Is it just me?

[OldpropGuy]

[P class=MsoNormal][SPAN style=FONT-SIZE: 10.5pt; FONT-FAMILY: Tahoma]I''m not one of the brilliant managers who shared in the six million dollar bonus, just one of the bottom-feeder employees who shared in the concessions with no promise of a future, so I certainly do not have the big picture. But, it appears to me that this is not the time to be giving away seats on our flights. How can one justify selling seats for the ridiculous low prices I’ve seen advertised lately, when the latest restructuring problem we hear about is the lack of projected revenue?[?xml:namespace prefix = o ns = urn:schemas-microsoft-comfficeffice /][o][/o][/SPAN][/P]
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[P class=MsoNormal][SPAN style=FONT-SIZE: 10.5pt; FONT-FAMILY: Tahoma]It reminds me of the old story of the two guys driving over to the next town and buying hay for fifty cents a bale, bringing it home and selling it for forty cents. After the first month, they examined their books and decided that the problem was they needed a bigger truck.[o][/o][/SPAN][/P]
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[P class=MsoNormal][SPAN style=FONT-SIZE: 10.5pt; FONT-FAMILY: Tahoma]Can one really shrink an airline into profitability using this strategy? Is it just me? [o][/o][/SPAN][/P]
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[P class=MsoNormal][SPAN style=FONT-SIZE: 10.5pt; FONT-FAMILY: Tahoma]Does it seem rational to announce a deal for twenty more RJ’s to a contract carrier (whose pilot group has not agreed to J4J) with a poor performance record and give them the profit, rather than trying to get the wholly-owneds ramped up with flying these “small jets.â€￾ [o][/o][/SPAN][/P]
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[P class=MsoNormal][SPAN style=FONT-SIZE: 10.5pt; FONT-FAMILY: Tahoma]I’m confused. Is Dave really our savior? I certainly hope there is more to this than is apparent. Is it just me? [o][/o][/SPAN][/P]
[P class=MsoNormal][SPAN style=FONT-SIZE: 10.5pt; FONT-FAMILY: Tahoma] [o][/o][/SPAN][/P][SPAN style=FONT-SIZE: 10.5pt; FONT-FAMILY: Tahoma; mso-fareast-font-family: ''Times New Roman''; mso-ansi-language: EN-US; mso-fareast-language: EN-US; mso-bidi-language: AR-SA][Disclaimer: I am not capable of running an airline. But, I did sell my shared of a successful business years ago before deciding to run off and fly for a living. Until now I thought it was a good move.][/SPAN]

 

[Old PSA]

I think you may be right. Dave doesn't get it. All we hear is money. Pay cut and layoff. His plan is just more of the same old line airline thinking. An indefensible fare structure and rules, first class, expensive lures for business travelers, tripping over ourselves in complicated procedures. Analyised, committed, studied and looked at, can anyone make a decision without a staff recomendation?

Well...perhaps it time, Dave looks at what is working in this business and copy it. All the majors are losing their shirts right now, Southwest isn't. So who do we continue follow, the big guys.

Come on Dave, think outside the box.

 

[TomBascom]

You're not selling every seat on the flight for those prices. You're selling a tightly controlled number of seats under heavy restrictions. These seats would, for the most part, otherwise be empty. So long as you cover a few minor variable costs (fuel, a bag of pretzels...) that probably run about $20 a seat you're making money that you wouldn't otherwise make.

You might argue that people used to pay $2,000 for those seats. That's water over the dam -- it's too late, those days will never return. The high fare carriers can reduce capacity in a downward spiral until they realize that those fares are gone or they go out of business. The only over-capacity in the industry is an excess of high fare seats.

 

[fr8tmastr]

I still think ol Dave is trying to position the company (by shrinking and getting rid of those pesky employees) to make way for the merger or buyout or sale to whoever, probably United again. Remember Wolf is still on the board and he would have never conned all of these concessions out of laborTo much bad blood.(hence dave) Keep in mind the reason the last United merger did not happen was because of the monopoly in certain markets and the airline's being too large. They have fixed that have'nt they.

 

[chipmunn]

The airline industry is in an unprecedented financial crisis that is not isolated to US where there is not enough revenue to cover expenses. The only business model that is working is that of low cost carriers, which have labor expenses significantly below major airlines. Do I like this? Absolutely not, but it is fact.

I believe to make comments such as as I think you may be right. Dave doesn't get it. All we hear is money. Pay cut and layoff. His plan is just more of the same old line airline thinking or to state I still think ol 'Dave' is trying to position the company (by shrinking and getting rid of those pesky employees) to make way for the merger or buyout is denying the economic realities of the marketplace.

US management is trying to develop a business plan to obtain the loan guarantee, which requires a 7 Percent profit margin projection, evaluated by an outside Auditor (Fitch Rating). With revenues decreasing, the only way to get the loan guarantee is to further cut cots.

It's simple arithmetic, but in my opinion some employees would rather deny reality. It may be good for some employees to read today's BusinessWeekonline column I posted today called Can airlines bring costs down to earth.

Chip

 

[usfliboi]

Chip! I have no need to bash Dave at all . At this point im trying hard to trust him. AT some point a company cannot blame the economy for bad buisness practice or poor management. Where we are today cannot be fully blamed on the economy or 9/11. Are those huge contributing factors? Yes! Ill repeat what i said in a previous post. We are paying management to forward looking Theres is no doubt in my mind that you could not seriously project the economy not being in poor shape, nor could you say the war on terrioism would end this year either. You had to believe fuel prices would stay the same or soar. Was there any hedging at all on fuel cost? It sounds to me that there was no hedging simply because they are using fuel prices as a factor all be it it will play a role period regardless... but to hedge would help huh? Im not nor have i been one to bash dave but i do look at reality.... Im not denying reality, u only have to turn on tv to see how bad things are esp ion the airline industry. But we were told we were way ahead of the game...and now the others are doing what we finally did...and if you are using the application for the fed loan guarentee as an example, when we were tent approved for the loan, it was without the major lease breaks we have recieved since filing chapter 11. What percentage did those lease breaks total to vs what lease breaks we predicted we would get ? I enjoy your post at times chip but please remember that the majority of the employees here arent looking down to other employees who make less instead are looking down to see how far they are from the bottom. Right now were in this all together and remember chip that this employee group has one thing and one thing only to base how management works and thats on past practice. Dave hasnt been here long enough to prove himself and fumbling thru bankruptcy isnt the way to gauge