Airline Executives Meet

[BoeingBoy]

USA320Pilot answers: The ATSB could care less if US Airways has a code share agreement with United or not. The ATSB only cares if the company produces a profit.

Wasn't the reason for scope relief the fact that GECAS might pull the financing for the RJ's, which in turn could reduce the revenue stream that was part of the plan presented to the ATSB for the loan guarantee?

And since we're on the ATSB, didn't you report that the ATSB had been briefed on (approved, endorsed, pick one) the "Going Forward Plan"? This quote from AWST tell a different story:

"The dissenter was the Treasury Dept. representative, acting Under Secretary for Domestic Finance Brian Roseboro, who said the board should have evaluated a new business plan for the airline, handled the "going concern" default by demanding measurable progress on the new plan and ruled case by case on non-cash asset sales."

Jim

 

[ClueByFour]

Moreover, informed sources speaking on the condition of anonymity said that US Airways, Northwest, and Continental reached a code share agreement last year and the final paperwork was provided to Crystal City, but for some reason at the last moment Dave Siegel elected to sign a deal with United, which now appears to be a huge mistake.

I hate to do this, but I believe that such sources are a figment of your imagination.

Name them, please.

I guess what I'm getting at is that without a published report or some degree of corroboration, it can only be concluded that these sources might as well be the tooth fairy.

Not that any of this matters: CO/NW/DL are hooked up. AA has both Oneworld and a very profitable lashup with Alaska.

US has no other dance partners (save United). Nor will anyone else dance, since they can wait and pick up the pieces for less than the cost of a codeshare integration if Little Dave does not get his stuff together in short order.

I've seen Seigel and his minions piss away chance after chance to drive revenue. Regularly. I've seen my firm direct just north of two million dollars in airfares away from US Airways since Dave's team took the helm (mostly due to the arrogance or foolishness of the US big account salesforce, Dave and Dave's steller public statements to intimidate the unions, BBB, etc). Let's remember how much success the last person (Wolf) had "waiting" for a transaction to take place. Dave lacks the talent and the time to let it happen (outside the confines of a Chapter 7 liquidation).

 

[USA320Pilot]

BoeingBoy:

According to a MEC Rep Neal Cohen has been working with the ATSB and addressed with the board where the company is going to return to profitability. As to the specifics of their conversation, I was not there, however, whatever was told to the ATSB was sufficent enough for the board to approve an ammended plan.

In regard to GECAS, maybe you should talk with Mike Abram, Michael Glanzer, Amy Alperi, and ALPA E&FA, then make your posts.

Respectfully,

USA320Pilot

 

[Cosmo]

The ATSB could care less if US Airways has a code share agreement with United or not. The ATSB only cares if the company produces a profit.

Perhaps, but I don't think they would be very happy to realize that they were lied to. It would almost certainly guarantee (no pun intended) that US Airways would not receive any future assistance from the ATSB, should it be needed.

Moreover, informed sources speaking on the condition of anonymity said that US Airways, Northwest, and Continental reached a code share agreement last year and the final paperwork was provided to Crystal City, ...

That's last year's news. Who cares now?

... but for some reason at the last moment Dave Siegel elected to sign a deal with United, ...

Here's a radical idea -- maybe Seigel knows something that you don't! Have you ever entertained the possibility that he doesn't tell you everything he knows when he rides on your jumpseat?

... which now appears to be a huge mistake.

This is your opinion, not a fact as you seemingly would have everyone believe. Indeed, I haven't heard Seigel call the United-US Airways codeshare deal a "huge mistake". Again, maybe he knows something that you don't.

Dave Siegel is letting it be known in the terminal, on the jump seat, in email messages, with news media leaks, and in speeches that US Airways will be involved in a corporate transaction.

Don't you recognize a classic "disinformation" campaign when you see one? You shouldn't so easily accept everything at face value.

However, in my opinion, United is on the brink of oblivion ...

Certainly no more so than US Airways, and most probably a good bit less so. But that's JMHO. We'll get a much better indication of the two carrier's relative financial strength in about a month when the first quarter 2004 SEC Form 10-Q's are issued. So why don't you give the "brink of oblivion" speech a rest until then.

More fundamentally, your comments about United are becoming shriller and more hyperbolic, a clear indication that you are becoming more and more desperate and fearful regarding US Airways' future, or at least your part in that future. And apparently everybody except you recognizes that.

 

[iflyjetz]

However, in my opinion, United is on the brink of oblivion, therefore, I believe it would be better for US Airways to find a replacement business partner.

Regards,

USA320Pilot

Both UAL and UAIR are on the brink of oblivion. If UAL is in worse shape, I'll be looking for work sooner than you. That means that I'll have more seniority than you at our next job.

http://load.pquinn.com/binaries/fries/

So you'll be working the fry vat while I'm taking orders at the drive up window.

 

[fatburger]

iflyjetz-

You'll also get to wear that cool headset, while the seniority challenged just have to settle for a hairnet.

-fatburger-

 

[autofixer]

However, in my opinion, United is on the brink of oblivion, therefore, I believe it would be better for US Airways to find a replacement business partner.

Regards,

USA320Pilot

Chip, both UAL and UAIR are on the brink of oblivion. If UAL is in worse shape, I'll be looking for work sooner than you. That means that I'll have more seniority than you at our next job.

http://load.pquinn.com/binaries/fries/

So you'll be working the fry vat while I'm taking orders at the drive up window.

Come on. I get tired of pilots and non-pilots acting as if the only jobs they are qualified for out in the REAL WORLD are fast food or The Home Depot. There are tons of jobs out there; all you have to do is work hard and show up to work on time. The uemployment rate is at historical lows (irrespectful of what election year candidates are saying). If you do that, you will be head and shoulders above most employees and WILL advance rapidly. And face it, if MAA pay rates become the norm, what do you have to lose?

 

[Fly]

The uemployment rate is at historical lows

Do you honestly believe that???? :blink:

 

[mweiss]

Do you honestly believe that???? :blink:

Heh. Wait until he tries to find a job.

There's a big difference between the reported unemployment rate and the number of people eligible for work who are not currently employed.

 

[jimntx]

The uemployment rate is at historical lows (irrespectful of what election year candidates are saying).

I'm not sure which history books autofixer is reading. Maybe one written by Saddam's Minister of Information. Here in Texas, the official, admitted-to-by-the-government unemployment rate is 6.4%. When I worked for the Texas Employment Commission (now known as the Texas Workforce Commission, the generator of said statistics) in the 70's, the unemployment rate never got above 4% and in the Houston area it hovered around 2% for much of that decade.

Or, maybe autofixer is one of those guys whose philosophy is...

If you are out of work, it is because you are lazy.
If my brother is out of work, the economy is in a recession.
If I am out of work, the economy is in a depression.

 

[funguy2]

Funnyguy:

Funnyguy said: "Ok, so US Airways has $925mil in the bank... Lets say they are able to sell off the Shuttle for $150mil and PSA for $150mil... That means they have $1225mil in the bank. Ok, next pay off the $726mil ATSB loan. Now the cash balance is $949. The company continues to lose $1/mil per day, and they go bankrupt at $500mil (just like the last time). That gives the company about a year and a half before the next bankruptcy filing. Now, who here thinks a company that is a year and a half from bankruptcy, again, has the cash, talent, time, energy, financing, etc to pull off any kind of transaction where they are the acquirer. Not me."

USAS320Pilot: Funnyguy, you forgot to mention the 25% reduction in CASM cut the company anticipates in the "Going Forwar Plan", which we will hear more about on Wednesday in a company wide Webcast.

Regards,

USA320Pilot

Given the continuing, and for US Airways escalating decline in yield, reduced CASM will be off-set by reduced RASM. Even if ALPA gave 25% back to the company, that would probably reduce CASM by 5-10%. There are some things this company cannot or will not do to reduce CASM:

EMBRAERS - less trip expense, higher CASM
Fleet Standardization - too late
Rolling Hub - forces expansion or furloughs, neither is a good thing right now.

I see this company making exactly 1 move to reduce CASM - employee givebacks. If the entire employee group, all unions, all non-union employees, give back 25% of their already reduced salary, that would result in a CASM decrease of 10-15% (based on employee costs being 1/2 of total costs, which is too high).

I do not believe US Airways will see meaningful cost reductions based on what management is currently doing.

 

[BoeingBoy]

USA320Pilot,

On 3/17 you said:

...the board agreed with the company's "Going Forward Plan"

AWST published this:

"The dissenter was the Treasury Dept. representative.....who said the board should have evaluated a new business plan for the airline"

I have no doubt that the board was briefed on our financial position and the need for more time to correct it, but that is different from saying they agreed with a specific plan. I'll take the word of a member of the ATSB board over second-hand info from management any day.

In a post above, you said:

"In regard to GECAS, maybe you should talk with Mike Abram, Michael Glanzer, Amy Alperi, and ALPA E&FA, then make your posts."

I think you misunderstood my GECAS comment. I was not expressing skeptism about the tenuous nature of the RJ financing, just pointing out the contradiction between RJ revenue flow being so important that scope relief is necessary to insure against it's loss yet code-share revenue being so apparently non-consequental that we should abandon it.

Jim

 

[funguy2]

I personally believe Northwest would be a better fit for US Airways because of economics.

Is this because of NW's inferior position in the western USA, or their inferior position over the Pacific? Or maybe it has to do with its overlapping hubs? Or maybe the overlapping hubs of its partners?

 

[BoeingBoy]

funguy,

"I do not believe US Airways will see meaningful cost reductions based on what management is currently doing."

I have every reason to agree with you. I believe we are on the verge of chasing declining yields and upward unit cost pressure from the influx of RJ's with employee concessions. A vicious circle it would be best to stay out of.

Jim

 

[Boomer]

jimtx, mweiss,

Actually, the admitted rate of unemployment during the second Clinton re-election campaign was 5.5%.
( http://data.bls.gov/cgi-bin/surveymost )

The current, admitted, rate of unemployment is 5.6%.
( http://www.bls.gov/news.release/empsit.nr0.htm )

Although it has recently become permissable to state that the numbers used to calculate the unemployment rate are "bogus" we must all remember that they were acceptable when we all wanted to know what the definition of "is" is.
( http://www.nationalreview.com/nrof_buzzcha...00403050905.asp )