David Siegel's Speech- Nov 12th

Jon153 said:
I'm still interested in Dave's comments about "BILL" Does anyone have any further information about it? I truely believe that if they actually tried to make it work it could. An alliance between Ted and Bill would be quite interesting.
Chip?
If you'll listen, after this statement Dave says "but seriously...", Bill was a joke. Get it?
 
Busdrvr:

I'm not going to get into a tit-for-tat discussion with you, but your last post was inaccurate.

Regards,

Chip
 
Chip Munn said:
Busdrvr:

I'm not going to get into a tit-for-tat discussion with you, but your last post was inaccurate.

Regards,

Chip
Oh come on Chip....a wee bit of "Tit Tatting" is exactly what we need here. Maybe if it works for Hooters Air...it will work for us??? (LOL)
 
Chip Munn said:
Busdrvr:

I'm not going to get into a tit-for-tat discussion with you, but your last post was inaccurate.
Chip:

Below are the Average Passenger Haul and Operating RASM figures for the six legacy network carriers for the 3rd quarter of 2003, as shown in each carrier's respective press release.

Airline............Pax Haul (mi)........RASM
American..............1,377................9.78¢
Continental..........1,549................9.79¢
Delta.........................981................9.98¢
Northwest............1,356...............10.96¢
United...................1,603.................9.95¢
US Airways.............975...............10.56¢

When Operating RASM is looked at in conjunction with average passenger haul, IMHO United is not doing too badly in comparison with the other carriers. And as Busdrvr pointed out, United was 4th best (ranked from top to bottom), just behind Delta but ahead of American and Continental, among the six carriers. So what precisely was wrong about his post?
 
Cosmo:

Who had the highest network carrier RASM from the figures you presented? In addition, RASM was presented by the companies is in different formats and by some accounts United was last.

The press release said the Passenger revenue per available seat mile - passenger unit revenue (cents) for Q3 was 8.83 cents per the press release below.

See Story

In addition, for accurate information and an industry comparison go to See Story and then click on Rumor Control, Click here for Daily Airline News, and then go the October 30 column.

Regards,

Chip

;)
 
Chip Munn said:
In addition, RASM was presented by the companies is in different formats and by some accounts United was last.
Chip:

Your comment above caused me to go back and look again at each carrier's financial data that was reported in their respective press releases. And you're right -- different carriers reported supposedly similar numbers in different ways. Thus, the operating RASM numbers in the table in my previous post were incorrect for most of the carriers.

So, to make a true apples-to-apples comparison, I took total operating revenues and total operating expenses for each of the six legacy network carriers, and then divided those numbers by each carriers' total ASMs. This results in Operating RASM and Operating CASM figures that are not adjusted up or down for things like regional carrier revenues and expenses, or special items of various kinds (whether bankruptcy-related or not).

So I've reproduced below the table from my previous post so that it now includes the "real" Operating RASM and Operating CASM numbers as well as Operating PASM (to coin an acronym) -- Profit per ASM. I've also included the passenger haul numbers from my previous post, which were accurate.

Airline............Pax Haul (mi)........RASM...............CASM............PASM
American..............1,377..............10.70¢..............10.32¢...
........0.38¢
Continental..........1,549..............11.51¢..............10.66¢....
.......0.85¢
Delta.........................981................9.98¢..............10
21¢...........-0.23¢
Northwest............1,356...............10.98¢..............10.35¢...
........0.63¢
United...................1,603...............10.83¢..............10.77
............0.05¢
US Airways.............975...............13.19¢..............13.46¢......
....-0.28¢

Given the different ways the above carriers account for their revenues (as you pointed out, Chip), I believe that Operating RASM, rather than Passenger RASM, is the best indicator of a carrier's relative revenue performance. After all, operating profits include more than just passenger revenues.

But as you can see from the above table, United is not the worst performer among the six carriers in either RASM, CASM or PASM, ranking 4th best, 5th best and 4th best, respectively (with highest RASM and PASM, and lowest CASM, constituting the best). Interestingly, while US Airways did indeed have the best RASM among the six carriers, it simultaneously had the worst CASM and, more importantly, the worst PASM in the group.

So IMHO it's not United (which recorded an operating profit in the 3rd quarter of 2003 with Operating RASM and Operating CASM figures that have shown dramatic improvement and are generally in the ballpark with those of American, Continental, Delta and Northwest) that is in the most trouble among the six legacy network carriers. The reality is that US Airways is currently in the weakest position among these six carriers, despite a quick trip through Chapter 11 and subsequently operating for six months post-bankruptcy in an improving economy. I believe that if US Airways doesn't improve its financial results soon, another trip through bankruptcy is a distinct possibility.
 
Cosmo,

I am sure you are well aware of what U went through this past year, and specifically the Rank and file employees. We've given heads, wages, benefits, workrules, to the point that our employees are actually getting Emotionally and physicall ill.

When looking at those figures, and if they are acutally accurate, OH-MY-GOD!


I can't even believe what I am seeing.....


Two rounds of major concessions equaling approx $1.4 billion in cost savings per year from our groups. TWO gov. bailouts with free tax dollars, 20,000 jobs gone. BK to get out of lease agreements, unwanted realestate, walking away from vendor contracts, dumping leases, and ATSB approval and having GE and RSA as major investors, alliances coming out of the ying -yang, and we still can't make it....TIME FOR NEW NEW NEW MANGEMENT PLEASE!

What I surmise is that its NOT Labor costs, but pax deciding to fly other carriers than U. CHANGE THE FARE STRUCTURE PLEASE. MAKE IT SIMPLE PLEASE and DO IT FAST PLEASE.
 
Cosmo said:
Airline............Pax Haul (mi)........RASM...............CASM............PASM
American..............1,377..............10.70¢..............10.32¢...
........0.38¢
Continental..........1,549..............11.51¢..............10.66¢....
.......0.85¢
Delta.........................981................9.98¢..............10
21¢...........-0.23¢
Northwest............1,356...............10.98¢..............10.35¢...
........0.63¢
United...................1,603...............10.83¢..............10.77
............0.05¢
US Airways.............975...............13.19¢..............13.46¢......
....-0.28¢
CASM 13.46?

That's just about where it was in 2001, pre 9-11, pre-bankruptcy and pre-concessions.

What's wrong with this picture?
 
Cos, I haven't taken the calc out past the numbers the companies posted, I'd be interested to see what you included in the cost and revenue figures. Chip made a serious gramatical error in the way he posted his numbers. He cited RASM, then compained that he meant PRASM (for PASSENGER RASM). In any case, it's a somewhat silly mesurement. By chip's standards, UPS and FEDex are in BIG trouble since they didn't get a DIME from pax (you mean they PAY you to haul boxes :eek: ...) UAL also hid some of it's operating profit in "UAL Loyalty Services" (the FF program).
 
Busdrvr:

I tried to keep the comparison as simple and as much on an apples-to-apples basis as possible. So I used total operating revenues, total operating expenses and total ASMs from each carrier's 3rd quarter 2003 press release to arrive at the operating RASM, operating CASM and operating PASM (Profit per ASM) numbers I most recently posted. I know that this might leave in the calculation some one-time charges and credits that do not really reflect the true financial strength or weakness of a carrier. But it seems that various carriers treat similar items differently.

For example, as best I can determine, the operating RASM and operating CASM shown in the press release discussing United's 3rd quarter 2003 financial results (9.95¢ and 9.88¢, respectively) appear to not include the revenues or expenses from three of United's four Express carriers -- and the fact that ACA's revenues and expenses were treated differently from those of Air Wisconsin, SkyWest and Mesa is yet a further accounting complication that I won't even try to deal with here. Moreover, I believe that there's a plausible argument to be made for removing Express carrier revenues and expenses from a major carrier's passenger RASM and operating CASM calculations, as United did to a large extent, in order to more accurately reflect the major carrier's results, especially since the Express carrier ASMs are not factored into the passenger RASM and operating CASM calculations. But after that somewhat long-winded description of United's actions in just this one area of its financial reporting, suffice it to say that United's treatment of Express carrier revenues and expenses was not matched by some of the other legacy network majors. So in order to avoid penalizing United (and IIRC American and US Airways as well) in any passenger RASM comparison because of the way it handles Express carrier revenues, or Northwest because of the substantial cargo revenues generated by its dedicated B747 freighter fleet, I simply concluded that operating RASM is a fairer and more accurate indicator of both a carrier's relative revenue performance and that revenue's contribution to operating profit.

So to wrap this up (finally :p ), I would agree that operating RASM and operating CASM, without upward or downward adjustments, might not necessarily be the most accurate figures to describe an individual carrier's financial strength or weakness. But given that various carriers seem to report similar financial items differently, those operating RASM and operating CASM figures are probably the best numbers to use when making comparisons among the carriers. JMHO.
 
PITbull:

I certainly am aware of the sacrifices that have been made by the employees of US Airways since 9/11, both those still working for your airline and especially those who no longer are doing so. Please understand that it gives me no joy or satisfaction to post numbers like those I have shown above, but the numbers are what they are (and I try to be as accurate as I possibly can be). The point of my post above was to try to convince Chip of two things: (1) that United's situation is not quite as dire as he often seems to portray it; and (2) that he should be at least a bit more concerned about US Airways' potential to fall further behind its peers, despite the carrier's trip through Chapter 11 with all of its associated pain, as the numbers above appear to be indicating. That said, I sincerely hope that both United and US Airways (and indeed, all the major network carriers) can survive the current downturn and become successful once again.
 
RASM and CASM need to be looked at versus the stage length / avg haul of the passengers. It cost more money to fly short haul flts than long so as a result the shorter the stage of the network the higher both RASM and CASM will be. Airlines will charge more per mile for shorter flights than longer. To adjust for this all one has to do is move all airlines RASM and CASM numbers to the same stage length as the airline you are trying to compare versus. (simple math to move along the curve) When all airlines are adjusted for the same stage than one can tell how high or low the CASM and RASMs are versus other airlines. Without the adjustment it is like comparing apples and oranges.
 
PITbull said:
Cosmo,

I am sure you are well aware of what U went through this past year, and specifically the Rank and file employees. We've given heads, wages, benefits, workrules, to the point that our employees are actually getting Emotionally and physicall ill.

When looking at those figures, and if they are acutally accurate, OH-MY-GOD!


I can't even believe what I am seeing.....


Two rounds of major concessions equaling approx $1.4 billion in cost savings per year from our groups. TWO gov. bailouts with free tax dollars, 20,000 jobs gone. BK to get out of lease agreements, unwanted realestate, walking away from vendor contracts, dumping leases, and ATSB approval and having GE and RSA as major investors, alliances coming out of the ying -yang, and we still can't make it....TIME FOR NEW NEW NEW MANGEMENT PLEASE!

What I surmise is that its NOT Labor costs, but pax deciding to fly other carriers than U. CHANGE THE FARE STRUCTURE PLEASE. MAKE IT SIMPLE PLEASE and DO IT FAST PLEASE.
Pit,

I did the same thing...OMG...!! :shock: :shock:

Something smells ....

SL
 
There you go again....trying to use logic :D

I can't get this tune out of my head......."Sailing on a ship of fools....."

Somebody please shoot me :shock: !!!!
 

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