Arpey tells shareholders that cost cuts are top priority

[Wretched Wrench]

We all know that WN pays its pilots and mechanics more than comparable AA employees, but it can still achieve superior labor cost performance.

Perhaps not all. Or some are in denial.

 

[Bob Owens]

NH/BB's

Sorry to hijack the post, But as long as AA pays mechanics what it pays, I don't see how they can compete with the TIMCO's of the world.

I do not believe AA can make a profit simply in volume.

True, AA has a good reputation in the maintenance world, but, just like passengers seek out the cheapest fairs, airlines and parcel carriers tend to do the same..with respect to contract maintnenace.
Not all, but a good number.

If money were not an object, TUL. AFW and MCI would have doubled in size and capacity and no mechanics would be on the street.

AA's labor rates uncompetative? Hardly. The fact is if AA started hiring new hires they would be hiring at rates that were less than what Timco etc offer. OSMs start at only $9.30/hr. Prior to this contract you would have to go all the way back to the 1970s to find a lower starting rtae for aircraft mechanics. AA can get away with paying a low rate because workers would be under the assumption, even if its false that hiring on at AA vs Timco would eventualy pay off. Of course after they realize it wont they would be leaving faster than they could replace them.

The fact is that AA used to do a lot of outside work, all the majors did. In the eighties Crandall claimed that he didnt want that work anymore because AA was expanding at a rapid rate. They got rid of the work and places like Timco expanded because those carriers that used to ship their work to AA had no choice. Like others brought up the dollar value isnt the only issue, you hope that the plane comes out of overhaul in better shape than it went in. Since Overhaul is determined by hours in service and not the actual condition its not uncommon for aircraft to come out of overhaul with more problems than when it went in, clearly a carrier that did its own overhaul would not be in the habit of putting out an overhauled aircraft in worse shape than it came in, because any savings from the overhaul end would be eaten up by losses on the operations end. If and airline overhauled their own fleet of a specific aircraft type then chances are they would know how to do it better than an outfit that would accomplish overhaul on any type of plane that happened to pull into the hangar.

 

[Bob Owens]

The other limit is labor, AA can't compete head to head with low wage outfits, but if they can do the work without hiring dedicated labor. That isn't to say that you as a AMT wouldn't benefit, ideally PTs would go full time, some incremental mechanics could be added, and OT would increase. It would also increase AMT productivity which is the most likely way to get a pay increase.

More lies from management.

AA is a low wage outfit.

Starting pay for people working in overhaul is as low as $9.30 an hour with as little as one week of paid vacation a year.

We do not have part time AMTs.

Productivity has nothing to do with pay increases. At one time it did, but not anymore. "Increased productity equals increased compensation" was a cold war concept where under a capitalistic system workers would share in what they produced instead of having their pay determined solely by market conditions that were manipulated by capitalists. Back then it was "management though reward" instead of todays "management through intimidation". Companies actually rewarded employees for loyalty.

Since deregulation real productivity has incraesed dramatically in this industry while real pay has declined dramatically. So if increased productivity has in fact created a surpluss of workers which has resulted in declining wages over the last twenty years why should we expect that if we increase productivity now that we would get a different result? Woulnt increased productivity continue to feed the surpluss of labor thus making your labor less valuable? If you work harder do not expect anything from it. Look at what has happened to us since 2003. Our productivity has incraesed yet our real pay has gone down. Management likes to sell this productivity myth in order to sucker you into working harder, with the mentality of todays management you stand a better chance of producing your way out of a job than producing your way to a pay raise. This is especially true for those at the bottom of the seniority list.