests. If we can go from 10 hours of flight time per aircraft, to 12, it will be like adding 10 (just a guess for arguement sake) aircraft to the fleet - without the captial expense.

- we will increase employee productivity

This goes hand in hand with aircraft utilization. Eliminating the crew productivity breaks, more hard time flying will help to reduce the number of furloughs that may be needed as more flying equiates to more jobs. The same can be said for ground crews. If I am a gate agent in PHL, today I work 3-4 flights in an 8 hour shift. If we roll the PHL hub, I could be working 6-7 flights in that same 8 hours. This will decrease the number of part-timers, but should increase the need for full time jobs. You are getting more bang for your buck here.

- we will increase point to point flying

I am sure the network vision is something similar to what we were in the past but now with the appropraite sized airplane. If we roll the PHL hub, the extra flying has to go somewhere. You can't possible just add all that service to just PHL. So now an airplane flies from PHL-RDU where it can then turn to LGA, DCA or BOS. All of the flying does not have to revolve around strictly the hubs.....and yes we will increase frequencies in our hub flying too. In a rolling hub you have to, but again, you will be usiing the more appropriately sized aircraft.

- we will increase internet sales

A new, simplified, user friendly web site could do wonders for getting more people to book on the web. Once the new web page is up and running you can advertise the advantages of booking off the web (other then ugly airplanes in a DotCom Livery). While Dave didn't speak directly to that, you can again see the writing on the wall.....increased internet sales, simplified fare structure = less complicated transactions which = less hassel.

- we will grow the fleet and the network

We are already growing the fleet and the network with the addition of the MDA aircraft. As we return to profitability, we can get the capital necessary to grow the mainline fleet. The network expands with the increased aircraft utilization.

- we will continue with our alliances with UA and Star

This helps to fil in the gaps in our current route structure and we can test the waters in new markets. We can bring in additional feed and gives us a marketing advantage over airlines like WN.

- we will change the company culture

I hope Dave was sincere about this. PitBull has been trying for well over a year to pound this point home to him. He needs to be more (for lack of a better phrase) employee friendly. Once we do start making a profit again, that in itslef will do much to increase the morale of the employees, but there is a lot of repair work that needs to start at Daves desk and pour downwards. They need to nurture the concept of team work and bring everyone together. We need to restore pride in working for this company.


WHEW. I an exhausted now! LOL

While I am not a total buy in on the Dave and Dave shows. I do see that there are changes that have taken place, are taking place and will take place. We are not as stagnent as many believe. There is a long road to go yet......How we get there is a anyones guess.

 

[More Facts and Less Emotion]

I do agree with those on here that take the wait and see approach. No one knows what is going to be asked of them. To say that you will vote No or Yes without knowing what you are voting on is premature and irresponsible.

For those that say that they have not seen anything in the presentation that shows what "the plan" is, perhaps you should listen to it again.

- we are reevaluating our entire fleet seat configuration.
- we are simplifying fares
- we are rolling the PHL hub
- we are changing the entire management team in PHL (see the COB releases)
- we will redeploy our assets with the introduction of additional MDA assets
- we are going to transform ourselves into an HP or AS.
- we are going to stand and compete - WE HAVE NO CHOICE
- Dave will toss the golden parachute and accept LCC type contract and pay
- Daves executive team will also change their compensation
- we will change the web to be more user friendly
- we will invest in more technoloogy
- we will increase flight frequencies with the addition of MDA aircraft
- we will add cities as more mainline aircraft become available
- we will replace turbo prop aircraft
- we will update mainline a/c with a new IFE
- we will update our facitilites with things such as wireless web access
- we will increase aircraft utilization
- we will increase employee productivity
- we will increase point to point flying
- we will increase internet sales
- we will grow the fleet and the network
- we will continue with our alliances with UA and Star
- we will change the company culture

Will some of this cost jobs, yes...and that could mean mine. Can we continue doing things they way we are today? No. I would prefer to lose my job due to stream lining our operations and have the possibility of coming back as the airline grows again, versus not having anything to come back to because the entire business entity is gone!!

Personally, I will take a wait and see approach. If I can't live with the concessions, then I will look to take my talents elsewhere.

One of the things that I think people wanted to hear is, what is expected from me. What are you going to ask me for in the way of concessions. I don't think that this meeting was the correct forum to put those things on the table. That shuold all be done in the board room with the union reps.

Let's wait and see what happens....

Wow. You kept a lot of notes. Or did you watch it twice?

 

[MarkMyWords]

I am a good notes taker and a good memory! 😀

 

[ktflyhome]

MMW: Very Well Done. I commend You. I will print this out for my personal copy. I feel you have been very objective.

 

[OldpropGuy]

SVQLBA -

Excellent response and you bring up some very valid points. If I may I would like to hit on some of my thoughts/thinking.

- we are reevaluating our entire fleet seat configuration.
.........................(snip the remainder of an excellent post)

The point people are missing is that none of these "fixes" require a vote of approval by employees! Why have they not already been implemented?

I think most of these ideas were proposed first on this site! Maybe we should just have a random drawing of participating users here to be "CEO of the month! It can't get much worse! Yes Dave, the buck stops with you.

This is a true indication of the level of leadership which is guiding the company into the future! Don't bet on making it to the promised land!

I'm don't know about all of you others, but if I was an employee 😉 I would be making alternate plans. Things look pretty grim. Good luck to all!

(Edited to make sure I'm do not appear to be an employee of any company!)

 

[MarkMyWords]

Awe, thanks KT......I am trying to keep an open mind......it is tough though.