Funny it cost so much to PAY us but they can GIVE away the majority of a 2 BILLION dollar bail out to JAPAN airlines.
Notice the can in the sentence
I understand at 4 I stated they gave Japan Airlines money. I should have replaced gave with offered. I know they did not take the bailout.
Ahh. Now I see it. Your post gave the impression that AA did give $2 billion to JAL and this post clears it up. It's helpful if people would write with precision so that the words they type match what they're trying to say. Sometimes it's not easy to do but it's a goal worth pursuing.
The point of the list however was to show that they are throwing around alot of money and had that money to burn. Its going everywhere but toward the employee. Also that was the last time chronologacly I could think of they were going to cut lose such a large amount of money. And yes American DID give away our concessions JAL just did not take them.
The increase in fuel prices after the concessions were imposed on you more than soaked up the entire dollar amount of the concessions. JAL didn't take them - ExxonMobil, ChevronTexaco and BP took them.
Yes, AA has borrowed money to buy more fuel efficient airplanes and offered to borrow money to keep JAL. No way will any company borrow money to pay higher wages - no lender would ever lend money so the borrower could give raises. I'm certain that you aren't willing to borrow money to increase your kids' allownace - same with employers. Raises aren't something you borrow to pay. Investments in new planes or to keep a valuable partner? Certainly.
It is irrelevant if JAL took the money the point was AA felt they could offer it. There supposed to be hurting remember?
http://www.mb.com.ph/node/238143/american-
That article butchered the facts, which admittedly are confusing about the AA/Oneworld/TPG offer.
AA didn't offer to throw away $2 billion of its money. AA offered to invest about $300 million in JAL and lined up TPG to invest another $1.1 billion. The two billion dollars referenced in the Manila paper consisted mostly of revenue that JAL already gets from customers that AA claims is because of their alliance with AA as explained here:
PART 1: ENHANCED $2 BILLION COMMERCIAL BENEFITS FROM AMERICAN, BRITISH AIRWAYS AND QANTAS
The first part of the broad-based offer would provide for vastly enhanced commercial relationships between JAL and American, British Airways and Qantas. The three airlines' approximately $2 billion in commitments and benefits would be realized by JAL over the three years and includes $1.5 billion of continuation of the ongoing revenue that JAL realizes from oneworld today, $300 million in incremental revenue guarantees from American Airlines, and approximately $200 million in enhancements from British Airways.
American already has proposed to JAL to apply for anti-trust immunity (ATI) between the United States and Japan on the basis that American - with its strong network and ability to quickly obtain ATI - is the best choice for JAL. With immunity and by participating in a joint venture with American, JAL can realize a revenue benefit that will bring it an estimated $100 million annually. As part of this enhanced offer, American is guaranteeing the $100 million in new annual revenue for the first three years of the proposed venture.
http://aa.mediaroom.com/index.php?s=43&item=2823
AA did offer to guarantee $100 million of revenue a year for three years - but that was hardly a risky move - since antitrust immunity with AA will probably bring JAL more than $100 million of new revenue each year.
I wonder how many employees at AA realize the motivations of Delta in trying to woo JAL away from AA and Oneworld. Delta wasn't trying to get JAL to join Skyteam because of all the wonderful things JAL would bring Skyteam as much as Delta wanted to inflict a wound on AA and Oneworld. In case anyone at AA hasn't noticed, Delta intends to kill AA. DL is trying to kill AA at NYC and is making inroads at LAX. Snagging JAL into Skyteam would have weakened AA further and DL knows it. How many daily flights to NRT could AA support without all the online connections JAL offers? Quite a few of the passengers AA flies to Tokyo each day connect to HKG, SIN, BKK and other Asian cities on JAL. JAL joins Skyteam and AA's five daily NRT flights probably shrink as customers defect to UA and DL.
Delta sees this as a fight to the death and AA management was right (IMO) to place it on the front burner and offer investment to prevent JAL from defecting to Skyteam. And if AA had to borrow some money on JAL's behalf to accomplish that goal, then that was the right thing to do, even if it did anger employees who would like (and in many cases deserve) pay raises. If JAL left, then the question becomes how many flights don't fly and how many employees get furloughed. Raises? AA's trying to preserve the current revenue, which hasn't even been enough to produce profits lately.
I don't feel foolish. I come here for information and clarification. Isn't this a place to get information and share news?
The purchase of new aircraft will cause AA to spend less on fuel. Would you rather that AA spent more on fuel?
No I rather them pay me decent. Yeah less on fuel, more on aircraft. I rather get new planes if its economically viable instead of fuel of course. But I don't see the immediate benefits. We do however have immediate problems. If we are really hurting as bad as they say we are the timing is a bit off don't you think? Maybee in time we will realize more profit form the new aircraft. But that only causes even more expense in the short term because of the cost of the aircraft.
Of course you'd like more pay. Who wouldn't? Don't you think someone at AA has crunched the numbers on fuel burn and decided that the 35% fuel savings per seat mile that the new 738s offer is a better solution than burning lots more fuel in old MD-80s? If it wasn't economically viable, then AA wouldn't be borrowing money to buy 84 new 738s. The fuel savings alone won't be enough to make the payments on the new planes, but when you add in the reduced maintenance costs, the new planes are not significantly more expensive than the old MD-80s. The ones many passengers are growing weary of. My complaint with AA management is that Arpey and Beer (and now Horton) took far too long to order these new planes. Had they placed the orders in 2005 instead of waiting until 2007-08, AA would be farther along in replacing the MD-80s and would have saved that much more on fuel in 2008 when oil peaked at $147/bbl.
If you fix airplanes for a living, then reduced maintenance expenses isn't all that good news for you, since it probably equals fewer mechanics.
Execs got huge bonuses? You really should read the proxy statement instead of listening to the worthless union's stooges.
Show me this proxy statement your talking about. I would love to see it. And no that information about the bonuses came from other sources than the TWU.
Here you go:
No payment under financial component of our Annual Incentive Plan. Because we did not meet the pre-tax earnings threshold of our Annual Incentive Plan in 2009, we did not make any payment under the financial component of the plan.
http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9Mzc4Mzg5fENoaWxkSUQ9Mzc3NTY2fFR5cGU9MQ==&t=1
In English (instead of corporate finance lawyer speak), that means that the board has once again not paid out any bonuses to management. Same as every year since 2001.
The Compensation Committee also considered the following factors in setting pay for our named executive officers in 2009:
• The need to retain and motivate them to achieve our goals and restore sustained profitability
• No employees received annual base pay increases in 2009
• Since 2001, no payment has been made to them under the financial component of our short-term incentive programs since we have not met the required 5% pre-tax earnings margins during that time, and they have not received any discretionary short-term incentive awards
• Our cyclical business and the difficult economic environment have resulted in extraordinary volatility in our stock price, the primary variable of our long-term equity based compensation. This volatility, coupled with our heavy emphasis on long-term compensation, has produced significant variations in realized compensation for our named executive officers from year to year. In addition, the future value of their long-term compensation remains highly unpredictable
• For the ten years 1999 through 2008, their total realized compensation was only approximately 65% of the total targeted compensation awarded to them during this period
Notice that the executives have received about 65% of the amount the board intended to pay them over that decade. That's equivalent to a 35% paycut, not dissimilar to the paycut you and everyone else suffered. Yes, they have been paid millions in stock. Point is, they got millions less than the board intended them to get. Corporate executives don't come cheap. Arpey gets about $670,000 in base salary (guaranteed) and that represents about 15% of his target compensation each year. That's right - the board intends for him to get about $4.5 million each year between cash, stock and retirement savings. Far more than anyone needs, to be sure, but in line with what CEOs get.
TWA? That purchase was two years before AA demanded concessions.
Did I say that was before the concessions. I said since 2001. I am fully aware the concessions were in 2003. But with the economy on the downslide even then they had no business buying another airline. They could just have easily waited for it to liquidate the assets and gotten them alot cheaper. Not to mention the assets we took on we did'nt even want. Plus all the debt we took on. I have no doubt that even 2 years later the concessions we gave went toward that purchase.
In hindsight, the TWA puchase didn't provide the benefits Carty hoped for when it was announced in January 2001. AA could have waited until liquidation, but the problem with that strategy is that it makes it difficult to get the one asset that's actually valuable: the higher-spending elite frequent flyers that TWA still had in major markets. The day TWA stopped flying, those higher-spenders would have dispersed to all the other airlines. That was one of the big assets that AA was buying - the revenue stream provided by the customers. The airplanes weren't what AA wanted. The slots and some real estate were valuable, but the customer base was the real prize. Reasonable people can disagree, but I don't think AA's finances in the wake of September 11, 2001 were any worse because AA had acquired the TWA assets. On the contrary, most of the airlines that didn't buy TWA filed for Ch 11 and slashed wages. What did AA do differently? Laid off all those newly acquired furlough cushions (TWA LLC employees).
I don't feel foolish at all. I do however think your confrontational. And from this post in my opinion you reek of Company.
I encounter numerous posts on this website that reek of ignorance (not necessarily yours) and I do my best to help provide information and combat that ignorance.
