Crownvic From United States of America, joined Oct 2004, 1897 posts, RR: 5
Reply 1, posted (8 years 3 days 3 hours ago) and read 2804 times:
Like most Major airlines in the U.S., I believe CO is a member of CRAF (Civil Reserve Air Fleet). Under CRAF, there is a commitment by all airline members to participate in a certain amount of flying for the U.S. Military. In exchange, airlines use to get "paid for" cargo conversions on their 747 & DC-10 fleets. With newer generation a/c (like 777's) , I do not know what the compensation is aside from the charter revenue.
To answer your question further, it is not uncommon to see this sort of flying by U.S. carriers. Even WN participates in many domestic military charters along with AA on international routes.
Quoting Crownvic (Reply 1): Under CRAF, there is a commitment by all airline members to participate in a certain amount of flying for the U.S. Military. In exchange, airlines use to get "paid for" cargo conversions on their 747 & DC-10 fleets.
Sort of. Here's how it works. Airlines commit specific aircraft to the program, and promise to make those specific aircraft (and sufficent appropriate crews -- 3 crews per a/c, I think) available on a specific amount of notice if the Fleet is "activated" by the Air Mobility Command at Scott AFB in an emergency. There are various "levels" of activation, which call for percentages of the fleet and/or different segments of the fleet to be activated. The fleet is divided into Aeromedical, Short Range International Pax and SRI Cargo, Long Range International Passenger and LRI Cargo, and Domestic pax and cargo.
The Air Mobility Command has no organic (i.e. their own) passenger lift, to speak of. It's usually said that they have none. This isn't entirely true, as they have some VIP aircraft, but they have no real troop lift other than the seats that are available on the freight aircraft. (Ever see the troop cabin in a C-5? It's comfortable and pretty cool, with plenty of pitch.) And it doesn't make sense for the military to have organic lift, because it's cheaper and easier to get it from the private sector.
The aircraft committed to the CRAF Fleet are assigned Mobilization Value Points based upon equivalents of a standard aircraft (I forget which model), and each type of aircraft is assigned an ACL or Allowable Cabin Load. So a 747-400 is worth more points than a 757, and so on. The basic idea is how much troop-carrying capacity each participant contributes to the total pie.
Here's how the airlines make money from the program. In peacetime, there is relatively-little need for the major carriers to provide lift. They don't really like to do it, and the reimbursement rates are based on the average cost to all carriers per seat-mile, plus a small markup, so it's not super-profitable business for them, although it IS revenue, which is sometimes nice to have at the margins. The reimbursement rate is the same per ACL seat-mile regardless of the size of the aircraft, except that for International, there is a narrowbody rate and a widebody rate. (There is a similar way that MVPs are awarded for cargo aircraft as well, and the rate is based on ton-miles.) The military makes a quarterly adjustment in the rate based upon the price of fuel, so those who do the flying are protected against fluctuations in fuel cost. In the International segment, there is a small amount of work that the military knows in advance (about 15% of the total in a given year, and declining) that it will need. The rest is called "expansion" flying, i.e. expansion of the contract. Carriers like World have much lower costs of providing the service than does, say, American, and there are efficiencies to be gained from having a regular track-charter operation (from stuff like crew staging and transportation, back-office expense to monitor the program, etc.) rather than have everyone do a little bit of the work and incur all the fixed costs of doing so, so if there were a way that American could benefit from having World do the flying, everybody would be happier. The military, wisely, gives them a way to do that, as described below.
Because the majors don't really want to do this flying unless it's really, really needed, the military allows the International participants to contribute their Mobilization Value Points to teams. They don't have to, but most do. This year, there are 3 primary teams: the Alliance Contractor Team, the FedEx team, and the UPS Team. Each team has cargo participants and passenger participants, and the total of MVPs for the team, compared to the overall pie of MVPs, determines that teams "entitlement" for the Fiscal Year (October to October), in terms of a percentage of the total flying. The Fixed (non-expansion) flying is then awarded to the teams in a rough percentage. Expansion flying is awarded on a monthly basis first to the entitled team, then to any other team, then to any qualified carrier; the AMC tries to balance it out so that each team gets its entitled percentage of that month's flying, but if a particular team can't do all the missions to which it is entitled in a given month, tough luck. It all starts again the next month. So, if the Alliance team is entitled to 35% of the expansion flying in a given month, but can't do it all, any flying that it couldn't do doesn't increase its flying the next month.
So those are the rules. The way the majors make money is as follows: the MVPs that they contribute to their "team" entitle the "team" to do a certain amount of flying. Each team has at least one core member that has the right to do all (or as much as it can) of the passenger flying for the team, and a similar cargo member. World is the core pax member of the Alliance team, North American is the core pax member of the UPS team, ATA (and, I think, Omni) is the core pax member of the FedEx team. If the team has passenger entitlements those guys get the call from the AMC. (And they are set up to do the work, the paperwork, etc., and they stage crews and maintenance people and supplies at stations around the world to run an efficient, reliable operation.) In return, the airlines that do the flying pay "commissions" back to the team, which are distributed among the team's members. So, for its commitment of aircraft, American, for example, gets commissions (and makes money) without actually having to do any flying. The flying members are primarily World, Omni, North American, ATA, and, to a much lesser extent, Ryan. Miami Air gets some work as well.
Now, although they don't really like to do the flying, certain majors nevertheless don't totally resist it when they have aircraft and crews available during slower periods. And one thing that the majors truly hate are "activations" by the AMC, because then the charters aren't voluntary and crews have to be kept available to fly on like 24 hours' notice and certain specific aircraft, if activated, have to be on standby. It's compulsory and disruptive, as opposed to the nicer situation of getting to do voluntary charters with available aircraft and crews. The military knows this. So, if it has needs that can't be met by the Usual Suspects, the majors will pitch in voluntarily lest they otherwise be subject to an activation. (In an activation, the core carriers also don't have to pay commissions back to the team, so that is another incentive for the majors to step up and voluntarily pick up the slack when necessary. When I say "voluntarily", I don't mean that they do it for free; I just mean that they do it without being compelled by an activation to do the mission.) So...when you see a CO or AA or NW aircraft on a long-range international CRAF charter, you can assume that World or Omni or NAA or ATA couldn't do it. Which is, generally speaking, an indication of how busy that they are. (It doesn't mean that World's aircraft won't all be sitting on the ground the following week, but it does mean that at least at that moment in time, they didn't have an available aircraft.)
Domestic military charters are contracted differently, and WN, at least a few years ago when the stats were published in detail, which they don't seem now to be, had grown from almost nothing to totally dominate the domestic military charter business.
BlueFlyer From United States of America, joined Jan 2006, 3967 posts, RR: 2
Reply 4, posted (8 years 3 days 2 hours ago) and read 2740 times:
Quoting Wjcandee (Reply 3): Airlines commit specific aircraft to the program
Why do they have to commit specific aircraft? Why can't ATA commit 3 generic 737-300s, instead of commiting N401TZ, N402TZ and N403TZ specifically ? I would think it would give the carriers greater flexibility (easier to make sure "a" 737-300 is ready at short notice rather than "this" 737-300) at, I think, little to no difference for the CRAF.
Also, why would United add 84 757s all of a sudden. I can understand a few aircraft being added and dropped every month for maintenance or scheduling reasons, but 84 aircraft at one time has to be fairly close to the entire UA 757 fleet.
I think, without knowing for sure, that the military wants to be able to be sure that the aircraft that it thinks will be available will in fact be available, and, perhaps more importantly, be able to demonstrate to the legislature to whom it reports with absolute certainty that specific numbers and types of aircraft are available. Another way of saying it is that it prevents cheating or just plain sloppiness. If you can say, "I get to grab THAT ONE if I need it," you're in a more definitive position than if you can only say, "They promised to let me use at least one of these." Another reason is that when specific aircraft are pledged, then specific tail numbers can be easily commandeered (sort of the same thing as above) and inspected, and hull insurance and indemnification and whatever else is necessary to provide in the case of hostile action can be specifically put on paper and applied to a specific airframe. Maybe an easier way of saying it is that in the event of an emergency, it is the government's choice, not the airline's, as to which aircraft will be activated, and if you have a sheet which identifies all the specific assets that are pledged, all you need to do is say, "Get me these specific aircraft," and you're done. The list is updated by the airlines and the government monthly, and, once again, it's more authoritative and errors can more easily be spotted when you get down to the level of detail that you actually pledge an actual tail number. Also, there's actually a bunch of paperwork involved in committing aircraft to the program, that actually goes to the configuration, ownership, etc., etc. of each specific aircraft, so maybe that's another reason they do it that way as well.
Quoting BlueFlyer (Reply 4): I would think it would give the carriers greater flexibility
Agreed. But I think that the essence of the program is effectively that the government doesn't care about the flexibility to the carriers in the event of an emergency. In peacetime, where there is no activation, the AMC doesn't order up tail numbers, it orders up missions. It doesn't care which ATA L1011-500 it gets, provided that they are all configured appropriately for the mission. But in an activation, specific aircraft are activated.
Quoting BlueFlyer (Reply 4): Also, why would United add 84 757s all of a sudden.
It's a good question, and I don't know the answer. Purely speculatively, until ATA started using the 757s for a big portion of their long-range international contract business in the past few years, the military didn't think it was a great long-range international aircraft for its needs, and may not have been as interested in having those aircraft in the fleet. The use by ATA and North American and Omni of these aircraft on these missions may have prodded the AMC to change the way it looked at the aircraft, and may have encouraged United to pledge them to that segment. I know that the military has been staging smaller complements of troops to move in recent months, from closer airfields. So...kinda like CO taking the 757 nonstop to places in Europe that don't merit a 777, the military is staging groups of troops in smaller numbers at US bases...in some cases. In others, it's big movements.
That said, the 757 really isn't a great aircraft for long-range international military movements. They bulk out with gear well short of the number of seats on the plane, particularly the 753, and at the average assumed passenger weight for military members, which is like 220 pounds, the amount of fuel that can be loaded before you reach MTOW really cuts into the available range, adding to the number of stops. A typical ATA 753 flies like DFW-BGR-SNN-Somewhere Else-OKBK. It's not as bad a trip as on a Miami Air 738, but it's not a seamless journey. A 777 can do Base-Newark-Kuwait, or the like. A 763 is probably about the ideal size and has the ideal range for what they want to accomplish with the smaller groups, but it just isn't available to the charter carriers (other than the couple that North American has available for charter; the other ones go to their scheduled service) and the scheduled carriers aren't parting with them yet. ATA tried to find suitable 763ERs, and just couldn't do it at a price they could afford. IMHO, World's MD11s are generally-speaking a very fine aircraft for the missions that involve a larger number of troops: plenty of seats, insane amounts of lifting ability for those heavy soldiers and their gear, decent range. A 744 is also nice for the biggest groups, but, again, they are not economical for the charter carriers to maintain, as there is basically zero commercial passenger charter demand for them when they aren't doing military missions, which is cyclical work. So, when the heaviest rotations use up all the charter aircraft, UA and NW will toss the military a few 744s for a couple of missions and take up the slack.
NorthstarBoy From United States of America, joined Jun 2005, 1825 posts, RR: 0
Reply 6, posted (8 years 3 days ago) and read 2681 times:
a couple of curiosities, are airlines which want international route authorities still required to pony up aircraft for the CRAF program?
if the government calls up specific aircraft, which means those aircraft have to be taken out of the regular fleet rotation, and that in turn, for whatever reason, causes a specific flight to be canceled, does the government have to reimburse the airlines for the loss of that revenue?
Why are people so against low yields?! If lower yields means more people can travel abroad, i'm all for it
ADXMatt From United States of America, joined Jul 2006, 950 posts, RR: 2
Reply 7, posted (8 years 3 days ago) and read 2676 times:
Quoting NorthstarBoy (Reply 6): if the government calls up specific aircraft, which means those aircraft have to be taken out of the regular fleet rotation, and that in turn, for whatever reason, causes a specific flight to be canceled, does the government have to reimburse the airlines for the loss of that revenue?
NO.... And the airline doesnt have to pay Denied Boarding Compensation either when the cancellation is due to Government Requisition of A/C. It's like a WX cancel. Beyond the control of the carrier.
I don't remember that happening recently though and when it did (IIRC was the Gulf War) it only lasted a few weeks and the airlines were able to start pre-cancelling.
In times of war national interests come first. It sucks though if you were on that canceled flight.
Clipper002 From United States of America, joined Aug 2004, 679 posts, RR: 13
Reply 8, posted (8 years 2 days 20 hours ago) and read 2576 times:
They bulk out with gear well short of the number of seats on the plane, particularly the 753, and at the average assumed passenger weight for military members, which is like 220 pounds, the amount of fuel that can be loaded before you reach MTOW really cuts into the available range, adding to the number of stops.
Actually Bill, the ACL is now up to 400 lbs per pax including their gear, so an MD-11 can only carry 312 pax for a GACL of 125,000 lbs.
BlueFlyer From United States of America, joined Jan 2006, 3967 posts, RR: 2
Reply 12, posted (8 years 2 days 15 hours ago) and read 2293 times:
Quoting Humberside (Reply 10): How come World and North American are in different teams when they are under common ownership?
World and North American have the same parent company, but they each have their own management team. Each company can therefore make decisions independently of the other, such as joining different teams(although, as per Clipper002, that will no longer be the case after September).
Wjcandee From United States of America, joined Jun 2000, 5152 posts, RR: 22
Reply 13, posted (8 years 2 days 14 hours ago) and read 2263 times:
Quoting BlueFlyer (Reply 12): Each company can therefore make decisions independently of the other, such as joining different teams
I guess. However, if Mr. Martinez wants them both on the same team, they will both be on the same team. Clipper002 said the reason...prior to the acquisition, which went through relatively quickly, North American had joined the UPS Team for FY06 (Oct05 to Oct06). When World Air Holdings bought North American, one of the first things they did was see if they could get North American reassigned to the Alliance Contractor Team for 06. By that point, it wasn't possible. I believe that they said in a conference call earlier this year that AMC had said "No." It also occurs to me that the UPS Team may also have said "No", given that there may have already been a contract in place for that year. In a recent conference call, World Air Holdings reiterated that NAA would be on the Alliance team for the upcoming year, and they see a major advantage to that, as it is generally the "strongest" (their word) team. I think that they mean that it has the most entitlements.
BlueFlyer From United States of America, joined Jan 2006, 3967 posts, RR: 2
Reply 14, posted (8 years 2 days 14 hours ago) and read 2227 times:
Quoting Wjcandee (Reply 13): However, if Mr. Martinez wants them both on the same team, they will both be on the same team.
I'm not disagreeing with either you or Clipper002. My point was more of a generic comment that merely because two companies have the same ownership doesn't mean they walk in lock step. Each situation is unique and has to be judged on its merits. There may be cases when World Holdings will order both carriers to cooperate, there may be cases when World Holdings will send them off in different directions and there may be cases when World Holdings will tell them to make their own bed and live with it.
Lt-AWACS From , joined Dec 1969, posts, RR:
Reply 15, posted (8 years 2 days 13 hours ago) and read 2195 times:
I've flown CO on a mil charter to Saudi Arabia from KTIK and it was great, and I got FF miles to ad to my account I've done ATA L-1011s and World. Got on a United 747 and right off again (not because of United LOL). They are all normally pretty good.
Ciao, and Hook 'em Horns,
Capt-AWACS, Mind the Gap