US Partner UA in play...how could this be?

[chipmunn]

Air board weighing United's wage plan - [FONT id=subhead]Pilot concessions scrutinized; rivals want deeper cuts[BR][/FONT][BR][A href=http://www.chicagotribune.com/business/printedition/chi-0211100224nov10,0,5301547.story?coll=chi%2Dprintbusiness%2Dhed]http://www.chicagotribune.com/business/printedition/chi-0211100224nov10,0,5301547.story?coll=chi%2Dprintbusiness%2Dhed[/A][BR]

 

[chipmunn]

[SPAN class=t]United and Association of Flight Attendants Reach Tentative Agreement on Labor Cost Savings; Meteorologists Ratify Agreement Reached Last Week[BR][/SPAN][BR][A href=http://biz.yahoo.com/prnews/021110/cgsu003_1.html]http://biz.yahoo.com/prnews/021110/cgsu003_1.html[/A][BR]

 

[magsau]

Of course Carty wants UAL to cut the pilots pay more. The AA pilots ARE going to be asked for cuts (sure Carty says he is not going to need employee concessions). Carty is looking for UAL to do his negotiations for him. It will be much easier for him to come to his employees and says....look at what UAL has negotiated, we must match this.

This is all AA b.s. I spoke with a Wall Street analyst over the weekend that knows the consulting firm that is spinning the AA line of no pay cuts. He said he felt this was flawed and that AA was only buying time to find out how much UA was going to get from its employees before they took action. If you would like to include the FACTS, Chip you might want to include that the AA pilots contract is up for renewal and facing contract negotiations during this period of industry trauma is not something labor really wants.

So thanks for the continued negative coverage of the UAL situation. How would we really ever know what was happening at our company without such an esteemed and credited news source as yourself keeping us in the loop.

 

[UAL777flyer]

Chip,

I am not, nor would not, take issue with you posting things about UA that some might take for being deliberately hurtful. I know that's not the case. I just think at times, it appears to be a never-ending quest to propogate the unique corporate transaction theory.

The fact of the matter is that a myriad of things get looked-at and analyzed at UA each and every day. Considering our situation, all options must be left on the table and probed in-depth. And that is what is going on. But to give credence to something merely because it is being discussed at the highest levels of both companies, ignores that fact in my view. Many things are discussed. That doesn't mean they have a snowball's chance in Hell of being implemented. That was my point. I read your posts consistently and find, for the most part, your thoughts and opinions to be on the mark. However, there are times when I think you venture off the beaten path by hinting that because something may have been discussed, it has an imminent chance of happening. That's not true. Things are looked at every day. Suffice it to say that given UA's current situation, virtually anything and everything is being looked at.

 

[chipmunn]

[P][FONT face=Times New Roman size=3]UAL stock rises, but bankruptcy talk persists[/FONT][/P]
[P][FONT face=Times New Roman size=3][A href=http://www.boston.com/dailyglobe2/316/business/UAL_stock_rises_but_bankruptcy_talk_persists+.shtml]http://www.boston.com/dailyglobe2/316/business/UAL_stock_rises_but_bankruptcy_talk_persists+.shtml[/A][/FONT][/P]

 

[chipmunn]

Approximately 4,700 US Airways pilots provided $465 million per year in cost savings for 6.5 years or $3.02 billion in total concessions.

Approximately 32,000 UAL pilots and flight attendants are voting on an average $472 million per year in cost savings for 5.5 years or $2.6 billion.

How will the ATSB view UAL's employee cuts after witnessing US Airways employee sacrifices?

Chip

 

[chipmunn]

 

[magsau]

Chip,

You say 4700 U pilots provided all those savings.....When I listened to the U mec code-a-phone it says that the junior pilot after the furlough will be 3800. Now with 1,000 less pilots contributing and all those pilots being at least 10years with the company (almost max longevity) how will that affect the amount of true concession money given. Sure their salaries are not going to be on the bottom line but that does mean fewer give less in true savings of the operation.

Also, you are missing a point with the ALPA AFA comparison with UAL and U. Still to come is the IAM and the non-union workers portions along with management cuts. At UAL we have bigger numbers of employees to disperse the amount each needs to give. (the good point of having a big employee base) Also, U has seen its revenues decline after BK and if you look at some of the models that forecast U performance they will continue to lose revenue based on the type of operation.(short segment-high cost) With a star partnership it may help stave off the losses but without any additional changes, IMO, U will have trouble.

UAL is trying very hard to avoid the BK. Take a look at the carriers that have filed for BK since degregulation. All except EA and PA have been to BK twice. AM,CO,TW all had multiple visits. With a BK monicker tied to a carrier their is some book-away traffic. At U with its tight financial line the book-aways could be the difference in you having to contribute more to the recovery package. Once in the BK cycle it becomes difficult to get out. CO is the only one of the above that was able to get out cleanly and it took several tries for them.

IMO if Tilton needed more from the UAL pilots he could have gotten it. The UAL pilots have continued to express our desire to resurrect the company and move on. Tilton is saying the right things and with todays LH revenue share on the N.Atlantic I think that will help our bottomline again.

 

[UAL777flyer]

Chip,

I continue to be baffled by your insistence on comparing US Airways level of labor cost cuts to United's in terms of determining whether UA's will be enough in the eyes of the ATSB. Each airline's ability to repay the loan guarantee is completely different. UA has many more intangibles with which to put at its' disposal to repay the loan. US does not. US is much more limited in what it can accomplish. To simply view US Airways labor cost cuts and then compare them to UA and determine that UA's isn't enough completely ignores the differences between the two carriers and the tools with which they have to repay the loan. The only real similarity between the two carriers situations is their current financial crunch. Have you seen UA's business plan? Are you aware of the changes we will be making to generate more revenue? I'm amazed that people seem to think that UA must achieve the same level of labor cost cuts that US has achieved. Is the ATSB's ultimate mission to hammer each airline down to the same cost level? If so, than I'd be inclined to believe your comparisons. But if each airline's application is judged upon its' own merits, US Airways cuts should have nothing to do with United's. I fully agree that the ATSB may ultimately determine that UA's cost cuts aren't deep enough. But it should be based upon the fact that UA's cuts aren't enough to make their proposed business plan succeed, and not because US Airways level of cuts are deeper. If this is what you're hearing from your informed sources, than I suspect that the ultimate mission of the ATSB is to hammer this industry's cost level down, irregardless of helping the airlines return to profitability, which would be nothing but a total sham and waste of time.

 

[chipmunn]

The ATSB is comprised of three departments and has over 100 advisors. This team is bound by OMB loan guarantee guidelines that require the applicant to present a business plan that projects a 7 percent profit margin within 7 years. The plan is reviewed by over 100 government consultants who provide and input that results in an outside auditor (Fitch) opinion and recommendation. [BR][BR]It is my understanding the ATSB team is questioning the UA revenue targets and if found to be overly optimistic, UA will be required to make additional cuts to qualify for the loan guarantee. [BR][BR]Union, analyst, and corporate sources have said that after 30 hours of discussions between the UA presentation team and the board, the airline has not been able to prove the business plan can produce a 7 percent profit margin.[BR][BR]Therefore, in my opinion, UA will obtain conditional federal loan guarantee approval, which would take the heat off of the board from UA's congressional delegation, and place the pressure on the shoulders of UA and its employees. If this occurs, it could be up to labor to make up the required changes.[BR][BR]Glenn Tilton has done an excellent job in a short time at UA and its unfortunate he was not hired sooner. Like US, UA is in a fight for its survival and it's every employees fight to do what is necessary to avoid bankruptcy and I hope you succeed.[BR][BR]Do I disagree with the ALPA pre-nuptial clause, the governance issue, and the AFA scope clause? Yes, but that is from a business perspective because I believe all of these labor issues have contributed to UA's present financial condition.[BR] [BR]Regardless, we should know more before the end of the month on how UA's reorganization proceeds.[BR][BR]Chip

 

[UAL777flyer]

PineyBob,

Why are airline employees so rude? Have you read a few of your own condescending posts recently? Just because you fly an airline and help pay our salaries, doesn't give you carte blanche to talk down to those very same employees. Respect and common courtesy is a two-way street. That is why I'm a firm believer in Herb Kelleher's theory that the customer is NOT always right, and is, in fact, many times wrong.

Just because Chip isn't a source for some news organization doesn't mean he doesn't have reliable info from his own sources. I don't always agree with what he writes, but I do believe he gets his share of accurate inside information into what's happening. He tries vehemently to inform as many people as he can and he is a 110% supporter of his company, even at the expense of clashing with members of his own profession and union. And he gets nothing for it except constant ridicule and insults. Whatever happened to respectfully disagreeing with someone? But anonymous message boards allow immature Romper Room types to sound-off without consequence. That's the nature of forums like this. You have to take the good with the bad--the immature flame-baiters with the respectful, professional types.

As for your stereotype that all airline employees are rude, you must not fly as often as you claim. There is good and bad to be found everywhere, including amongst airline passengers. What a novel concept, huh?

 

[W:EXCH:INVOL]

Good God....another FlyerTalk.com

Weren't your little pins supposed to be a club secret? Sorta like a frat handshake or something?

Just another (sometimes) rude CSA, INVOL

 

[chipmunn]

[A href=http://quote.bloomberg.com/fgcgi.cgi?T=marketsquote99_news.ht&s=APdgztBPlVUFMJ3Mg]http://quote.bloomberg.com/fgcgi.cgi?T=marketsquote99_news.ht&s=APdgztBPlVUFMJ3Mg[/A]

 

[chipmunn]

In my opinion, this is a major reason for UA employees, US' partners, to do whatever it takes to prevent a formal reorganization:[BR][BR][A href=http://www.bloomberg.com/fgcgi.cgi?T=marketsquote99_news.ht&s=APdgP0hVmQ29udGlu]http://www.bloomberg.com/fgcgi.cgi?T=marketsquote99_news.ht&s=APdgP0hVmQ29udGlu[/A]

 

[UAL777flyer]

PineyBob,

You had my interest right up until the point where you mentioned your posts being akin to Andy Rooney. That guy is about as relevant as the Model T these days. I understand the nature of your point. But the post in question was extremely condescending to the very employees whose attitude you called into question. That was my point. You're always going to get a few bad apples in any bunch. But the good far outweighs the bad. We live in an era where negativity and pessimism sells. How about highlighting good service. The bad ones always get noticed. But the good ones often are taken for granted. Being a flight attendant or customer service agent is a completely thankless job. Neither are paid exhorbitant salaries, yet their job is arguably one of the toughest. They have to be apologists for their company and the problems that 99.9% of the time, they didn't create yet must answer for. I remember all too well being a customer service agent for TWA at JFK.

My Romper Room comment was merely to highlight the fact that these boards are littered with immature, disrespectful people who think highly of themselves for being able to bash and insult others using an anonymous identity. Your post containted a bit of condescension in it, so forgive me if I put you in the flamebaiter category. My mistake. But maybe next time, you should proof read your work before it's posted. These folks are going through a difficult time. Their company is teetering on the edge of possible shutdown. Their pay/benefits are being cut, their morale is low and they're just trying to fight the good fight and have a place of employment to come to when they wake up each day. Granted this is a public board and people are free to speak their opinions. I realize that. But considering the circumstances of what's happening with US at the present time, maybe you could reel in the inflammatory rhetoric a bit. Just a suggestion. But if you're modeling your posts after someone like Andy Rooney, I'm not optimistic.