Note for the trivia fans: the executive braintrust who got CAL to outsource it''s heavy maint left CAL and went to NWA, where he tried to do the same thing. The IAM helped him along by staging job actions and promoting a "don''t work too fast, you don''t want to work yourself out of a job" attitude. AMFA never corrected the "slower work - more dues payers" job ethic the IAM left behind. Oh well. The work will come back in about ten years, as this process is cyclical.
TWU allows 41% Outsource of Maintenance
- Thread starter RV4
- Start date
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- #17
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On 7/1/2003 10:52:21 AM AAmech wrote:
While the chart does show AA with a lower percentage of outsourcing than most, the #'s are clearly wacky! How in the world does she come up with 41%? AA outsources compnents ONLY! I could see if we were sending out the entire plane but her #'s make no sense whatsoever. Same with USairways. They also do most everything in-house except for engine overhaul with is 100% outsouced. She gives them a 50%.
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The data provided comes from BACK Aviation Solutions...On 7/1/2003 10:52:21 AM AAmech wrote:
While the chart does show AA with a lower percentage of outsourcing than most, the #'s are clearly wacky! How in the world does she come up with 41%? AA outsources compnents ONLY! I could see if we were sending out the entire plane but her #'s make no sense whatsoever. Same with USairways. They also do most everything in-house except for engine overhaul with is 100% outsouced. She gives them a 50%.
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[url="http://www.backaviation.com/"]http://www.backaviation.com/[/URL]
Information Services
In the high-stakes game of global aviation, every decision is critical. Exactly the right data at precisely the right time is essential. BACK offers the most accurate, comprehensive, value-added aviation data collection in the industry. For over 25 years, we have been providing aviation professionals with access to up-to-the minute information including fleet inventories, flight schedules, traffic trends, financials, and operating statistics.
It will be interesting to see if this data activates a grievance at Northwest by AMFA, given their contract has a 38% limit and appears to have been exceeded in 2002 by 7%.
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On 7/1/2003 10:52:21 AM AAmech wrote:
While the chart does show AA with a lower percentage of outsourcing than most, the #''s are clearly wacky! How in the world does she come up with 41%? AA outsources compnents ONLY! I could see if we were sending out the entire plane but her #''s make no sense whatsoever. Same with USairways. They also do most everything in-house except for engine overhaul with is 100% outsouced. She gives them a 50%.
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On 7/1/2003 10:52:21 AM AAmech wrote:
While the chart does show AA with a lower percentage of outsourcing than most, the #''s are clearly wacky! How in the world does she come up with 41%? AA outsources compnents ONLY! I could see if we were sending out the entire plane but her #''s make no sense whatsoever. Same with USairways. They also do most everything in-house except for engine overhaul with is 100% outsouced. She gives them a 50%.
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The only way I see the 41% outsource is that the figures might just include contract maintenanance at line stations that we do not staff. My opinion of course but that would make sense.
James T. Kirk
Senior
- Apr 9, 2003
- 301
- 0
Direct Aircraft Maintenance Cost Outsourcing Analysis
The chart that appeared in USA Today relating to outsourcing of maintenance cost contained a gross error. Back Aviation utilized Form 41 cost data to estimate the amount of third party maintenance outsourcing. Their calculation included dollars paid to third party providers divided by total direct a/c maintenance. This is extremely misleading and not at all accurate, as they should have added “maintenance burden†to the total direct a/c maintenance cost.
Form 41 data divides maintenance cost into four main categories. The first three are Labor, Materials and Third Party Charges and are all assignable by aircraft type. The fourth, which was left out of the Back/USA Today analysis, is called Maintenance Burden. Burden is the cost incurred by an airline to perform maintenance. For example, the costs of hanger rental or ownership, tooling, equipment, electricity and vehicles that are required to perform maintenance activities are included in burden. Maintenance Burden accounts for 46% of American Airlines Total aircraft maintenance cost.
What makes the Back/USA Today analysis misleading is the fact that “Burden†charges that third party providers incur are included in the “Third Party Charges†category. The third party charges category includes labor, materials, burden and profit margin reported as one lump sum (the detail is not reported). Therefore the analysis included burden cost for third party providers and not for the airline, which incorrectly inflates the estimated amount of outsourced work.
AA
CO
DL
NW
UA
US
WN
TOTAL
% Direct A/C Maintenance Outsourced (Excluding Burden)
BACK/USA Today Calculation using full year data
38.4%
65.0%
37.6%
43.5%
33.1%
50.3%
65.1%
43.7%
% Direct A/C Maintenance Outsourced (Including Burden) Correct Calculation using full year data
20.9%
36.0%
25.2%
26.6%
16.7%
29.1%
56.9%
25.7%
The chart that appeared in USA Today relating to outsourcing of maintenance cost contained a gross error. Back Aviation utilized Form 41 cost data to estimate the amount of third party maintenance outsourcing. Their calculation included dollars paid to third party providers divided by total direct a/c maintenance. This is extremely misleading and not at all accurate, as they should have added “maintenance burden†to the total direct a/c maintenance cost.
Form 41 data divides maintenance cost into four main categories. The first three are Labor, Materials and Third Party Charges and are all assignable by aircraft type. The fourth, which was left out of the Back/USA Today analysis, is called Maintenance Burden. Burden is the cost incurred by an airline to perform maintenance. For example, the costs of hanger rental or ownership, tooling, equipment, electricity and vehicles that are required to perform maintenance activities are included in burden. Maintenance Burden accounts for 46% of American Airlines Total aircraft maintenance cost.
What makes the Back/USA Today analysis misleading is the fact that “Burden†charges that third party providers incur are included in the “Third Party Charges†category. The third party charges category includes labor, materials, burden and profit margin reported as one lump sum (the detail is not reported). Therefore the analysis included burden cost for third party providers and not for the airline, which incorrectly inflates the estimated amount of outsourced work.
AA
CO
DL
NW
UA
US
WN
TOTAL
% Direct A/C Maintenance Outsourced (Excluding Burden)
BACK/USA Today Calculation using full year data
38.4%
65.0%
37.6%
43.5%
33.1%
50.3%
65.1%
43.7%
% Direct A/C Maintenance Outsourced (Including Burden) Correct Calculation using full year data
20.9%
36.0%
25.2%
26.6%
16.7%
29.1%
56.9%
25.7%
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On 7/2/2003 6:09:25 AM James T. Kirk wrote:
Direct Aircraft Maintenance Cost Outsourcing Analysis
The chart that appeared in USA Today relating to outsourcing of maintenance cost contained a gross error. Back Aviation utilized Form 41 cost data to estimate the amount of third party maintenance outsourcing. Their calculation included dollars paid to third party providers divided by total direct a/c maintenance. This is extremely misleading and not at all accurate, as they should have added “maintenance burden” to the total direct a/c maintenance cost.
Form 41 data divides maintenance cost into four main categories. The first three are Labor, Materials and Third Party Charges and are all assignable by aircraft type. The fourth, which was left out of the Back/USA Today analysis, is called Maintenance Burden. Burden is the cost incurred by an airline to perform maintenance. For example, the costs of hanger rental or ownership, tooling, equipment, electricity and vehicles that are required to perform maintenance activities are included in burden. Maintenance Burden accounts for 46% of American Airlines Total aircraft maintenance cost.
What makes the Back/USA Today analysis misleading is the fact that “Burden” charges that third party providers incur are included in the “Third Party Charges” category. The third party charges category includes labor, materials, burden and profit margin reported as one lump sum (the detail is not reported). Therefore the analysis included burden cost for third party providers and not for the airline, which incorrectly inflates the estimated amount of outsourced work.
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Thanks for the clarification. On 7/2/2003 6:09:25 AM James T. Kirk wrote:
Direct Aircraft Maintenance Cost Outsourcing Analysis
The chart that appeared in USA Today relating to outsourcing of maintenance cost contained a gross error. Back Aviation utilized Form 41 cost data to estimate the amount of third party maintenance outsourcing. Their calculation included dollars paid to third party providers divided by total direct a/c maintenance. This is extremely misleading and not at all accurate, as they should have added “maintenance burden” to the total direct a/c maintenance cost.
Form 41 data divides maintenance cost into four main categories. The first three are Labor, Materials and Third Party Charges and are all assignable by aircraft type. The fourth, which was left out of the Back/USA Today analysis, is called Maintenance Burden. Burden is the cost incurred by an airline to perform maintenance. For example, the costs of hanger rental or ownership, tooling, equipment, electricity and vehicles that are required to perform maintenance activities are included in burden. Maintenance Burden accounts for 46% of American Airlines Total aircraft maintenance cost.
What makes the Back/USA Today analysis misleading is the fact that “Burden” charges that third party providers incur are included in the “Third Party Charges” category. The third party charges category includes labor, materials, burden and profit margin reported as one lump sum (the detail is not reported). Therefore the analysis included burden cost for third party providers and not for the airline, which incorrectly inflates the estimated amount of outsourced work.
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However the damage has been done, USAToday says AA contracts out 41%, and the printed media NEVER lies unless its about the other guy''s action.
The jury will of course be directed to ignore the chart.
James T. Kirk
Senior
- Apr 9, 2003
- 301
- 0
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On 7/2/2003 8:29:00 PM j7915 wrote:
However the damage has been done, USAToday says AA contracts out 41%, and the printed media NEVER lies unless its about the other guy''s action.
The jury will of course be directed to ignore the chart.
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The company that put out the article isn’t putting out lies they are using a different method of calculating out sourcing figures. The reason they are using that method is they are in the business of working on out sourced work. They want to make it sound so they will have a chance to bring in more work. AA nor any of the other airlines use that method to calculate the percent of out sourced work.On 7/2/2003 8:29:00 PM j7915 wrote:
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On 7/2/2003 6:09:25 AM James T. Kirk wrote:
Direct Aircraft Maintenance Cost Outsourcing Analysis
 
The chart that appeared in USA Today relating to outsourcing of maintenance cost contained a gross error. Back Aviation utilized Form 41 cost data to estimate the amount of third party maintenance outsourcing. Their calculation included dollars paid to third party providers divided by total direct a/c maintenance. This is extremely misleading and not at all accurate, as they should have added “maintenance burden” to the total direct a/c maintenance cost.
 
Form 41 data divides maintenance cost into four main categories. The first three are Labor, Materials and Third Party Charges and are all assignable by aircraft type. The fourth, which was left out of the Back/USA Today analysis, is called Maintenance Burden. Burden is the cost incurred by an airline to perform maintenance. For example, the costs of hanger rental or ownership, tooling, equipment, electricity and vehicles that are required to perform maintenance activities are included in burden. Maintenance Burden accounts for 46% of American Airlines Total aircraft maintenance cost.
 
What makes the Back/USA Today analysis misleading is the fact that “Burden” charges that third party providers incur are included in the “Third Party Charges” category. The third party charges category includes labor, materials, burden and profit margin reported as one lump sum (the detail is not reported). Therefore the analysis included burden cost for third party providers and not for the airline, which incorrectly inflates the estimated amount of outsourced work.
 
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Thanks for the clarification. On 7/2/2003 6:09:25 AM James T. Kirk wrote:
Direct Aircraft Maintenance Cost Outsourcing Analysis
 
The chart that appeared in USA Today relating to outsourcing of maintenance cost contained a gross error. Back Aviation utilized Form 41 cost data to estimate the amount of third party maintenance outsourcing. Their calculation included dollars paid to third party providers divided by total direct a/c maintenance. This is extremely misleading and not at all accurate, as they should have added “maintenance burden” to the total direct a/c maintenance cost.
 
Form 41 data divides maintenance cost into four main categories. The first three are Labor, Materials and Third Party Charges and are all assignable by aircraft type. The fourth, which was left out of the Back/USA Today analysis, is called Maintenance Burden. Burden is the cost incurred by an airline to perform maintenance. For example, the costs of hanger rental or ownership, tooling, equipment, electricity and vehicles that are required to perform maintenance activities are included in burden. Maintenance Burden accounts for 46% of American Airlines Total aircraft maintenance cost.
 
What makes the Back/USA Today analysis misleading is the fact that “Burden” charges that third party providers incur are included in the “Third Party Charges” category. The third party charges category includes labor, materials, burden and profit margin reported as one lump sum (the detail is not reported). Therefore the analysis included burden cost for third party providers and not for the airline, which incorrectly inflates the estimated amount of outsourced work.
 
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However the damage has been done, USAToday says AA contracts out 41%, and the printed media NEVER lies unless its about the other guy''s action.
The jury will of course be directed to ignore the chart.
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just like normal....you AMFA pukes will never change. Do a little research and figure out the whole story behind the numbers! C'mon, all of the numbers are misleading because they don't take into consideration the companies burden. Even the Northwest numbers are wrong, I think we are aware that they aren't at 45% either. If they are, AMFA should be getting rich because they tactfully negotiated a dollar for dollar payment to themselves if the company goes over 38%.Have a wonderful day!
P.S. Let's not forget these numbers were before Northwest outsourced five of their C check lines to vendors....hey where'd all the people go?
P.S. Let's not forget these numbers were before Northwest outsourced five of their C check lines to vendors....hey where'd all the people go?
will fix for food
Veteran
- Aug 20, 2002
- 664
- 50
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On 6/30/2003 11:55:03 PM Buck wrote:
"By the lowest average compensated mechanics in the industry."
Just curious Buck, are you including the OSM payscale in this calculation?
It is called "Farming Out In House"
Do you think that "farming out in house" is better or worse than farming those jobs out to an outside vendor?
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On 6/30/2003 11:55:03 PM Buck wrote:
"By the lowest average compensated mechanics in the industry."
Just curious Buck, are you including the OSM payscale in this calculation?
It is called "Farming Out In House"
Do you think that "farming out in house" is better or worse than farming those jobs out to an outside vendor?
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- Thread Starter
- Thread starter
- #24
Northwest could farmout 100% under the IAM agreement in place when AMFA came on the property. AMFA negotiated one time so far and got a 38% limit of LABOR DOLLARS, not the whole maintenance dollars (mangers salary, paper clips, etc.) in addition to the highest pay in the industry.
What is the TWU limit on outsource and what is the current industry standing in pay?
will fix for food
Veteran
- Aug 20, 2002
- 664
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Obviously the 45% figure stated in this thread at first is wrong, and the 26.6% figure for 2002 is old, so what is NWA's current farmout? I thought it was supposed to be reviewed quarterly. What is it for 2003 year to date?
It seems to me that 26.6% of the total budget HAS to be pretty close to 38% of labor costs alone.
It seems to me that 26.6% of the total budget HAS to be pretty close to 38% of labor costs alone.
- Aug 20, 2002
- 7,319
- 1,555
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On 7/3/2003 3:43:29 PM will fix for food wrote:
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Yes of course I am including the OSM payscale. They are mechanics at AA.On 7/3/2003 3:43:29 PM will fix for food wrote:
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On 6/30/2003 11:55:03 PM Buck wrote:
"By the lowest average compensated mechanics in the industry."
Just curious Buck, are you including the OSM payscale in this calculation?
It is called "Farming Out In House"
Do you think that "farming out in house" is better or worse than farming those jobs out to an outside vendor?
----------------
On 6/30/2003 11:55:03 PM Buck wrote:
"By the lowest average compensated mechanics in the industry."
Just curious Buck, are you including the OSM payscale in this calculation?
It is called "Farming Out In House"
Do you think that "farming out in house" is better or worse than farming those jobs out to an outside vendor?
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I believe in raising the standard of my profession. The airline industry is not a "JOBS" prgram, it is cyclical with the economy. However since the introduction of the "B" scale and its evolvement to the OSM classification, the company has been able to maintain a large work force even when the work load decreases. The TWU maintains its "JOBS" program at the expense of the rest of the mechanics.
What I believe is it is better to lay off than to reduce the wages and benefits that have been fought for over the years. It is never good to farm out the work, but it is allowed.
James T. Kirk
Senior
- Apr 9, 2003
- 301
- 0
When all of the 2003 numbers have been factored in NWA will be well over the 38% LABOR DOLLARS CAP as per their contract. NWA has sent a letter to amfa notifying that they plan to exceed the 38% cap and are not going to pay amfa any penalty money. Now what a surprise that is to everyone.
will fix for food
Veteran
- Aug 20, 2002
- 664
- 50
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On 7/4/2003 12:06:14 AM Buck wrote:
P>"Yes of course I am including the OSM payscale. They are mechanics at AA."
Sorry about all the questions, but I am not all that familiar with the OSM situation. Are the OSM/s all licensed mechanics? Are they just in Tulsa? I believe you are able to bump into an OSM position if you are laid off, I know you go to the lower pay scale, but do you continue to accrue seniority, pension, etc?
"I believe in raising the standard of my profession. The airline industry is not a "JOBS" prgram, it is cyclical with the economy. However since the introduction of the "B" scale and its evolvement to the OSM classification, the company has been able to maintain a large work force even when the work load decreases. The TWU maintains its "JOBS" program at the expense of the rest of the mechanics.
What I believe is it is better to lay off than to reduce the wages and benefits that have been fought for over the years. It is never good to farm out the work, but it is allowed. "
Eagle''s OSM work is at Nordam and all the other places whose names I don/t know. I personally think that is nuts. I have seen the bills for some of the repairs that they do and Eagle has the capability to do them cheaper in house using repairmen and/or mechanics.
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On 7/4/2003 12:06:14 AM Buck wrote:
P>"Yes of course I am including the OSM payscale. They are mechanics at AA."
Sorry about all the questions, but I am not all that familiar with the OSM situation. Are the OSM/s all licensed mechanics? Are they just in Tulsa? I believe you are able to bump into an OSM position if you are laid off, I know you go to the lower pay scale, but do you continue to accrue seniority, pension, etc?
"I believe in raising the standard of my profession. The airline industry is not a "JOBS" prgram, it is cyclical with the economy. However since the introduction of the "B" scale and its evolvement to the OSM classification, the company has been able to maintain a large work force even when the work load decreases. The TWU maintains its "JOBS" program at the expense of the rest of the mechanics.
What I believe is it is better to lay off than to reduce the wages and benefits that have been fought for over the years. It is never good to farm out the work, but it is allowed. "
Eagle''s OSM work is at Nordam and all the other places whose names I don/t know. I personally think that is nuts. I have seen the bills for some of the repairs that they do and Eagle has the capability to do them cheaper in house using repairmen and/or mechanics.
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- Thread Starter
- Thread starter
- #29
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On 7/4/2003 10:56:29 AM James T. Kirk wrote:
When all of the 2003 numbers have been factored in NWA will be well over the 38% LABOR DOLLARS CAP as per their contract. NWA has sent a letter to amfa notifying that they plan to exceed the 38% cap and are not going to pay amfa any penalty money. Now what a surprise that is to everyone.
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Show us the letter!On 7/4/2003 10:56:29 AM James T. Kirk wrote:
When all of the 2003 numbers have been factored in NWA will be well over the 38% LABOR DOLLARS CAP as per their contract. NWA has sent a letter to amfa notifying that they plan to exceed the 38% cap and are not going to pay amfa any penalty money. Now what a surprise that is to everyone.
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- Aug 20, 2002
- 7,319
- 1,555
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On 7/4/2003 10:31:47 AM will fix for food wrote:
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On 7/4/2003 10:31:47 AM will fix for food wrote:
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On 7/4/2003 12:06:14 AM Buck wrote:
P>"Yes of course I am including the OSM payscale. They are mechanics at AA."
Sorry about all the questions, but I am not all that familiar with the OSM situation. Are the OSM/s all licensed mechanics? Are they just in Tulsa? I believe you are able to bump into an OSM position if you are laid off, I know you go to the lower pay scale, but do you continue to accrue seniority, pension, etc?
"I believe in raising the standard of my profession. The airline industry is not a "JOBS" prgram, it is cyclical with the economy. However since the introduction of the "B" scale and its evolvement to the OSM classification, the company has been able to maintain a large work force even when the work load decreases. The TWU maintains its "JOBS" program at the expense of the rest of the mechanics.
What I believe is it is better to lay off than to reduce the wages and benefits that have been fought for over the years. It is never good to farm out the work, but it is allowed.
"
Eagle''s OSM work is at Nordam and all the other places whose names I don/t know. I personally think that is nuts. I have seen the bills for some of the repairs that they do and Eagle has the capability to do them cheaper in house using repairmen and/or mechanics.
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And why is their work at Nordam? Who represents them? If AMR can have work done cheaper, why does this not happen? Does Eagle have to threaten Bankruptcy before AMR investigates?On 7/4/2003 12:06:14 AM Buck wrote:
P>"Yes of course I am including the OSM payscale. They are mechanics at AA."
Sorry about all the questions, but I am not all that familiar with the OSM situation. Are the OSM/s all licensed mechanics? Are they just in Tulsa? I believe you are able to bump into an OSM position if you are laid off, I know you go to the lower pay scale, but do you continue to accrue seniority, pension, etc?
"I believe in raising the standard of my profession. The airline industry is not a "JOBS" prgram, it is cyclical with the economy. However since the introduction of the "B" scale and its evolvement to the OSM classification, the company has been able to maintain a large work force even when the work load decreases. The TWU maintains its "JOBS" program at the expense of the rest of the mechanics.
What I believe is it is better to lay off than to reduce the wages and benefits that have been fought for over the years. It is never good to farm out the work, but it is allowed.
"
Eagle''s OSM work is at Nordam and all the other places whose names I don/t know. I personally think that is nuts. I have seen the bills for some of the repairs that they do and Eagle has the capability to do them cheaper in house using repairmen and/or mechanics.
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