Here comes the BK threat from the company

[Buck]

You're generally better than that. Let's focus on the issues and the words posted here (and the underlying facts and opinions) and less on the assumed motivations of those posting here.

As an aside, I'd bet serious money that WT has never worked for AA in any capacity, let alone management. His posting record reveals that he's an unabashed Delta fan - and I don't think any AA management personnel is motivated enough to regularly post thousands of words praising Delta in an attempt to sway opinions of AA rank and file. For one thing, the TWU takes care of swaying the opinions of the maintenance employees without the need for any help.

You're generally better than that.

Explain, better than what? When an individual uses an open forum to get his/her point across, they are open to all forms of criticism. Just as WT has the right to post the Internet to state his opinion. I just believe that the long drawn out World Books are a waste of time. Like I said before my soup no longer has all the letters of the alphabet, the I and Q are missing. If the company files for Bankruptcy, so be it. What will I do, probably nothing. As another poster in another forum put it. Lets go after the real problem.......

 

[strikeforce]

I like how WT is suddenly an employee advocate, and trying to spin AA's aircraft order as being financed on the backs of the employees.

If anything, it's being financed on the backs of the oil companies...

AA will pay less to the oil companies, but unless they improve their current maint. program the slew of new aircraft will need lots of attention by the lowly paid mechanics. AA just swapped the next gen 737's that were previously based at ORD with the old 737's from miami....lots of issues with the old ones....and I can guarantee in a few years those next gen aircraft will need lots of help. The scare bus will generate lots of overtime too because it's an airbus...enough said, and the 787 will need lots of hot bonding the carbon fiber skin.....So, if people think AA will save all this money wasting less gas....they will spend the savings on maint. It's just the AA way it is!

 

[WorldTraveler]

I can assure the board that as FWAAA has noted I have never been employed by AA or AMR.
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My alone connection with AA is that my brother works for AA on the ramp in DFW and I have flown on AA on his pass benefits a couple of times.
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I appreciate the nod to being intelligent and acknowledge that there are a number of obviously intelligent people on this forum - of various stripes.
More than discussing credentials, I am and always have been interested in seeing AA fans and employees - but most importantly mgmt - come forth with solid proposals that can turn the company down - without flushing the current employees away in the process.

 

[Buck]

I can assure the board that as FWAAA has noted I have never been employed by AA or AMR.
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My alone connection with AA is that my brother works for AA on the ramp in DFW and I have flown on AA on his pass benefits a couple of times.
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I appreciate the nod to being intelligent and acknowledge that there are a number of obviously intelligent people on this forum - of various stripes.
More than discussing credentials, I am and always have been interested in seeing AA fans and employees - but most importantly mgmt - come forth with solid proposals that can turn the company down - without flushing the current employees away in the process.

Without belittling Fleet Service, what does your brother do for the airline? Is he a Mechanic or a Baggage Handler or what?

 

[commavia]

Let's focus on the issues and the words posted here (and the underlying facts and opinions) and less on the assumed motivations of those posting here.

Well, since nobody has actually responded to my post - other than to mock or grandstand - I would be interested to hear what strategy AA should have followed. What should the plan have been?

While Delta, Northwest, United and USAirways were using bankruptcy to lay off thousands more, freeze and/or dump pensions, further cut base pay, further gut work rules, outsource flying to regionals, outsource overhauls to third parties and foreign countries, etc., how should AA have responded? Generally speaking, the three major work groups - pilots, flight attendants and mechanics - at these legacy carriers (to say nothing of low-fare airlines) are today paid less, and/or are more productive, and/or number proportionally fewer than the same groups at AA. But does none of this matter? Has AA's competitive disadvantage been solely due to management?

And, perhaps more importantly, I would be curious to hear what AA union members believe their union's response is going to be when AA's negotiating team uses those same numbers to argue before the NMB that the unions are being unreasonable? What is the union going to say in response? Are those (mostly) government numbers B.S.?

 

[FWAAA]

AA will pay less to the oil companies, but unless they improve their current maint. program the slew of new aircraft will need lots of attention by the lowly paid mechanics. AA just swapped the next gen 737's that were previously based at ORD with the old 737's from miami....lots of issues with the old ones....and I can guarantee in a few years those next gen aircraft will need lots of help. The scare bus will generate lots of overtime too because it's an airbus...enough said, and the 787 will need lots of hot bonding the carbon fiber skin.....So, if people think AA will save all this money wasting less gas....they will spend the savings on maint. It's just the AA way it is!

Perhaps, but how long does a new narrowbody fly before it's due for its first heavy C check? AA says (on its website) that heavy C checks occur every five or six years. That's a very long maintenance holiday that carries significant potential savings. Sure, line maintenance will required just as it is now, but hundreds of new narrowbodies plus 100 potential 787s could see TULE's workload fall dramatically for a few years.

 

[FWAAA]

Just because AA will reduce less oil/fuel with newer planes does not mean the oil companies are providing funding for the investments. By your logic, AA mechanics will be paying for the new planes by virtue of AA's need for less maintenance.

I'm confused. If the fuel savings equal a substantial portion of the lease payments, then yes, the new planes are financed on the backs of the oil companies and not the employees. Yes, I realize that the fuel savings won't completely make the payments, but maintenance savings plus fuel savings just about covers the payments. Of course, "maintenance savings" means the employees will shoulder some of the costs - as fewer mechanics will be needed for the first few years at least.

I still am waiting for an example of an airline that has replaced 60-70% of its fleet - in AA's case to the tune of well over $10B of new aircraft even w/ discounts - over a 5 year period and managed to pay its people competitive wages. That is an enormous investment that I have not seen anyone explain how AA can assume without reducing AA's other costs including payroll to far below the rest of the industry.

This fleet replacement is a huge gamble on long-term fuel prices. If fuel stays expensive (or increases further), then the fuel savings will cover much of the expense. If fuel prices moderate and stay reasonable long-term, then the strategy will be much more costly.

I don't think there's any disagreement that AA's labor costs are out of line with its competitors and that, long-term, drastic changes will have to occur if AA is to survive. But AA's labor costs are too high no matter what vintage planes are flown and no matter how poor AA's fleet fuel economy numnbers are. If fuel and maintenance savings practically cover the lease expenses of new fuel efficient planes, then labor costs don't have to change to pay for the planes.

Yes, AA's labor costs have to fall into line with the competition, either by concessions or by increases in the structural costs of the competition, but labor costs don't have to be slashed in order for AA to purchase and fly new fuel efficient aircraft. AA didn't slash labor costs when it bought 75 new 738s in 1997 to replace the 727s nor did labor costs have to be slashed in 1997 when AA ordered the current fleet of 47 777s to replace the MD-11s and DC-10s. AA didn't cut labor costs three years ago when it ordered the first of what are now about 150 new 738s that are slowly replacing MD-82s and MD-83s.

 

[Buck]

Well, since nobody has actually responded to my post - other than to mock or grandstand - I would be interested to hear what strategy AA should have followed. What should the plan have been?

While Delta, Northwest, United and USAirways were using bankruptcy to lay off thousands more, freeze and/or dump pensions, further cut base pay, further gut work rules, outsource flying to regionals, outsource overhauls to third parties and foreign countries, etc., how should AA have responded? Generally speaking, the three major work groups - pilots, flight attendants and mechanics - at these legacy carriers (to say nothing of low-fare airlines) are today paid less, and/or are more productive, and/or number proportionally fewer than the same groups at AA. But does none of this matter? Has AA's competitive disadvantage been solely due to management?

And, perhaps more importantly, I would be curious to hear what AA union members believe their union's response is going to be when AA's negotiating team uses those same numbers to argue before the NMB that the unions are being unreasonable? What is the union going to say in response? Are those (mostly) government numbers B.S.?

1) Well, since nobody has actually responded to my post - other than to mock or grandstand - I would be interested to hear what strategy AA should have followed. What should the plan have been?


I believe that AA should have followed the other airlines to take advantage of the environment that granted a cleansing of the books. In the interim, AA purchased TWA, Thereby adding red to their books. By purchasing TWA the company attempted to right itself by gaining real estate, something Crandall appeared to like.

2)Has AA's competitive disadvantage been solely due to management?

I would say that AA's mismanagement has placed the ROI for their maintenance program in the dumps. AA refuses to compensate maintenance, whom has already given ( as well as other groups of labor ) the concessions needed to become competitive with other airlines. Where else can one go but to the next step up? Labor has changed so maybe it is time management change also.

3) As for the mechanics, the TWU will do what it has traditionally done, rollover and burrow deeper into the company hip pocket, but only if they can get more dues payers at no matter the cost.

 

[DFWFSC]

Well, since nobody has actually responded to my post - other than to mock or grandstand - I would be interested to hear what strategy AA should have followed. What should the plan have been?

While Delta, Northwest, United and USAirways were using bankruptcy to lay off thousands more, freeze and/or dump pensions, further cut base pay, further gut work rules, outsource flying to regionals, outsource overhauls to third parties and foreign countries, etc., how should AA have responded? Generally speaking, the three major work groups - pilots, flight attendants and mechanics - at these legacy carriers (to say nothing of low-fare airlines) are today paid less, and/or are more productive, and/or number proportionally fewer than the same groups at AA. But does none of this matter? Has AA's competitive disadvantage been solely due to management?

And, perhaps more importantly, I would be curious to hear what AA union members believe their union's response is going to be when AA's negotiating team uses those same numbers to argue before the NMB that the unions are being unreasonable? What is the union going to say in response? Are those (mostly) government numbers B.S.?

Why are you being so hard on the unions? What dog do you have in this fight? Are your anti-union sentiments due to the fact that your mother use to be a executive secratary at AA hdq and you grew up with a chip on your shoulder towards unions? Are you affraid a trip thru BK and you might loose your pass travel benefits? Care to elaborate?

 

[Buck]

Perhaps, but how long does a new narrowbody fly before it's due for its first heavy C check? AA says (on its website) that heavy C checks occur every five or six years. That's a very long maintenance holiday that carries significant potential savings. Sure, line maintenance will required just as it is now, but hundreds of new narrowbodies plus 100 potential 787s could see TULE's workload fall dramatically for a few years.

A maintenance holiday for the new airplanes, yes, maybe. However the older aircraft have to maintained during the transition. The 757's are out of yield and the 737's are getting close. The Retro has been put on the back burner until it can again be accomplished in a timely manner. I believe barring a bankruptcy that many are fond of talking about, I will retire and I am only 51 yrs old, before maintenance takes a break because of the new aircraft.

 

[commavia]

I believe that AA should have followed the other airlines to take advantage of the environment that granted a cleansing of the books. In the interim, AA purchased TWA, Thereby adding red to their books. By purchasing TWA the company attempted to right itself by gaining real estate, something Crandall appeared to like.

While I understand what you're saying - wouldn't bankruptcy have been worse for AA's employees? And as for TWA - that happened before 9/11, and before Delta, Northwest, United and USAirways filed for bankruptcy.

Why are you being so hard on the unions? What dog do you have in this fight?

Who's being hard on the unions? Back in 2003 AA's employees sacrificed a massive amount in order to keep the company out of bankruptcy, and still today have never recovered the earnings they received before 9/11. I don't minimize that sacrifice for one second. And I certainly don't have any issue with the unions trying to get their members the absolute best deal possible - after all, that's what unions are supposed to do. But why is it that when somebody says something you don't like, that makes them anti-union? I just listed statistics comparing AA's union labor force with competitors' union and non-union labor forces - and made the point that perhaps AA's union employees, despite all of the crap they absolutely do have to put up with, may still have ended up better off today than the alternative "strategy" that some apparently would have preferred (bankruptcy).

I'm not pro-union, nor pro-management. I'm pro-AA succeeding, which benefits both labor (including the unions) and management.

 

[Birdman]

3) As for the mechanics, the TWU will do what it has traditionally done, rollover and burrow deeper into the company hip pocket, but only if they can get more dues payers at no matter the cost.

Could this be a TWU dichotomy? They now have thousands less paying dues, and while they not only gave up nothing, they increased their own wages at the same time we gave up billions. :blink:

 

[Mr Red]

Well, since nobody has actually responded to my post - other than to mock or grandstand - I would be interested to hear what strategy AA should have followed. What should the plan have been?

While Delta, Northwest, United and USAirways were using bankruptcy to lay off thousands more, freeze and/or dump pensions, further cut base pay, further gut work rules, outsource flying to regionals, outsource overhauls to third parties and foreign countries, etc., how should AA have responded? Generally speaking, the three major work groups - pilots, flight attendants and mechanics - at these legacy carriers (to say nothing of low-fare airlines) are today paid less, and/or are more productive, and/or number proportionally fewer than the same groups at AA. But does none of this matter? Has AA's competitive disadvantage been solely due to management?

And, perhaps more importantly, I would be curious to hear what AA union members believe their union's response is going to be when AA's negotiating team uses those same numbers to argue before the NMB that the unions are being unreasonable? What is the union going to say in response? Are those (mostly) government numbers B.S.?

AA did the same thing without BK !!!

 

[commavia]

AA did the same thing without BK !!!

So are those numbers wrong?

 

[WorldTraveler]

My brother is a crew chief.

Hey Comm,
perhaps part of the reason that people aren't buying your message is because you until the most recent couple posts have downplayed that AA people took massive cuts - and have also berated other airline mgmt teams - despite the fact that they have turned their companies around.
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You have yet to acknowledge that airline employees at those other airlines DO NOT face the threats to pay and livelihoods that AA employees now face - and that cumulatively AA employees very likely will end up w/ far bigger cuts after 2 rounds of restructuring - this one plus 2003 - than other airlines except perhaps US.
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As many employees have pointed out to you, AA's pay cuts were just as brutal as what other airlines incurred - and in many cases, there really weren't the pension losses for most employees that you have tried to paint... most airline employees even w/ terminated pensions have benefits that are 100% insured by the PBGC and other airline employees - most notably DL and NW employees with frozen benefits, didn't lose anything.
Finally you fail to acknowledge that many of those other airline employees have begun to recovery significant amounts of the losses they incurred via pay raises and profit sharing.
And part of AA's problem is that the TW acquisition followed on the heals of several other failed AA mergers and hub developments since deregulation... the TW deal saddled AA with alot of debt for an acquisition that in a pretty short amount of time was worth nothing to AA - and in the process was a major factor in AA's significantly deteriorated labor relations. Was AA mgmt incapable of seeing any value in TW more than what as an overflow for ORD - where ironically they now continue to reduce capacity and lose market share.
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Perhaps if you focus on what AA SHOULD DO NOW instead of trying to compare how much worse off other airline employees are compared to AA employees, you might find some interest.
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My perspective remains that AA's greatest failure in all of this is TIME.... they have moved way too slow and have racked up increasing losses which ultimately have to be paid for by someone. Unless you can find someone else that will foot the bill, the employees will get stuck with it.
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We are on the same page that I too want AA to succeed and for AA employees to share in that success.
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FWAAA,
the issue again is not that AA will have a bunch of new fuel-efficient airplanes that will require maintenance - although there are plenty of maintenance people who see all these new planes as the opening for AA to dismantle alot of its maintenance operations.
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The concern is that AA will be a high leveraged company - both as a result of the debt that it now carries and as a result of the huge lease payments that it will have to make. Even if AA cuts maintenance and fuel expenses, they are committed to making payments on their fleet.... that is what leverage is all about. AA has much less flexibilty to park planes in a downturn and has a much smaller margin for adjustments to the business model when so much of their costs are locked up in long term commitments. When a company has that little ability to adjust its business plan, it is the employees who have to provide the flexibilty - in the form of future pay cuts - in order to pay for all of those expensive airplanes.
I still see no example of any airline that has replaced such a large percentage of its fleet in such a short time frame without paying its employees wages well below the industry average. If you can show me, I might change my tune.
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I also can't see how oil companies are funding these purchases because AA is buying less fuel... does your local power company fund your purchase of compact flourescent light bulbs because you use less electricity? No.
Your power company will still sell electricity and they aren't raising your rates to cover the electricity that you aren't buying any more than OPEC will continue to sell just as much if not more jet fuel (or crude).
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and my biggest concern is still about AA's revenue competitiveness - and I have seen no one really address how AA is going to address the fact that AA's position in NYC and CHI is rapidly declining... UA is hot on AA's every action at LAX.. which leaves MIA and DFW as the two key cornerstones which are not being "HUGELY" attacked, even though MIA is showing signs of growing competitive pressures and AA has to deal with the fall of the Wright Amendment in a couple years....
the fact that AA's RASM growth numbers across its network are trailing its competitors tells me that coming up with a plan to address AA's revenue problems is far more important to determining the future of AA employees than whether they fly 25 year old M80s or brand new 320neos.

I am glad this thread is taking more of a tone of dialogue and spirited discussion....