Psa Crj 700
- Thread starter 700UW
- Start date
Your right Capt. none of us get the RJ or SJ issue. It is YOUR ALPA that has put us in the position we are in today. Whille ALL other carriers were adding RJ's to their W/O Companies years ago, YOUR GROUP cared not about the entire Company just its ML UNION memebers. Again, I never understood your IT'S ALL ABOUT ME attitude.
Maybe someday I will, but by then I am sure it will be too late. So PLEASE don't complain about the people you say FULL-PAY until the LAST DAY.........BECAUSE your UNION is showing that same attitude! So maybe you should just leave if you don't like it.
Maybe someday I will, but by then I am sure it will be too late. So PLEASE don't complain about the people you say FULL-PAY until the LAST DAY.........BECAUSE your UNION is showing that same attitude! So maybe you should just leave if you don't like it.
so you are infering that if ALPA had the stones to go to the plate when wolfe and gangwahl wished for RJ'S we might not be in the predicament we are today?Hope777 said:
hmmm...sounds like self serving attitudes contributed greatly to our present demise.
RowUnderDCA
Veteran
- Oct 6, 2002
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Do you understand a metaphor?700UW said:
GEEZ. Could you borrow some perspective?
What I don't understand is this.USA320Pilot said:
What is the motivation for US Airways selling off a presumably profitable WO (presumably based on what I read here) in order to reduce capital expenditures, only to spend capital on increasing the mainline fleet, which is currently unprofitable? As part of this you swap ATSB debt (pay down the loan) for aircraft debt (buying new aircraft).
This only makes sense if you are an employee who benefits from the arrangement.
Furthermore, why would you sell profitable cash generating portions of the company before disposing of "non-core assets".
This only makes sense if US Airways defaults on the ATSB loan again. And if that is management's plan, then its only a matter of time until the doors close...
Far more reasonable plans would include sale/lease-back of the CRJ-701's to a leasing company for short-term liquidity, or a potential IPO where US Airways retains 51-75% of PSA (and its profits) while getting a cash infusion. And definitely a sale of the merged ALG/PDT should be attempted first (or IPO).
US Airways should only sell PSA, if profitable, as a Plan Z, either this or close the doors (for real) decision.
BoeingBoy
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- Nov 9, 2003
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funguy2,
I think part of the problem is that nobody outside the upper echelons of CCY really knows if the W/O'ed (or even the affiliates) are profitable or not. Too many costs and revenues are hidden in publically available data. A perfect example is PIT, where 25 of the 50 "mainline" gates are used by the Express operation - how do you break down and apportion that cost?
I suspect you'll see the sale/leaseback of not only the CRJ-701's but also the Emb-170's - it's already happening with at least the Emb-170's. Whether there will be a profit involved, as opposed to merely a refunding of already paid costs (deposits, progress payments, etc) is another open question.
Many of us would like to see the expenditures going to acquire some of the RJ's used to instead acquire mainline aircraft. The RJ's have an intrinsically higher CASM, which makes it that much harder to lower overall system CASM as the number of RJ's increases - and we already have a larger percentage of our capacity (ASM's) provided by Express than any other airline.
Jim
I think part of the problem is that nobody outside the upper echelons of CCY really knows if the W/O'ed (or even the affiliates) are profitable or not. Too many costs and revenues are hidden in publically available data. A perfect example is PIT, where 25 of the 50 "mainline" gates are used by the Express operation - how do you break down and apportion that cost?
I suspect you'll see the sale/leaseback of not only the CRJ-701's but also the Emb-170's - it's already happening with at least the Emb-170's. Whether there will be a profit involved, as opposed to merely a refunding of already paid costs (deposits, progress payments, etc) is another open question.
Many of us would like to see the expenditures going to acquire some of the RJ's used to instead acquire mainline aircraft. The RJ's have an intrinsically higher CASM, which makes it that much harder to lower overall system CASM as the number of RJ's increases - and we already have a larger percentage of our capacity (ASM's) provided by Express than any other airline.
Jim
Boeing Boy:BoeingBoy said:
I realize that the RJs are inherently higher CASM than mainline and that US Airways has more Express than anybody... but
1. US Airways has traditionally had a higher RASM in years past.
2. Mainline size aircraft will not work on a large scale at smaller stations (the BGMs, ELMs, AVLs, SAVs of the world).
3. If it ain't broke, don't fix it! If its profitable... keep it.
And you are right, whether or not PSA is profitable, at this point, is speculation.
If the WO's are not profitable... I am the first one to advocate to sell 'em... the sooner the better. Or better yet, shut 'em down.
Part of US Airways problem is that there are multiple pieces of the puzzle, all of which are uniquely broken:
PIT - high pax cost
PHL - LCC entry / congestion
Exp - expanding a high CASM operation
ML - CASM too high due to inefficiencies/etc
etc...
Everytime you try to fix one problem (i.e. WO), you run into the other ones (then what about PIT, etc)... Its really a complex situation.
BoeingBoy
Veteran
- Nov 9, 2003
- 16,512
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funguy2,
You're right on several points....
There is certainly a place for Express using both RJ's & turboprops - my only question is the number of RJ's and how big Express will be relative to mainline.
As for PIT, I still can't understand why some decision hasn't been made one way or the other - add back mainline flights or cut the number of gates since either would lower the infamous "high cost per pax" there.
As for the other two (discounting the operational problems at PHL), they're both tied to cost (or CASM). To me, the quickest way to lower CASM is to fly the airplanes more and spread both labor and non-labor costs over more seat miles.
Jim
You're right on several points....
There is certainly a place for Express using both RJ's & turboprops - my only question is the number of RJ's and how big Express will be relative to mainline.
As for PIT, I still can't understand why some decision hasn't been made one way or the other - add back mainline flights or cut the number of gates since either would lower the infamous "high cost per pax" there.
As for the other two (discounting the operational problems at PHL), they're both tied to cost (or CASM). To me, the quickest way to lower CASM is to fly the airplanes more and spread both labor and non-labor costs over more seat miles.
Jim
USA320Pilot
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- May 18, 2003
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Here's what I have been told by senior management on the reason for LOA 91, the potential sale of the "wholly owned" airlines, and the status of the Pittsburgh hub.
GECAS wants to diversify there US Airways risk, but help the company survive to protect their 5% US Airways ownership, the CFM power-by-hour maintenance contracts, about $2 billion in mainline aircraft financing, and A320 family, CRJ, and EMB engine sales.
PSA and Piedmont/Allegheny will be sold to pay down the loan guarantee, boost liquidity, and reduce short and long-term debt. This will help the company meet the loan guarantee covenants. In addition, this move would eliminate potential M&A activity scope clause violations, presumably between US Airways and United AFA.
PSA will command a higher purchase price after LOA 91 is ratified on May 10 because the CRJ-701 delivery positions, which will be increased from 25 to 60 RJs, can then be transferred and will comply with other carrier 50-50 J4J agreements.
In regard to Pittsburgh, as part of the January 5, 2004 agreement between the ACAA and US Airways, the company committed to continue to staff the hub at current levels through the busy summer season, however, the plan is to reduce the flying by about another 60% and go from 25 mainline gates on concourse B to 10 and keep 10 Express gates, for a total of 20 gates in October.
The new business plan will transfer about 20 of 35 mainline jets to East Coast focus cities and westward.
Finally, as I have said in the past, the Pittsburgh hub negotiations have been held hostage to United Airlines formal reorganization. As Dow Jones reported on April 20, Dave "Siegel chose to get out of bankruptcy as soon as possible in a failed attempt to merge with UAL Corp."
For a number of reasons that did not happen, such as the Iraqi War, SARS, dramatic post bankruptcy LCC expansion, and yield pressure. However, I have been told the long-range plan is to merge, probably with United, but it's still unclear how both companies restructuring will unfold and difficult to predict how the potential corporate combination(s) will unfold.
Regards,
USA320Pilot
GECAS wants to diversify there US Airways risk, but help the company survive to protect their 5% US Airways ownership, the CFM power-by-hour maintenance contracts, about $2 billion in mainline aircraft financing, and A320 family, CRJ, and EMB engine sales.
PSA and Piedmont/Allegheny will be sold to pay down the loan guarantee, boost liquidity, and reduce short and long-term debt. This will help the company meet the loan guarantee covenants. In addition, this move would eliminate potential M&A activity scope clause violations, presumably between US Airways and United AFA.
PSA will command a higher purchase price after LOA 91 is ratified on May 10 because the CRJ-701 delivery positions, which will be increased from 25 to 60 RJs, can then be transferred and will comply with other carrier 50-50 J4J agreements.
In regard to Pittsburgh, as part of the January 5, 2004 agreement between the ACAA and US Airways, the company committed to continue to staff the hub at current levels through the busy summer season, however, the plan is to reduce the flying by about another 60% and go from 25 mainline gates on concourse B to 10 and keep 10 Express gates, for a total of 20 gates in October.
The new business plan will transfer about 20 of 35 mainline jets to East Coast focus cities and westward.
Finally, as I have said in the past, the Pittsburgh hub negotiations have been held hostage to United Airlines formal reorganization. As Dow Jones reported on April 20, Dave "Siegel chose to get out of bankruptcy as soon as possible in a failed attempt to merge with UAL Corp."
For a number of reasons that did not happen, such as the Iraqi War, SARS, dramatic post bankruptcy LCC expansion, and yield pressure. However, I have been told the long-range plan is to merge, probably with United, but it's still unclear how both companies restructuring will unfold and difficult to predict how the potential corporate combination(s) will unfold.
Regards,
USA320Pilot
Cosmo
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- Aug 20, 2002
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USA320Pilot:USA320Pilot said:
Once again you've taken a statement out of context. The full quote from the Dow Jones article is as follows:
This unnamed source (your favorite kind!), whom you quote to implicitly support your continuing United/US Airways merger theories, in reality dismisses such a prospect by calling it "dead at this point". I find it odd that you apparently overlooked this "industry source's" unambiguous statement.
It may be in US Airways' plans to merge with another carrier, but it is definitely not in United's plans at this time, as Tilton has reiterated over and over again. Could that change in the future? Sure, one can't totally discount the possibility of such a merger. But it clearly isn't the certainty that you seem to think it is.USA320Pilot said:
USA320Pilot:
Again... state your source. "Senior Management" doesn't cut it. You could be refering to "Senior Management" of ALPA, who has seemed to give you poor information in the past (specifically related to UAL BK and AWA ATSB covenenants). You could also be refering to the cheif pilot, who may not have the details, etc, that a COO might, for example.
How come the sheer lunacy of one failing carrier acquiring another failing carrier is never mentioned as a reason why the merger didn't happen?
And by the way, that "according one industry source" quote you keep bringing up sounds like US Airways was selling out to UAL, not acquring UAL. I guess that ends your little UCT/ICT bit. And again, "according to one industry source" could be you. I give it little credibility, since Mr. Seigel himself (and others) has stated the BK exit was due to credit card processing issues... Now, that could be a "red herring," and Mr. Seigel has seemed to be less than accurate before, but I will take his word over "an industry source" everytime.
As I've said before, "an industry source could be anybody, even you, for all I know.
Moving RJ's East, I beleive... LGA-upstate NY and certain DCA markets need to be on RJ's to be competitive. Also, there are probably some service additions from BOS which could be added. RJ's moving west... US Airways still doesn't have a market west of PIT to place them profitably... Much less the time and cash to develop such a market.
And again, there are probably better ways to raise liquidity via PSA than an outright sale. An IPO is one. Sale/leaseback of aircraft is another. If PSA is profitable, divesting it would be a mistake.
Lastly, according to you the facts you cite, dressing this airline up to sell it to UAL has failed... Twice. Once with Wolf, and once (supposedly) by Seigel. Third time, the company might not even come around. Why does this company continue to embark on failing strategies... If the problems were fixed, management would have no trouble selling out to UAL.
Again... state your source. "Senior Management" doesn't cut it. You could be refering to "Senior Management" of ALPA, who has seemed to give you poor information in the past (specifically related to UAL BK and AWA ATSB covenenants). You could also be refering to the cheif pilot, who may not have the details, etc, that a COO might, for example.
How come the sheer lunacy of one failing carrier acquiring another failing carrier is never mentioned as a reason why the merger didn't happen?
And by the way, that "according one industry source" quote you keep bringing up sounds like US Airways was selling out to UAL, not acquring UAL. I guess that ends your little UCT/ICT bit. And again, "according to one industry source" could be you. I give it little credibility, since Mr. Seigel himself (and others) has stated the BK exit was due to credit card processing issues... Now, that could be a "red herring," and Mr. Seigel has seemed to be less than accurate before, but I will take his word over "an industry source" everytime.
As I've said before, "an industry source could be anybody, even you, for all I know.
Moving RJ's East, I beleive... LGA-upstate NY and certain DCA markets need to be on RJ's to be competitive. Also, there are probably some service additions from BOS which could be added. RJ's moving west... US Airways still doesn't have a market west of PIT to place them profitably... Much less the time and cash to develop such a market.
And again, there are probably better ways to raise liquidity via PSA than an outright sale. An IPO is one. Sale/leaseback of aircraft is another. If PSA is profitable, divesting it would be a mistake.
Lastly, according to you the facts you cite, dressing this airline up to sell it to UAL has failed... Twice. Once with Wolf, and once (supposedly) by Seigel. Third time, the company might not even come around. Why does this company continue to embark on failing strategies... If the problems were fixed, management would have no trouble selling out to UAL.
USA320Pilot
Veteran
- May 18, 2003
- 8,175
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I have repeatedly said that I do not want to merge with United and would prefer to see US Airways partner with a stronger carrier.
United is fixing some problems, but the company still has major issues, which may not be resolved such as:
The pension relief may not permit United to qualify for the loan guarantee.
The company has about a $250 million obligation to Denver that must be cured and pending municipal bond litigation with Chicago for about $600 million.
The airline told the bankruptcy court at last months Omnibus hearing that it is nearing agreements on about one-third of its 174 outstanding EETCs, but the others have yet to be resolved.
Dulles is nearing a fix, but will be difficult to integrate.
The company told the bankruptcy court that current fuel prices will raise its operating expense by $450 million this year and this number was not included in the December 2003 business plan submitted to the ATSB. Moreover, the company cannot hedge fuel. This will have an enormous effect on the 7% profit margin required in 7 years.
The company told the court it lost about $300 million in January and February and even though it's in bankruptcy, the airline may have the worst or second worst industry quarterly loss, after dramatically lowering costs.
There is enormous pressure to not let United obtain the loan guarantee, although I believe the ATSB will not be influenced by politics, but instead will focus on the application meeting OMB guidelines.
United may need an equity investor to help it pay off the DIP financing if the loan guarantee is not obtained. According to recent news reports there are private equity firms right now looking at the airline sector to invest, but the price could be very high for United and its employees.
In regard to my sources, I can talk with every person in the US Airways executive suite except for Lakefield, who I do not know and I have never met, yet.
Finally, I never said US Airways was being dressed up to sell to United and I do not believe that will occur, especially in the near-term. United cannot emerge from bankruptcy at its current rate and it will post a huge quarterly loss, but other venture capital options are available.
Respectfully,
USA320Pilot
United is fixing some problems, but the company still has major issues, which may not be resolved such as:
The pension relief may not permit United to qualify for the loan guarantee.
The company has about a $250 million obligation to Denver that must be cured and pending municipal bond litigation with Chicago for about $600 million.
The airline told the bankruptcy court at last months Omnibus hearing that it is nearing agreements on about one-third of its 174 outstanding EETCs, but the others have yet to be resolved.
Dulles is nearing a fix, but will be difficult to integrate.
The company told the bankruptcy court that current fuel prices will raise its operating expense by $450 million this year and this number was not included in the December 2003 business plan submitted to the ATSB. Moreover, the company cannot hedge fuel. This will have an enormous effect on the 7% profit margin required in 7 years.
The company told the court it lost about $300 million in January and February and even though it's in bankruptcy, the airline may have the worst or second worst industry quarterly loss, after dramatically lowering costs.
There is enormous pressure to not let United obtain the loan guarantee, although I believe the ATSB will not be influenced by politics, but instead will focus on the application meeting OMB guidelines.
United may need an equity investor to help it pay off the DIP financing if the loan guarantee is not obtained. According to recent news reports there are private equity firms right now looking at the airline sector to invest, but the price could be very high for United and its employees.
In regard to my sources, I can talk with every person in the US Airways executive suite except for Lakefield, who I do not know and I have never met, yet.
Finally, I never said US Airways was being dressed up to sell to United and I do not believe that will occur, especially in the near-term. United cannot emerge from bankruptcy at its current rate and it will post a huge quarterly loss, but other venture capital options are available.
Respectfully,
USA320Pilot
ClueByFour
Veteran
- Aug 20, 2002
- 3,566
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SEC violations at 11.
