Smaller United

[coolflyingfool]

I can see UAL operating with less a/c but the same number of flights. Instead of having a/c sit for a long turn around, it can be shortened and operate an extra flight or 2. UAL won't go the way of SWA and 30 minute turn arounds, but there is time to be had. Just my thoughts.....

 

[Just Plane Crazy]

Yes I can see that UAL will be a smaller airline and that TED will be standing as a separate company. Most domestic flights would be handled by TED with the exception of HUB to HUB flights (LAX – SFO – DEN – ORD – IAD) and more Express flights. All international flights will be handled by UA. This way UA will be able to park all B737, B767 and some of the B747. B777 will be the backbone of the international routes with some B747 to handle Pacific flights. Some of the B757 will be used for HUB to HUB traffic (in addition to some B777 and B747). TED will continue to be an A319/320 airline and it all depends how SkyWest wants to go if there will be room for the A318 in their concept.

This way UA will trim down its cost TED will spin off as an LCC with Alliance affiliation and Express will get some additional traffic.

In addition UA could get back into the Freighter Business. Convert some of the B757 and B747 to freighters and give NW a run for their money. Join their STAR Alliance Members LH and SQ and capture some of the lucrative Cargo Market. Naturally it would be like LH did it as a separate Company UA Cargo.

 

[mrfish3726]

Ummmm....

Before everyone gets into a panic, there are no furloughs planned at this point.

The current plan is and has been to park some 737's at the end of the summer. Manpower planning projects their needs at least 6 months out. Often longer to account for training cycles. They shrunk the pilot group to the bare minimum they thought they could get away with for the summer. (In fact they went too far as evidenced by the shortage in the 737 fleet and cancelations due to lack of crews.) their reasoning was that come fall the airline would be back to normal staffing levels based on projected block hours in fall and winter. There are also vacancy bids out for the 747, 777, and 320 fleets, which will create some upward movement and absorb some of the manpower from the bottom.

Therefore, the current pilot population already takes into account the parking of the 737s and reduction of flying in the fall and the increase of Pacific flying. This is common knowledge around campus. It has been advertised and discussed in detail at several union and company meetings that I have attended over the last 6 months.

Additionally, to the disappointment of our competition, there is no plan to shrink United Airlines. Tilton and our management team are keenly aware that UA's route structure is our greatest strength and has no intention of making the same mistake as Eastern/Pan Am/TWA by trying to shrink to profitablity. I hate to sound like a certain other poster on these boards, but this information comes from a pretty high level source.

Now, back to you regularly scheduled speculation and rumor mill...

Before everyone gets into a panic, there are no furloughs planned at this point.


Everytime we heard that at UNITED, it CAME TRUE so don't go there LOL!!!

 

[767jetz]

Everytime we heard that at UNITED, it CAME TRUE so don't go there LOL!!!

Really? Care to back that up with some facts, smart guy?

When exactly did UA say it would not furlough pilots and then did just that?

For your information, UA actually STOPPED furloughing pilots BEFORE they said they would.

Please stop trying to wind up people by spreading this cr@p.

 

[JetClipper]

In addition UA could get back into the Freighter Business. Convert some of the B757 and B747 to freighters and give NW a run for their money. Join their STAR Alliance Members LH and SQ and capture some of the lucrative Cargo Market. Naturally it would be like LH did it as a separate Company UA Cargo.

United has threatened to get back into the all-cargo business several times since shutting-down the DC10 operation in 2000, but it never goes beyond posturing.

UA publicly claimed that the DC10s failed because United couldn't get slots at NRT, but I think the truth is they just realized they don't have a clue how to operate freighters. In addition, United needs to get their belly capacity operation back in-shape before even considering adding additional capacity; I've heard from more than one forwarder that they simply refuse to ship via UA because their service is so poor (I think a lot of this has to do with the outsourcing of cargo handling).

 

[JungleClone]

767jetz, you'd be surprised at the sources I have. I'm not saying concessions are guaranteed, but they're likely. The Finance gurus in WHQCJ are analyzing it in their computer models as we speak. The difficult task is finding a way to make the cuts as "labor friendly" as possible. Good luck on that one. Do you think United is going to line up investors when they see our pension funding obligations over the next several years? Not without major strings being attached, such as a piece of ownership once we emerge from Ch. 11. We are not profitable yet. It's summer time. What do you think is going to happen in mid-September until the holidays roll around? It's going to be red ink city. The reality of the situation is that United has not yet gotten costs down to a level at which we can compete profitably against all comers, especially the LCC's. The company is in full-force spin mode about how great TED is. Sure, the load factors are outstanding. Yes, reliability has been great. Yes, we're stealing share from Frontier (9 points thus far). That's all great news, honestly. But show me the P & L. How are the markets performing economically? Are we buying that customer loyalty to the point where the markets are losing money? If so, how long do you think we can afford to play that game? But until I hear economics on how TED is performing, I'm not going to drink the Kool-Aid just yet.

I realize that as a pilot, further concessions are probably not something you want to think about. I don't like it any more than you do. But reality tells me that some form of further pay and/or benefit cuts is likely. Most everyone agrees that costs must come down further. Fuel isn't going to come down. So you tell me: where will it come from? Fuel and labor are your two biggest expenses. I just don't think there is any way around it.

 

[Bear96]

JungleClone, I think you are right on. Some UA employees are still totally in denial about our situation. They see the airline operating normally with no REALLY significant changes in our route structure since entering Ch.11 (so far); our pay checks are not bouncing (yet)...

Look at our colleagues at USAirways for an example of what we are in for. Or even what AA employees have given up, and they aren't even in bankruptcy (yet...). The pain hasn't even begun for us.

Defined benefit pensions are HISTORY in the airline biz. The pilots are fortunate enough to have their "B" fund, but every other pension scheme will be gone in short order. A private investor would be CRAZY to sink money into UA without the stipulation that the pensions be killed. JetBlue, and even the can-never-do-no-wrong Southwest, have no defined benefit pensions for the rank-and-file. That is the wave of the future to be able to compete in this industry where apparently employees at the LCCs are willing to work for nothing.

 

[firstamendment]

JungleClone, I think you are right on. Some UA employees are still totally in denial about our situation. They see the airline operating normally with no REALLY significant changes in our route structure since entering Ch.11 (so far); our pay checks are not bouncing (yet)...

Look at our colleagues at USAirways for an example of what we are in for. Or even what AA employees have given up, and they aren't even in bankruptcy (yet...). The pain hasn't even begun for us.

Defined benefit pensions are HISTORY in the airline biz. The pilots are fortunate enough to have their "B" fund, but every other pension scheme will be gone in short order. A private investor would be CRAZY to sink money into UA without the stipulation that the pensions be killed. JetBlue, and even the can-never-do-no-wrong Southwest, have no defined benefit pensions for the rank-and-file. That is the wave of the future to be able to compete in this industry where apparently employees at the LCCs are willing to work for nothing.

Hey Bear
Thank you for your post. It's a long road from DENIAL to REALITY. Finally, someone at United who is facing reality.

 

[C54Capt]

That is the wave of the future to be able to compete in this industry where apparently employees at the LCCs are willing to work for nothing.

Bear,

With all due respect, several of these "LCC" pilots are earning more than their counterparts at the "legacies" even before future concessions. So, be careful how you characterize your comments toward your peers in the industry.

 

[Speedbird]

Here's something from Business Week regarding the future of defined-benefit plans, retiree health care at United and other carriers, and other companies outside of the airline industry. It looks like DB plans will eventually go the way of the DoDo bird. One potential ramification of this if it indeed should occur is to swing the pendulum on the debate about the necessity of enforcing the age-60 retirement rule in favor of those who believe it should be extended in order to recoup lost retirement benefits.

EDITORIAL NOTE: I'm sure one of the resident experts will advise us later that the author of this article is a rank amateur who couldn't spell "pension" let alone explain how DB plans work. I guess it's still true that "denial" is not just a river in Egypt. <_<

Business Week

 

[Bear96]

Bear,

With all due respect, several of these "LCC" pilots are earning more than their counterparts at the "legacies" even before future concessions. So, be careful how you characterize your comments toward your peers in the industry.

I doubt it when you consider total compensation including:

-- Benefits (i.e., insurance)
-- Work rules (i.e., # of hours actually worked over a year vs. # of hours paid)
-- Defined benefit pensions
-- Quality of life issues such as length of layovers, quality of hotels, reserve rules

 

[jimntx]

I doubt it when you consider total compensation including:

-- Benefits (i.e., insurance)
-- Work rules (i.e., # of hours actually worked over a year vs. # of hours paid)
-- Defined benefit pensions
-- Quality of life issues such as length of layovers, quality of hotels, reserve rules

Bear, I don't know about pilots, but I know that comparing flight attendant pay, work rules, etc., I would not say that those of us at the legacies are better off than our LCC counterparts today.

My friends who are still flying at AA are talking constantly about 4-5 hours of sleep on a layover being the norm rather than the exception these days because of the way the company schedules the inbound and outbound flights and the location of layover hotels and the transportation to and from.

I just saw a Frontier bid sheet yesterday. I did not find a single layover in the bid sheet that was less than 14 hours block to block, and most were in the 15-20 hour range with some being over 24 hours (almost unheard of at AA anymore, even on International trips). My friend at Frontier had a trip recently where she got fed by the company 4 times in one day (just the way the trip legs worked out). At AA even on a 14-hour DFW-NRT leg, flight attendants get nothing to eat that they don't provide themselves unless there is a left over passenger meal.

At Frontier, if you are re-assigned (or junior manned as it's called at some airlines), it can be only once a month for a total of 1 day. You have to be released no later than 24 hours after your scheduled end of trip. At AA, as long as you haven't gone over the FAA 6-day max, they can keep reassigning you with no problem.

Have you looked at the SWA TA for flight attendants. At AA the top of scale is around $42/hr through 2008 with a per diem of $1.50/hr. (The f/a contract can be re-opened in 2006, but given AA's history of dragging out negotiations for at least 3 years, it will probably be 2009 before the f/as get a new contract.) Beginning in June, 2007 (last year of the new contract) top of scale for SW f/as will be over $50/hr. Their per diem is $2.10 hr. And, on the per diem they have a "me too" clause with the pilots.

AA flight attendants can be scheduled up to 13 or 14 hours now. The new contract for SW retains a 10.5 hr scheduled duty day. If the day goes over 12.5 hours on duty for any reason, the f/a is paid double time for that day. If the day goes over 16 hours for any reason, the f/a is paid triple time for the day.

I'm having a hard time seeing a better quality of life and work rules for the legacies right now. And, the worst part is that I doubt that the concessions are over at UAL, U, or AA. The management can't see anything else to do--certainly giving up their own salaries, perks, and golden parachutes is not on the table. I think its kind of funny that the majors all used to point at SW when saying that they needed to get costs (English translation: pilot and f/a pay) in line with Southwest. Now it's America West and JetBlue. Given the total UAL route system, how much competing do you actually do with those two airlines? But, I wouldn't be surprised if they are the standard the company will use when they come back to you for more concessions. It's what U is doing right now.

 

[Bear96]

jimntx,

I certainly can't defend what the AA F/As did. I don't understand that anomaly myself. They gave away the store under very strange circumstances. Even we here at ol' bankrupt UA are doing much better than the AA F/As right now-- we still have crew meals, more than FAA-min layovers, etc.

I doubt the concessions are over either at the legacies-- but that is my point. They are having to lower the bar with their existing employees to compete with the jetBlues and the AirTrans and the Independent Airs and the ATAs and the Mesas, etc. You are pointing to the examples of what happens after the wage slide has already been well under way for several years now. I think it is more accurate to look at the relative compensation / work rules / etc. at the point when people took the job. Perhaps that is a more useful way of dividing it up: rather than LCC vs. non-LCC, maybe it is better to look at it in terms of places that have been around for a while and were good places to work when the majority of their current employees started working there (which would include SW) vs. the "less-mature" carriers.

The people starting as F/As and pilots now are accepting terrible working conditions, for the most part (although I know someone can probably point to some example as an exception to that). It is much easier to not even start working in the first place for an employer that offers poor terms, than it is to leave after you have much time (seniority!) and energy invested and personal connections formed in a place that used to provide you a decent living.

Imagine what would have happened if pilots and F/As had simply stopped accepting positions at places that pay so poorly or have poor work rules over the past few years, when the downward slide became evident. The trend would not be the way it is today in many ways (though not all-- there are certainly other major trends going on the industry-- I don't mean to suggest otherwise-- but at least the "race to the bottom" for employee compensation wouldn't have been so quick or severe). But as long as there are bodies willing to fill positions with poor compensation, it will drag down even those employees at the airlines that had a formerly proud tradition of making airline jobs into jobs worth having for the long-term.

BTW what kind of defined benefit pension has Frontier offered their F/As over the years? How many paid holidays do they have? How long are their NRT layovers?

 

[46Driver]

How do we get a job then if we refuse to accept a position? Wait until UAL, AA, Delta, Fed-Ex, or UPS calls - especially as the hiring committees continue to raise the minimums to get hired? I'm not being vindictive, just pointing out that for a lot of us majors were not even a consideration: it was a LCC (or regional) or nothing. Not surprisingly, many of us opted for the former.

 

[UseYourHead]

jimntx,

But as long as there are bodies willing to fill positions with poor compensation, it will drag down even those employees at the airlines that had a formerly proud tradition of making airline jobs into jobs worth having for the long-term.

jimntx,

I have been reading this thread with amazement in that UAL folks (and all legacy carriers-and yes I work for one) are believing the falacy that things are going to get better, and the problem of profitability will go away.

This is really about one thing at this point...making money. UAL is bankrupt, and at some point UAL will lose control of its own destiny if a profitable operation in not in the future...near term. No one cares about our pension, houly wage, crew meals, etc.

And guess what, there is a line around the block ready to step in and take your job at even lower wages than today. For example, jetBlue has 10,000 pilot applications on file...hello....

Where do you think the 1000 airplanes are going that the LCC´s have on order?

While it is true that our pay and working conditions have ratcheted down to LCC´s, our problem is we are still bleeding, and in UAL´s case while in bankruptcy, that is going to stop one way or another, like it or not...it really is a no brainer.

There will be furloughs, absent profitability, labor will once again pay for mismanagement...fair?, of course not, but no one said life is fair. What do you think the creditors think that are getting 2 cents on the dollar through the BK process?

I would recommend fastening your seatbelt, all legacy airlines are in for rough ride in the next few years, as LCC´s carriers grow from 25% to 50% of the marketplace.

And until we can all compete and make money while doing it, we will not stop them. The old days of throwing capacity at markets and driving the competition out of business is over, unless of course you are talking about LUV or JBLU doing it to you...although that may work at this stage for independence air, as they are weak right now at the start up stage.