Thats the dumbest statement from you yet.
Thank you very much. That's high praise coming from you.
Now you are trying to spin this up to a $1,34 billion cost disadvantage?
You need to check your math, even AA only claimed a $600 million disadvantage.
That's not the dumbest thing you've ever posted, Bob, but it's up there near the top.
Bob, all I did was compare the labor costs at US with the labor costs at AA. And no, I'm not claiming that US has a $1.34 billion cost advantage, as some of the difference (as I posted) is the AA labor cost of insourced overhaul (which, as you know, makes AA's labor cost line item higher than it would be if AA outsourced all its overhaul). I don't know how much of that $1.34 bilion difference is spent by AA on overhaul, but I do know that overhaul doesn't soak it all up - because AA's total maintenance expenses aren't even $1.34 billion.
I don't know where Brundage came up with the $600 million labor cost disadvantage number, but I suspect that it was an average of the legacy peers. I chose US for this simple comparison because its pay rates and are so woefully below AA's pay rates for pilots and FAs, and its labor costs are substantially less than AA's labor costs as a percentage of its revenue. US employees generate far more revenue than you do for a lot less pay.
What percentage of their costs go to pay for outsourced maintenance? When UAL made their presentation to their mechanics they claimed that 13% of their total costs was for outsourced maintenance services, plus another 22% for the rest of their labor costs. USAIRs costs are probably around the same. That comes out to 35% for UAL. AA's numbers are also inflated because of 3P related labor costs. So every hour that a mechanic in AFW puts into rebuilding an engine for some other airline, that cost gets added to AAs labor costs, every hour a mechanic in Europe earning $45/hr spends working on another airlines airplane gets added to AAs labor costs. TEASEL does a lot of 3P work, all that gets added in.
In 2010, US paid $661 million for maintenance materials and repairs. That includes outsourced maintenance plus parts for insourced line maintenance. AMR's maintenance materials and repairs line item was $1.33 billion. Add the labor costs for US together with its $670 million maintenance materials and repairs line item and do the same for AA. AA's labor costs plus maintenance materials and repairs far exceeds the number at US. No matter how much you spin, the fact is that US has a huge cost advantage over AA. Other legacy peers may have smaller advantages, but they have lower costs than AA. On that issue, WT is correct.
Do you know for certain that AA includes the labor expense for its MRO work for other airlines in its labor cost line item? Or are you just making things up? I don't know. Perhaps you do?
Whats the percentage of labor costs for TIMCO or AAR? I'll bet they are a lot higher than 31.4% and I bet the revenue generated per hour for that labor is much, much less. The fact is you are making statements and implying something without all the facts even though you have them, I'm not saying I have all the facts but I'm adding facts that make your conclusion less acceptable.
Who cares what percantage of MRO chop shop revenue is used to pay their employees, Bob? I was comparing the labor expense of US and AA, you know, two competing airlines. I couldn't care less if those MROs paid their employees 5% of their revenue or 95%, since that trivia doesn't change the fact that US pays its employees substantially less (both absolutely and as a percentage of revenue) as AA pays its employees.
Capt. Sully made just $125/hr as a near-retirement A320 captain. AA's widebody First Officers all make more money per hour and every AA captain makes much more per hour than $125/hr; AA's MD-80 captains make $161/hr. US FAs make a fraction of AA's FAs. US fleet service make substantially less than your TWU bretheren in fleet service. In short, US employees make far less on average than AA employees. AA spends far more per employee than US, despite your desparate wish that it not be so.
If USAIR and UAL were structured the same, which they arent then your compasions might have some validity. Should guys at TIMCO wear it proudly that labor costs at Timco are a greater percentage than labor costs at UPS even though they make half as much? No, thats dumb. Time and time again we've debunked the importance of AA's labor cost difference yet you keep pushing the same misinformation. Why not just answer my question from a month ago about where the billions between their lower labor costs , increased revenue and Fuel costs went?
Yes, Bob, your typical MO: when the facts aren't on your side, start with the name calling and your own misinformation campaign. Just par for the course from an ineffective union leader who thus far has failed to persuade his employer to pay him what he's worth. You guys are worth far more than AA is paying you - so why do you waste valuable time arguing with me about facts that can be found in varous public filings? Or are you now arguing that US is filing false info with the SEC as well?
You've debunked nothing so far. I'm just glad that my negotiating team is more effective (and less skeptical of the facts) than you and the TWU. I think that helps them focused on thinking of ways to get their membership the results they want.