Will AA declare bankruptcy?

[Bob Owens]

Allegiant left because the company quote was to high. I would not know about Fed-X. As for the hourly rate do not forget that it is around $100. Labor and overhead including the facility and engineering etc.

Or so we were told.

 

[Flying low]

Allegiant left because the company quote was to high. I would not know about Fed-X. As for the hourly rate do not forget that it is around $100. Labor and overhead including the facility and engineering etc.

Or so we were told.

We (those that didn't work Allegiant) were told that AA had to much of our own work and didn't have the room for them anymore. We also heard that Allegiant wasn't to happy that their planes wound up being pulsed at the same time as our MD-80's.

 

[imwithstupid]

That's funny. Whenever AA has peddled heavy maintenance to other carriers and charged them much more per hour then they pay us themselves, there has never been a problem filling up the hangars. Fed Ex and Allegiant were happy to pay for our maintenance. AA ultimately decided they needed the hangar space and ended the contracts. Now explain to me why other airlines who apparently have lower maintenance costs are more than willing to pay AA for heavy work? Could it be that your claim (and AA's complaint of higher labor costs) are based on faulty numbers? If we are so overpaid, then how come Fed Ex and Allegiant were so willing to pay an even higher rate than American pays us? I know that AA charges around $80 per hour for contract maintenance. Our pay (with the few benefits we have left) doesn't come close to half of that. Could it be that the rates in South America and Asia are also that high, or is it that the quality of the work done here is worth the extra money? As far as productivity numbers that AA puts out, a few years ago they claimed that management had increased their productivity by 10 or 15% (don't remember the exact number). Since management produces absolutly nothing, then claiming an increase in productivity is just a falicy. Where I come from if someone lies about one thing they will lie about everything. AA management has been caught in so many lies that it is hard to believe anything they say. We have to take every thing with a grain of salt. Since the same people have been running the airline into the ground since 2003 and supposedly lost billions of dollars (when you include special items, whatever the heck they are) and the BOD has not made a move to replace these people, you have to figure they are doing what the BOD wants them to do. If I was on the BOD of any company and the same thing was happening I would fire them all. You would do it too, but it is not happening. The problem with AA is the management of the company. That is obvious.

Your info is acquired from word of mouth. They left because we were to high. The reps for most of the third party work in Tulsa all were amazed how much butt time their is in Tulsa. The only fact you have that is correct (management), they do not have any idea how to run a maintenance base. If they did half of the union would be gone. So they are doing that in a different way, let it fail.
8 out of 10 union folks you talk to in tulsa say " I would never run my business like this" and in the next breath they say "their mismanagement is making me lots of money". That tell me folks in tulsa do not care, as long as I have a paycheck all is good. It is a sad state of affairs.

 

[Mr Red]

We (those that didn't work Allegiant) were told that AA had to much of our own work and didn't have the room for them anymore. We also heard that Allegiant wasn't to happy that their planes wound up being pulsed at the same time as our MD-80's.

Think about it 100.00 per hr, same as your local goodwrench! unbelievable. One more time for those who don't understand,its the same story on contract work every time.
AA could have all the contract work they want but when u don't man for it,or decide we have more of our own work that needs to be done so screw the contract work.
Thats been the story for the 20 years I've been here!

 

[Hopeful]

Think about it 100.00 per hr, same as your local goodwrench! unbelievable. One more time for those who don't understand,its the same story on contract work every time.
!

Yea, of which the car owner will gladly pay to get his/her car back as soon as possible but when it comes to flying wan;t to pay bus fares to fly cross country or across the Atlantic.

 

[limit]

Your info is acquired from word of mouth. They left because we were to high. The reps for most of the third party work in Tulsa all were amazed how much butt time their is in Tulsa. The only fact you have that is correct (management), they do not have any idea how to run a maintenance base. If they did half of the union would be gone. So they are doing that in a different way, let it fail.
8 out of 10 union folks you talk to in tulsa say " I would never run my business like this" and in the next breath they say "their mismanagement is making me lots of money". That tell me folks in tulsa do not care, as long as I have a paycheck all is good. It is a sad state of affairs.

Ok.
I am one of those that mismanagement made lots of money for.
But..... I do care.
So how can I help the management team, that according to you can not manage, with what you suggest?
specifically:

"If they did half of the union would be gone."
How can I help them do this?
I all for it.
Should I walk up to my manager and demand this from him Monday morning?
or did you have something else in mind?


"So they are doing that in a different way, let it fail."


Wow! Is this the actual plan?

 

[WorldTraveler]

What do you use as a basis for size? ASMs or fleet size? Most from the management side use fleet size, comparing how many mechanics we have per airplane to carriers that only have narrowbodies. They also dont factor in competitors outsourced labor, so they arent fair numbers. AA maint cost per ASM are also inflated because of all the Mods that AA has been doing such as winglets and new interiors etc. AA also chooses to have several fleet types which means more parts, more tooling and more training, figure if you go from one to two types you just doubled those costs, go to three and you triple them etc etc. AA also has fleet types which are less common so they can not rely on pool parts like Southwest which operates the most common fleet around. Pretty much everybody has 737s.

The unit of production in the airline industry is available seat miles (ASMs)... every other metric is based on ASMs.... Revenue per ASM, Cost per ASM etc.... and those two can be drilled down to specific levels.
Yes, for specific areas, you can use metrics such as number of mechanics per airplane but that number is not accurate because there are different levels of aircraft utilization between airlines.
You are correct that all of these calculations have some element of error in them based on factors that do include the level of outsourcing... but the maintenance CASM is still the all inclusive number of what it costs to maintain an airline's fleet - and reflects mods, outsourcing, everything to do w/ maintenance.
I know AA has done alot of mods but I doubt very seriously that they have done anywhere close to as much in the way of mods as DL has - first converting 30 or so aircraft from domestic to int'l config, 20 or more interior mods every year, plus winglets. AA's fleet is less complex than DL or US' and yet both of those have lower maintenance costs than AA.
.
I ahve said before that I don't know the specifics of why AA's maintenance costs are so much higher than its peers - DL and UA are both large network airlines w/ similar percentages of widebody aircraft doing int'l flying.
As a union leader, I would think you should be able to obtain in some manner some sort of comparative statistics about how productive your peers are for specific tasks that are done by maintenance.
IN the absence of you and the TWU knowing, the company will call the shots and they will do what they think is right, regardless of whether they are or not. IN the absence of information, you are unfortunately at their mercy regarding whatever changes they say they are needed in order for AA to be competitive.
.
It is possible that AA needed the space for its own overhauls but given that there are people who say that AA's costs for insourced overhauls are too high and other carriers don't do them inhouse and DL - the largest US airline based MRO focuses on line, engine, and component maintenance more than overhauls (which is part of why they entered into the maintenance partnershp w/ AeroMexico), I doubt if any US airline can cost effectively do inhouse routine overhauls.

 

[OldGuy@AA]

Allegiant left because the company quote was to high. I would not know about Fed-X. As for the hourly rate do not forget that it is around $100. Labor and overhead including the facility and engineering etc.

So you are saying that our quote was too high, but Allegiant had several airplanes overhauled (Dock 1D) anyway and then decided it was too high? Doesn't make sense.

 

[OldGuy@AA]

Your info is acquired from word of mouth. They left because we were to high. The reps for most of the third party work in Tulsa all were amazed how much butt time their is in Tulsa. The only fact you have that is correct (management), they do not have any idea how to run a maintenance base. If they did half of the union would be gone. So they are doing that in a different way, let it fail.
8 out of 10 union folks you talk to in tulsa say " I would never run my business like this" and in the next breath they say "their mismanagement is making me lots of money". That tell me folks in tulsa do not care, as long as I have a paycheck all is good. It is a sad state of affairs.

It was not word of mouth but my own eyes that saw Allegiant MD80s in Dock 1D in Tulsa getting heavy C checks. If a quote is too high, you don't have the work done. You don't have a bunch of airplanes done and then say the quote is too high. The same thing happened as with Fed Ex and UPS before them. AA management decided they wanted the hangar space and cancelled the contracts. That is fact. As far as butt time goes, we used to have what was called "bench stock" in cabinets so when you needed a part such as a bearing or seal, you went to the cabinet and got it out. AA management decided they did not like this so now a part has to be ordered and, even though you can throw a rock and hit the warehouse, you get it 24 hours later, provided it goes to the right load center. Also when you have to wait in line at the tool crib window for earplugs and paper towels, it tends to keep you away from the airplane. I have personally seen where we have quoted a price for bringing something in house and the company goes to the 3rd party and negotiates new rates using our own numbers. As far as attitudes amoung the union members, you get what you give. AA treats their union employees like second class citizens. If the company can make the base work with half the employees then more power to them. That would mean half the management they have too so that is why it won't happen. But at least you do admit that AA management is incompetent.

 

[Buck]

So you are saying that our quote was too high, but Allegiant had several airplanes overhauled (Dock 1D) anyway and then decided it was too high? Doesn't make sense.

No I do not believe I said that. When the time for contract renewal came around, Allegiant took bids for the work and the company was not selected because the company outbid themselves. Yes it could have been intentional to drive Allegiant away to acquire hangar space. To the best of my knowledge, most of the Allegiant work was done on the Pulse Line. I believe this was when 1D was being modified for the 737. I worked on 3D for the entire time the Allegiant contract was there. But yes the actual per hour quote is somewhere around $100 an hour including overhead. The Allegiant aircraft were overhauled under one contract and then the renewal took place and the company lost....

 

[OldGuy@AA]

No I do not believe I said that. When the time for contract renewal came around, Allegiant took bids for the work and the company was not selected because the company outbid themselves. Yes it could have been intentional to drive Allegiant away to acquire hangar space. To the best of my knowledge, most of the Allegiant work was done on the Pulse Line. I believe this was when 1D was being modified for the 737. I worked on 3D for the entire time the Allegiant contract was there. But yes the actual per hour quote is somewhere around $100 an hour including overhead. The Allegiant aircraft were overhauled under one contract and then the renewal took place and the company lost....

Thanks for the repost and making it more clear. As far as $100 per hour for the AA contracts that is just par for the course. Claiming overhead when they rent the facitlity for next to nothing and even have the City of Tulsa paying the electric bill for them. Crooks.

 

[limit]

No I do not believe I said that. When the time for contract renewal came around, Allegiant took bids for the work and the company was not selected because the company outbid themselves. Yes it could have been intentional to drive Allegiant away to acquire hangar space. To the best of my knowledge, most of the Allegiant work was done on the Pulse Line. I believe this was when 1D was being modified for the 737. I worked on 3D for the entire time the Allegiant contract was there. But yes the actual per hour quote is somewhere around $100 an hour including overhead. The Allegiant aircraft were overhauled under one contract and then the renewal took place and the company lost....

Yes,their rep told us repeatedly and at least a month in advance that his information from their team was that AA was too high on the new contract negotiations.
He did not state if AA's new bid was higher than the existing contract price,or if the competitors bids were lower than AA's.
Which ever was the case, we knew the contract was gone way ahead of the announcement.

 

[WorldTraveler]

Bob or others,
how many AA mechanics are devoted exclusively to overhauls - and what percentage of the total maintenance workforce is this?

 

[Mr Red]

If u think an airline run by bean counters is not at an advantage after billions in give backs by labor defies common sense

 

[FWAAA]

Bob or others,
how many AA mechanics are devoted exclusively to overhauls - and what percentage of the total maintenance workforce is this?

The Tulsa World recently reported that TULE employs about 6,000 maintenance employees (which would include management and support personnel) which is about half of AA's maintenance employee total:

http://www.tulsaworld.com/business/article.aspx?subjectid=45&articleid=20110901_45_E1_ULNSeE683170

Add in the AFW and DFW overhaul employees and the number is easily 7,500 to 8,000 (including management and support).