Another great revenue month for AA

[WorldTraveler]

http://finance.yahoo.com/news/amr-reports-april-2012-revenue-201500864.html

11.6% growth in RASM is near the top of the industry.

Keep it coming!

 

[WorldTraveler]

Dang, and to think there are people who actually don't want to see news that AA is improving its revenue performance.

 

[FWAAA]

Unfortunately, there are some employees who think they've already written the final chapter and dramatic improvements in revenue don't jive with their script. Some hate management so passionately that news of any management success is not welcome. It would be an understatement to say they're rooting against AA's successful reorganization. There are some employees who will be disappointed if it doesn't end just like Eastern.

 

[WorldTraveler]

Of course if AA successfully demonstrates that it can generate and grow revenue superior to US, then there will be less reason to need a merger with them - so there is another group of people that isn't interested in seeing AA succeed.

So sad that some people find joy in someone's downfall.

The US airlines are moving into the peak summer season not only when loads force revenues up but also when labor has even less incentive to work.
If AA can make it thru Labor Day with a reasonably intact operation and still be showing positive revenue growth that is on the upper end of the industry, AA's future as an independent airline is probably all but insured.

 

[Bob Owens]

I think its Great News! More evidence that AA doesnt need any concessions from us!
VOTE NO
In 1995 we made the mistake of Voting Yes for a deal that gave the company 6 years of concessions just as we were coming out of a recession. The same tag line about "saving Jobs" was used by the company and the TWU then as well, afterwards they said they knew it sucked, but we voted it in and had to liove with it. Now they are using the same tactic to get us to accept their ultimatum at a time where the industry has acknowledged that theres a shortage of mechanics and as we see here revenues are soaring!

 

[FrugalFlyerv2.0]

I think its Great News! More evidence that AA doesnt need any concessions from us!
VOTE NO

Restore and More!!!

 

[FWAAA]

If AA's labor costs already matched the labor costs at the other formerly bankrupt competitors like UA, DL and US, then I'd agree with Bob Owens.

Although AA has historically attracted a revenue premium to the other airlines, that premium has been shrinking and in some cases, eliminated over the past several years since their bankruptcies and mergers. Until the first quarter of 2012, AA's revenue growth has lagged most other airlines. DL in particular has increased unit revenue by very impressive margins since the late 2008 recession-led revenue falloff.

AA is now, for the first time in several years, near the front of the pack in revenue increases. Problem is, its labor costs are still industry-leading. Successful reorganization will require both: large revenue gains plus lower labor costs. In four short months, AA management is demonstrating success at revenue improvements, despite the constant blather that "management has no plan."

Innovative labor representation would negotiate me-too provisions that would link management success/gain-sharing to labor gains beyond the simplistic and miserly 15% profit sharing pool, which is worse than the late 1990s profit sharing arrangement where labor received more like 25% of pretax profits. But alas, the underpaid mechanics don't have innovative representation - they're instead represented by the TWU. Look up "ineffective" in my dictionary and there's the TWU logo.

 

[TWU informer]

The problem with the Labor Cost arguement is that the Mechanic and Related group at AA was/is at the bottom of the industry once we take away the pension equation. AA was making a valid arguement that given our defined pension cost we could not become top in pay.

Now, the M&R pension is gone and not even within the discussion anymore.

So, in addition to being last in the industry when matched against our peers, AA has demanded that all work groups give up an equal 20% in cost reductions during this restructuring.

We are already last in pay/benfits when compared to our peers. And the 20% further reduction will make us unreasonably low balled and not even close to a fair wage.

Again, there is no way AA or the TWU should expect us to even have a close vote on this offfer. It should be no less than 70% NO. Then the TWU needs to stop pandering to the idea that work group cost reductions should be equal because we did not start out equal to begin with, and the reductions should instead be based on cost matching against our competition and their work groups.

I say RIF those that are not needed, compensate fairly those that are left, and then go for improved productivity adn accountability. That is what every other viable company in this country does if they want to remain in business. Why should I sit back and let the concessions for jobs destroy both our professsion and American Airlines futher?

 

[FWAAA]

Nobody denies that AA's mechanics are paid very low wages. Practically at the bottom. But how would it go over with the pilots and FAs (whose pay is near the top of the industry) if AA proposed the 20% cuts from them but proposed several dollar an hour pay raises for M&R? AA would have already shut down for good - pilots and FAs would have walked off the job when the term sheets were released.

As you've pointed out before, M&R refused pay raises in 2010. Pay raises that were conditioned on further concessions. Had those compromises been ratified, then AA would probably be seeking the same 20% cost reduction from M&R but not thru payrate cuts.

Even the successful airlines that already navigated bankruptcy are demanding further concessions in exchange for pay raises now, like US with its FAs. I may be wrong, but I don't see non-concession payraises for legacy airline employees ever again.

 

[topDawg]

The problem with the Labor Cost arguement is that the Mechanic and Related group at AA was/is at the bottom of the industry once we take away the pension equation. AA was making a valid arguement that given our defined pension cost we could not become top in pay.

Now, the M&R pension is gone and not even within the discussion anymore.

So, in addition to being last in the industry when matched against our peers, AA has demanded that all work groups give up an equal 20% in cost reductions during this restructuring.

We are already last in pay/benfits when compared to our peers. And the 20% further reduction will make us unreasonably low balled and not even close to a fair wage.

Again, there is no way AA or the TWU should expect us to even have a close vote on this offfer. It should be no less than 70% NO. Then the TWU needs to stop pandering to the idea that work group cost reductions should be equal because we did not start out equal to begin with, and the reductions should instead be based on cost matching against our competition and their work groups.

I say RIF those that are not needed, compensate fairly those that are left, and then go for improved productivity adn accountability. That is what every other viable company in this country does if they want to remain in business. Why should I sit back and let the concessions for jobs destroy boht our professsion and American Airlines futher?

THIS. CASM numbers i have seen for DL/AA/UA has AA one cent above UAL (my guess is do to most of yalls work being done in house and a DB plan.) for maintenance. The idea that yalls maintenance cost to much is a bunch of bull s**t. They are taking just to take, shame the TWU is willing to go for it.

 

[WorldTraveler]

Although AA has historically attracted a revenue premium to the other airlines, that premium has been shrinking and in some cases, eliminated over the past several years since their bankruptcies and mergers. Until the first quarter of 2012, AA's revenue growth has lagged most other airlines. DL in particular has increased unit revenue by very impressive margins since the late 2008 recession-led revenue falloff.

AA is now, for the first time in several years, near the front of the pack in revenue increases. Problem is, its labor costs are still industry-leading. Successful reorganization will require both: large revenue gains plus lower labor costs. In four short months, AA management is demonstrating success at revenue improvements, despite the constant blather that "management has no plan."

I will leave the rest of that quote to others to argue but this part is completely accurate - and AA's future will live or die based on its ability to generate industry competitive if not superior revenues.

The problem that AA MUST avoid - and it appears capable of doing so - is allowing its revenues to be marginalized even though it is a smaller player.
AS is a much smaller network player than its peers - some call it a discount carrier but it is actually probably both. The key is that it generates revenues proportionate to other network carriers - and it runs a solid, sound business doing it.

That is the model that AA needs to shoot for.... and the chances are quite strong that they will reach it.