Jetwire Setting Us Up For Concessions?

[BoeingBoy]

So quit screwing labor into the ground because you do not want to shrink the airline and decrease supply.

[post="307930"][/post]​

It'd help if you'd at least try to be consistent......

In the thread about the cancelled flights you imply that trimming the schedule is a mistake because of the lost revenue then here you argue that flights should be cut to increase revene. So which do you believe.

If you want to see the effects of shrinkage, look no further than my employer - US Airways.

Since 9-11, as a stand-alone carrier we'll have reduced the fleet by about 45% and reduced employee headcount by over 50%. Where's all that additional revenue from shrinkage?

On top of that, the defined benefit pensions are all gone. Retiree health care benefits are all gone. Unsecured creditors have been shafted - twice. The $1 Billion ATSB loan has been spent.

If shrinking to profitability worked, with all the other cost reductions achieved thru 2 bankruptcies we should be the most profitable company the world has ever seen. If it worked, we should be making money faster than management could count.

Instead, our unit costs are nearly the same as in 2001. The losses continue. In my opinion we were headed for liquidation until the merger with America West came along, and we're not out of the woods yet by any means. We've (or the new AWA management) has a little breathing room to try and right the ship before the money from the new investors (suckers, maybe?) runs out.

Jim

 

[TWU informer]

Another point is that if AA, maximzes its own flying it continues to put more pressure on the other airlines, which ideally forces them out of business, eventually. Reducing capacity just allows other airlines further entrance into our markets.

[post="307943"][/post]​

An Airlline "out of business"? Yeah right. What TV channel have you been watching?

They are not going out of business, they are filing Bankruptcy and still flying without paying their bills.

 

[Oneflyer]

They are not going out of business, they are filing Bankruptcy and still flying without paying their bills.

I guess you skipped over the "eventually" part?

Come on, give us some more of your brilliant airline strategy.

 

[TWU informer]

It'd help if you'd at least try to be consistent......

In the thread about the cancelled flights you imply that trimming the schedule is a mistake because of the lost revenue then here you argue that flights should be cut to increase revene. So which do you believe.

[post="307948"][/post]​

You are incorrect and a liar!

I never implied that trimming schedule was a mistake.

I simply added that the losses you calculated could not be totaled accurately because of lost revenue, and you agreed.

Lost revenue, does not mean lost profit in this industry.

 

[TWU informer]

I guess you skipped over the "eventually" part?

Come on, give us some more of your brilliant airline strategy.

[post="307954"][/post]​

Well hell, eventually fuel prices will be lower and AA will make record profits.

Eventually terrorist will strike again and kill thousands of Americans.

Eventually mechanics will leave for higher pay for their skill and there will be a shortage of technicians working on aircraft.

Eventually?
What kind of brilliance is there in a strategy of eventually?

 

[Oneflyer]

Lost revenue, does not mean lost profit in this industry.

Really, I'd like to know one airline that has shrunk its way to profitability.

 

[TWU informer]

Really, I'd like to know one airline that has shrunk its way to profitability.

[post="307961"][/post]​

That's just it professor, everyone is growing and everyone is not profitable.

Even the LCC's that have been in business are "growing" into a cost structure that will "eventually" lead to huge losses.

How many are "growing" into profitable status via the Bankruptcy process? Is the BK Judge approving huge growth by defunct carriers as a business plan to return to profits?

 

[Oneflyer]

Well hell, eventually fuel prices will be lower and AA will make record profits.

Eventually terrorist will strike again and kill thousands of Americans.

Eventually mechanics will leave for higher pay for their skill and there will be a shortage of technicians working on aircraft.

None of these events, must happen.

A company that continues to lose money, eventually has to go out of business. Pan Am lost money for 20 years before they finally stopped flying, same with TWA, eastern, and others. Eventually it does happen.

 

[Oneflyer]

Even the LCC's that have been in business are "growing" into a cost structure that will "eventually" lead to huge losses.

Agreed, so why again should AA shrink?

 

[TWU informer]

None of these events, must happen.

A company that continues to lose money, eventually has to go out of business. Pan Am lost money for 20 years before they finally stopped flying, same with TWA, eastern, and others. Eventually it does happen.

[post="307964"][/post]​

OK, so how many aircraft do you want, and how are you going to pay for them?

I am reasonable, give me the bigger picture with specifics?

Shall we go for say, $50 Billion in debt and 1500 aircraft? Maybe 5000 flights per day?

Give me some details on your plan. How big? How to pay for it?

 

[Oneflyer]

OK, so how many aircraft do you want, and how are you going to pay for them?

I am reasonable, give me the bigger picture with specifics?

I didn't say buy new aircraft, what said was that, AA needs to maximize its current fleet. Fly as much as possible with its current assets.

The more AA flies the cheaper it gets, until the only costs are the variable one, like fuel and direct labor (F/A and Pilots). Assuming AA can cover those costs, it should fly as much as possible.

 

[TWU informer]

So now you're resorting to the "Liar, liar, pants on fire" strategy?

[post="307968"][/post]​

That is an uncalled for statement.

His comment was indeed a lie, and he will answer for himself. He falsely claimed that I implied that shrinking the schedule was a mistake. That is a lie, and that is what is should be called.

You are the one that appears to bringing the playground into the debate with that posting.

Now that I think about it, why didn't AA increase and grow the schedule in those markets they just removed some service from? Shouldn't they have increased and grown the service there to offset fuel prices and averaged the cost down?

 

[TWU informer]

I didn't say buy new aircraft, what said was that, AA needs to maximize its current fleet. Fly as much as possible with its current assets.

The more AA flies the cheaper it gets, until the only costs are the variable one, like fuel and direct labor. Assuming AA can cover those costs, it should fly as much as possible.

[post="307968"][/post]​

Well now that changes everything.

Flying more miles with current assests is not a bad idea.

Maybe I misunderstood your "Grow the Airline" arguements all along.

Let me re-read those psotings with that idea in mind and see if you make more sense.

 

[BoeingBoy]

You are incorrect and a liar!

[post="307958"][/post]​

A liar? I certainly don't think so, though perhaps I mis-interpreted your remarks about "fuzzy math" and implying that if I thought cancelling a handful of flights was good then I should think that cancelling 2500 flights would be wonderful.

If I truly misinterpreted your remarks, I apologize.....

Jim

 

[Oneflyer]

Flying more miles with current assests is not a bad idea.

Maybe I misunderstood your "Grow the Airline" arguements all along.

There are a couple more assumptions that go along with this idea.

The primary one being that AA can't sell their assets for what the cost.

Ideally what AA would want to do would be to sell assets, pay down their debt, but due to the depressed state of the industry and the condition of AA's assets they can't do that. AA's S80s are essentially worthless, with Boing and Airbus giving out incredible financing deals, anyone looking for aircraft would just buy new. Other assets such as terminals are unique and not easily sold for full value.

Therefore, since AA can't sell their assets for enough to pay down the debt associated with the asset, they should attempt to maximize those assets to the fullest extinct possible.