Us Airways Pilot Pension Relief Torpedoed

[ClueByFour]

:blink: UAL isn't merging with anyone. They are in bk.....trying to clean there own messes. Are you trolling? :down:

Actually, it seems to be sarcasm.

That said, it would seem that this will help UA overcome perhaps the biggest remaining hurdle to their Chapter 11 emergence.

 

[Deleted by Moderator]

ClueByFour Posted on Jan 28 2004, 10:07 PM

QUOTE (Deleted by Moderator @ Jan 28 2004, 11:38 PM)
UAL isn't merging with anyone. They are in bk.....trying to clean there own messes. Are you trolling?


Actually, it seems to be sarcasm.

That said, it would seem that this will help UA overcome perhaps the biggest remaining hurdle to their Chapter 11 emergence.

Do you really think it would help United? IMHO, I think it would be the straw that broke the camels back. I think it has taken every ounce of energy to get this team to work together instead of against each other and to add a SERIOUS seniority integration into the mix would be fatal to both.

 

[737nCH11]

Deleted,

He means the resolution of the pension issue, not a merger.

 

[Traveler]

I am very pleased to see that the pilots received some resolve on this pension issue.

Thanks for the support.

It would be a real treat if all this mess came together one day and made a little more sense.

I assume people choose an industry to be a part of not just for love and interest but also for some kind of stable career potential. The only way any employee in this volatile industry will safely have a career is if a new stability is permitted by the powers that be which insures the continuity of safety, service and a vitality of enduring strength and longevity.

Can you believe that @#*%$!, Economist Alfred Kahn wrote a book on how to deregulate the deregulation process.

He writes, "Do the bare minimum and then let go." (He’s still the hypocrite) He states in his book, Letting Go: Deregulating the Process of Deregulation, or: Temptation of the Kleptocrats and the Political Economy of Regulatory Disingenuousness (What a crock!). He further states, “Many consumers depend on the only local utility available, Kahn observes, so their service must be protected. Regulation will be required (Now I'm confused. Is it Regulation or DE-Regulation), he says, to assure competitors access to the utility companies' lines and wires, on terms that permit them to compete if they are equally efficient.â€

In 1999 he made these comments:

“American air carriers risk government re-regulation of fares if they continue to practice predatory pricing...â€, (It seems predatory pricing has a narrow meaning applied only to traditional Airlines desperately trying to protect the heart and core of their existence. Regulators whistle, shuffle their feet and point their gaze skyward when it comes to the certain slow death of legacy carriers trying to use true American free market competitive rules to logically synergize their industry as is naturally done in other industries. The cost alone of fighting government deregulated regulations can destroy Airlines during the period of intense scrutiny. Not just for Mergers but Alliances as well).

More Kahn: "No one wants to go back to re-regulation to limit the spread of fares, but there is some talk in Congress to do just that. Too often, new, low-cost competitors are squeezed out by the incumbent airlines. Start-up low-fare airlines need time to get on their feet. Yet if an incumbent airline cuts prices to below cost until the newcomer is bankrupted or leaves the area, the consumer is not served. (Did you hear Southwest brag that if it comes to a war of attrition in Philadelphia, Southwest will win. So is the customer served if the "Oldcommer is bankurpted or leaves the area?)

"Prices inevitably return to their prior levels or higher once the low-fare airline has departed," explained Kahn, citing a case where a carrier increased the number of its low-fare seats from 1,500 to 50,000 after a low-fare carrier entered the market. (I’m all for competition, but holding the big guy down until he’s bleed to death doesn’t sound like competition. Then there’s that bit about price levels. Don’t people know that these LCCs have the highest prices in those markets they dominate. And anybody knows that once these LCCs reach the mature stage of a business life-cycle, and stop growing, their costs will eventually go up just as the mature carrier’s did. Costs go up, prices go up. It’s in the textbooks.)

"It is vital to remember that average fares since deregulation have decreased 39 percent. At the same time, unrestricted fares have increased 70 percent or more," continued Kahn. "(But), while that is quite a spread, re-regulation is not the answer. Effective monitoring of monopolization is the answer."(Soooo... Let's see... that's regulatiing the deregulated industry so as to encourage a "do the bare minimum then let go" philosophy in order to encourage free competation limited by regulations which inhibit the natural evoulution of free market dynamics which, if left the hell alone would help insure the dependability of safety and service to remote markets not serviced by "Point to Point" carriers who will thrive regardless because of their low cost structurs operating with the attractiveness of low fares, insuring their perpetual viability beneath the umbrella of medium to high fare, full service, international Legacy Airlines serving a vital function in the security and stability of the Nations critical interests in the area of Commerce and Transportation. Makes sense to me.)

(Any logical, cost effective, synergy is a bad idea to Kahn. And people listened to him like he’s the oracle) "It is very important to have antitrust scrutiny eliminating gateway-to-gateway monopolies. For instance, the alliance between United Airlines [UA] and Lufthansa has all but driven out all U.S. carriers from the America to Germany market. American Airline's deal with British Airlines could do the same for routes between London and America."

"And the time to act is now", according to Kahn. He predicts that within a decade the United States could find itself with only three major airlines and few other competitors if international-domestic alliances are not closely monitored. United and Lufthansa, Delta [DAL] and SwissAir, American and British Airways and their affiliated airlines could be the result of unrestricted monopolization, he warned. (Why don’t we just take four companies. Have them build four sets of independent capital intensive rail lines from the east coast to the west coast in a highly competitive market. Then have these four companies run four sets of capital intensive engines and rail cars along those separate tracks. Have them all leave at the same time. All half full. Eating up the resources of the Planet. Draining their Corporate Financial Strength. All... because guys like Kahn have shifted the Paradigm which for some reason has become sacred yet truly contrary to the natural order of free competition. The powerful Oil lobby doesn't put up with this kind of nonsence. Pump prices often rise before any actual Oil prices, if they ever do and then pump prices drop well after oil prices fall. Mergers are abundant in the Oil industry which politicians reason has brought stability and strength to this vital resorce of National Interest. Never the less, prices rise and fall at the whim of Oil execs and are not driven by domestic competition).

 

[BoeingBoy]

This seems as good a place as any to post this:

Fitch: U.S. Airline Pension Relief Legislation Poses L-T Credit Risks

Article

Falls into the "Be careful what you wish for" catagory.

Jim

 

[USA320Pilot]

H.R. 3108, The Pension Funding Equity, passed yesterday by the Senate, likely will not help United Airlines emerge from bankruptcy. The proposed law pushes out required contributions to 2006, but in the case of United, the company must still make about $5 billion in pension contributions during the 7-year ATSB loan guarantee period.

Airline loan guarantee applicants must be able to prove to Fitch Rating, the ATSB's independent auditor, that the company can project a 7% profit margin in 7 years, with the pension obligations included in the application/business plan.

H.R. 3108 permits significant changes in the required cash funding of the major airline's defined benefit pension plans only in 2004 and 2005, which simply defers existing cash obligations, until 2006 and beyond.

Therefore, from this observer's perch, United employees could still see the DB portion of their retirement plans terminated as part of the company's plan of reorganization.

Respectfully,

USA320Pilot

 

[diogenes]

On the one hand, I'm glad a step was taken to help with the pension issue.

On the other, it's pretty interesting to see that alpha-male, individualist, Republican-type ALPA is not too good for a government bailout.

And even more interesting to see the same Senate that will not extend unemployment benefits to the proles or ANY meaningful aid to laid-off airline employees post 9/11 ok this deal.

Just goes to prove you shouldn't watch your sausage or your laws made!

 

[TheX]

Any news on pension relief? Would be nice.