TWU Waving White Flag Already

[The Dissident]

Sure you can, it has been the basis for what you have accomplished for the last 5 years.

Go Ahead, take your victory lap: for now.

Dont pay any attention to FWAA, Hes not even in the business and once stated he couldnt even live on our paltry 32 bucks an hour. For such a financial guru you think he would be able to and thrive at that!!!

 

[FWAAA]

Fabricated? If anything its conservative. If you figure each employee costs the company an average of $60,000 a year times 40,000 that comes out to $2.4 billion, then they took another $1.8 billion in concessions from those who remained. If their numbers dont reflect that perhaps it went to the executives and management.

Your math calculation on its own is correct: $60k multiplied by 40k employees would equal $2.4 billion. But AA did not shrink by 40k people, and I doubt that the people who did leave made anywhere near $60k on average.

Employment at AA (mainline only) was reported by AA to be 97,800 at the end of 2002 and was reported to be 71,800 at the end of 2007, for a reduction of 26,000 people. AMR employment dipped by about 24,000 (since Eagle probably added a couple thousand people since the end of 2002) from 109,600 to 85,500.

Executives and management took the money?

The fact is, spending on wages is down just by just about exactly the $1.8 billion that the concessions promised. If personnel reductions meant billions more in cost savings, those wages not paid would be reflected in even larger reductions in the line item for wages. In early 2003, AA said that about half of the $1.8 billion would come from wages and work rule changes and the other half would come from furloughs/reductions. And the numbers reflect that $1.8 billion savings. Not $1.8 billion plus the imaginary extra $2.4 billion.

Well the people are gone so the savings must be there. Perhaps much of went for Winglets, Goldhoffers and all the new ground equipment we see.

Sure, AA bought winglets and new ground equipment. But if your alleged personnel reductions were accurate, then spending on wages would be much, much less than they were.

I dont agree that more shrinkage is needed. The planes are pretty much full. If they shrink any more then people wouldnt be able to get where they need to get at any price-there would be no seats available.

Fares still aren't high enough to pay all the costs plus leave profits left over plus raise everyone's wages to pre-concession levels (plus give raises on top of that). If you don't agree with that statement then you and reality could use a reintroduction.

Planes are full in part because fares are so cheap. I recently bought LAX-BOS-SJU and return for $267 including all taxes. AA is only gonna get $208 of that. Wanna know why I bought it? Because it was cheap. A day on the beach plus over 16,000 frequent flyer miles - more than enough to upgrade a domestic coach ticket to the next class of service. The $208 that AA clears won't even cover my pro-rata share of the fuel for those four long flights let alone any other costs. And I don't HAVE to go to San Juan. I wouldn't have bought the ticket if it cost what it should have cost. So on those flights I fill up a seat, making the flight look more full. Because I'm a top-tier elite, I'm practically guaranteed a seat in F (J to/from SJU) at no extra cost.

As I've posted before, I think you overestimate the number of passengers who HAVE to fly their flight. Like it or not, flying is discretionary for almost everyone on the plane. When fares are cheap, employers send their employees on lots of flights and there's less of an incentive to curb travel spending. When fares are cheap, families fly more often. My kids fly LAX-MIA very often to see grandparents. Because it's cheap. Fares go up to where they ought to be and you'll see fewer passengers. Price goes up, the quantity you sell tends to go down. Econ 101. Fares go down and you tend to sell a lot more. Like now. Flying isn't like filling up the gas tank so you can drive to work. Flying is something we do because it's so darned affordable.

Or we go on strike.

You certainly have that option. You have posted numerous times lately that AA employees ought to just "shut it down" and cause AA to liquidate if it won't pay you fairly. Funny thing about that sentiment: Over on the USAir forum, someone recently said that about USAir and several people jumped all over them for wishing 30,000 people out a job. And although the President (whomever wins) would probably order an end to an AA strike (just like Pres Clinton did), if they didn't, it's likely that an AA strike would bring about the end.

Because senority is paramount, you and many others have not left AA for greener pastures because many don't want to "start all over at the bottom." Understandable. Starting pay at WN for most non flight crew jobs is about $10/hr. Takes a while to top out and make serious money. And besides, WN may not be profitable forever - with your luck, they'd begin to show losses just as you top out and the concession demands would begin.

So you're unwilling to leave and start over yet you repeatedly post that it would be ok to cause AA to liquidate so EVERYONE would have to start over. Anyone else see the incongruity there? Leaving and starting over would be ok with you as long as the other 85,000 AMR employees have to do the same? Something you're unwilling to do on your own. But ok with you as long as you can bring down the whole ship. Something tells me that the pilots with their multi-million dollar pensions, despite all their tough talk, won't climb aboard your leaky boat. They're currently hurling invectives at the poster on the USAir forum for speaking such heresy.

Anyway, hope you can finally get paid a living wage, especially those of you in extremely expensive cost of living line stations.

 

[Bob Owens]

Your math calculation on its own is correct: $60k multiplied by 40k employees would equal $2.4 billion. But AA did not shrink by 40k people, and I doubt that the people who did leave made anywhere near $60k on average.

Employment at AA (mainline only) was reported by AA to be 97,800 at the end of 2002 and was reported to be 71,800 at the end of 2007, for a reduction of 26,000 people. AMR employment dipped by about 24,000 (since Eagle probably added a couple thousand people since the end of 2002) from 109,600 to 85,500.

Well you left out all the TWA people. If they are counted by the NMB then its fair enough to include them in the calculation.

Fares still aren't high enough to pay all the costs plus leave profits left over plus raise everyone's wages to pre-concession levels (plus give raises on top of that). If you don't agree with that statement then you and reality could use a reintroduction.

Then they need to raise them, like pretty much everyone else everywhere else in the economy is doing.

Planes are full in part because fares are so cheap. I recently bought LAX-BOS-SJU and return for $267 including all taxes. AA is only gonna get $208 of that. Wanna know why I bought it? Because it was cheap. A day on the beach plus over 16,000 frequent flyer miles - more than enough to upgrade a domestic coach ticket to the next class of service. The $208 that AA clears won't even cover my pro-rata share of the fuel for those four long flights let alone any other costs. And I don't HAVE to go to San Juan. I wouldn't have bought the ticket if it cost what it should have cost. So on those flights I fill up a seat, making the flight look more full. Because I'm a top-tier elite, I'm practically guaranteed a seat in F (J to/from SJU) at no extra cost.

And if it was $299 you would have stayed home? I doubt it.

As I've posted before, I think you overestimate the number of passengers who HAVE to fly their flight. Like it or not, flying is discretionary for almost everyone on the plane. When fares are cheap, employers send their employees on lots of flights and there's less of an incentive to curb travel spending. When fares are cheap, families fly more often. My kids fly LAX-MIA very often to see grandparents. Because it's cheap. Fares go up to where they ought to be and you'll see fewer passengers. Price goes up, the quantity you sell tends to go down. Econ 101. Fares go down and you tend to sell a lot more. Like now. Flying isn't like filling up the gas tank so you can drive to work. Flying is something we do because it's so darned affordable.

Most of these theories work off a bell curve, it gets to the point where no matter how cheaply you sell the ticket you dont get that many more people.

You also always leave out the fact that there is the belly, where a lot of freight and small packages are carried. So when the passenger load is lighter they can make up for it by filling the bellies.

You certainly have that option. You have posted numerous times lately that AA employees ought to just "shut it down" and cause AA to liquidate if it won't pay you fairly. Funny thing about that sentiment: Over on the USAir forum, someone recently said that about USAir and several people jumped all over them for wishing 30,000 people out a job. And although the President (whomever wins) would probably order an end to an AA strike (just like Pres Clinton did), if they didn't, it's likely that an AA strike would bring about the end.

Then its a powerful incentive for management to be reasonable.

So you're unwilling to leave and start over yet you repeatedly post that it would be ok to cause AA to liquidate so EVERYONE would have to start over. Anyone else see the incongruity there? Leaving and starting over would be ok with you as long as the other 85,000 AMR employees have to do the same?

Well you seem to forget that most of us have worked at other carriers before. We survived. After having invested so many years into a place "scorched earth" is the logical way to go. The EAL guys would have lost more money and had a harder time finding employment if they had simply given in and left one at a time. Other carriers were quick to move in on EALs markets once the strike was in full swing and ex-EAL workers gave those carriers the ability to do it. AA didnt lower wages when EAL struck, they hired them at higher "Flex rates". At first they tried to pull a fact one and after they started working decided to pay them the starting rate, they all walked in at one time and told them that they would quit if it wasnt adjusted. The company submitted, having taken on addition flying they couldnt afford to let these guys go. The other workers were already being forced the maximum amount allowed (3 days in a row).I used to turn it down and have them force even when I was willing to stay just so they couldnt force me on my Friday. Within two years I predict we will see similar shortages of mechanics on the line.

 

[FWAAA]

Well you left out all the TWA people. If they are counted by the NMB then its fair enough to include them in the calculation.

No, I didn't leave anyone out. TWA, LLC was a subsidiary of Amerian Airlines, Inc. at the end of 2002, and the 97,800 employees at 12/31/02 included the LLC employees. As I said before, mainline employment is down by 26,000 from 12/31/02 to 12/31/07.

Most of these theories work off a bell curve, it gets to the point where no matter how cheaply you sell the ticket you dont get that many more people.

That's true, and since the planes are currently pretty full, lowering the fares further can't result in very many more passengers. But as you point out, that bell curve works both ways; raise the fares substantially (as in 30% or more) and you'll probably find that revenue doesn't improve and might even go down.

You also always leave out the fact that there is the belly, where a lot of freight and small packages are carried. So when the passenger load is lighter they can make up for it by filling the bellies.

Very good point - AA's cargo volume has gradually declined the past several years - don't know if it's because AA is turning away cargo because of full planes (pax and bags at low fares) or whether extremely high fuel prices are depressing cargo volume. From a shipper's perspective, fuel at $0.55/gal made it easy to justify flying marginal value freight. Fuel at over $3/gal now might give someone second thoughts about flying marginal value cargo. High value, lightweight and perishable stuff will get flown no matter matter the price - but low value, heavy and nonperishable stuff might not.

About the SJU tickets - $299 might not have deterred my purchase, but there is a number somewhere that would keep me from buying. Full F/J on that ticket goes for $3,100 - and I know I wouldn't have paid that for such a short getaway (even though that's what I got). Somewhere in between those prices is my decision point.

 

[eolesen]

But as you point out, that bell curve works both ways; raise the fares substantially (as in 30% or more) and you'll probably find that revenue doesn't improve and might even go down.

I've shown before how raising fares can become a zero-sum game... A 5% increase on a $350 fare = $17 incremental revenue. If you lose just one passenger over the increased price, it will take 20 passengers paying the higher fare to offset that loss.

 

[Bob Owens]

No, I didn't leave anyone out. TWA, LLC was a subsidiary of Amerian Airlines, Inc. at the end of 2002, and the 97,800 employees at 12/31/02 included the LLC employees. As I said before, mainline employment is down by 26,000 from 12/31/02 to 12/31/07.

Ok 40,000 jobs since 2001.

That's true, and since the planes are currently pretty full, lowering the fares further can't result in very many more passengers. But as you point out, that bell curve works both ways; raise the fares substantially (as in 30% or more) and you'll probably find that revenue doesn't improve and might even go down.

Who says fares have to go up 30%? The WSJ had a article a few years abck, when the airlines were posting record losses that stated that something like $7 more a seat wouold have eliminated the loss.

Very good point - AA's cargo volume has gradually declined the past several years - don't know if it's because AA is turning away cargo because of full planes (pax and bags at low fares) or whether extremely high fuel prices are depressing cargo volume. From a shipper's perspective, fuel at $0.55/gal made it easy to justify flying marginal value freight. Fuel at over $3/gal now might give someone second thoughts about flying marginal value cargo. High value, lightweight and perishable stuff will get flown no matter matter the price - but low value, heavy and nonperishable stuff might not.

Why would the shipper care, all that he would care is how much the carrier charged him.

About the SJU tickets - $299 might not have deterred my purchase, but there is a number somewhere that would keep me from buying. Full F/J on that ticket goes for $3,100 - and I know I wouldn't have paid that for such a short getaway (even though that's what I got). Somewhere in between those prices is my decision point.

And somewhere in between is profitability. Like I said with such a high volume of seats sold a small increase can make a big difference to the bottom line.

 

[Bob Owens]

I've shown before how raising fares can become a zero-sum game... A 5% increase on a $350 fare = $17 incremental revenue. If you lose just one passenger over the increased price, it will take 20 passengers paying the higher fare to offset that loss.

FWAAA, Now you know why the airlines are losing money, the people running them are afraid to charge what they should be charging. Lose one passenger and it takes 20 to make up for that loss and the other 180 help make it very profitable. Sure you have the empty seat but then you can stuff more in the belly.

 

[eolesen]

If it were only that simple, Bob. You don't just lose one out of 200. The pricing models have pretty consistently shown if you raise fares 5%, and you'll probably lose 5% of the customers you would have otherwise sold at the lower fare level.

Don't think that the pricing plays a role in traffic being down?

Headline: American Airlines March traffic down 2.8% on 4.6% less capacity

Headline: American Eagle's March traffic fell 9.5% on 8.6% less capacity

Headline: Continental traffic up 4.3% on 4.6% more capacity

Headline: Southwest March Traffic up 9.8% on 5.3% more capacity


Now... guess which carrier instituted fuel surcharges and rate hikes, and which ones didn't.... AA's load factor went up, but only because they were pulling out capacity. Overall, there were fewer customers.

What's worse? In 2008, Easter fell into March. In 2007, it was in April... So, even with all the extra Easter traffic, AA seemed to have lost customers year over year.


And your article about raising fares $7??? IIRC, that was when fuel was below $30/barrel. People were concerned about UAL imploding at $60 oil. Now purchasing departments would kill for $60 oil....

 

[FWAAA]

Who says fares have to go up 30%? The WSJ had a article a few years abck, when the airlines were posting record losses that stated that something like $7 more a seat wouold have eliminated the loss.

The pilots have demanded a 50% increase so they can get their 1992 pay plus the CPI since then. The FAs and even The Worthless Union will demand similar increases to recapture their concessions. That works out to about $2.5 billion more a year. Fuel is likely to cost at least $2.5 billion more this year than last; so far, we need about $5 billion more to cover those items. AA really could use more profit so it can buy more fuel efficient new airplanes, so let's budget another billion (bringing the hoped-for 2008 profit to about $1.5 billion compared to last year's $500 million). So there we have it - AA's got to find about $6 billion more this year than last year. Still with me?

Last year, AMR's total revenue was $23 bilion. 6 into 23 is .26, or 26%. Let's round up to 30% so that AA can have a banner year, restore everyone's pay, pay out real profit sharing plus pay down more debt plus buy new fuel efficient planes.

Still think $7 a person is gonna amount to a hill of beans? Last year, there were 100 million pax. $7 each would mean an extra $700 million, not even enough to restore the pilot pay, let alone any of the other items. Like FAs, TWU, FUEL increases, more profit, etc.

Why would the shipper care, all that he would care is how much the carrier charged him.

AA's cargo rates are up substantially - AA actually passes along the fuel cost increases to cargo shippers. If my product can be shipped by boat instead, high fuel costs may tip me that direction. If my product is Continental US only, and can be trucked or trained instead of flown, $3/gal fuel may tip me that direction.

AA's cargo volume was down 8.6% last month compared to March, 2007. Huge dropoff. See what happens when rates go up? Volume goes down.

FWAAA, Now you know why the airlines are losing money, the people running them are afraid to charge what they should be charging. Lose one passenger and it takes 20 to make up for that loss and the other 180 help make it very profitable. Sure you have the empty seat but then you can stuff more in the belly.

Sorry to be such a buzzkill, Bob, but see preceding paragraph about that magical freight you keep talking about. AMR freight volume was down 8.6% last month. Passengers were down, also, but they weren't replaced with more freight.

I already know why the airlines are losing money. My spouse (with a terminal degree in economics) teaches economics at the college level. I have an advanced degree in econ myself. As you can guess, some of our friends also teach econ at the college level (spouse's colleagues). And those economists are in unanimous agreement as to why the airlines keep losing money: There's far too much capacity, both domestic and international, for today's exploding fuel prices.

As has been posted before, high capital costs plus the hope that things get better soon (as in, $10/bbl oil again) keeps the airlines filling seats to minimize the losses, even though those fares keep dropping. You gotta charge low fares to fill seats. They should be grounding planes and laying off employees instead. THAT would cause higher fares. In turn, those higher fares would cause fewer passengers. Leading to more planes being grounded and more employees being furloughed.

That's a pretty grim scenario, but that's what the future holds if oil stays over $100 (or goes higher) over the long term.

When I mentioned above that the economists were in unanimous agreement about the cause of the airlines' predicament - keep in mind that some of them are flaming liberals and some of them are Fox News conservatives. Some of them are kinda moderate. They agree on almost nothing else but the airlines' current mess and what's causing it. Simple Supply and Demand. Econ 101. I can anticipate your next comment - what do they know about airline pricing? When you, after all, an accomplished A&P licensed mechanic, actually work at an airport. None of them (me included) know jack about fixing airplanes. And you're an expert at both pricing models and fixing airplanes? There's a reason Arpey doesn't call on you for assistance with pricing decisions and that reason is kinda similar to why the number crunchers never roll up their sleeves in the rain and snow to help you diagnose a problem with a turbine engine. B)

The airlines are caught in a capacity situation that was designed around fuel that spent the entire decade of the 1990s bouncing around between $10/bbl and $30/bbl. So they all expanded like crazy. And now that their biggest input has hit $112/bbl (price several days ago), they need to downsize. A lot. You've probably got the senority to survive that downsizing. Tens of thousands of employees don't.

 

[eolesen]

It's not just the airlines, either... Supply and demand has the Big Three shutting down production lines for SUV's and diesels pickups. They simply can't sell them at current fuel prices. When I see incentives approaching $5K for a Jeep Liberty, you know things suck on the auto lots....

Likewise with the big RV manufacturers. Long-time and pioneer motorhom manufacturer Winnebago announced a 67% drop in revenues year over year. Haven't looked for Fleetwood's numbers yet, but they have a lot of other product diversity (everything from tent trailers to manufactured housing) to hide any weakness in the motorhome line.

I'd expect that Peterbuilt, Kenworth, & Volvo are probably seeing softer demand as well, as OTR trucking companies and independents alike start to rethink whether or not to get another year or two out of their existing rig as a way of offsetting the higher fuel bill....

 

[Boomer]

According to most industry analyst, the US AirCarrier Industry is a collective loss since Orvil and Wilbur hired Charles Taylor to build the first aircraft engine.

Since that time, aircraft, engine and avionics manufacturers have built huge industrial complexes around commercial aviation.

Fortunes have been won and lost as pioneers and visionaries launched schemes arguably attempting a profit. During the upside and downside, managment has ALWAYS BEEN PAID.

What we see today is no different from what we have seen. With respect to the current aviation theology: airline workers should expect to be compensated for less than agreed upon while those that failed receive more.

I love those that claim that Capitalism works; until they fall on their keesters. They then demand a government bailout directly; or, cowardly climb to the bankruptcy court to screw those on the lower rungs while claiming that the expertise that brought them to the brink is somehow required a bonus.

The apologists for the airlines claim that the workers accepted a job with inherent risks while excusing the same set of failed managers from the same test.

 

[Bob Owens]

If it were only that simple, Bob. You don't just lose one out of 200. The pricing models have pretty consistently shown if you raise fares 5%, and you'll probably lose 5% of the customers you would have otherwise sold at the lower fare level.

Don't think that the pricing plays a role in traffic being down?

Headline: American Airlines March traffic down 2.8% on 4.6% less capacity

Headline: American Eagle's March traffic fell 9.5% on 8.6% less capacity

Headline: Continental traffic up 4.3% on 4.6% more capacity

Headline: Southwest March Traffic up 9.8% on 5.3% more capacity


Now... guess which carrier instituted fuel surcharges and rate hikes, and which ones didn't.... AA's load factor went up, but only because they were pulling out capacity. Overall, there were fewer customers.

What's worse? In 2008, Easter fell into March. In 2007, it was in April... So, even with all the extra Easter traffic, AA seemed to have lost customers year over year.

Maybe its because AA flies more International flights and the dollar is worth less. There are many factors that can affect traffic.

And your article about raising fares $7??? IIRC, that was when fuel was below $30/barrel. People were concerned about UAL imploding at $60 oil. Now purchasing departments would kill for $60 oil....

This industry has been ready to implode since I got into it 28 years ago. Like I said, profits dont matter, as long as we move people and things the industry will be here.

 

[Bob Owens]

Still with me?

I dont care where they get it, pay me or shut it down. Maybe they will have to strike better deals with Boeing and other suppliers, maybe $1000 toilet seats will be a thing of the past.

Still think $7 a person is gonna amount to a hill of beans? Last year, there were 100 million pax. $7 each would mean an extra $700 million, not even enough to restore the pilot pay, let alone any of the other items. Like FAs, TWU, FUEL increases, more profit, etc.

AA has been spending money like a drunken sailor. Winglets, Goldhoffers, electric tugs etc. Maybe they will have to be a little more discretionary in their spending.

AA's cargo rates are up substantially - AA actually passes along the fuel cost increases to cargo shippers. If my product can be shipped by boat instead, high fuel costs may tip me that direction. If my product is Continental US only, and can be trucked or trained instead of flown, $3/gal fuel may tip me that direction.

Good luck with that-truckers use the same fuel as jets, in fact they pay more.

AA's cargo volume was down 8.6% last month compared to March, 2007. Huge dropoff. See what happens when rates go up? Volume goes down.

Could also be because of the weak dollar. We dont make all that much stuff to export and we cant afford as much imports-especially from Europe.

I already know why the airlines are losing money. My spouse (with a terminal degree in economics) teaches economics at the college level. I have an advanced degree in econ myself. As you can guess, some of our friends also teach econ at the college level (spouse's colleagues). And those economists are in unanimous agreement as to why the airlines keep losing money: There's far too much capacity, both domestic and international, for today's exploding fuel prices.

Well according to all those economic theories the industry should have vanished decades ago, but it hasnt so your theories dont provide all the answers do they?

Here is one set of variables to plug into your theories. What if airline workers had simply said no to concessions in the aftermath of 9-11? All we did was delay the inevitable fuel price crisis that the airlines are facing. In fact all we did was take our money and give it, indirectly, to the oil companies. As far as personal income, I lost two years of pay anyway, I lost the money and the ability to sell my time somewhere else so letting the airlines shut down wouldnt have been as devastating to my finances as taking the pay cuts, perhaps more disruptive to my life but not to my overall long term finacial well being. If we had simply said no,and perhaps called a general strike, the oil companies would have either had to come to agreements with the airlines or face the prospect that the broader economy would collapse as airlines(one of their biggest customers) ceased flying. That would then have created a glut of oil and the price would have had to come down.

As has been posted before, high capital costs plus the hope that things get better soon (as in, $10/bbl oil again) keeps the airlines filling seats to minimize the losses, even though those fares keep dropping. You gotta charge low fares to fill seats. They should be grounding planes and laying off employees instead. THAT would cause higher fares. In turn, those higher fares would cause fewer passengers. Leading to more planes being grounded and more employees being furloughed.

Yes but reducing capacity would have broader effects on the economy. Hotels would have empty rooms, the Feds would be collecting less in departure taxes, Local and state government would be collecting less in airport fees, oil companies would be selling less fuel, banks would be holding planes that are sitting in the desert, etc etc. Like I've said before, this industry doesnt exist as a money maker, never did according to the experts, but as long as we are moving people and things lots of other industries and parties are making money. Thats why it exists and thats why the government prevents consolidation.

When I mentioned above that the economists were in unanimous agreement about the cause of the airlines' predicament - keep in mind that some of them are flaming liberals and some of them are Fox News conservatives. Some of them are kinda moderate. They agree on almost nothing else but the airlines' current mess and what's causing it. Simple Supply and Demand. Econ 101.

Yea but they are economists, they were taught from the same books about the economy and none of them really run a business do they?

I can anticipate your next comment - what do they know about airline pricing? When you, after all, an accomplished A&P licensed mechanic, actually work at an airport. None of them (me included) know jack about fixing airplanes. And you're an expert at both pricing models and fixing airplanes? There's a reason Arpey doesn't call on you for assistance with pricing decisions and that reason is kinda similar to why the number crunchers never roll up their sleeves in the rain and snow to help you diagnose a problem with a turbine engine.

Never said I was an expert on pricing but despite all your theories sometimes plain old common sense provides the best course of action. After all the "experts" went to the same school of thinking as you yet in 75 years they still havent made this a profitable industry have they?

The airlines are caught in a capacity situation that was designed around fuel that spent the entire decade of the 1990s bouncing around between $10/bbl and $30/bbl. So they all expanded like crazy. And now that their biggest input has hit $112/bbl (price several days ago), they need to downsize. A lot. You've probably got the senority to survive that downsizing. Tens of thousands of employees don't.

Well this industry has been expanding for 75 years and oil wasnt always cheap. Didnt we only recently surpase its inflation adjusted historical high? Dont worry about the downsizing, the other day only one ETOPS trip left JFK. It wasnt weather, or equipement or a job action, it was a lack of flight crews. A slew of senior pilots retired. Over the next few years expect the labor shortage to become critical. At AA TWU members have to retire by Jan 1 2011. If they dont their pensions, which are based on the best 4 consecutive years out of their last 10, will actually go down the longer they work. Our best 4 out of the last 10 are 2001-2004, with 2002 being the best year.

 

[TWU-GOTTA-GO]

I dont care where they get it, pay me or shut it down. Maybe they will have to strike better deals with Boeing and other suppliers, maybe $1000 toilet seats will be a thing of the past.

Maybe they should take it from the $1 billion that have gotten in cost savings and 3rd party work that they have bragged about over the past 2 years.

 

[eolesen]

Maybe its because AA flies more International flights and the dollar is worth less. There are many factors that can affect traffic.

Nice try. Here it is by division:

D.O.T. DOMESTIC -5.9%
INTERNATIONAL +3.0%
ATLANTIC -0.2%
LATIN AMERICA +8.4%
PACIFIC -8.8%

Note that domestic was down 5.9% year over year. That's not the weak dollar vs. the Euro. It's fare hikes, and people being really worried about how they're going to fill the gas tank or buy groceries next month....

If anything, the weak dollar is helping international travel in markets where AA has a strong international point of sale, i.e. Latin America.