Jetblue And The Rest Of Us.

[Hopeful]

Yesterday's financial news showed JetBlue's profits 43%down compared to the same quarter last year. Even Southwest is feeling it. Low fares and higher fuel costs are hurting all the carriers. I doubt very much that AA is going to rest on its cost cutting laurels. Once the busy summer season is over, AA will be back for further cost cutting.

Although it may not come in the form of paycuts or another week's vacation gone. It probably will come in the form of layoffs and changes to the pension plan.

This company will not rest until we are transformed into a low cost carrier. For anyone to believe that AA will look elsewhere instead to the employees is naive. I do not see AA shedding routes, taking there name off of arenas around the country, off the theater on Broadway in NYC or furher reducing management levels. To compete with JetBlue, Southwest, Airtran, Frontier and the rest of them, AA will have to become them.

The only thing AA will not let fall below market value is their salary and compensation package. Each one of us better start realizing that further changes are on the horizon and more pain and suffering will affect more union members.

If we all continue to subscribe to the "I got mine" mantra, we all lose. If they close Class II stations, people are affected, if they choose to close one overhaul base or greatly reduce it, we all lose. As much as we all have our opinions on who will better serve us in respect to a union, I do not wish anyone to lose their jobs.

Call it gloom and doom, but recognize the realities of what's ahead!



As if you all didn't already know this!

 

[Birdman]

Hopeful, did you happen to notice the 140% increase in maintenance costs for JB. Their up to about 69 new A310 aircraft with an average fare of about $105. It will only be a matter of time before their costs increase to normal levels and the legacy carriers will cease using them as a cost-cutting role model.

 

[fix_airplanes]

If you are still young enough, you need to re-evaluate your chosen career path.

Us older folks will just have to ride it out to whatever retirement is left.

 

[Hopeful]

Not young enough. Too much time invested!

It's just that I've seen, as most people have, the changes in this industry.
I just don't see a major improvement in pay and benefits in the near future.
The airlines took the ball that was given them before 9/11 and ran with it after 9/11. This was their big opportunity to go after labor costs. My point of this post was that they are not done yet.

Birdman, I agree with you. Jetblue's cost will continue to grow as they grow.

But I just have the feeling that the legacy carriers use the low cost role model not only as a road to profitablity, but a road into decimating labor costs. They never seem to look to their managerial model as a big part of the problem!

 

[Birdman]

But I just have the feeling that the legacy carriers use the low cost role model not only as a road to profitablity, but a road into decimating labor costs. They never seem to look to their managerial model as a big part of the problem!

You've got that right. I've wondered since I began working here 14 years ago how this company could possibly make money the way it was/is mismanaged (from the maintenance side). With the exception of LUV, it seems to be an industry trend.

 

[Bob Owens]

I heard a saying that "the future is the past yet to come".

In the early 80s we had Low cost "Laker" as the new model.

It served its purpose, then dissapeared.

In the late 80s we got another dose with Peoples Express.

Same story.

Now we have Jet Blue.

How many times will airline workers fall for the same scam?

Start ups will always have low labor costs. AA took advantage of the fact that new hires start at lower wages with the growth plan.

However other costs that are harder to quantify impact the airlines. Inexperience and the lack of expertise impair efficiency. Out of service aircraft are very costly.

After a "Honeymoon period" its employees are no longer willing to sacrifice their lives for corporate "love". Their costs go up, if not in wages then in turnover costs which for pilots and mechanics is substantial.

While small start ups in theory have an advantage size buys the larger airlines time. The larger airlines can afford to lose money head to head with the small start ups indefinately because they can make up for those losses on routes that the LCC dont serve. Routse that they cant serve because they dont have the equipement or manpower or facilities to serve.