AMR reports 2009 loss of $1.4 billion, excluding special items

[jimntx]

My apologies. I forgot that CO and its flight attendants had reached a new CBA (imagine that!). But, that doesn't help to explain the higher cost structure point that E was trying to make with a comparison of AA vs. CO. If anything it should make things worse.

I guess it must be all the fault of M&R since we ruled out the f/as as a reason for a lower cost structure at CO.

 

[nbmcg01]

Do you think the BOD is ready to replace Arpey et al?
Do you think the job would be offered to Crandall?
If so, would he take it?

 

[700UW]

Actually Bob Owens showed us that AA's M&R are one of the lowest paid, CO and US' M&R make more than AA.

 

[FWAAA]

A topped out FA at CO makes $55 an hour base pay not counting premiums.

According to the contract, $50/hr is the topped out base pay; the $55/hr is incentive pay for hours in excess of 225 per quarter (up to 330 hours).

If you're going to take this thread completely off-topic (what do CO FA rates have to do with the topic?), the least you could do is avoid posting misleading information.

 

[eolesen]

Fact is there's really no one good comparator to AMR when you start looking at earnings. If you start blending the results from the larger carriers, you get a better idea of where they stand. CO's a good comparison, but there are some key differentiators that skew things in CO's favor.

I shouldn't have to point out that CAL went thru two bankruptcies, arbrogating all of their labor contracts in 1983, dumping (as some of the TWU repeatedly point out) 50 years worth of workrules in one fell swoop. The 1990 bankruptcy didn't target labor, but they've done a better job at keeping their costs lower since then. AA's done OK, but there's only so far they can go without bumping key structural issues like network, scope, and labor.

From a network perspective, CO's a little better off than AA. AA's just too damn big for its own good.

Four of AA's major hubs/gateways are in fairly expensive markets they can't possibly dominate -- ORD, LAX, NYC, and MIA. CO's at the same disadvantage in NYC, but they benefit from being at EWR vs. duking it out head to head at LGA & JFK.

DFW and IAH are fortress hubs for both carriers, but DFW only accounts for less than a quarter of AA's operation, whereas IAH is probably closer to 40% of CO's.

AA's operation at DFW is also considerably bigger than CO's at IAH, and the dumb-ass 1970's terminal design adds a lot of cost. If I were AA, I'd reduce DFW flying by at least 20% and tell the airport that growth will return once the U shaped terminals are replaced.

CO's also had better luck with alliances. QF and CX work out pretty well for AA, and I suspect that MX and LAN do as well, but I'm not so sure about Europe. AA's hitched their wagon to the BA deal for 10 years too long. Having BA in oneworld is good. With LH buying up all their Star Alliance partners in Europe, there's little opportunity left to find a new partner. Maybe ATI will come and they can start seeing the benefits. And maybe not.

Scope and labor... It's a rats nest aided by the bankruptcies, and something I suspect more likely to see CO shift more towards AA than AA is to shift towards CO. CO's pilots are probably by far the angriest labor group in the industry right now, and rightfully so when you start looking at some of the provisions of their contract (crew rest on the 757 consists of blocking off the last row of coach...).

As mentioned, the flight attendants and mechanics make more than AA. But don't forget that by CO's estimates, 50% of their maintenance is outsourced. The majority of CO's mechanics are line mechanics -- we've beaten this argument to death, but if you separated the line from overhaul, it might be practical to pay AA line mechanics what their peers are making. It flies in the face of unionism, but if you want parity, it has to be on based not just on pay, but also on scope and workrules.

AMR Fedexed

I hope you're not too excited about them using FDX... It's typically a HR requirement to have accountable delivery for that type of stuff, and last I knew, AA only paid around $1.50 for an overnight envelope.

 

[FWAAA]

Before electronic ticketing became all the rage, aa.com allowed passengers to choose FedEx overnight for ticket delivery for a fee of $3, and I was told that AA was making a profit on every shipment at that price. At the time I was paying a discounted price of $10 (but obviously not as good a discount as AA was getting).

 

[nbmcg01]

Before electronic ticketing became all the rage, aa.com allowed passengers to choose FedEx overnight for ticket delivery for a fee of $3, and I was told that AA was making a profit on every shipment at that price. At the time I was paying a discounted price of $10 (but obviously not as good a discount as AA was getting).

Funny that my furlough notice came snail mail..hummmm

 

[jimntx]

Actually Bob Owens showed us that AA's M&R are one of the lowest paid, CO and US' M&R make more than AA.

Ok, so it's not the f/as, and it's not M&R running up the costs. I know. I know. It's what we pay the company that provides the wheelchair escorts that must be running up the costs. Yeah. That's the ticket.

 

[FWAAA]

Ok, so it's not the f/as, and it's not M&R running up the costs. I know. I know. It's what we pay the company that provides the wheelchair escorts that must be running up the costs. Yeah. That's the ticket.

I like Jim's sense of humor.

The AA pilots make more money than any other USA-based legacy passenger airline (except for WN - for those pedantic enough to consider WN a legacy) - maybe it's the APA's fault?

 

[FWAAA]

AMR stock responding favorably pre market!

AMR was up big on Wednesday even though the broader market took a big hit. Oil prices declined, and they're down again today. Lose $1.4 billion and stock rises several percent. Hope springs eternal.

 

[jimntx]

According to the contract, $50/hr is the topped out base pay; the $55/hr is incentive pay for hours in excess of 225 per quarter (up to 330 hours).

If you're going to take this thread completely off-topic (what do CO FA rates have to do with the topic?), the least you could do is avoid posting misleading information.

Even when being an apologist (there's that nasty word that you call namecalling) for AMR, you should make sure you know what YOU are talking about. What you posted means that CO f/as do not collect that 10% premium until they fly over 75 hours/month. At AA, I make an $8/hr premium for flying anything over 70 hours/month (a 22% premium), and I'm not even top of scale.

I hope you're not too excited about them using FDX... It's typically a HR requirement to have accountable delivery for that type of stuff, and last I knew, AA only paid around $1.50 for an overnight envelope.

Before electronic ticketing became all the rage, aa.com allowed passengers to choose FedEx overnight for ticket delivery for a fee of $3, and I was told that AA was making a profit on every shipment at that price. At the time I was paying a discounted price of $10 (but obviously not as good a discount as AA was getting).

Like Nancy, they didn't bother to send my furlough notice via FEDEX, and my notice of the travel separation offer was made via an article on the Flight Service web page--which is certainly not accountable delivery since I'm fairly certain that I am one of a distinct minority of f/as who actually reads anything on that cheerleading-ain't-we-wonderful-in-Flight-Service-management website.

And, snail mail is still $0.35. A lot cheaper than $1.50--particularly when multiplied by 1410.

 

[The Goose]

AMR was up big on Wednesday even though the broader market took a big hit. Oil prices declined, and they're down again today. Lose $1.4 billion and stock rises several percent. Hope springs eternal.

It doesn't matter whose stock your talking about - had they made money, it would have dropped immediately. Lose money and the stock rises.

I DID NOT HAVE DOPE THAT GOOD IN COLLEGE!!

 

[eolesen]

To clarify, I didn't mean to imply it's AA HR's specific requirement. My last employer required a confirmation signature on related to a change in employment status - be it a job offer, termination, or being busted from full time to part time. If we couldn't hand them the letter in person and get their signature acknowledging receipt, then it went Fedex. My current employer gladly sent me my offer letter via PDF, but the original still came via UPS with signature-required for delivery (vs. it being dropped off without signature).

Overkill, perhaps, but it avoids a situation where someone claims "they didn't notify me!"

Like Nancy, they didn't bother to send my furlough notice via FEDEX, and my notice of the travel separation offer was made via an article on the Flight Service web page

If you logged into the FS web via Jetnet, it may be accountable, and if you clicked into the article, it's definitely accountable to a specific login.

 

[Royal Ambassador]

I heard this morning that AMR Fedexed information about the flight attendant travel separation package to all the furloughees (most of whom are former TW).

I hope you're not too excited about them using FDX... It's typically a HR requirement to have accountable delivery for that type of stuff, and last I knew, AA only paid around $1.50 for an overnight envelope.

The travel separation letter was sent to hundreds of flight attendants who are eligible to retire with full travel benefits (and not much else).

Why in the world would someone accept only five or ten years of D2 passes when they can retire with lifetime travel benefits including four annual D1 passes?

It may have only saved a few thousand dollars, if the offer was communicated only to those who were not yet fifty years old at the time of furlough, but then didn't AA remove olives from salads in order to save money?

 

[MERV]

That's great to hear prices are going up, so the the airlines can offset any new cost.

American Airlines ( AMR - news - people ) launched the first widespread fare hike of the new year this week, up to $16 per roundtrip on thousands of flights in the U.S. The airlines pushed through four major increases last year and 15 in 2008.

Rick Seaney, CEO of travel company FareCompany.com, said Southwest fare increases are important because they let the bigger, so-called legacy airlines raise prices on routes where they compete against Southwest.

"When Southwest hikes domestic prices, legacy airlines break out in a sly grin," he said.

Southwest, Continental profits raise recovery hope
http://www.forbes.com/feeds/ap/2010/01/21/...?partner=alerts