Will AA declare bankruptcy?

Will AA declare bankruptcy?


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You were doing well until the "compensation" part. AA executives get paid in stocks/stock options. If AA files for BK, that will go basically down to zero.

In bankruptcy, AA will ask the judge for an increase in compensation for executives "SO AS TO RETAIN THE KEY TALENT, YOUR HONOR! WE CAN'T AFFORD TO HAVE ALL OUR INVALUABLE MANAGEMENT TEAM LEAVE FOR OTHER COMPANIES, ETC ETC ETC."
Then, once AA emerges from the employee raping bankruptcy, the invaluable executives will receive thousands and thousands of shares of the new AA!
 
good work on the calculations, Bob. Some of the assumptions might have to be pressure tested but the process is valid.
It is possible to survive BK... other airline employees have.
But it can often take years just for people to readjust to their new income levels that do come w/ BK, let alone think about immediately setting in place a plan to help recover the pension benefits they have or might lose.
The key is being proactive.... if everyone sat down and did the calculations for themselves that you just did, then the process should not be as fearful as it otherwise might be.
I would encourage you to run some sample numbers involving other seniority and age combinations, have them double checked by an account, and then pass the info on TWU members.
Pension accounting is not simple but it is also is not a secret... w/ the right tables or calculators and someone who can help explain the challenges in meeting one's financial goals, it is possible to not only survive but to also thrive in the midst of uncertainty.
The point was to throw out there how a freeze, brought on through BK would affect us, the impact wouldn't probably be as severe as many believe it would be. We should not fear it to the point of giving away even more in a vain effort to avoid it especially since if they do go BK it will be to go after the pilots pensions and workrules, and i think its too late for that as well. As far as wages they are already at rock bottom. In New York they had to raise the starting wage to the third step in Aircraft maintenance and forth step , with top scale in six months in facilities. The situation is not likely to improve for the industry any time soon. With manufacturers having to fill record orders, and other industries competing for the skill sets we have and continued attrition ( as I've cited many times before, AA alone will require 500 of the 3000 or so A&Ps that come into the industry just to maintain headcount) the wages are already too low.BK can't force anyone to stay and it can't force new hires to take the job.
 
U need t talk to the people that wanted to retire in 2008. Half their 401 EVAPORATED by the Wall Street Ponzi schemes !!!
I agree that Wall Street is a Ponzi scheme but I don't believe that we should be willing to give up on getting decent compensation because the company and others threaten that if we don't they will go BK .
 
Can someone explain how this is not pretentious and arrogant?
In my 32 years in the industry this is the first time (in normal negotiations) that I've ever seen where unions did not come to the table with at least saying they had the expectation of getting an " industry leading contract". Are they being pretentious and arrogant or are they still acting like unionists and refusing to cower to the company and accept diminished expectations? I think they are going the right way, There's a shortage of pilots, the company needs to get an agreement with new aircraft on order, they should squeeze for all they can. Questions about BK have never been fully answered, none of the unions actually challenged the courts in the post 9-11 environment when there were thousands of recently furloughed airline workers on the street, we know the judge can rip up the agreement, the question is what if the union rejects what he proposes? Did the unions back in the post 9-11 period just choose to accept what the judge ruled to avoid ripping up the contract, was the judges ruling uncontested? Today's environment, while not perfect, is more favorable to the pilots and if they decide to take on the challenge it's in all our interests to support them, AFL-CIO affiliated or not.
 
Totally agree! It's bad enough in this current environment. Once should consider themselves fortunate just having a job.




They management the business - how do you think they generate revenues and order new planes, etc.?

I would also like to know how they are "circumvent(ing) labor agreements"?



Typical management answers!!

On the one hand you're saying WE are lucky to have a job because the economic environment is horrible, except nobody told management that because they're hiring like there's no tomorrow. So, what is it....bad economy or bad management?

Yea, they manage the business alright....right into the ground. How much debt does AA have....11B, yet they have money to burn by renovating terminals, buying new deicers, fuel trucks, ramp vehicles, and refurbishing aircraft interiors, adding aircell and placing the largest aircraft order in aviation history, but they don't have money to reward their frontline employees for bailing AA out of BK in 2003. Real nice!

Look, you go ahead and defend management because BK will be the only way I will give the crooks and cronies more money. I think the AMT's a lot smarter than the TWU INTL leadership and AA management believes. They think we're just going to roll over and give them more. Not a chance! For me, it's FULL RETRO TO 2008 or NO VOTE!! or BK and ALL OUT CHAOS, and lots of metal sitting around. Take your pick AA!
 
Regarding your comment, if AA can improve scope and increase flying, it will be better for the pilots in the long-run as well as it will allow AA to expand even more to "larger" routes (such as international, major hubs, etc.). Not being able to get the feed (due to costs) is one of many major hindrances for AA to expand.
We heard that same BS over at M&R. So we said ok if that's the case then guarantee that nobody loses their job in their location as a result of expanded Eagle , of course the company said they were not interested in negotiating, they want it their way or no way. The fact is that with the addition of more long haul flights, by large aircraft like the 777-300ER, regional feed ASMs are automatically increased. Over the last ten years the AA fleet has been shrinking while the Eagle fleet has grown proportionately larger. AA has shrunk as Eagle has grown under the current ratio, why would we believe that raising the ratio even higher would promote growth when historically the opposite has happened? Sounds to me like a new version of trickle down economics.
 
In bankruptcy, AA will ask the judge for an increase in compensation for executives "SO AS TO RETAIN THE KEY TALENT, YOUR HONOR! WE CAN'T AFFORD TO HAVE ALL OUR INVALUABLE MANAGEMENT TEAM LEAVE FOR OTHER COMPANIES, ETC ETC ETC."
Then, once AA emerges from the employee raping bankruptcy, the invaluable executives will receive thousands and thousands of shares of the new AA!


Agree 100% but unfortunately that's corporate America!!!

Look at the bankruptcies @ United, Delta, Usair. All the executives
received bonuses during the restructuing and ALL approve by the
same judge willing to abrogate all the collective agreements.
 
Are they being pretentious and arrogant or are they still acting like unionists and refusing to cower to the company and accept diminished expectations?
Is acting like unionists ignoring the fact that AA is near bankruptcy and that making outlandish demands further denigrates unions in the public's minds? Chest thumping by unionists does not errase red ink on paper, regardless of who's at fault.


There's a shortage of pilots, the company needs to get an agreement with new aircraft on order, they should squeeze for all they can.
Shortages don't negate the effects of poor manAAgement. Sure, they should squeeze for all their worth but again, their only worth what they can get from a compAAny in dire financial straits.

Today's environment, while not perfect, is more favorable to the pilots and if they decide to take on the challenge it's in all our interests to support them, AFL-CIO affiliated or not.
I've accepted that "today's environment" is not favorable to anyone, including the pilot's, and crying in my beer over the past doesn't move the compAAny forward. While I agree concessions are not an option, neither should breaking the bank.
 
Typical management answers!!

On the one hand you're saying WE are lucky to have a job because the economic environment is horrible, except nobody told management that because they're hiring like there's no tomorrow. So, what is it....bad economy or bad management?

Yea, they manage the business alright....right into the ground. How much debt does AA have....11B, yet they have money to burn by renovating terminals, buying new deicers, fuel trucks, ramp vehicles, and refurbishing aircraft interiors, adding aircell and placing the largest aircraft order in aviation history, but they don't have money to reward their frontline employees for bailing AA out of BK in 2003. Real nice!

Look, you go ahead and defend management because BK will be the only way I will give the crooks and cronies more money. I think the AMT's a lot smarter than the TWU INTL leadership and AA management believes. They think we're just going to roll over and give them more. Not a chance! For me, it's FULL RETRO TO 2008 or NO VOTE!! or BK and ALL OUT CHAOS, and lots of metal sitting around. Take your pick AA!
That's why I have him on ignore, Strike - he's not worth conversing with as "he's got his" and thinks we should finance more of "his" as do other executive-types and wanna-bes.

They're trash, plain and simple, and aren't worth a working man's time of day.
 
Is acting like unionists ignoring the fact that AA is near bankruptcy and that making outlandish demands further denigrates unions in the public's minds? Chest thumping by unionists does not errase red ink on paper, regardless of who's at fault.



Shortages don't negate the effects of poor manAAgement. Sure, they should squeeze for all their worth but again, their only worth what they can get from a compAAny in dire financial straits.


I've accepted that "today's environment" is not favorable to anyone, including the pilot's, and crying in my beer over the past doesn't move the compAAny forward. While I agree concessions are not an option, neither should breaking the bank.
How are unions supposed to act???

Unfortunately for the AMT's, WE belong to a labor organization that doesn't act like a union, and WE work for a company that finds comfort in screwing with labor. Therefore, the AMT's need to get the maximum wages and benefits out of AA before AA dies, and it is dying a slow death, and not because of bad business decisions made by the AMT's, but by management.

I've also accepted the fact that "today's enviornment" is not favorable for breaking the bank and killing the golden goose, but I've also accepted the fact that for the last 21 years I've worked for irrational and incompetent managers and providing the company with more concessions will not eliminate these managers, therefore, NOTHING WILL CHANGE AT AA EXCEPT MY WAGES & BENEFITS!! Just like the last 8 years.
 
In bankruptcy, AA will ask the judge for an increase in compensation for executives "SO AS TO RETAIN THE KEY TALENT, YOUR HONOR! WE CAN'T AFFORD TO HAVE ALL OUR INVALUABLE MANAGEMENT TEAM LEAVE FOR OTHER COMPANIES, ETC ETC ETC."
Then, once AA emerges from the employee raping bankruptcy, the invaluable executives will receive thousands and thousands of shares of the new AA!

The judge will take a look at what will be considered "fair compensation". I don't recall during DL, NW, UA's BK that management were raking in "bank". Many in management will be simply fired and have no job protection. That is the chance (risk) they took.


Today's environment, while not perfect, is more favorable to the pilots and if they decide to take on the challenge it's in all our interests to support them, AFL-CIO affiliated or not.

But we don't see that happening? In fact, I stated previously that all parties need to get together and "hammer things out"...

Typical management answers!!

On the one hand you're saying WE are lucky to have a job because the economic environment is horrible, except nobody told management that because they're hiring like there's no tomorrow. So, what is it....bad economy or bad management?

Yea, they manage the business alright....right into the ground. How much debt does AA have....11B, yet they have money to burn by renovating terminals, buying new deicers, fuel trucks, ramp vehicles, and refurbishing aircraft interiors, adding aircell and placing the largest aircraft order in aviation history, but they don't have money to reward their frontline employees for bailing AA out of BK in 2003. Real nice!

Look, you go ahead and defend management because BK will be the only way I will give the crooks and cronies more money. I think the AMT's a lot smarter than the TWU INTL leadership and AA management believes. They think we're just going to roll over and give them more. Not a chance! For me, it's FULL RETRO TO 2008 or NO VOTE!! or BK and ALL OUT CHAOS, and lots of metal sitting around. Take your pick AA!

Strikeforce, AA has to renovate terminals, order new aircraft,etc. There is no way it can remain competitive if it didn't.

As I've been incessantly mentioning, there was no "bailout of BK in 2003" because ostensibly, wages were too high in the first place. It doesn't seem that wages in 2011 are "mean wages" (industry averages), thus AA's financial problem.

Ok, I've got a question for you.

If this is a management problem then why has literally every single independent analyst state that AA's cost structure is too much??

Even union heads state that AA's cost structure is too high:

"Capt. Dave Bates, the union chief and a 26-year American veteran, says he knows AMR has a cost problem. "Our union understands the need for [increased[ productivity ]," he says "*

*-Wall Street Journal-July 1, 2011

Another example:

"Studies show the airline (AA) is at or near the bottom of the industry in productivity, says Jerry Glass, president of F&H Solutions Group and a former US Airways labor executive."*

*-Bloomberg, October 2010

"American Airlines now suffers from a disadvantageous high unit cost base as measured by CASM, that was ranked as the highest industry-wide only last year."*--

*-Aspire Aviation, June 2010.

(I can come up with a number of more sources)

Now, these are neither my words nor AA management's words. Just how is this going to be addressed??


We heard that same BS over at M&R. So we said ok if that's the case then guarantee that nobody loses their job in their location as a result of expanded Eagle , of course the company said they were not interested in negotiating, they want it their way or no way. The fact is that with the addition of more long haul flights, by large aircraft like the 777-300ER, regional feed ASMs are automatically increased. Over the last ten years the AA fleet has been shrinking while the Eagle fleet has grown proportionately larger. AA has shrunk as Eagle has grown under the current ratio, why would we believe that raising the ratio even higher would promote growth when historically the opposite has happened? Sounds to me like a new version of trickle down economics.

Having large aircraft doesn't "automatically increase regional feed". AA's Eagle fleet has grown because they have no choice. If mainline pilots had scope changes, AA mainline could get smaller planes such as the 190/E195's. This in turn would not only grow mainline AA,but shrink Eagle.



Agree 100% but unfortunately that's corporate America!!!

Look at the bankruptcies @ United, Delta, Usair. All the executives
received bonuses during the restructuing and ALL approve by the
same judge willing to abrogate all the collective agreements.

Please show some proof of this...I'm quite curious.


That's why I have him on ignore, Strike - he's not worth conversing with as "he's got his" and thinks we should finance more of "his" as do other executive-types and wanna-bes.

They're trash, plain and simple, and aren't worth a working man's time of day.

Good, I don't have time for close-minded people either... :lol:


How are unions supposed to act???

Unfortunately for the AMT's, WE belong to a labor organization that doesn't act like a union, and WE work for a company that finds comfort in screwing with labor. Therefore, the AMT's need to get the maximum wages and benefits out of AA before AA dies, and it is dying a slow death, and not because of bad business decisions made by the AMT's, but by management.

I've also accepted the fact that "today's enviornment" is not favorable for breaking the bank and killing the golden goose, but I've also accepted the fact that for the last 21 years I've worked for irrational and incompetent managers and providing the company with more concessions will not eliminate these managers, therefore, NOTHING WILL CHANGE AT AA EXCEPT MY WAGES & BENEFITS!! Just like the last 8 years.

I agree, AA management was irrational -for not filing for BK back in 2003. If you think its bad now, wait until (if) AA heads to BK.....
 
Is acting like unionists ignoring the fact that AA is near bankruptcy and that making outlandish demands further denigrates unions in the public's minds? Chest thumping by unionists does not errase red ink on paper, regardless of who's at fault.



Shortages don't negate the effects of poor manAAgement. Sure, they should squeeze for all their worth but again, their only worth what they can get from a compAAny in dire financial straits.


I've accepted that "today's environment" is not favorable to anyone, including the pilot's, and crying in my beer over the past doesn't move the compAAny forward. While I agree concessions are not an option, neither should breaking the bank.
Near bankruptcy? Dire financial straits? Well what does that mean? They have more cash than ever before, a third fewer workers and just placed the largest order ever for new aircraft. This year they are set to bring in $24billion, almost if not more than they did in 2008. How does it go" it was the worst of times, it was the best of times"?
 
Near bankruptcy? Dire financial straits? Well what does that mean? They have more cash than ever before, a third fewer workers and just placed the largest order ever for new aircraft. This year they are set to bring in $24billion, almost if not more than they did in 2008. How does it go" it was the worst of times, it was the best of times"?

... and then came the chickenhawk ...

That was a funny commercial.
 
Near bankruptcy? Dire financial straits? Well what does that mean? They have more cash than ever before, a third fewer workers and just placed the largest order ever for new aircraft. This year they are set to bring in $24billion, almost if not more than they did in 2008. How does it go" it was the worst of times, it was the best of times"?

I consider any company of our size that loses $10-$12,000,000,000 in the last decade as being in dire straits and most recently when all others prosper, we flounder. MismanAAgement? In most industries if your not moving forward, your moving back.
 
Strikeforce, AA has to renovate terminals, order new aircraft,etc. There is no way it can remain competitive if it didn't.

As I've been incessantly mentioning, there was no "bailout of BK in 2003" because ostensibly, wages were too high in the first place. It doesn't seem that wages in 2011 are "mean wages" (industry averages), thus AA's financial problem.

If this is a management problem then why has literally every single independent analyst state that AA's cost structure is too high

Having large aircraft doesn't "automatically increase regional feed". AA's Eagle fleet has grown because they have no choice. If mainline pilots had scope changes, AA mainline could get smaller planes such as the 190/E195's. This in turn would not only grow mainline AA,but shrink Eagle.
Customers don't care about safety but if the terminal isn't pretty they will fly somebody else, funny but for years all we've heard was that if AA charges a nickel more than a competitor they will loose customers, more room in coach, doesn't matter, nothing matters but price but now you are claiming all these Taj Mahals are needed to make AA competitive , please, everyone knows it's just a cash burn.

Wages were never too high and there's more to costs than labor, in fact labor costs have been shrinking as a percentage for years.

Having large aircraft on long haul routes automatically increase the number of ASMs that regionals can provide in the TWU contract. Under current rules a 777 flying 300 people 7000 miles adds 126,000 ASMs for regional flying, 300x7000=2,100,000 x .06 =126,000 that's enough ASMs for 50 Eagle RJ flights between New York and Boston or wherever they want to fly within 250 miles of New York. Enough for 17 Eagle RJ LGA to DFW trips. The number of flights affects our headcount more than the number of passengers or payload. That's at 6%, if we double it to 12% one 777 on a 7000 mile trip would allow the company to increase regional flying by 252,000 ASM. That one flight could wipe out all the mainline flying in several Class II cities. So while it may add one head to JFK it may come at the cost of closing both EWR and PHL and losing 40 heads to Eagle, JetBlue or whomever AA has doing their regional feed.
 

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