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CO Reductions - 310 Pilots  
User currently offlineRonmacIAH From United States of America, joined Aug 2006, 52 posts, RR: 0
Posted (5 years 1 week 1 day 20 hours ago) and read 8854 times:

CO intends to furlough up to 310 pilots as part of the overall cost reductions announced earlier this week. CO states the reductions are necessary due to 2nd quarter losses of $213 million. CO states the furloughs may be implemented as early as 9/23. Not good news for our hometown airline.

http://www.chron.com/disp/story.mpl/business/6542588.html


hey, lets be careful out there
76 replies: All unread, showing first 25:
 
User currently offlineAA737-823 From United States of America, joined Mar 2000, 5731 posts, RR: 11
Reply 1, posted (5 years 1 week 1 day 12 hours ago) and read 8516 times:

It's upsetting and disappointing.
That said, I wonder if these 310 are the ones that were walking around with FUPM bracelets on.... classy in these times.

What really raises my eyebrow, though, is that most other airlines (US, AS, FL, and others) are posting profits this quarter- some of them, including special items and such, but still.
What happened that CO, once the profit darling, is now the big loss maker?

I'm gold with tons of OnePass miles, but now I'm expecting them to further reduce my benefits, and further restrict my miles redemptions, due to these losses.


User currently offlineTommy767 From United States of America, joined Aug 2003, 6584 posts, RR: 11
Reply 2, posted (5 years 1 week 1 day 11 hours ago) and read 8383 times:

Sad news. And yes I wonder, why did CO post a significant loss this quarter compared to other carriers?

No doubt in my mind that EWR will get the brunt of the layoffs. There are a lot of young RJ pilots based out of there



"Folks that's the news and I'm outta here!" -- Dennis Miller
User currently offlineCODC10 From United States of America, joined Jul 2000, 2397 posts, RR: 6
Reply 3, posted (5 years 1 week 1 day 10 hours ago) and read 8342 times:

This was a very bad quarter for CO, the worst in a long time. CO's performance was substantially worse than its competitors.

One major concern is that CO is highly exposed to several areas that have been hit very hard by recent events, including Mexico (H1N1 and drug concerns), the utter collapse of international premium demand, fallout from the financial meltdown in New York, and softened cargo demand.

CO's domestic network has been loss-making for quite some time, so the recent success of the international sector has essentially subsidized it to a degree. Now, with international demand evaporating, CO is in a very precarious position. They have plenty of cash on hand, are still well-run, and have a good long-term fleet plan and financing options, but some major changes are definitely on the way.


User currently offlineCODC10 From United States of America, joined Jul 2000, 2397 posts, RR: 6
Reply 4, posted (5 years 1 week 1 day 10 hours ago) and read 8346 times:



Quoting Tommy767 (Reply 2):
No doubt in my mind that EWR will get the brunt of the layoffs. There are a lot of young RJ pilots based out of there

EWR may get the brunt of layoffs, but any furloughs are coming out of the mainline ranks. RJ pilots are employed by ExpressJet and Chautauqua, and thus are not necessarily part of any CO-mandated layoffs, though they may be on the chopping block should CO reduce regional flying.


User currently offlineSancho99504 From United States of America, joined Dec 2005, 569 posts, RR: 0
Reply 5, posted (5 years 1 week 1 day 10 hours ago) and read 8303 times:



Quoting AA737-823 (Reply 1):
That said, I wonder if these 310 are the ones that were walking around with FUPM bracelets on.... classy in these times.

What are FUPM bracelets? Pardon my ignorance.



kill 'em all and let God sort 'em out-USMC
User currently offlineJEdward From United States of America, joined Nov 2005, 133 posts, RR: 0
Reply 6, posted (5 years 1 week 1 day 10 hours ago) and read 8230 times:



Quoting Sancho99504 (Reply 5):
What are FUPM bracelets? Pardon my ignorance.

F@#$ YOU PAY ME, I think.



As Christ died to make men holy, let men die to make us rich. --S.C.
User currently offlineTommy767 From United States of America, joined Aug 2003, 6584 posts, RR: 11
Reply 7, posted (5 years 1 week 1 day 9 hours ago) and read 8179 times:



Quoting JEdward (Reply 6):
F@#$ YOU PAY ME, I think.

LOL...wow really? Thats pretty ignorant. Good thing ppl. probably do not know what it really means.



"Folks that's the news and I'm outta here!" -- Dennis Miller
User currently offlineSancho99504 From United States of America, joined Dec 2005, 569 posts, RR: 0
Reply 8, posted (5 years 1 week 1 day 9 hours ago) and read 8144 times:

WOW, straight and to the point. I thought Kellner did a good job working with all the employees at CO these past few years as we've seen low yields and high fuel costs destroy airlines' profitability? Maybe I was wrong.


kill 'em all and let God sort 'em out-USMC
User currently offlineCO767FA From United States of America, joined Aug 2005, 532 posts, RR: 2
Reply 9, posted (5 years 1 week 1 day 9 hours ago) and read 8096 times:



Quoting AA737-823 (Reply 1):
...classy in these times.

Right...employee's should just shut it and be glad they are employed.


User currently offlineLAXintl From United States of America, joined May 2000, 24884 posts, RR: 46
Reply 10, posted (5 years 1 week 1 day 9 hours ago) and read 8078 times:

Makes sense. Company did say bunch of 737 Classics would be removed this winter.


From the desert to the sea, to all of Southern California
User currently offlineNetjetsINTL From United States of America, joined Jul 2009, 593 posts, RR: 0
Reply 11, posted (5 years 1 week 1 day 7 hours ago) and read 7746 times:

These 310 soon to be furloughed pilots will bring the total number to what???

User currently onlineMax Q From United States of America, joined May 2001, 4383 posts, RR: 19
Reply 12, posted (5 years 1 week 1 day 7 hours ago) and read 7484 times:

The reason for the huge loss was the total mismanagement of the fuel hedging program.


If we had paid the 'unhedged' price for jet fuel we would have been solidly profitable.



This is the reason Kellner departed and Jeff 'the hatchet man' Smisek is wielding his axe.


A great shame and unnecessary. We are paying the price for managements mistake.



If they were to furlough 310 Pilots that would be in addition to 147 already on the street totalling 457 altogether.

[Edited 2009-07-23 18:37:44]


The best contribution to safety is a competent Pilot.
User currently offlineRonmacIAH From United States of America, joined Aug 2006, 52 posts, RR: 0
Reply 13, posted (5 years 1 week 1 day 7 hours ago) and read 7476 times:



Quoting CODC10 (Reply 3):
This was a very bad quarter for CO, the worst in a long time. CO's performance was substantially worse than its competitors.

One major concern is that CO is highly exposed to several areas that have been hit very hard by recent events, including Mexico (H1N1 and drug concerns), the utter collapse of international premium demand, fallout from the financial meltdown in New York, and softened cargo demand.

You make some very valid points with numerous issues that represent serious challenges. Having said that, recent flights I've taken to AMS, DEN and MSY have all been full with people waiting on standby. This may be somewhat misleading due to fewer flights and reduced capacity.

Any of the CO folks have updates on load factors in the last 6 months, are they really dropping or staying about the same?



hey, lets be careful out there
User currently offlineCo757 From United States of America, joined Apr 2005, 94 posts, RR: 0
Reply 14, posted (5 years 1 week 1 day 5 hours ago) and read 6996 times:

Our flights are completely full or oversold with a standby list galore. I find it hard to believe we lost that much money and tryuly believe they want the numbers to look bad so in September they "have a reason" to say a merger with UAL is necessary to survive. I belive thats why Kellner is leaving. I'm sure this has been well planned out for sometime.

User currently offlineAlias1024 From United States of America, joined Oct 2004, 2748 posts, RR: 2
Reply 15, posted (5 years 1 week 1 day 4 hours ago) and read 6850 times:



Quoting Max Q (Reply 12):
If they were to furlough 310 Pilots that would be in addition to 147 already on the street totalling 457 altogether.

Didn't they send out about 500 letters before the first furlough? They are probably grossly overdoing it on the letters just to make sure there is no chance of furloughing someone that didn't get the letter. Still sucks that there will be anyone else getting furloughed.  Sad



It is a mistake to think you can solve any major problems with just potatoes.
User currently onlineMax Q From United States of America, joined May 2001, 4383 posts, RR: 19
Reply 16, posted (5 years 1 week 1 day 2 hours ago) and read 6346 times:



Quoting Co757 (Reply 14):
Our flights are completely full or oversold with a standby list galore. I find it hard to believe we lost that much money and tryuly believe they want the numbers to look bad so in September they "have a reason" to say a merger with UAL is necessary to survive. I belive thats why Kellner is leaving. I'm sure this has been well planned out for sometime.



You are correct, the flights are overflowing but we 'hedged' our fuel at $140 a barrel when you could buy it on the open market for less than half that guaranteeing a loss.


I hope you are wrong about a merger with UAL but it's hard to tell with Smisek. He certainly is not creating a great impression by starting massive furloughs as soon as he 'takes power' but that's probably about 'impressing' Wall Street.


I think a traditional merger with UAL would be disastrous for us.

Quoting Alias1024 (Reply 15):

Didn't they send out about 500 letters before the first furlough? They are probably grossly overdoing it on the letters just to make sure there is no chance of furloughing someone that didn't get the letter. Still sucks that there will be anyone else getting furloughed.

I don't remember how many it was last time but you are completely correct. They do send out far more letters than necessary to cover themselves.



The best contribution to safety is a competent Pilot.
User currently offlineRonmacIAH From United States of America, joined Aug 2006, 52 posts, RR: 0
Reply 17, posted (5 years 1 week 21 hours ago) and read 5774 times:

More info this morning (7/24) regarding pilot layoffs (212 of 310 are first officers based in EWR) along with 413 flight attendants and 621 airport customer service positions.

This looks like it good get ugly and fast....

http://www.chron.com/disp/story.mpl/business/6544835.html



hey, lets be careful out there
User currently offlineCODC10 From United States of America, joined Jul 2000, 2397 posts, RR: 6
Reply 18, posted (5 years 1 week 18 hours ago) and read 5597 times:



Quoting Max Q (Reply 12):
The reason for the huge loss was the total mismanagement of the fuel hedging program.

CO completely and unequivocally dropped the ball on fuel hedging. They gambled and lost everything. As I understand, this was a major reason behind the departure of Jeff Misner in 2008. I am confident that Zane Rowe is a more savvy CFO, but the fallout from the fuel crisis last year is still a major factor.

As much as I like Larry and respect him as a person, he plays it too close to the vest for me. Under Kellner, Continental has very rarely strayed from the straight-and-narrow, which, undoubtedly, has been wise at times. My personal impression from having met the man is that he is extremely concerned about his employees, and is passionate about being their advocate, despite what some unhappy union rhetoric may suggest around contract time.

The net result of the Kellner era at CO has been more-or-less status quo, stay the course. CO has become very good at what they do, but the more you stay the same, the more you fall behind.

I'm confident that under Smisek we will see a much more aggressive leadership style and thus a much different CO. The market has changed with the DL/NW merger, and CO must either grow its scope to compete or be relegated to second-tier status. Some may resent Smisek for his Ivy League pedigree and background in law and economics, but the reality is that such an education is proven to be among the best predictors of success in this era of capitalism. There's no evidence that pilots can run an airline any better: for every Gordon Bethune, there's been a Dick Ferris. Smisek's been in this business for a while, nearly 15 years. He knows his stuff. I think he may be what CO needs to get out of these doldrums.

Quoting RonmacIAH (Reply 13):
You make some very valid points with numerous issues that represent serious challenges. Having said that, recent flights I've taken to AMS, DEN and MSY have all been full with people waiting on standby. This may be somewhat misleading due to fewer flights and reduced capacity.

The problem is that passenger yields have been absolutely trashed with loss-making sale fares from the spring (impact felt in the 2nd quarter) and an almost disappearance of the high-yield, high-fare intercontinental business customer, especially from New York. Planes may be full, but if the majority of pax are paying fares that do not cover the cost of their transportation, then the flight is doomed to lose money, simple as that. I can't blame anyone but the airlines here: they sell the fares, and the race-to-the-bottom of this past spring resulted in some of the most shockingly low fares I have ever seen.

I must say I'm guilty of it too: I took a brief trip to Hawaii on CO (EWR-IAH-HNL and return) in May for about $350... I've paid more than that to go to Florida at times!


User currently offlineMasseyBrown From United States of America, joined Dec 2002, 5372 posts, RR: 7
Reply 19, posted (5 years 1 week 17 hours ago) and read 5565 times:



Quoting CODC10 (Reply 18):
As I understand, this was a major reason behind the departure of Jeff Misner in 2008.

I'm sure you are right. In hindsight, Misner was correct about oil prices but his timing was off by about 6 weeks. The Board and Kellner panicked (to be fair, so did almost everybody else) causing CO to hedge at the peak.

Even discounting the disastrous hedging program, I think CO's performance over the past year has been lackluster. The cratering of business class revenues was predictable and CO responded like an ostrich. While the departure of Kellner is orderly, he can't be pleased with his record.



I love long German words like 'Freundschaftsbezeigungen'.
User currently offlineYellowtail From United States of America, joined Jun 2005, 6052 posts, RR: 2
Reply 20, posted (5 years 1 week 16 hours ago) and read 5479 times:



Quoting Co757 (Reply 14):
Our flights are completely full or oversold with a standby list galore

have flown CO on 6 segments in the past month..and every segment was oversold. My LHR-IAH was oversold by 40 and things got so desperate they were offering folks $600 + flight voucher to go via EWR on a later flight.



When in doubt, hold on to your altitude. No-one has ever collided with the sky.
User currently offlineDualQual From United States of America, joined Mar 2006, 758 posts, RR: 1
Reply 21, posted (5 years 1 week 16 hours ago) and read 5446 times:



Quoting CODC10 (Reply 18):
I'm confident that under Smisek we will see a much more aggressive leadership style and thus a much different CO.

So far it looks like a bad aggressive. We have just changed bean counters. How much of a paycut will Mr Smisek be taking as a show of goodwill to the 1700 other "co-workers" he is about to railroad? And speaking of which, is fuel hedger extrodinare on the chopping block or did he collect his bonus? One other thing, FUPM!!! We're done funding managements ineptitude.


User currently offlineTommy767 From United States of America, joined Aug 2003, 6584 posts, RR: 11
Reply 22, posted (5 years 1 week 14 hours ago) and read 5299 times:



Quoting CODC10 (Reply 18):
The net result of the Kellner era at CO has been more-or-less status quo, stay the course. CO has become very good at what they do, but the more you stay the same, the more you fall behind.

Could not have said it better myself. Larry kept the 'bethune image' of the company rolling through his stewardship but did not make any big changes to improve the airlines name. All expansion took place from EWR with TATL 757s (and if you ask me they went a little overboard) addition of the Q400s from EWR (good idea) and some cutbacks from CLE (huge mistake) when it had been said in press releases that CLE was supposed to aleviate traffic from EWR and it never happened. He also turned down the deal with UA (controversial. seems like many A.netters were divided) and business class catering slightly detiorated. Plus from the time he took the position CO SHOULD HAVE installed new businessfirst seats. A few years ago it wasn't much of an issue but NOW the product for sure lacking.



"Folks that's the news and I'm outta here!" -- Dennis Miller
User currently offlineMasseyBrown From United States of America, joined Dec 2002, 5372 posts, RR: 7
Reply 23, posted (5 years 1 week 14 hours ago) and read 5272 times:

The actual reductions will apparently affect the *people* at EWR, since they are relatively junior; but where will the lost positions be? Spread around the system or concentrated somewhere?

Last September EWR was spared much of a reduction when IAH and CLE took most of the hit. EWR was protected last year when the possible loss of slots was an issue, but now that that risk is over, this year might be EWR's turn.

Plan B: closing CLE could probably accomplish some (half?) of the crew number and most of the non-flying staff reduction. That has to be a possibility as well.

Opinions?



I love long German words like 'Freundschaftsbezeigungen'.
User currently offlineIAHERJ From United States of America, joined Jun 2001, 677 posts, RR: 7
Reply 24, posted (5 years 1 week 13 hours ago) and read 5212 times:

Kellner always knew the cost of everything at CAL but the value of nothing. Morale is at a 10 year low and it is starting to show. CAL sits at the BOTTOM of its peers in terms of yields now. A place CAL has not occupied since the pre Gordon Bethune days. Our 2nd quarter loss can almost entirely be traced to the fuel hedging decisions made by basically 1 man almost a year ago. Is this person going to be with us in the Fall when 500 reservation agents are displaced(most will be unemployed) and around 750 FA's are either voluntarily released or furloughed involuntarily along with countless employees who are non-union and will be let go within the next 2 weeks as their is no "process" for reducing their numbers like there is for unionized employees(who end up in the same unemployment line anyway). At the pilot training center this week(I had 2 days of recurrent simulator) I spoke to 2 junior first officers who were going through their recurrent checks. With noses in the books, trying not to mess up their checkrides all the while aware that in a few months they might be unemployed. I feel for all these people from all over the airline. Not a single work group that I know of has had its concessions given back. All the while Larry and Jeff and the other senior management types celebrated in 2006(in the form of options worth millions) just months after the final concessions were given back by the mechanics/flight attendants/dispatchers, and pilots(to the tune of around 250 million annually). Now Larry will walk with something in the amount of 20 million dollars(10 million in severance) after 5 years of service as the CEO. The rest of us will be here for decades to come and will walk with whatever we have saved(no set amounts) in our "retirement" plans.

This is not just a CAL thing. This is a Corporate America thing. Get yours, because you can be sure the leadership of the company will get theirs. What sucks is that CAL has always played this "working together" card. In my opinion, CAL has become the most anti-labor airline in the industry. And this from someone who is not in jeopardy of being laid off(this time).



Actually flown: EMB-120 EMB-145 B717 B737 B757 B767
25 COflyerBOS : As a loyal CO flyer and fan, I hate reading this news. I wish the best for all who are going to be affected negatively in the next few weeks.
26 Tommy767 : My dad was on a MCO-EWR flight last month accidently got up while a flight attendent was trying try to pass (no cart) and didn't realize he stepped i
27 LAXintl : Nice comments and all, but what do you suggest Continental do, loose even more money by inaction? Yes they lost a boat load due to under water hedges
28 Max Q : Well, times are tough and we are paying the price for managements mistakes. Having said that, and despite being as pro union as any Cal Pilot I think
29 DualQual : Showing some unity for the first time since 1983. There are plain red bands available as well if you don't fancy the FUPM. Just get behind the messag
30 Max Q : I understand the intent, Dual Qual but don't you think actions are more important than symbols ?
31 Atlaaron : Fight for what? What do you honestly think the outcome will be? It's just going to pull labor and management further apart and labor further from get
32 DualQual : Actions are the cornerstone of our contract efforts but symbols are a constantly visible display of our cause. I expect the outcome to be an industry
33 Max Q : I've seen endless amounts of stickers / badges etcand they have never made an iota of difference except for wasting our union dues which, of course we
34 MaverickM11 : Pilots aren't, precisely because of things like that.
35 FlyASAGuy2005 : Full flights don't always equal profits..as the case with this quarter's earnings. DL has seen it's highest LFs in years due to reduced capacity, tig
36 Fxramper : Sorry to the CO guys and gals. I fear my airline is next for the chop block.
37 Av8r915 : Hedging when oil was below $40 a barrel several months ago would have been a start. They aren't the pilots (at least not these days) Kellner's gettin
38 LAXintl : An even riskier and quite unlikely decision. The forward pricing curve is currently upwards and has been so for several months, so in other words fut
39 MaverickM11 : Did you put your money into the market then? Yep, they are, at any carrier other than the regionals.
40 777STL : No sympathy here. I never understood why airline employees think they're special and thus should be immune to the market forces of the economy. If Pre
41 Post contains links Av8r915 : Yes, I pumped up my 401k during that down market and I have seen some good results recently because of that. I don't know what you're thinking, but a
42 AirframeAS : Is CO even offering any early buyouts before the furlough? If they are not doing that, then why arn't they offering them? Isn't this one of the soluti
43 MaverickM11 : Only the very top, and even then their base salary isn't much higher than pilots; as a percentage pilots are the overwhelming majority of top earners
44 Sbworcs : So even if the company is leaking cash all over the place you believe you should be paid more to help??
45 Av8r915 : Pretty much anyone above middle management out earns the average pilot. On a side note, a Chelsea catering "supervisor" will bump a 30 year Captain w
46 Av8r915 : I don't think you realize that we are currently the cheapest pilots (compared to our peers at UA, DL, NW, US, etc.) when it comes to pay, benefits, w
47 LAXintl : Here is some food for thought for those that feel management is "over paid" In the last 12mos, US Airways has lost 3 execs - General Counsel, CIO, an
48 Jumbojettim : I work for an airline, and by NO means do I think or any of my co-workers feel that we are special. In actuality it is the opposite, we keep taking p
49 MaverickM11 : And now Larry Kellner. I figured. You're dreaming. Middle management would love to get compensated as well as pilots and only work pilot hours. A sec
50 Av8r915 : Great, more power to them! If they are that talented, then I'd hope they'd go where they can benefit the most. However, I don't think that most airli
51 Av8r915 : He hasn't been that great of a leader, so farewell! Thanks for the sarcasm! Because I now invest conservatively, I'm now way ahead (percentage-wise)
52 Sbworcs : I did not state that it was the Pilots that are causing the leaking of cash I was questioning the viability of asking for more money when the company
53 Av8r915 : In my opinion, I don't think anything pay-wise will change for a while. The furlough letters & "FUPM" bracelets are posturing for negotiations which
54 CODC10 : On which planet is this?
55 CO767FA : BFD - With the current financial meltdown, these execs are a dime a dozen- so many qualified people with the credentials these "execs" carry, US is p
56 CODC10 : Whoops, missed 'captain'. Disregard...
57 Boeing12345 : That is standard company wide, not just for the pilot group. For what it's worth I don't understand why either. I came from a job where I had coverag
58 LAXintl : Maybe, but the point is airlines are challenged and often disadvantaged when it comes to competing with rest of America for business talent. The indu
59 Crash65 : Dreaming? Really? Your posts are so rife with generalizations and assumptions, that they prove without a shadow of a doubt, that you have little to n
60 MaverickM11 : No, but that's life, and not really a fair comparison because pilots are not CEOs. Compared to middle management however--the ones pilots think are r
61 NYC2theworld : Pilots, like middle management (for the most part) get to leave work completely at the office (or airport) when they walk out of the building. Try ask
62 Crash65 : What is a three week vacation?
63 Lowrider : Really? So that time I spend at home preping for checkrides, ground schools, trying to keep up on the revisions to various manuals, and simply re-adj
64 Doug_or : I wonder how many unicorns those 2nd year captains could buy with their 120K?
65 MaverickM11 : Don't forget your commute to/from work...or the stress of work on your life...or the fear of layoffs...or paying the mortgage on your home...or avoid
66 Lowrider : Thanks for helping me make my point. Some things from the job do follow you home, just like almost any other job. Did you find a count of how many se
67 MaverickM11 : Do you think a more rigid, expensive contract is going to improve pilots' upward mobility?
68 Lowrider : More expensive? No. More rigid? Perhaps. Denpends on what you change in the document. Got a copy of the Continental contract? If I had a couple of we
69 CO767FA : So what's the point - the poor C_O should be paid an exorbitant amount of money because they are doing their job? Why do they deserve 600x the lowest
70 CALTECH : The airlines are only starting to feel the pain. This recession is not over, nor has reached bottom. It is not unfeasible that Continental may file fo
71 MaverickM11 : I'm pretty sure no pilot union is negotiating for a lower pay package and/or more relaxed work rules. I can guarantee you a union doesn't improve fle
72 Lowrider : I don't recall ever using the phrase "less expensive". Depends on what sort of flexibility you are talking about. I am familiar with circumstances wh
73 Valkyrie01 : How much revenue does cargo bring in?
74 Aeropix : How far back are they furloughing in CO? What's the most junior hire date going to be if the 310 additional are let go?[Edited 2009-07-27 01:46:39]
75 FUN2FLY : Here's my thoughts on the pilots. CO started the year w/351 mainline jets. Will end the year with 337. Take this 4% reduction in units, plus lower fly
76 CO767FA : Whose flexibility -management or front line?
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