Is a change in control coming?

[signals]

Interesting. Where do you see evidence of that?

Since piggy boo-boo has me on ignore, someone tell him to look at the pilots.

 

[signals]

This is something else that happens with the IBT(teamsters) they will stop your pension if you get a job in the same field of aviation as well. How BS is that that the union you paid to protect you now can stop your pension if you are required to go back to work, or need exta money for bills. IAM and the IBT are just industrial union which we need to rid the airline industry of. May have been good back in the day, when numbers of members counted and could direct power but those days are long gone.

And this surprises you because...

Teamsters follow the money and if out-sources-ha ha- outnumber the current membership then bye-bye!

 

[Bob Owens]

This is something else that happens with the IBT(teamsters) they will stop your pension if you get a job in the same field of aviation as well. How BS is that that the union you paid to protect you now can stop your pension if you are required to go back to work, or need exta money for bills. IAM and the IBT are just industrial union which we need to rid the airline industry of. May have been good back in the day, when numbers of members counted and could direct power but those days are long gone.

It is BS, but how would they know?

 

[johnny kat]

Bob,

Wow...thanks for the info. Everything discussed on these boards between employees only serves to point out just how unfair and misdirected deregulation has been. In short a nightmare that has done nothing for the employees and the airline companies. The only winners have been the passengers with cheap airfares at the expense of the very people who made the flight happen, and airline management bigwigs. It sickens me that we are squabbling over pigs guts trying to get anything.

Was any of it worth it? I remember reading a Time magazine article back in 1980 that laid out the panacea of what deregulation would bring. What a bunch of b/s. The whole truth about what is going on is that there must always be an airline industry. No surprise, everyone must have access to air travel. It is the only industry that can connect people all over the planet within 24 hours to one another...so, it must exist. The lie that has been told is that people will not fly if they have to pay enough to actually cover the cost of the ticket. B/S again. The entire problem has been over saturation. Thank goodness for consolidation. It is the only thing that will solve this problem once and for all.

Robert Herbst the analyst, painted a nice picture of airlines after the final phase of consolidation (AA/US). By saying after the final phase airlines will become very boring with modest growth and constant profits. HMMM...sounds like the way it supposed to be in a normal successful business.

The employees have had enough. It is time for this mess to be cleaned up after 34 years of nothing but hardship for the poor souls who for some reason are attracted to this circus.

 

[AMFAinMIAMI]

It is BS, but how would they know?

Bob

Not sure how they would know but that is what Chris Moore the IBT Intl rep who was brought to miami by our (Miami video amt) told us at the Teamsters organizing meeting Sept 12th in the hotel conf. room. He mentioned that while I was asking how the IBT pension works and why the central states and western Conf, pensions were
in trouble.

 

[1AA]

It is BS, but how would they know?

BS or not this is true. Teamsters rational reason is if you stay in the field you take away another teamsters job somewhere else down the line.
I spoke to a UAL guy who is involved in union activities and the IBT has this covered in all states and all areas.

 

[Bob Owens]

Bob,

Wow...thanks for the info. Everything discussed on these boards between employees only serves to point out just how unfair and misdirected deregulation has been. In short a nightmare that has done nothing for the employees and the airline companies. The only winners have been the passengers with cheap airfares at the expense of the very people who made the flight happen, and airline management bigwigs. It sickens me that we are squabbling over pigs guts trying to get anything.

Was any of it worth it? I remember reading a Time magazine article back in 1980 that laid out the panacea of what deregulation would bring. What a bunch of b/s. The whole truth about what is going on is that there must always be an airline industry. No surprise, everyone must have access to air travel. It is the only industry that can connect people all over the planet within 24 hours to one another...so, it must exist. The lie that has been told is that people will not fly if they have to pay enough to actually cover the cost of the ticket. B/S again. The entire problem has been over saturation. Thank goodness for consolidation. It is the only thing that will solve this problem once and for all.

Robert Herbst the analyst, painted a nice picture of airlines after the final phase of consolidation (AA/US). By saying after the final phase airlines will become very boring with modest growth and constant profits. HMMM...sounds like the way it supposed to be in a normal successful business.

The employees have had enough. It is time for this mess to be cleaned up after 34 years of nothing but hardship for the poor souls who for some reason are attracted to this circus.

Dont kid yourself, there are plenty of winners, but the workers are the biggest losers. For instance AA took in $7 billion more in revenue by flying 30% fewer planes and 40,000 less workers, those who remained essentially saw their real earnings cut in half.

Passengers paid more, were packed in tighter and probably had fewer options than ten years ago. So I wouldnt say they won.

So, where did that extra $7 billion in revenue, plus the savings from what they took from the workers, go? Answer that and you will find your winners. Inevitably it will lead to the banks.

If you want to see the future for the Airlines look at the rails. Everything that we are going through, they went through. Overexpansion, bankruptcies, consolidation, oil and steel did the same thing. If labor is to be an effective element they too must consolidate and establish industry rates and terms.

 

[johnny kat]

Bob Owens

If you want to see the future for the Airlines look at the rails. Everything that we are going through, they went through. Overexpansion, bankruptcies, consolidation, oil and steel did the same thing. If labor is to be an effective element they too must consolidate and establish industry rates and terms.
____________________________________________________________________

Absolutely agreed!

 

[WorldTraveler]

Bob,
very good assessment of the labor situation and why AA is risking its future by paying mechanics so low. Unlike pilots - which also will be in short supply - mechanics have highly transferrable skills.

You, however, continue to totally miss the impact of fuel on the airline industry.
From AA's 2000 annual report as filed with the SEC, they said that in 2000, AA spent $2.5B on fuel at 78 cents/gallon which constituted 14% of AA's total costs - and that was up from the two previous years in which fuel was 50 cents a gallon and constituted 10% of AA's costs.

By the end of 2011, for about 5% more fuel, AA paid $8.4 billion at over $3/gal constituting over 33% of AA's costs - and that was up in the previous two years when fuel was $2.01 and $2.31 per gallon and represented.27 and 29% of AA's costs.

That doesn't mean that other carriers haven't also dealt w/ high fuel costs but for someone like you to not understand that AA's fuel costs have gone up by SIX BILLION dollars - more than tripling - over a ten year period in which AA used almost the same amount of fuel severely limits your ability to speak w/ authority on the subject.
The simple fact is that the airline industry has been severely affected by the increase in fuel prices.

And kat, while no one doubts that deregulation overpromised to the public at the expense of airline employees, no one could have predicted that oil prices would rise to what they are today and where they likely will remain if not continue to rise.

Those dramatic increases in fuel prices are leading to a dramtatic reduction in demand for travel as ticket prices must rise to cover costs, esp. of fuel which is well beyond the airlines' control for the most part.

And no the banks did not pocket that extra $6B in revenue. Oil is a commodity which means the suppliers all over the world have benefitted. Lest someone make the statement, the Middle East now is a minority supplier of petroleum to the US. Most petroleum used in the US now comes from the western hemisphere and the US is moving towards energy independence.

Anyone who wants to talk about the airline industry has got to understand ALL of the drivers; failing to acknowledge the impact of fuel on both the costs to the airlines and the reduced demand - which has to result in fewer flights renders one's opinions far less valid.

That doesn't mean that there aren't other factors that are involved in determining which airlines succeed but to make statements about increased revenues w/o understanding other costs is simply not accurate.

 

[swamt]

Here comes yet another delay. AA will do anything to extend the possibility of a merger with US. Horton really don't want to give up the reins now does he??

AMR Seeks to Extend Exclusive Right to File Exit Plan

 

[Bob Owens]

Bob,
very good assessment of the labor situation and why AA is risking its future by paying mechanics so low. Unlike pilots - which also will be in short supply - mechanics have highly transferrable skills.

You, however, continue to totally miss the impact of fuel on the airline industry.
From AA's 2000 annual report as filed with the SEC, they said that in 2000, AA spent $2.5B on fuel at 78 cents/gallon which constituted 14% of AA's total costs - and that was up from the two previous years in which fuel was 50 cents a gallon and constituted 10% of AA's costs.

By the end of 2011, for about 5% more fuel, AA paid $8.4 billion at over $3/gal constituting over 33% of AA's costs - and that was up in the previous two years when fuel was $2.01 and $2.31 per gallon and represented.27 and 29% of AA's costs.

Ok, and how do those figures compare at SWA? Isnt SWA paying a lot more for fuel now as well? Jet Blue? Delta? United?

What you leave out when figuring the percentage of costs is the fact that if labor costs go down, which they did, that fuel costs as a percentage of total costs, even if the cost was the same stayed the same, would all other things being equal go up.


And yes you can count the oil companies as one of the "winners" in Airline Deregulation and their profits come directly from our pockets. Our failure to shut down the industry, and most of the demand for Jet Fuel, has enabled them to jack up prices to unreasonable levels and helped them earn record profits. Who owns the oil companies? Banks.

 

[FWAAA]

Here comes yet another delay. AA will do anything to extend the possibility of a merger with US. Horton really don't want to give up the reins now does he??

AMR Seeks to Extend Exclusive Right to File Exit Plan

It's a joint motion of AA and the unsecured creditors committee. How do you know it's Horton's idea? For all we know, the UCC is pulling the strings and calling the shots.

 

[eolesen]

And yes you can count the oil companies as one of the "winners" in Airline Deregulation

So, absent deregulation, fuel would have stayed lower? Don't think so -- fuel would have still gone up due to global conditions, and airlines would have had to go to the government to get fare increases passed. Keep in mind this is the same government that can't figure out how to do a budget after three years, or how to stop spending more money than it brings in as revenue...

Here comes yet another delay. AA will do anything to extend the possibility of a merger with US. Horton really don't want to give up the reins now does he??

Perhaps, just perhaps, the reason for this is because US and AA have made progress, and want to be able to wrap up the loose ends without a hostile bidder entering the picture?

Y'all are shocked that AA has required more than a year in bankruptcy, yet UA and DL spent considerably longer getting their acts together...

 

[WorldTraveler]

AA MIGHT have been able to pull off a year in BK if everything had gone as planned, but the whole reason why any company is in BK is because the plans didn't quite work. DL's BK at 21 months was the shortest successful among the legacy carriers in that the company returned to viability; AMR might make 18 months but racing the clock is far less lofty than not getting the job done right. If AA had restructured fully in 2003, there wouldn't be a BK today - but it is now obvious that AA couldn't restructure outside of BK compared w/ restructuring plans of airlines in BK. And since AA, like, DL will still end up w/ substantial pension debt and could have - and did - cut wages outside of BK, the real value of BK is in cutting non-employee expenses in BK court.

As for fuel, Bob, no one said that fuel was the only measurement of success in the airline industry over the past 10 years... but when increased fuel costs make up for 90% of the increased revenues which you continue to trot around, then fuel really does matter - and you can't talk about the increased revenue w/o acknowledging alot of costs went up to cover expenses over which AA had little to no control. AA's health care costs went up dramatically - along w/ the rest of America's - over the past year but AA was still charging insurance premiums that were well short of the market. A couple hundred million dollars less in health care costs might well have made a difference in whether AA could have stayed out of BK or not.

The market for jet fuel is global as E notes and the cost didn't go to prop up oil industry exec pay. All of the global oil companies are for-profit publicly owned companies which means their profits went to stockholders, which include many stock funds such as in your IRA. There are ample statistics available as to where every penny of a gallon of fuel goes and you can look them up but the majority of cost goes to the producer, not profits and certainly not executives. I don't like the price of oil either but I know where the problem is and where it is not.

There are some genuine structural issues w/ jet fuel prices that are affecting the airline industry but they are not intentional acts of oil companies against the airlines but rather issues which the airline industry has to understand and correct.
1. Most US refineries are tuned to maximize the production of gasoline; jet fuel is a by product which the oil producers produce and sell but they are far from focused on creating a stable price point for the airline industry.
2. The number of refineries in the US is decreasing, primarily because US autos are more and more efficient and there is little growth in demand for gasoline. As refineries close, jet fuel production gets hit proportionately harder because jet fuel is a fairly small percent of the production of most US refineries and jet fuel consumption is not falling at the same rate as the reduction in jet fuel supplies.
3. The market for petroleum products in the US is being met from offshore refined products which means that whatever jet fuel is not produced here must be imported at expensive transportation costs because there is no surplus jet fuel production capacity anywhere near the US.
4. The price of jet fuel relative to other refined products continues to grow.

One of your employer's competitors is dealing w/ these STRUCTURAL issues by buying a refinery, tuning it to produce the maximum amount of jet fuel possible, and then swapping the non-jet fuel products for jet fuel in a nationwide deal that reduces their overall costs. DL's actions should put more jet fuel into the market, although it is possible that refiners could change their production of existing plants to keep the supply constant and offset what DL produces for its own use. If that happens, then the price for players other than DL will go up; if DL's production increases the overall supply, then all players will benefit.

But there is not some concerted effort to squeeze airlines by the oil companies. There are genuine structural reasons why airlines ahve been harder hit by fuel increases and DL just happened to take a move that will help them - and might help other players in the industry, depending on actions of the rest of the petroleum and airline industries.

The real reason why AA has struggled more over the past decade while other carriers have not to the same degree is because of revenue, a subject I have talked about plenty here. There is no need to rehash it other than to note that the low fare carriers and Delta, among the network carriers, have done a far better job of growing revenues than AA - much of it at the expense of AA, UA, and US. When revenues grow, it is much easier to cover increased costs and not to look to employees to fund the deficits in the company.

And there is no sign that the carriers that have succeeded at growing revenues are going to stop doing so.

Understanding the problems that really face the industry and AA and understanding why some companies have been able to minimize the pain on their employees will go along way to helping you focus your frustration and energy in the right place.

Don't expect other workers in the airline industry to join you in shutting it down because not all airline employees have been equally affected, in part because their companies have done a better job of adapting to the realities of the industry.

 

[OldGuy@AA]

Bob,
very good assessment of the labor situation and why AA is risking its future by paying mechanics so low. Unlike pilots - which also will be in short supply - mechanics have highly transferrable skills.

You, however, continue to totally miss the impact of fuel on the airline industry.
From AA's 2000 annual report as filed with the SEC, they said that in 2000, AA spent $2.5B on fuel at 78 cents/gallon which constituted 14% of AA's total costs - and that was up from the two previous years in which fuel was 50 cents a gallon and constituted 10% of AA's costs.

By the end of 2011, for about 5% more fuel, AA paid $8.4 billion at over $3/gal constituting over 33% of AA's costs - and that was up in the previous two years when fuel was $2.01 and $2.31 per gallon and represented.27 and 29% of AA's costs.

That doesn't mean that other carriers haven't also dealt w/ high fuel costs but for someone like you to not understand that AA's fuel costs have gone up by SIX BILLION dollars - more than tripling - over a ten year period in which AA used almost the same amount of fuel severely limits your ability to speak w/ authority on the subject.
The simple fact is that the airline industry has been severely affected by the increase in fuel prices.

And kat, while no one doubts that deregulation overpromised to the public at the expense of airline employees, no one could have predicted that oil prices would rise to what they are today and where they likely will remain if not continue to rise.

Those dramatic increases in fuel prices are leading to a dramtatic reduction in demand for travel as ticket prices must rise to cover costs, esp. of fuel which is well beyond the airlines' control for the most part.

And no the banks did not pocket that extra $6B in revenue. Oil is a commodity which means the suppliers all over the world have benefitted. Lest someone make the statement, the Middle East now is a minority supplier of petroleum to the US. Most petroleum used in the US now comes from the western hemisphere and the US is moving towards energy independence.

Anyone who wants to talk about the airline industry has got to understand ALL of the drivers; failing to acknowledge the impact of fuel on both the costs to the airlines and the reduced demand - which has to result in fewer flights renders one's opinions far less valid.

That doesn't mean that there aren't other factors that are involved in determining which airlines succeed but to make statements about increased revenues w/o understanding other costs is simply not accurate.

I have never claimed to be a business expert but I do know that with any business if your cost of doing business or providing a service increase, like fuel to airlines, you pass that on to your customers. Every service industry known to us and every retailer or provider of anything from insurance to food has increased their price for their product. Have you not noticed the prices at the grocery store going up with the price of gas? But the airline industry has refused to pass these fuel increases on to the public. AA has instead taken the money from us to keep prices low. The experiment has worked so well for them that they now don't even have to negotiate. They run to BK with billions of dollars in the bank and get a judge (and a weak union) to help them screw the employees even more. Now I am sure Mr. E. will say I am entirely full of baloney and that prices have gone up. They have but not near as much percentage wise as any other product in this country. Name any other industry or business where the weakest dictate the pricing of the industry. The executives of the airline industry have figured out a way to screw the workers out of pay and benefits and in the near future with concessionary contracts in place will find that there are suddenly lots of profits, but alas since we are locked into long term contracts we cannot share in the windfall. The profits will mysteriously disappear as the contracts come to the time of amending. The thing that is really disgusting to me is that there are some people who are actually welcoming a merger with US Air. This is the only airline in the entire industry who has historically had worse management than American Airlines. Bob makes a great point. They treat their employees like crap (better than AA treats us though). What makes you think they'll treat us any different? You know that in France they were cutting off people's heads in the village squares for doing things like this. I do in no way condone this, but I can understand it. At this point I wouldn't be surprised if Walmart was interested in taking over AA. We fit thier business model.