AWA MEC HOTLINE 8/3/07

[767jetz]

How about putting the numbers down for all to see. Let's hear the truth according to Mr United.

Don't have to. The AWA MEC already did. Look it up for yourself.

 

[767jetz]

Facts...what facts. The FACT is AWA has some of the administrative costs. Big deal. Smoking gun or just smoke? How much was it? 1 million, 5, 10...more? Still won't change the whopping difference in profit potential East vs West.

A320 Driver B)

Just ask the AWA MEC...

America West Operation Bears Cost of Merger

America West (financially at the very least) is bearing some of the huge administrative costs from our acquisition of US Airways in 2005.

 

[A320 Driver]

Don't have to. The AWA MEC already did. Look it up for yourself.

Yes, the AWA MEC was very precise and specific with their statement quoted below.

"This essentially means that for financial purposes, America West (financially at the very least) is bearing some of the huge administrative costs from our acquisition of US Airways in 2005."

"some" ?
"huge" ?
"acquisition" ??

Very descriptive...welcome to the spin zone.

Any port in a storm.

A320 Driver B)

 

[BottomFeeder]

Don't have to. The AWA MEC already did. Look it up for yourself.

That's funny since I did not see any numbers from them? They did say the cost of meger related expenses but the numbers were not given. Why don't you post them since you have the numbers. I bet you can't.

 

[BottomFeeder]

The numbers for anyone to read....

Jim

Jim,

Thanks for the link. Since most of us are not an CPA and I know you are good with these type of things. Would you break down the numbers and tell us how much of the merger related expenses were charged to AWA. It would be nice to show how much of the expenses were charged to AAA as well. That way we compare apples to apples.

 

[Tim Nelson]

In his August 1 chairman's message Jack Stephan said, "The profitability road that we are on is squarely on the backs of the AAA pilots. And as the breakdown of the second quarter financials indicate, the AWA portion of the operation continues to show a loss. This makes it all the more disheartening to learn that the AWA MEC approached management and relayed that the "West pilots would be outraged if the East was granted parity." Such sentiment sinks to a level that is not representative of our profession or of unionism at its most basic form. The inescapable reality remains that we make less for doing the same job."

"On another matter related to equal pay for equal work, and equally as irritating, the AWA leadership continues to report to their pilots and other parties that we are not truthful in our communications to our pilots. I personally take exception to their claim. While I served you as Communications Chairman and while I have served you as MEC Chairman, your leadership has consistently reported the good, the bad, and the ugly and we will continue to do just that. To suggest that your leadership is guilty of protecting you from the truth, reflects a mindset that “just doesn’t get it.â€￾ I hope you share the indignation of your elected representatives and your MEC Officers over this totally inappropriate accusation. We remain committed solely to the US Airways pilots and we work for you, period. As for the offhand comments of the AWA leadership, we will consider the source and we will refrain, as always, from commenting on their affairs. We will continue to be professional in all our communications," Stephan continued.

USA320Pilot comments: I have known Jack Stephan for over 20 year's and he is a man of impeccable integrity. When he calls a spade a spade it is a spade. The purposeful misinformation by the AWA MEC and its integrity is further fueling the fire of the US Airways pilots and I believe increases the odds of separate contracts and separate operations and that the EC will continue its position of not passing the Nicolau Award onto the company.

Why? If either option does not occur a certain decertification of ALPA on both the East and West property will occur and the East pilots may burn the company down to the ground. Management's recourse? Breaking up the airline.

Therefore, to keep the business enterprise intact the only way to do this appears to be separate operations and separate contracts.

Regards,

USA320Pilot

USA320Pilot,
I have a question regarding the profit sharing for next year. Was it ALPA INTL or your MEC that decided to offer your profit sharing monies to the union brothers at AWA? And given the significant profit gains of this year, is it likely that ALPA west will enjoy the same gift from ALPA east?
Anyways, I would guess that the profit sharing, guaranteed euipment for the east, and the $70million make it difficult for ALPA east to make further concessions to the westies.
regards,

 

[BottomFeeder]

Just ask the AWA MEC...

Mr. United,

Don't you think if the numbers were so overwhelming that they would have posted them for support? It is easy to throw general references but the facts are in the numbers. You say that you saw them and no one else is stating that. Why don't you post them?

 

[BoeingBoy]

All the items aren't tabulated. For example, a $100 change fee for a ticket on HP metal shows up in US revenue. Same for the $25 move up fees when pax confirm on an earlier flight. I have no idea how much money that represents a quarter.

The big items that are tabulated total $118 million for the quarter, if I remember off the top of my head.

You presumably can't just take the $118 million from East's profit and add it to West's results to get an "apples to apples" comparison since presumably the cost of services purchased from Group by the two mainline divisions are greater for the combined airline than for a hypothetical unmerged East operation. However, the method they use to split these "administrative costs" does not reflect the different cost structures of the East and West operations, so East gets some benefit from the lower West cost structure while West pays a penalty for the higher East cost structure.

Jim

 

[electricjet98]

All the items aren't tabulated. For example, a $100 change fee for a ticket on HP metal shows up in US revenue. Same for the $25 move up fees when pax confirm on an earlier flight. I have no idea how much money that represents a quarter.

The big items that are tabulated total $118 million for the quarter, if I remember off the top of my head.

You presumably can't just take the $118 million from East's profit and add it to West's results to get an "apples to apples" comparison since presumably the cost of services purchased from Group by the two mainline divisions are greater for the combined airline than for a hypothetical unmerged East operation. However, the method they use to split these "administrative costs" does not reflect the different cost structures of the East and West operations, so East gets some benefit from the lower West cost structure while West pays a penalty for the higher East cost structure.

Jim

"Additionally, as a result of the merger of the reservations systems in March 2007, all ticket sales for transportation previously issued by AWA are now issued by US Airways. While AWA earns passenger revenues when operating flights for US Airways, all revenues associated with ticket reissuance and change fees are now earned by US Airways."

The above is just one of several such statements. Everything is sufficiently commingled to make any reasonable comparison very difficult.

 

[BottomFeeder]

"Additionally, as a result of the merger of the reservations systems in March 2007, all ticket sales for transportation previously issued by AWA are now issued by US Airways. While AWA earns passenger revenues when operating flights for US Airways, all revenues associated with ticket reissuance and change fees are now earned by US Airways."

The above is just one of several such statements. Everything is sufficiently commingled to make any reasonable comparison very difficult.

Exactly Right

The way the numbers are reported it would be impossible to get the break down numbers with out further information. The references by the AWA MEC are only a guess at best. Then there is the old saying liars figure and figures lie.

Hey Mr. United show us your figures you saw.

 

[electricjet98]

In his August 1 chairman's message Jack Stephan said, "The profitability road that we are on is squarely on the backs of the AAA pilots. And as the breakdown of the second quarter financials indicate, the AWA portion of the operation continues to show a loss. This makes it all the more disheartening to learn that the AWA MEC approached management and relayed that the "West pilots would be outraged if the East was granted parity." Such sentiment sinks to a level that is not representative of our profession or of unionism at its most basic form. The inescapable reality remains that we make less for doing the same job."

"On another matter related to equal pay for equal work, and equally as irritating, the AWA leadership continues to report to their pilots and other parties that we are not truthful in our communications to our pilots. I personally take exception to their claim. While I served you as Communications Chairman and while I have served you as MEC Chairman, your leadership has consistently reported the good, the bad, and the ugly and we will continue to do just that. To suggest that your leadership is guilty of protecting you from the truth, reflects a mindset that “just doesn’t get it.â€￾ I hope you share the indignation of your elected representatives and your MEC Officers over this totally inappropriate accusation. We remain committed solely to the US Airways pilots and we work for you, period. As for the offhand comments of the AWA leadership, we will consider the source and we will refrain, as always, from commenting on their affairs. We will continue to be professional in all our communications," Stephan continued.

USA320Pilot comments: I have known Jack Stephan for over 20 year's and he is a man of impeccable integrity. When he calls a spade a spade it is a spade. The purposeful misinformation by the AWA MEC and its integrity is further fueling the fire of the US Airways pilots and I believe increases the odds of separate contracts and separate operations and that the EC will continue its position of not passing the Nicolau Award onto the company.

Why? If either option does not occur a certain decertification of ALPA on both the East and West property will occur and the East pilots may burn the company down to the ground. Management's recourse? Breaking up the airline.

Therefore, to keep the business enterprise intact the only way to do this appears to be separate operations and separate contracts.

Regards,

USA320Pilot

Impeccable integrity, huh. Look at the 10-Q yourself and tell me that the money isn't so commingled that any attempt at comparison is immpossible.


AWA

As of June 30, 2007, AWA’s cash, cash equivalents, short-term investments and restricted cash were $1.22 billion, of which $1.08 billion was unrestricted. We have the ability to move funds freely between operating subsidiaries to support operations. These transfers are recognized as intercompany transactions. Net cash used for operating activities for the first six months of 2007 was $82 million. This compares to net cash provided by operating activities of $216 million for the first six months of 2006. The period-over-period decrease in cash provided by operating activities of $298 million is primarily due to a decrease in AWA’s air traffic liability (ticket sales for transportation that has not yet been provided) offset by an increase in the net payable to related parties, principally US Airways. Concurrently with the migration of the AWA and US Airways reservations systems into one system in March 2007, all ticket sales for transportation previously issued by AWA are now issued by US Airways. Accordingly, all cash receipts for transportation sales are received by US Airways.


US Airways

As of June 30, 2007, US Airways’ cash, cash equivalents, short-term investments and restricted cash were $2.28 billion, of which $1.92 billion was unrestricted. We have the ability to move funds freely between operating subsidiaries to support operations. These transfers are recognized as intercompany transactions. Net cash provided by operating activities for the first six months of 2007 was $774 million, as compared to net cash provided by operating activities of $494 million for the first six months of 2006. The period-over-period increase of $280 million is primarily the result of an increase in air traffic liability (ticket sales for transportation that has not yet been provided) offset by a decrease in the net payable to related parties, principally AWA. Concurrently with the migration of the AWA and US Airways reservations systems into one system in March 2007, all ticket sales for transportation previously issued by AWA are now issued by US Airways. Accordingly, all cash receipts for transportation sales are received by US Airways, which results in a greater number of cash transfers made to AWA from US Airways for AWA to meet its cash operating requirements.


These types of statements are scattered all through the 10-Q, but that fact is lost on your buddy Jack. Yeah, a real straight shooter that Jack!

Other than that, just more of your empty, pointless threats.

Give my regards to Jack!

 

[electricjet98]

Exactly Right

The way the numbers are reported it would be impossible to get the break down numbers with out further information. The references by the AWA MEC are only a guess at best. Then there is the old saying liars figure and figures lie.

Hey Mr. United show us your figures you saw.

Please note that the AWA MEC statement was simply a reply to the AAA MEC's initial attempt at spinning the whole story. More misinformation from Jack!

 

[electricjet98]

USA320Pilot,
I have a question regarding the profit sharing for next year. Was it ALPA INTL or your MEC that decided to offer your profit sharing monies to the union brothers at AWA? And given the significant profit gains of this year, is it likely that ALPA west will enjoy the same gift from ALPA east?
Anyways, I would guess that the profit sharing, guaranteed euipment for the east, and the $70million make it difficult for ALPA east to make further concessions to the westies.
regards,

It was required per the AWA pilot's CBA. Since that portion of profit sharing generated from east operations should be approximately proportional to that portion of profit sharing paid to the east pilots (and the same with the west) the east pilots didn't give us anything.

But I'm sure Jack's waterboy will have a different spin on the whole thing.

 

[AWA320]

USA320pilot is intentionally misrepresenting the facts. As was pointed out in the beginning of this thread, there are significant costs that were removed from the East operation that are now being paid by the West operation. This artificially raises the Easts "profit" and artificially creates the West "loss."

The truth is in the details, and there are some on the East side who would prefer to distract people from seeing those details with their constant rhetoric.

WOW!!!!! Not on either property but calls it like it really is. Nice job 767 real nice job...

 

[AWA320]

The numbers for anyone to read....

Jim

OOOOHHHHHHHH Bottomfeeder that must hurt, it's got too. There is no way to constantly get knocked on one's (A) and not feel the blow. NEXT????