Luv Into Phl

[Dilligas]

<snip> The labor groups must allow the company to reduce its costs.

The efficiency in how well we work together is vital. 

The majority of the employees are willing to work with this management team.

Each employee should decide if they are willing to give us the needed tools to restructure the company in a competitive manner.

It's time for a "regime change" in CCY.

NO trust, no credibility, no leadership. The legacy is being written as the bumblers that destroyed a 50+ year company in less than 18 months despite the advantages of multiple concessionary agreements and bankruptcy.

It's fairly evident that the employees have made their decision and that decision is NO. Unequivocably, have no doubt.

NO more concessions. NO more lies. NO more.

The emperor has no clothes. The regime is exposed as incompetent and clueless, and the laughingstock of the industry, and corporate America. Hey, at least you'll get your names in all the Case Studies in MBA programs for the next thirty years! Aren't you proud?

There will be no more givebacks.

Wake the hell up, B-O-D, and fulfill your duties. The regime must GO. They are miserable failures. It is time to act.

 

[USA320Pilot]

Pacemaker:

I never said unit costs need to be a low as AirTran's. They do not because the company will have a revenue premium in international markets and through its alliances. This is free money that the LCC's cannot obtain, without an alliance of their own.

The cuts I've listed that are in the business plan provided to the ATSB are expected to lower US Airways CASM from 14.12 cents shortly after September 11 and its current level of 10.98 cents, to 9.9 cents.

The company needs more cuts and some could come from pension legislative relief, the Pittsburgh hub negotiations, A320 heavy maintenance outsourcing (with mechanic protections to job loss), and alliance cost cut synergies. This will help bridge the LCC/US Airways cost gap further by lowering US Airways' unit costs, but there will likely need to be more cuts to get the airline down below a CASM of 9 cents.

If this can be accomplished, I believe US Airways will have sustained profitability.

Regards,

Chip

 

[FLYLOW22]

Chip,

Can I still fly if you take over IAD and MIA? Maybe we could fly together. Maybe I could carry your bags? Wow, that would be an honor.

Help him carry his well informed head instead.

 

[unit4clt]

Chip,

This management is responsible for the slow death of this company. Just look at the stations where they switched mainline flights to rjs and props. In just about every single city where express has taken over, we have lost market share. But management continues on this same path of failure. Tell me, how can RJS compete with southwest b737s to CLE, STL, MKE, BNA and other cities that have been outsourced to mesa?

 

[FlyingHippie]

Chip, Chip, Chip. I've been reading your rants for years, some of it I respect, I understand, but what I don't get is your short term memory. Lest we forget how much we have sacrificed in the name of US Airways? We've given our gold to the gods in the Crystal Palace in the hopes to keep our "winged air shrine" intact and viable with their leadership. We've given our gold, where is their leadership? I do recall when you were quite angry at losing your pension. Remember, THAT was not in the give-back brochure. I am amazed at your empathy towards Siegel. This is very "Stockholm syndrome" of you. For the record, Stockholm syndrome is a psychological state in which the victims of a kidnapping, or persons detained against their free will develop a relationship with their captor(s). This empathy can sometimes make prisoners help their captors to achieve their goals. It's quite clear Mr. Siegel's goals are not in the best interests of the employees. It's gone beyond just keeping our jobs. We're talking the basic human need for dignity. The way Mr. Siegel has conducted himself towards our group is in the very least undignified. He has humiliated us. I will not give one more inch until he is removed. I know others feel as strongly about it as I do. He has become such a polarizing figure that it is holding this company back. There are far too many battles being fought within the company confines. Battles we cannot afford to be fighting, we need a change, we need leadership, and we need it yesterday. It's time for Dave to do the right thing and step down.

 

[FLYLOW22]

Employees should definately work with Siegal.

Go immediately to him and offer that all employees that handle USAirways passengers will immediately accept all payrates and working conditions of SouthWest Airlines effective November 1. And that they will work one additional day a month for free.

Take it, stay with what you already have, or liquidate.

It's not just the pay and compensation packages. It's the way SW operates. They go to a fraction of the cities that a full route network carrier goes to. It's expensive to go to cities like SBY and ROA. SW will never go there with a 73. Never. SW cherry picks high density cities with high frequency routes. U cant do that.... well they could but they would give up all of the small/medium cities.

 

[ClueByFour]

In regard to yoru comments regarding United and US Airways, let's not forget US Airways' chairman of the board, David Bronner, has publicly speculated that United has a 50-50 chance of surviving. He said that if United were to sell assets, he (RSA) would consider backing the purchase of some "if it would be beneficial to US Airways."

The difference here between US Airways and other airlines is that the Arlington-based company, for whatever reason, has a "sugar daddy" to provide financing, if he desires.

Will it occur? Maybe, maybe not, but I believe the LCC expansion/threat could increase Bronner's motivation to acquire United assets at bargain prices to protect his US Airways investment.

The italics are mine in the quote above.

Bronner will be first to get paid if US is liquidated. Bronner will probably make all of his initial investment back if US liquidates. US cannot currently compete in a post bankruptcy world. US' stock price is falling.

Keeping in mind that Bronner is first in line to get paid, why exactly would he want to put more money at risk? While he has it, he does work for a public interest safeguarding other people's money, not a hedge fund. He also said those things during a period where he was trying to exert authority over the then-RSA DIP'D US. Has he made any remark expressing interests in spending any more money on US in the last 6 months?

Of course, then there are the issues of what other (solvent) airlines would bid on UA assets, and which UA assets US could pick up that would help fend off the LCCs. UA has LAX (LUV), SFO (LUV), ORD (LUV at MDW and people with more money after the gates), IAD (right between LUV, LUV, and more LUV), DEN (Fronteir) and MIA (among much LUV in south Florida). Pan Am (a well known international airline with a feeble feeder network) died a less than spectacular death. US has been run out of every airport that LUV has even approached. Maybe Herb will start flying to the Carribean, just to make Dave (and to a much larger extent), Arpey nuts. And if he won't, Neeleman will.

 

[Dilligas]

They IMO opinion think like LOSERS and if you view the annual reports they have produced the numbers to merit the title of LOSER!

I have always felt that with proper management that US Airways not only could but should be one of the most consistent money makers in the industry.

I am very tired of all the whining from CCY. Either fight or fold and do it quick.

Bob,

When you speak of issues like leadership, motivating one's employees, and teamwork... I agree with you. When you go into your airline business plans, I think your view is very naive. You still don't quite seem to understand that the "rules" aren't quite as black and white and may not apply to our industry the same as in yours.

That being said, however, this regime is a bunch of losers. They have shifted blame and elevated excuse making to an art, but there are no leaders. The troops have finally realized this and its like a thunderclap snap back to reality. We realize what the intentions are by these "short" timers (no pun intended ) and we won't allow it to continue in the way it has been.

Yes you heard the same from W&G. Ask yourself why? It's because there NEVER has been a plan to grow this company and continue to operate it. W&G were here to sell it, plain and simple. The current regime is not interested in making this airline a growing commodity, in my opinion. To me its very obvious what their strategy is.

I try to learn something from my competitors and everyone I deal with. That is why I felt your comments about LUV out of line. You may have an axe to grind with them but I respect them tremendously. Their record, balance sheet, and employee relations speak volumes.

I strongly agree that this east coast franchise is salvageable, and potentially profitable, but not with the current regime. They have no credibility left and it will take a fresh team, with energy, dynamic ideas, true leadership and charisma, and a solid business plan to win back the hearts and minds of the U family, (employees and customers).

The window of opportunity to save this company is very small and the Board of Directors should act swiftly to save this franchise.

It is much darker on the inside than you can imagine.

 

[USA320Pilot]

Unit4clt:

Unit4clt asked: "Tell me, how can RJS compete with southwest b737s to CLE, STL, MKE, BNA and other cities that have been outsourced to mesa?"

Chip answers: With MDA EMB-170s, which is a tremendous product that will have a break even load factor lower than the LCC's. For example, the EMB-170 has two-by-two seating, seats that are wider than the B737, and mainline perks like a FFP program, clubs, and interline booking.

By the way, MDA will lower US Airways' unit costs by averaging the new US Airways Group operation over the mainline network.

Regards,

Chip

 

[unit4clt]

Chip,
Only time will tell if the EMB can compete. I believe this managment will continue to make the same mistakes (converting Mainline flights to RJS) and things will not improve until they admit they have a faulty plan, and make changes, or the BOD replaces them.

 

[T-bone]

Unit4clt:

Unit4clt asked: "Tell me, how can RJS compete with southwest b737s to CLE, STL, MKE, BNA and other cities that have been outsourced to mesa?"

Chip answers: With MDA EMB-170s, which is a tremendous product that will have a break even load factor lower than the LCC's. For example, the EMB-170 has two-by-two seating, seats that are wider than the B737, and mainline perks like a FFP program, clubs, and interline booking.

Chip has a good point; the Embrer 170 is an excellent product. I've spent some time with the A/C with the Embraer people and I can attest it is all it's advertised to be.

 

[AP Tech]

Hawk,
I have given all I plan on giving to this company in the form of concessions! It is time for this highly prized managment team to do what they are getting paid for...running an airline, and I am not talking about into the ground like they are currently doing!!!!! I have no faith in this managment team, it is like feeding a slot machine which never pays off. Dave came on board and everyone had high hopes, but the bottom line is he has been a failure!!!Where do we draw the line on the amount of money we give back?
Chip,
I strongly disagree with you statement that the farm out of the Airbus fleet will not affect mechanic and related "currently" working. Let's say for instance that if the A/C are farmed out and in the near future the company gets a good deal on say 50 Airbus A/C, they retire 50 Boeing A/C to keep the fleet above 279 a/c. Now that the A/C are gone what is to become of the mechanics and related that are currently working in heavy mtc, say 20 of the A/C were do heavy checks this year.......GONZO!!!!! And I don't buy the theory of a no layoff clause, especially with the Liars and Thieves who are running this outfit now!! Oh, by the way much was said about the 30 mechanics that were recalled from furlough for deicing in Pit, well it turns out 9 bids were canceled before the men had a chance to report their first day, I guess the company forgot to mention that........ :down:

 

[batman]

Chip, with all due respect, quoting what MR. Alabama said about interest in UAL six months ago when United was frankly close to Ch7 in the face of war and sars is of very litte relavence. I suggest you stop thinking about your absurd UCT dream and pay attention to whats happenning at your airline. Usair success is just as important to United as is vice versa.
h34r:
ps. howcome you never post any bad news about USair, only UNited!?
----------------------------------------------------------------------------------------
Southwest move may mean adios for airline

Analysts: US Airways must slash costs more if it hopes to survive

Thursday, October 30, 2003

Frank Reeves, Post-Gazette Staff Writer

When Southwest Airlines Chairman Herb Kelleher announced this week that his discount airline planned to attack US Airways on its turf in Philadelphia, he tried to be polite.

But when pressed by a reporter, Kelleher acknowledged that US Airways' weak financial condition made it a tempting target -- so tempting that the Dallas-based airline broke with its usual strategy of avoiding congested airports and not taking on major carriers in their hubs.

"It would be unfair to say that we didn't take [US Airways' shaky financial condition] into account" when deciding to begin service in the spring in Philadelphia, Kelleher said.

Though he was quick to add that the nation's fourth largest metropolitan area had long been in the discount carrier's sights. "It's a very high priced market," which hasn't been developed to its potential, Kelleher said -- a statement underscored by the fact that despite its large population, Philadelphia's airport accounts is only the nation's 18th-busiest.

The boldness of Southwest's decision didn't go unnoticed by some industry analysts, who saw it as a sign of US Airways' vulnerability.

"There is definitely blood in the water," said analyst Ray Neidl of Blaylock & Partners in New York, comparing US Airways to a wounded animal that attracts sharks. "Southwest looked at US Airways' cost structure, realized it wasn't making money even after reorganization under bankruptcy, and decided that it was now to time to move before another low-cost carrier moved in.''

Kevin Mitchell, chairman of the Radnor, Pa.-based Business Travel Coalition, said that if he were US Airways management, he would find it most unsettling that Southwest apparently "concluded that US Airways might not be around very long. And if US Airways went under, Southwest would own Philadelphia before another low-cost carrier came in."

Neidl said US Airways Chief Executive Officer David Siegel did a good job obtaining cost-savings concessions during bankruptcy reorganization. "But the revenues aren't coming back as fast as many thought. Siegel has got to get his [costs] down even more or go to a different business model," Neidl said. One option might be for US Airways to become a strong regional airline.It is similar to the message Siegel's been preaching at every turn.

He again warned this week that low-cost carriers are "the toughest competitive challenge" US Airways and other a major carriers have ever faced. These weren't idle words. When Southwest began service at Baltimore-Washington International Airport in the 1990s, US Airways was the dominant carrier. Now it ranks a distant No. 3, having been easily supplanted by Southwest.

To fend off challenges from Southwest and other low-cost carriers, US Airways must reduce its cost structure, Siegel said. Even US Airways' code-sharing alliances and far-flung network won't enable it to compete with the discount airlines unless it can get costs low enough that what it charges for tickets is competitive with what the low-cost airlines charge.

At the core of the effort, as has been the case for more than a decade, are labor costs.

But if Siegel intends to seek more concessions from the airline's unionized workers, it is likely to be a hard sell. US Airways employees, who last year agreed to $1 billion in annual wage and benefit cuts, appear to be in no mood to give any more.

"We've certainly stepped up to the plate. Our concessions alone have taken the company out of bankruptcy," said Jack Stephan, spokesman for the Air Line Pilots Association (ALPA). "The ALPA well of concessions has dried up."

In two rounds of negotiations, US Airways' unionized pilots agreed to about $566 million in annual concession and allowed the airline to terminate the pilots' pension plan and replace it with a less generous one.

Stephan said the pilots are waiting to see whether Siegel and his "management team can a run an airline and not just say, 'We've got to take more from employees.' "

William Lauer, chairman of Tarentum-based Allegheny Capital Management, which previously had invested in US Airways, said that the airline and its unions "are heading into another round of negotiations."

And Mitchell, of the Business Travel Coalition, said the airline's need to cut costs and employees' resistance to further concessions "portends for a lot of pain and struggle over the next year. It guarantees that US Airways goes into a second round of bankruptcy."

If the airline again files for Chapter 11 protection, it would give it broad authority to abrogate existing union contracts and impose new work rules and salary cuts on its employees.

Still, while some analysts seem ready to concede that Southwest will quickly supplant US Airways as the dominant carrier in Philadelphia, Lauer isn't that pessimistic. He said Southwest faces some difficult challenges in Philadelphia.

The Southwest strategy relies on its ability to turn around flights quickly on its point-to-point routes. This may prove difficult at Philadelphia International Airport, which despite a decline in air traffic since Sept.. 11, still is congested because "there's not enough launch and landing space," Lauer said.

 

[Fly]

Modified by Fly

I can't keep having the same rant with Chip. It's not healthy for me. Some people wish to live in dreamland, I don't.

 

[USA320Pilot]

Fly:

As a United Flight Attendant, I find your input into the US Airways forum interesting. How come you do not post very much on the United board and seem to only chase me around?

I find that complimentary.

By the way, did you see where United said pension issues and the Atlantic Coast contract are among the remaining tasks before United can file an amended application with the Air Transportation Stabilization Board for backing of a private sector loan.

Fly, I was just wondering how can that be? Moreover, who first reported about this on the USaviation.com message boards?

Fly, what happens if those issues remain unresolved? Furthermore, when will United settle the municipal bond litigation and begin paying its debt at the UCT hubs, and since the ATSB loan guarantee must repay up to $1.5 billion in DIP financing, where will United's reamining exit financing come from?

Fly, those who live in glass houses may not want to fire "cheap shots".

Here's the URL if you want to view the story.

Regards,

Chip