Royal Ambassador,Feb 1 2004, 03:27 PM
The TWA people were furloughed when TWA went broke.
You said:
Perhaps you should pay more attention in your college classes. 6,000 of 28,000 is roughly 21%. Without the furlough cushion that you enjoyed, AA would have furloughed approximately 4,800 of the 24,000 nAAtive population, give or take a few hundred.
You can not make that leap. . .for the following reasons
The extra financial burden and debt brought to AA from the acquisition of TWA probably forced the company to lay off a higher percentage than would have been required if they had not taken on TWA. Without the extra debt, they probably would not have had to lay off 21%. American took on an additional $3.5 billion in debt with TWA, paid $92M in aircraft lease fees and $742M for TWA assets.
AMR retires thirteen leased TWA aircraft but still pays those leases through 2014 to the tune of $159 million.
All this at a time when the air industry was turning down. . . ."overcapacity that has left the industry with billions of dollars in losses over the last couple of years", analysts said. Then add 9/11 in the mix.
Morgan Stanley shows that airline revenue per mile per seat (passenger yield) has fallen 4.5% annually since deregulation in 1978. Morgan Stanley shows that airline pricing has been falling for 40 years. . . .
No one knows what went on in the corporate offices, why these decisions were made. But to claim TWA has been a cushion for AA'ers is beyond speculation and borders on urban legend. Once you look at the facts, you see AA was a cushion for TWA F/A's, even if it was only for a couple of years.
When Collectively, the U.S. airlines lost $8.3 billion in 2001 and $11.3 billion in 2002, according to figures compiled by the Air Transport Association, to think that somehow TWA would have survived is just not facing reality. When there was only 20 million on hand, having to charge low cost fares just to keep cash coming in, the figures just don't add up.
According to industry experts: "it was highly likely that TWA would have been liquidated. . . "
And your own CEO WILLIAM F. COMPTON said:
. . "But, TWA’s financial predicament continues and we can no longer afford to operate,
. . remains essentially a single hub operation, putting us at a schedule disadvantage to multiple hubcarriers.
Finally, this winter we ran out of time. In fact, by January 10, 2001, TWA had cash on hand of only $20 million and needed significantly more just to make it through the next day."
TWA did not fare well after the airline industry was deregulated in 1978. It has been clear for some time that TWA was unlikely to pull itself out of lean times.
TWA's costs are unusually high, he said, because the airline has no credit. Thus, TWA cannot hedge on fuel prices and its aircraft lease fees to Boeing Corp. are steep.
in recent years TWA has been paying "at least $100 million" a year extra in aircraft leases because its credit rating was so poor. And last year, during the enormous run-up in jet fuel prices, the airline did not have enough money to hedge its fuel costs, sources said.
TWA's lease contract with Boeing for nine 767s is about $600,000 a month for 18 years, while American's average lease cost for 767s is $450,000 a month, sources said. The 27 TWA 757s are leased for $480,000 to $540,000 a month, while the similar lease cost is $300,000 a month. TWA's MD-80 lease costs are about $330,000 a month, compared with American's $200,000 a month fee.
TWA was an airline with low yielding routes and a 15% revenue gap relative to the industry average.
Your CEO approached at least seven other airlines looking for a way to survive, American was the only one to pay the bills, being acquired by AA was a reprieve.
Especially for the retirees: "American also assumes certain debt and financial responsibilities, such as covering TWA's retired employees."
Like I said, math is not my strong suit, but I understand enough to see how these figures run.
to answer your comment:
Plenty of your posts have appeared there in the week or so leading up to the vote count.
I do not need to justify or explain my posts on another board to you, but for the sake of the many people that read THIS board, I am replying. . .
I posted there what I post here, I do not want slotting, I do not want to lose one number of my senority, no how, no way. That is not a bitter nor caustic statement. It may be one you do not like, but it is not bitter nor caustic.
You did not answer my question. Are you an AA flight attendant?
