Us Airways Burning Through Cash Stash

[usairways_vote_NO]

U employees are going to have to work for compensation MUCH lessthan the cherry-picking LCCs in order to match them.

[post="252378"][/post]​

Hate to burst anyones bubble but USAirways employees and CEO's could work for free and still they couldn't match the LCC's but don't tell MWeiss that.

 

[mweiss]

What do I have to do with that observation? It's true (assuming, of course, that nothing else but wages/salaries changed).

 

[usairways_vote_NO]

What do I have to do with that observation? It's true (assuming, of course, that nothing else but wages/salaries changed).

[post="252414"][/post]​

Yeah I almost edited my reference to you out of my post but what the heck.

Do you mean USAirways before all the recently hailed changes from the great transformation plan took place or from USAirways state today?

 

[aafsc]

may be usair should take back all of the money from all of the former ceos' and stop giving huge amnts to the current regime. may be that would save a lot of dough

[post="252336"][/post]​

They even paid for the taxes on his severence package. I wish my employer would pay my taxes.

 

[usairways_vote_NO]

They even paid for the taxes on his severence package. I wish my employer would pay my taxes.

[post="252441"][/post]​

Do you have to pay taxes on the taxes that are paid for you?

 

[FWAAA]

Do you have to pay taxes on the taxes that are paid for you?

[post="252443"][/post]​

Yes, so many executives negotiate a gross-up payment sufficient to cover all the taxes on the payment, including the taxes on the taxes. Very common in the corporate world.

 

[Tim Nelson]

After TWA and US Airways, some executives might get the idea to implement a reverse B scale, such as after 25 years start tapering off wages and benefits for those wanting to protect their seniority positions.

Some senior mama will probably hunt me down for posting this in public.

Reap what you sow.

[post="252345"][/post]​

No matter what US AIRWAYS wants again from its employees, one thing is for sure, the 'courrier service' that pimps itself as a union will be right there for them.

No doubt about it.

regards,

 

[ELP_WN_Psgr]

Just a couple of quick thoughts. First of all I hope everyone is as well as they can be, under the circumstances....and that folks are avoiding the flu bug etc etc.

U employees are going to have to work for compensation MUCH lessthan the cherry-picking LCCs in order to match them.

You know, folks like to throw that "cherry picking LCC" accusation around.....but I don't think I am gonna buy off on it totally until I see U (or any other legacy type carrier) flying mainline metal between across such desirable routes as HRL-AUS, MSY-BHM, MCI-BNA, ABQ-AMA, or MAF-LAS.

Herein lies the tragedy and I think many of us could see it coming like a freight train. Nobody has done anything to cure the airlines systemic problems. All they have done is chopped wages and killed their workforce's motivation.

Is anybody really in charge or are executive decisions made by the Board of Directors consulting a ouija board, a magic eight ball, or perhaps they draw numbers out of a hat?

The real problem, the one that will kill U (assuming something does) is not employee wages, it is not even their overreliance on obscene fares.

It is, to put it bluntly, that they have contracted out way too much of their flying.

I would suggest to you that if a route can make money, it is worth having. if it doesn't, then it needs to be chopped and the assets deployed elsewhere.

Paying another carrier on a fee for departure basis doesn't make the bad route go away.....airlines like to think they have reduced their costs by having someone fly mediocre (or worse) routes for them at a fixed price, but it hasn;t solved the problem.

Quick rules for making a small fortune in the airline business.

1. Start with a large fortune.

If you can't manage that one....try these other rules.

2. Fly your airplanes where you can make money. Don't try to serve all sorts of places just so you can say you serve all sorts of places. Put the darned airplanes where there are passengers willing to pay a fare above the cost of providing the airplane seat, and run flights in those places.

3. Don't pay some other carrier anything to run routes for you that don't make any money. Yeah yeah yeah people can argue about "feed to the network" and "synergistic connecting traffic" and all that bs. A route either makes money or it doesn't. If it doesn't, it ought to be abandoned and the resources put somewhere else that offers a better chance at a return on investment.

A lot of people on a lot of airline boards have pooh-poohed the idea over the years that "they don't want to become another Southwest." My question has always been "what is it about making money that you really don't like?" If U's management were smart, which they're not.....with the low labor cost advantage they enjoy they would be turning the company into a Southwest clone as quickly as they could. Are they? Of course not. They don't want to be like Southwest. And until they decide that is their goal in life, they are going to keep on sending checks to Mesa, run completely full flights that don't break even, and whining about how they need employee concessions.

Art and Bob and a number of people have commented, over time, about how sorry an airline Southwest must be. I disagree vehemently (hence my screen name) but let's, just for a moment, pretend that Southwest is a really sorry airline. Let me ask which would be better - to be well paid by a sorry airline which is profitable without charging rapacious fares, or to earn McDonaldland wages working for a carrier that is upscale and well regarded?

The stockholders would like to see some sort of return on their investment.

I'm sure the employees would enjoy seeing management quit using bankruptcy laws to take away what's left of their meager paychecks.

The huddled masses that fly from city to city in our great country would probably like to pay lower walk up fares than, say, $954 between PHL & BUF.

Your management needs to get with the program. But they won't. I guess they must garner some sort of perverse satisfaction from taking away people;s livelihoods. It's a shame, but what other explanation can there be for their refusal to act boldly and positively to cure the company's ills?

 

[Fatherknowsbest]

Excellent post. Management does not do the job because no one is pushing them to do it. The BOD? Not competent enough. Bronner? Still doesn't know the airline business and probably never will. Lakefield? What a looser.

They all think that aviation fuel is going to drop 35% to 50% in the next year.

So glad I don't have to worry about this grind enymore (retired). I really dislike Management that doesn't care about anyone but themselves and are clueless.

US Airways pays everyone else to make a profit but can't make one themselves.

No wonder Air Wisconsin wants in on the Express gravy train!

 

[mweiss]

Do you mean USAirways before all the recently hailed changes from the great transformation plan took place or from USAirways state today?

[post="252432"][/post]​

Doesn't seem to make a difference either way. The "great transformation plan" to date seems to involve returning lots of mainline aircraft, adding RJ service to replace some of the lost mainline, and starting and stopping service to places in less than two weeks.

 

[delldude]

Doesn't seem to make a difference either way. The "great transformation plan" to date seems to involve returning lots of mainline aircraft, adding RJ service to replace some of the lost mainline, and starting and stopping service to places in less than two weeks.

[post="252771"][/post]​

well said michael...don't let usa320 tell you any different.

 

[Harry Callahan]

Stop it stop it right now. There is always the judge waiting to give instant relief by cutting employees wages. No more doom and gloom. Da judge and USAirways holds all the cards.

[post="252339"][/post]​

More concessions on the way. Get in the bent over position

 

[USFlyer]

3. Don't pay some other carrier anything to run routes for you that don't make any money. Yeah yeah yeah people can argue about "feed to the network" and "synergistic connecting traffic" and all that bs. A route either makes money or it doesn't. If it doesn't, it ought to be abandoned and the resources put somewhere else that offers a better chance at a return on investment.

Herein lies one major problem. Due to connecting traffic, I would submit many airlines, and in particular US, have no clear way to determine if a particular route and/or city is profitable or unprofitable. And, does dropping the connecting traffic coming from an unprofitable route then make other routes unprofitable, resulting in an ever downward spiral (part of the 'you can shrink into profitability' mantra)? It's a tough analysis and I don't really think US has a good handle on it (well, it's clear they don't). Up until about 2-3 years ago, they just priced the possibly unprofitable cities to be profitable, and folks were paying those fares. Now that game has changed, which has led to the mess we're now in.

 

[usairways_vote_NO]

Hate to burst anyones bubble but USAirways employees and CEO's could work for free and still they couldn't match the LCC's but don't tell MWeiss that.

[post="252386"][/post]​

It's true (assuming, of course, that nothing else but wages/salaries changed).

[post="252414"][/post]​

Do you mean USAirways before all the recently hailed changes from the great transformation plan took place or from USAirways state today?

[post="252432"][/post]​

Doesn't seem to make a difference either way. The "great transformation plan" to date seems to involve returning lots of mainline aircraft, adding RJ service to replace some of the lost mainline, and starting and stopping service to places in less than two weeks.

[post="252771"][/post]​

Thank you that was exactly my point but I needed you to clarify your "nothing else"

 

[whlinder]

Herein lies one major problem. Due to connecting traffic, I would submit many airlines, and in particular US, have no clear way to determine if a particular route and/or city is profitable or unprofitable. And, does dropping the connecting traffic coming from an unprofitable route then make other routes unprofitable, resulting in an ever downward spiral (part of the 'you can shrink into profitability' mantra)? It's a tough analysis and I don't really think US has a good handle on it (well, it's clear they don't). Up until about 2-3 years ago, they just priced the possibly unprofitable cities to be profitable, and folks were paying those fares. Now that game has changed, which has led to the mess we're now in.

[post="252781"][/post]​

This is an good point, and one that legacy carriers don't really think about too much. They don't have a good handle on connecting traffic, even though they can readily get data that shows fares paid from a connecting flight prorated over the flights that the passenger took. It is tough to determine 'what you would have sold... i.e. if you cut a 'connecting' flight or raise the fares on the connection so that you sell less connecting tickets, do you end up selling more nonstop tickets or just flying more empty seats? If US had the money and the people they could probably get a very good grasp on it, but they have neither.

I wrote a long post about this a couple of days ago:
http://www.usaviation.com/forums/index.php...opic=18922&st=0