Why productivity is the labor issue between mature airlines & Southwest

[usfliboi]

Chip! I have no need to bash Dave at all . At this point im trying hard to trust him. AT some point a company cannot blame the economy for bad buisness practice or poor management. Where we are today cannot be fully blamed on the economy or 9/11. Are those huge contributing factors? Yes! Ill repeat what i said in a previous post. We are paying management to forward looking Theres is no doubt in my mind that you could not seriously project the economy not being in poor shape, nor could you say the war on terrioism would end this year either. You had to believe fuel prices would stay the same or soar. Was there any hedging at all on fuel cost? It sounds to me that there was no hedging simply because they are using fuel prices as a factor all be it it will play a role period regardless... but to hedge would help huh? Im not nor have i been one to bash dave but i do look at reality.... Im not denying reality, u only have to turn on tv to see how bad things are esp ion the airline industry. But we were told we were way ahead of the game...and now the others are doing what we finally did...and if you are using the application for the fed loan guarentee as an example, when we were tent approved for the loan, it was without the major lease breaks we have recieved since filing chapter 11. What percentage did those lease breaks total to vs what lease breaks we predicted we would get ? I enjoy your post at times chip but please remember that the majority of the employees here arent looking down to other employees who make less instead are looking down to see how far they are from the bottom. Right now were in this all together and remember chip that this employee group has one thing and one thing only to base how management works and thats on past practice. Dave hasnt been here long enough to prove himself and fumbling thru bankruptcy isnt the way to gauge

 

[ilg30/7]

Bob Owens:

Not usually in agreement with you but that was an OUTSTANDING post. USAirways 'new' management team is now showing their true colors. I wanted to believe in Dave as much as anybody. I now realize how foolish this was. He now has the same problem as Wolf and Gangwal: lack of credibility among the rank and file. He dug his own grave in this regard. I just hope he did not dig USAirways' as well.

 

[Bob Owens]

UAL777;
I think your cabin altitude is too high! Better check your outflow valve.

 

[wings396]

We would have gladly worked under SW work rules for our pay..Problem was the company didn't want to hear that from us....reason being too many changes in upper mgmt. would have to be made to make it all work...most if not all in this company are willing to work as hard as needed to make this all come together. I will work under their rules any day to keep my wages...only thing this airline wants is to beat us up all they can with MDA pay rates...if we keep running from them with mainline, we will only flt PIT-CLT-PHL....

 

[pitguy]

Nice artical Chip. Thanks for the link.

I wonder about the section that states:

United pilots fly just over 50 hours, even in a busy month. Southwest pilots are paid for each trip, not each hour, so they have a strong interest in keeping flights on schedule.

I wonder Chip if our pilots are compensated like Southwest's pilots as in being paid by the trip? I think ours might be paid by the hour. I know they always want to kick the brakes off to start the ACARS clock running even if it is too early to pushback.

 

[hopethingswillbeok]

my cousin, who is over ten years younger than myself, has been with airtran, she doesn't make that much money, but for some reason, the same reason i did it the airlines, looked like a great career job.....my mother retired from the airlines and raised my brother and myself, she started in 1966, i thought is was one of the greatest jobs.....well i have been very fortunate to work for the airlines myself, and in the past felt i could retire like everyone else.....yes myself have made major changes in life sytle and living, but still could go out to eat every once in awhile and have food on the table....now i wonder.....the sad part is, i am now many years older than the good old days......if anyone out there knows of a good company to look into or do something else, please help......i am ready for a change.....just to let you know, in eighteen years i have only missed probably fourteen days of sick time.......very good employee

 

[Old PSA]

Dave just doesn't get it. He is using the same airline model all the big guys are using. It is no good trying to reduce labor cost by reducing wages if your business model is not reflective of the current operating environment and ours isn't.

Come on Dave, before it is too late. Our business product is outmoded. The public is buying with the wallet. You have to change the direct of US and more of the same even with low waged employees is not going to survive.

 

[pitguy]

That is exactly how I felt when so many pilots attacked the mechanic group when we were trying to get a true TA.

Besides, I can not help to see the real 'fat' on the steak. I am sorry if I offended any one. I truly just want our company to pull out of this and feel some further cuts would help as long as the cuts are done properly. In the mean time I will continue to serve as a model employee to the best of my abilities.

It is not an attack, but pointing out much needed changes.

 

[chipmunn]

[P][BR][BR][FONT face=Times New Roman size=3]Pitguy, [/FONT][FONT face=Times New Roman size=3]I find it interesting you wish to attack pilots, but fail to look at areas of your employee group for inefficiencies.[/FONT][BR][BR][FONT face=Times New Roman size=3]Old PSA, I disagree with your post. I think Dave Siegel fully understands the issues. Can you answer the following questions for me? [/FONT][BR][BR][FONT face=Times New Roman size=3]Do the OMB Guidelines for the federal loan guarantee require a business plan that projects a 7 percent profit margin over 7 years?[BR][BR]Does this business plan need a projected B credit rating with verfication from an outside auditor, in this case Fitch Rating? Does Fitch have to provide a positive recommendation to the ATSB for the applicant to obtain the loan guarantee?[/FONT][BR][BR][FONT face=Times New Roman size=3]Can you tell me how management could have predicted fares would fall to 20-year lows, there would be increased security costs been imposed on the airline industry, that war-risk insurance would continue to climb to all time highs, and fuel prices would rise in response to a pending war with Iraq?[/FONT][/P]
[P][FONT face=Times New Roman size=3]US Airways required a $1.8 to $1.9 billion bottom line change prior to the above mentioned problems exasberating in September. Now the bottom line change must be about $2.0 to $2.2 billion per year to get the loan guarantee due to falling revenues, per the information provided at yesterday's 341 creditors meeting. With all due respect, it's not rocket science to understand if revenues fall, costs must be further cut to obtain the loan guarantee. Moreover, the creditors will demand a ROI, whether it's through a formal reorganization or an asset liquidation. With the above listed facts, can you tell me with falling revenues how US Airways can qualify for the loan guarantee program and survive? [/FONT][BR][BR][FONT face=Times New Roman size=3]Thanks[/FONT].[BR][BR][FONT face=Times New Roman size=3]Chip[/FONT][/P]

 

[Old PSA]

Chip,

Sorry, what I'm trying to say and rather poorly at that, is the way that US and the other old line airlines do business is no longer viable. While you are correct in saying the immediate effects and after effects of 9/11 were not foreseeable, the trend in this business was already there. 9/11 shorten the time period dramatically. Also, I fully understand the requirements of the loan, but I do not believe continuing to do business as we are, just at a lower labor cost will be ultimately sucessful. I believe the industry has change and US isn't going too. I am taking a longer look at this, not just getting re-started but 5-10-15 years ahead. I can't see how our current business model is going to work.

 

[diogenes]

[blockquote]
----------------
On 10/23/2002 228 PM chipmunn wrote:


Pension plan and productivity changes are being discussed within ALPA. In addition, I suspect similar changes could happen within all labor groups including the pilots. For the record, I endorse these changes for ALPA as well as the other labor groups.[/P]


Chip [/P]
----------------
[/blockquote]


Yawn/// These exciting pension changes already occurred - 12 years ago in my shop. Hard to get excited. And believe me, you won't like them, either.

 

[TomBascom]

Chip -- you have said a number of times that fares are at a 20 year low.

I'm assuming you mean average fares. Over the last 20 years so-called business fares have not fallen. They have skyrocketed to the point where nobody with any sense of responsibility to their company or client will buy them. So called leisure fares have fallen far less than the business fares have risen. It's debatable that they've fallen at all. The gap between the highest and lowest fare is wider than it has ever been and may very well be the widest gap between high and low end for any product with so little differentiation on the planet. Anyone who has actually purchased business fares knows this.

The airlines are not providing any reason to buy anything except the lowest available fare. All of the rules and restrictions create reasons not to buy a ticket at all rather than incentives to purchase a more expensive ticket. The major airlines have created a lumbering behemoth of disincentives and scratch their heads wondering why revenues are down.

Meanwhile SWA, ATA, HP and few others are pricing the product fairly, treating passengers like customers and making money.

 

[UAL777flyer]

Bob Owens,

I think you first need to reel in your assumption and figure out that I'm not a pilot.

 

[Bob Owens]

Chip;
Do the OMB Guidelines for the federal loan guarantee require a business plan that projects a 7 percent profit margin over 7 years?

Where is that reference?
Obviously these numbers, even if they are real are contradictory to the purpose of the act. The act recognizes that Sept11 did serious economic damage to the industry. Its purpose was To preserve the viability of the United States air transportation system.Its also obvious that the weakest carriers would be the most likely to need the loans. 7% ROI for 7 years-prior the 90s that would be considered a super performer. Why would the government set such a high standard? Was such performance ever acheived by this industry even in the Regulated era? The numbers are absurd, if the airlines could reasonbly acheive such numbers then there would be no need for such legislation. These numbers come right from the office of that jerk Bush and are designed for a singular purpose- to be used as a gun to be held at the head of workers. This way the company gets what they want but can blame it on the OMB, 90% of the workers will not bother to see who pulls its strings.

I still say that the Unions at U screwed up. They should have called their (the company,ATSB,OMB, Fed Reserve) bluff. Politically letting U go under just weeks before the Nov elections would have been a Political disaster for Bush. (did Bushes company ever make 7% for 7 years?)Opportunistic polititions (is there any other kind)would have put the OMBs demands under closer scrutiny. That would have reflected badly on the White House, and the Republican party.

So now the company will just continue to make unrealistic demands until the employees say enough is enough, then the press and the Republicans will blame the unions for killing the company and try to pass 1327 as a means of taming the unions so that communities no longer have to worry that those nasty greedy,self destructive airlines workers can never deprive the Hard working American people the RIGHT to travel!

If they had rejected the companies proposals in September, Political considerations would have forced the OMB to modify the conditions of the loan.

 

[chipmunn]

[P][FONT face=Times New Roman size=3]Bob Owens:[/FONT][/P]
[P][FONT face=Times New Roman size=3]Chip asked: Do the OMB Guidelines for the federal loan guarantee require a business plan that projects a 7 percent profit margin over 7 years? [/FONT][/P]
[P][FONT face=Times New Roman size=3]Bob Owens asked: Where is that reference?[/FONT][/P][FONT face=Times New Roman size=3]
[P]Chip comments: The federal loan guarantee program and its regulations were created by Mitch Daniels, the Director of the Office of Management and Budget for the Bush Administration. The ATSB requires loan guarantee applicants to provide a business plan that projects a 7 percent profit margin within 7 years and can be found at:[/P][/FONT]
[P][A target=_blank href=http://www.ustreas.gov/atsb/][FONT face=Times New Roman size=3]http://www.ustreas.gov/atsb/[/FONT][/A][FONT face=Times New Roman size=3] [/FONT][/P]
[P][FONT face=Times New Roman size=3]Chip [/FONT][/P]