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Bankruptcy Judge Voids APA AMR Contract  
User currently offlineAA94 From United States of America, joined Aug 2011, 605 posts, RR: 2
Posted (2 years 3 months 2 weeks 4 days ago) and read 18510 times:

A bankruptcy judge just granted American the right to cancel the APA Pilots contract. The APA represents around 8,000 AA pilots.

Specific details are spotty, but an explanation of today's hearing agenda can be found here: http://aviationblog.dallasnews.com/2...ith-american-airlines-pilots.html/

UPDATE with link: http://aviationblog.dallasnews.com/2...toss-out-its-pilots-contract.html/

[Edited 2012-09-04 15:10:36]


Choose a challenge over competence / Eleanor Roosevelt
124 replies: All unread, showing first 25:
 
User currently offlinesonomaflyer From United States of America, joined Apr 2010, 1888 posts, RR: 0
Reply 1, posted (2 years 3 months 2 weeks 4 days ago) and read 18418 times:
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An expected result. So now AA will impose a contract consistent with its renewed application. Is it safe to assume this would be considered a "temporary" contract with no fixed term while the sides try to reach a long term deal?

User currently offlineLAXdude1023 From India, joined Sep 2006, 7808 posts, RR: 25
Reply 2, posted (2 years 3 months 2 weeks 3 days 23 hours ago) and read 18242 times:

Just when you thought things at AA couldn't get more cuddly.


Stewed...Lewd...Crude...Irreverent...Belligerent
User currently offlineMir From United States of America, joined Jan 2004, 21865 posts, RR: 55
Reply 3, posted (2 years 3 months 2 weeks 3 days 23 hours ago) and read 18070 times:

I assume this means that if things turn around at AA and the company is doing really well several years down the road, the pilots can go to a judge to get their contract voided and have newer conditions more favorable to them imposed?

Rhetorical question, of course.

Quoting LAXdude1023 (Reply 2):
Just when you thought things at AA couldn't get more cuddly.

Yeah, it's going to get pretty ugly over there.

-Mir



7 billion, one nation, imagination...it's a beautiful day
User currently offlineBlueDanube From United States of America, joined May 2012, 20 posts, RR: 0
Reply 4, posted (2 years 3 months 2 weeks 3 days 23 hours ago) and read 18005 times:

Quoting Mir (Reply 3):
I assume this means that if things turn around at AA and the company is doing really well several years down the road, the pilots can go to a judge to get their contract voided and have newer conditions more favorable to them imposed?

If only....


User currently offlinetugger From United States of America, joined Apr 2006, 5785 posts, RR: 10
Reply 5, posted (2 years 3 months 2 weeks 3 days 23 hours ago) and read 17865 times:

Quoting Mir (Reply 3):
I assume this means that if things turn around at AA and the company is doing really well several years down the road, the pilots can go to a judge to get their contract voided and have newer conditions more favorable to them imposed?

Rhetorical question, of course.

Hey, if the pilots actually take an ownership option in AA then they absolutely could do that. Of course they would have to declare bankruptcy again which would destroy their investment but they could do it! Because it is just such an easy option....

Quoting Mir (Reply 3):
Yeah, it's going to get pretty ugly over there.

There? How about here!

Tugg



I don’t know that I am unafraid to be myself, but it is hard to be somebody else. -W. Shatner
User currently offlinealuminumtubing From United States of America, joined Jul 2008, 367 posts, RR: 12
Reply 6, posted (2 years 3 months 2 weeks 3 days 9 hours ago) and read 16432 times:

Things are in chaos right now. The APA has notified management that they will not meet with them to discuss the 1113 terms. AA must now manage 8000 pilots independently with whatever terms they decided to impose. That alone could prove entertaining. I have no clue what is going to happen. I do know for sure, that the UCC wants a mutually agreed upon contract, as their attorney stated as much during the proceeding. So, this is all temporary. How long, I honestly don't know. But either something happens or AA slowly dies on the vine. That's it in a nutshell.

User currently offlineRevelation From United States of America, joined Feb 2005, 12961 posts, RR: 25
Reply 7, posted (2 years 3 months 2 weeks 3 days 9 hours ago) and read 16362 times:

Seems like this thread has a few hours priority over the one I started:

Judge Allows AMR To End Pilot Contract (by Revelation Sep 4 2012 in Civil Aviation)

Might I suggest the title include AA or AMR in the title as well as APA?



Inspiration, move me brightly!
User currently offlineXFSUgimpLB41X From United States of America, joined Aug 2000, 4229 posts, RR: 37
Reply 8, posted (2 years 3 months 2 weeks 3 days 5 hours ago) and read 14506 times:

The operation could (and should) spiral into a train wreck. Everyone knows that the best way to run a company is to make your employees absolutely miserable!

AA pilots gave a lot to keep the company out of bankruptcy almost a decade ago, and the management team has been completely inept at running a viable company. Ridiculous that this came to court ordered ability to abrogate a contract... If terms are actually imposed, the pilots need to send a sharp reminder on the things they do to help the operation speed along every day.



Chicks dig winglets.
User currently offlinePHX787 From Japan, joined Mar 2012, 7959 posts, RR: 19
Reply 9, posted (2 years 3 months 2 weeks 3 days 5 hours ago) and read 14467 times:

So given the fact that the APA approved the US proposal, is this more or less an open door, as far as pilots are concerned, for DP's ambitions? Or am I mistaken?


Follow me on twitter: www.twitter.com/phx787
User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 10, posted (2 years 3 months 2 weeks 3 days 5 hours ago) and read 14391 times:

Quoting PHX787 (Reply 9):
So given the fact that the APA approved the US proposal, is this more or less an open door, as far as pilots are concerned, for DP's ambitions? Or am I mistaken?

My understanding is that the APA MEC has approved a term sheet with Parker. It is now, yet, however been voted on by the APA membership.


User currently offlineStitch From United States of America, joined Jul 2005, 31417 posts, RR: 85
Reply 11, posted (2 years 3 months 2 weeks 3 days 4 hours ago) and read 14143 times:
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Quoting tugger (Reply 5):
Hey, if the pilots actually take an ownership option in AA then they absolutely could do that. Of course they would have to declare bankruptcy again which would destroy their investment but they could do it!

If they're on the BoD, they can just attempt to vote in a more lucrative contract. UA's labor groups successfully did so with their BoD spots when they had partial ownership of the company.


User currently offlineTVNWZ From United States of America, joined Feb 2006, 2413 posts, RR: 2
Reply 12, posted (2 years 3 months 2 weeks 3 days 3 hours ago) and read 13209 times:

Quoting Stitch (Reply 11):

Good example. And how did that work out?


User currently offlineFlaps From United States of America, joined Feb 2000, 1300 posts, RR: 4
Reply 13, posted (2 years 3 months 2 weeks 3 days 2 hours ago) and read 12633 times:

Quoting XFSUgimpLB41X (Reply 8):
AA pilots gave a lot to keep the company out of bankruptcy almost a decade ago, and the management team has been completely inept at running a viable company.

And they did that out of the goodness of their hearts and their concerns over the long term viability of the company and all of their fellow coworkers? Allow me to call bullsh@t on that. They did it to protect their own behinds and nothing more. AA took a gamble by staying out of bankruptcy as long as they did. They tried to protect their shareholders and their employees by not wiping out pensions and investments through the courts. This was a noble effort and well thought of at the time by those same groups that are now vilifying them for not doing so. AA took a chance and they lost. That is unfortunate but it is what it is. Had it been successful, no doubt the pilots would be claiming all the credit just as they are now dishing out the blame.


User currently offlineavek00 From United States of America, joined Oct 2004, 4417 posts, RR: 19
Reply 14, posted (2 years 3 months 2 weeks 3 days 1 hour ago) and read 12300 times:

Quoting commavia (Reply 10):
My understanding is that the APA MEC has approved a term sheet with Parker. It is now, yet, however been voted on by the APA membership.

The US term sheet is effectively dead for the pilots now -- Parker would be a fool to stick to it now that the bankruptcy court has allowed AMR to alter the economic baselines sharply downward.



Live life to the fullest.
User currently onlineMaverick623 From United States of America, joined Nov 2006, 5738 posts, RR: 6
Reply 15, posted (2 years 3 months 2 weeks 3 days 1 hour ago) and read 12180 times:

Quoting Flaps (Reply 13):
And they did that out of the goodness of their hearts and their concerns over the long term viability of the company and all of their fellow coworkers?
Quoting Flaps (Reply 13):
They did it to protect their own behinds and nothing more.

First of all, it is silly to make financial decisions based purely out of the "goodness of your heart".... it is a quick way to lose everything.

The pilots took the pay cut to avoid having something like this happen. Unfortunately, instead of being pumped back into the operation, the money saved went straight into the executive's pockets.

Quoting Flaps (Reply 13):
This was a noble effort and well thought of at the time

Just shows how foolish those people were.

Quoting Flaps (Reply 13):
Had it been successful

It wasn't ever going to be successful, because it's not. But that's ok, we can let management take all the credit for all the good, and blame the pilots for trying to save their careers by giving up money, saying it actually hurt the company.



"PHX is Phoenix, PDX is the other city" -777Way
User currently offlineFlaps From United States of America, joined Feb 2000, 1300 posts, RR: 4
Reply 16, posted (2 years 3 months 2 weeks 2 days 23 hours ago) and read 11530 times:

Quoting Maverick623 (Reply 15):
It wasn't ever going to be successful, because it's not. But that's ok, we can let management take all the credit for all the good, and blame the pilots for trying to save their careers by giving up money, saying it actually hurt the company.

My point is this:

The pilots and management (and plenty of others) are all responsible here. The pilot group was not heroic when they took the cuts. They were trying to save their bacon nothing more nothing less. Very hypocritical to come back now and whine about their terrible sacrifices of the past. Even their own union came under suit during that fiasco. In acting this way now they come across as whiny and spoiled brats. I have been pilot, manager and consultant in this industry for 25 years and have been seated at every place around the table through these types of "negotiations". While there is plenty of blame to go around on all sides/parties to the AA debacle, from a public perspective the pilot posturing has been the most immature. The pilots' concerns about their future are real and valid. For that I have empathy. Their juvenile posturing however elicits no sympathy from me.
For the record, I too invested close to 100G for my education. When things turned south for the industry I (as well as many others) looked ahead and decided get out and invest those talents elsewhere. Others chose to gamble and stay with flying. Each of those groups made a choice and each much live with the consequences. I loved flying but when it no longer fed the kids I had to make a choice. I chose to feed the family and give up a lifelong passion. It was a painful choice. Others chose the risk and for some it worked great and others it didn't. That is now turning out for many to be a painful choice. If you want to work in the industry by all means do so. If you want to make big bucks by all means do so, good luck trying to make money in this business though, those days are OVER FOR GOOD.

Its long past time for finger pointing. It is time to put aside the egos and rationally try to salvage what is left of AA for the sake of all at AA and the industry itself. While another merger may be doable the loss of a combined AA/US would devastate the industry. I envision the failure of the combined entity due to weak management and poor labor relations at both companies. They cant get their act together as individual entities. They will never be able to successfully operate the combined franchise. Does anyone remember the Bonanza/Pacific/West Coast into Airwest debacle? Ok, Im off my soapbox, flame away!!!!!


User currently offlineTVNWZ From United States of America, joined Feb 2006, 2413 posts, RR: 2
Reply 17, posted (2 years 3 months 2 weeks 2 days 21 hours ago) and read 11312 times:

Quoting avek00 (Reply 14):
The US term sheet is effectively dead for the pilots now -- Parker would be a fool to stick to it now that the bankruptcy court has allowed AMR to alter the economic baselines sharply downward.

I'm afraid the investors would insist on the AMR deal. Parker would be out in a flash.


User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17824 posts, RR: 46
Reply 18, posted (2 years 3 months 2 weeks 2 days 19 hours ago) and read 11050 times:

Quoting TVNWZ (Reply 17):
Quoting avek00 (Reply 14):
The US term sheet is effectively dead for the pilots now -- Parker would be a fool to stick to it now that the bankruptcy court has allowed AMR to alter the economic baselines sharply downward.

I'm afraid the investors would insist on the AMR deal. Parker would be out in a flash.


Why? Parker is a much more capable leader than Horton, who so far has been little more than tone deaf and hapless.

Quoting Maverick623 (Reply 15):
The pilots took the pay cut to avoid having something like this happen. Unfortunately, instead of being pumped back into the operation, the money saved went straight into the executive's pockets.

False. AA simply lost *less* money than it would have otherwise. There was no "money saved" to divert.



E pur si muove -Galileo
User currently onlineMaverick623 From United States of America, joined Nov 2006, 5738 posts, RR: 6
Reply 19, posted (2 years 3 months 2 weeks 2 days 15 hours ago) and read 10822 times:

Quoting Flaps (Reply 16):
It is time to put aside the egos and rationally try to salvage what is left of AA for the sake of all at AA and the industry itself.

I really have a hard time following your logic. You say that the pilots took concessions to "save their bacon", then go after them when they still get screwed over and complain about it?

Quoting MaverickM11 (Reply 18):
False.

Erm, no. For starters, it's really no secret to us in the industry that directors and above get nice bonuses everytime they realize a cost savings. That's not a bad thing in and of itself, but as we've seen, the goal now has become getting the bonuses, everything else be damned.

BTW, you guys are aware that by steering the company into bankruptcy, Horton stands to make millions of dollars in bonuses? Hardly inspires confidence that any of the suits actually cares about anything other than their beloved bonuses.



"PHX is Phoenix, PDX is the other city" -777Way
User currently offlineRDH3E From United States of America, joined Mar 2011, 1823 posts, RR: 3
Reply 20, posted (2 years 3 months 2 weeks 2 days 2 hours ago) and read 10449 times:

Quoting Maverick623 (Reply 19):
I really have a hard time following your logic. You say that the pilots took concessions to "save their bacon", then go after them when they still get screwed over and complain about it?

Yes, he is saying that. I would say, given their completely uncompetive pilot agreement (even after their concessions) compared to the agreements of their peers, the pilots were completely unwilling to "give" more. Even though it would've just gotten them back to average. It's not just $/hour like you'll probably come back with, it's work rules and scope clauses that killed AMR.

Quoting Maverick623 (Reply 19):
BTW, you guys are aware that by steering the company into bankruptcy, Horton stands to make millions of dollars in bonuses?

Sorry, you're so wrong. Horton LOST millions the day they declared bankrupcy. He had millions on millions of dollars in stock options which were sent to zero by that decision. He personally will come out of this with a 7 figure negative without a doubt.


User currently offlineXFSUgimpLB41X From United States of America, joined Aug 2000, 4229 posts, RR: 37
Reply 21, posted (2 years 3 months 2 weeks 2 days 1 hour ago) and read 10349 times:

Quoting RDH3E (Reply 20):
Yes, he is saying that. I would say, given their completely uncompetive pilot agreement (even after their concessions) compared to the agreements of their peers, the pilots were completely unwilling to "give" more. Even though it would've just gotten them back to average. It's not just $/hour like you'll probably come back with, it's work rules and scope clauses that killed AMR.

AMR's work rules are hardly better than DLs, and their payrates and soft money (work rule bonuses and such) are considerably lower.



Chicks dig winglets.
User currently offlineRDH3E From United States of America, joined Mar 2011, 1823 posts, RR: 3
Reply 22, posted (2 years 3 months 2 weeks 2 days 1 hour ago) and read 10300 times:

Quoting XFSUgimpLB41X (Reply 21):

AMR's work rules are hardly better than DLs, and their payrates and soft money (work rule bonuses and such) are considerably lower.

Like no ULH flying? And you conveniently ignored Scope...


User currently offlineTVNWZ From United States of America, joined Feb 2006, 2413 posts, RR: 2
Reply 23, posted (2 years 3 months 2 weeks 2 days ago) and read 10233 times:

Quoting MaverickM11 (Reply 18):
Why? Parker is a much more capable leader than Horton, who so far has been little more than tone deaf and hapless.

Because the cost differential would probably not work. Leadership to Wall Street is the fortitude to stick it to whomever to make the company more profitable. And I don't write that in a negative sense. If you are a leader who has great raport with the employees and they think you are a god, but you can not deliver the number, you're out. If you are a hard nosed, could care less about what people think of you and make an outstanding profit, you're in. And rewarded.


User currently offlineRevelation From United States of America, joined Feb 2005, 12961 posts, RR: 25
Reply 24, posted (2 years 3 months 2 weeks 2 days ago) and read 10153 times:

Quoting MaverickM11 (Reply 18):
AA simply lost *less* money than it would have otherwise. There was no "money saved" to divert.

And yet the bonuses got paid, but you knew that...

Quoting RDH3E (Reply 20):
Sorry, you're so wrong. Horton LOST millions the day they declared bankrupcy. He had millions on millions of dollars in stock options which were sent to zero by that decision. He personally will come out of this with a 7 figure negative without a doubt.

Potential gain is just that, potential.

Quoting TVNWZ (Reply 23):
Leadership to Wall Street is the fortitude to stick it to whomever to make the company more profitable. And I don't write that in a negative sense. If you are a leader who has great raport with the employees and they think you are a god, but you can not deliver the number, you're out. If you are a hard nosed, could care less about what people think of you and make an outstanding profit, you're in. And rewarded.

And that leads the execs to stuff their pockets as fast as they can, and when they bail out with their golden parachute or get kicked out, the next poor b*st*rd has to come along and deal with the mess.



Inspiration, move me brightly!
User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17824 posts, RR: 46
Reply 25, posted (2 years 3 months 2 weeks 1 day 23 hours ago) and read 10309 times:

Quoting Maverick623 (Reply 19):
Erm, no. For starters, it's really no secret to us in the industry that directors and above get nice bonuses everytime they realize a cost savings

It's possible they received bonuses as part of their compensation plan but a) that's fairly standard and b) it's small change compared to the cost wedge that separated AMR from the rest of the industry.

Quoting TVNWZ (Reply 23):

Because the cost differential would probably not work. Leadership to Wall Street is the fortitude to stick it to whomever to make the company more profitable. And I don't write that in a negative sense. If you are a leader who has great raport with the employees and they think you are a god, but you can not deliver the number, you're out. If you are a hard nosed, could care less about what people think of you and make an outstanding profit, you're in. And rewarded.

I'm not sure how any of that would support Horton, who I'm not sure a single sentient being has any faith in at this point.

Quoting Revelation (Reply 24):

And yet the bonuses got paid, but you knew that...

What are you referring to? The stock options? Or standard middle management bonuses?



E pur si muove -Galileo
User currently offlineRevelation From United States of America, joined Feb 2005, 12961 posts, RR: 25
Reply 26, posted (2 years 3 months 2 weeks 1 day 23 hours ago) and read 10273 times:

Quoting MaverickM11 (Reply 25):
The stock options? Or standard middle management bonuses?

Bonuses can be made up of cash and/or stock options, and if they are indeed bonuses, they are tied to performance metrics.



Inspiration, move me brightly!
User currently offlinetugger From United States of America, joined Apr 2006, 5785 posts, RR: 10
Reply 27, posted (2 years 3 months 2 weeks 1 day 23 hours ago) and read 10468 times:

Quoting Revelation (Reply 24):
And that leads the execs to stuff their pockets as fast as they can, and when they bail out with their golden parachute or get kicked out, the next poor b*st*rd has to come along and deal with the mess.

Weren't the pilots offered the same bonuses (they were based on stock performance I believe)?

TUgg



I don’t know that I am unafraid to be myself, but it is hard to be somebody else. -W. Shatner
User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17824 posts, RR: 46
Reply 28, posted (2 years 3 months 2 weeks 1 day 23 hours ago) and read 10413 times:

Quoting Revelation (Reply 26):
Quoting MaverickM11 (Reply 25):
The stock options? Or standard middle management bonuses?

Bonuses can be made up of cash and/or stock options, and if they are indeed bonuses, they are tied to performance metrics.

Why shouldn't they have been paid if they met the performance metrics?



E pur si muove -Galileo
User currently offlineHPRamper From United States of America, joined May 2005, 4144 posts, RR: 8
Reply 29, posted (2 years 3 months 2 weeks 1 day 20 hours ago) and read 10228 times:

Quoting TVNWZ (Reply 23):
If you are a leader who has great raport with the employees and they think you are a god, but you can not deliver the number, you're out. If you are a hard nosed, could care less about what people think of you and make an outstanding profit, you're in. And rewarded.

Not always. At Fedex Express there is a policy of PSP which starts with taking care of your people first, which in turn results in better service, which brings and keeps customers driving profit.

The company continually reinvests in the employee group in various ways which is why the investor returns are not as high as they could be.
Wall Street knows this and doesn't really seem to vilify the company for it.


User currently offlineXFSUgimpLB41X From United States of America, joined Aug 2000, 4229 posts, RR: 37
Reply 30, posted (2 years 3 months 2 weeks 1 day 19 hours ago) and read 10138 times:

Quoting RDH3E (Reply 22):
Like no ULH flying? And you conveniently ignored Scope...

The only reason there is no ULH flying is because negotiations stalled.

Scope is on par with CAL... they've done just fine the past 10 years, wouldn't you say?



Chicks dig winglets.
User currently offlineLDVAviation From United States of America, joined exactly 6 years ago today! , 1116 posts, RR: 5
Reply 31, posted (2 years 3 months 2 weeks 1 day 19 hours ago) and read 10115 times:

Quoting XFSUgimpLB41X (Reply 30):
Scope is on par with CAL... they've done just fine the past 10 years, wouldn't you say?

Nope... Scope was starting to squeeze them too. See what they tried to do at Newark once they could operate under United's scope clause.

Continental only did well because their pilots were among the lowest paid, but the most productive. AA pilots would know nothing about that.


User currently offlineXFSUgimpLB41X From United States of America, joined Aug 2000, 4229 posts, RR: 37
Reply 32, posted (2 years 3 months 2 weeks 1 day 18 hours ago) and read 9973 times:

Quoting LDVAviation (Reply 31):
Nope... Scope was starting to squeeze them too. See what they tried to do at Newark once they could operate under United's scope clause.

Continental only did well because their pilots were among the lowest paid, but the most productive. AA pilots would know nothing about that.

Not really... what they tried to do at newark was just cheaper flying, so of course they would take advantage of it. CAL was doing just fine. Not because of their pilots productivity- which didnt hurt, nor their pay (their pay has been about mid range of the legacies the past decade), but because it was an exceptionally well run airline with a great network.



Chicks dig winglets.
User currently offlineSJUSXM From United States of America, joined Aug 2006, 294 posts, RR: 0
Reply 33, posted (2 years 3 months 2 weeks 1 day 16 hours ago) and read 9840 times:

Quoting Revelation (Reply 24):
And yet the bonuses got paid, but you knew that

The bonuses the APA was offered, and APA agreed to let management have. However wrong they may have been to most pilots, the APA agreed to it.

Quoting XFSUgimpLB41X (Reply 30):
Scope is on par with CAL... they've done just fine the past 10 years, wouldn't you say

Well, being that they are now United, no. Just like I would say AA is not doing well if US takes them over.

Plus a major component of how scope is hurting AA is how UA is employing their large regionals in ORD. CO didn't have that problem in fortress IAH, EWR or the RJ city that is CLE.



AT7, ER3, ER4, ER5, CR7, E70, E75, F100, M82, M83, 722, 732, 738, 752, 762, 763, AB6, 320, 321, 772, 77W
User currently offlineRDH3E From United States of America, joined Mar 2011, 1823 posts, RR: 3
Reply 34, posted (2 years 3 months 2 weeks 1 day 7 hours ago) and read 9601 times:

Quoting XFSUgimpLB41X (Reply 30):
Scope is on par with CAL... they've done just fine the past 10 years, wouldn't you say?
Quoting XFSUgimpLB41X (Reply 32):
what they tried to do at newark was just cheaper flying

They did fine, but were absolutely being squeezed. They had one of the highest CASM's in the industry. To your second comment, what they actually did was bring 70 seaters in where they could in order to better serve markets and simultaneously reduce casm. That's not "just cheaper flying" it's a strategic shift.

AA didn't have that luxury and thus whenever they faced direct Eagle vs UAX/DL CX/USX competition they were at an immediate disadvantage because their competitor COULD have brought in bigger jets, regardless of whether they actually did or not.


User currently offlineTWA85 From United States of America, joined Feb 2012, 226 posts, RR: 0
Reply 35, posted (2 years 3 months 2 weeks 1 day 5 hours ago) and read 9456 times:

Quoting XFSUgimpLB41X (Reply 32):
Not really... what they tried to do at newark was just cheaper flying, so of course they would take advantage of it. CAL was doing just fine. Not because of their pilots productivity- which didnt hurt, nor their pay (their pay has been about mid range of the legacies the past decade), but because it was an exceptionally well run airline with a great network.



CO did fine with their scope agreements because they didn't have to compete with UA at ORD, DL at JFK and both UA and DL at LAX, with their limited scope agreements like AA did. In all three of the previously mentioned markets AA had the tough choice of allocating a higher cost mainline aircraft in a market where UA and DL were allocating a lower cost regional aircraft which would make it tough for AA to compete or allocate a smaller lower yielding regional aircraft in a market where UA and DL were allocating larger higher yielding regional aircraft which limit the amount of AA revenue growth vs UA and DL in those same exact market. Yes CO at EWR competed with both AA and DL at JFK, however CO had the dominant size at EWR to off set the lack of revenue that AA does not have at JFK or ORD. As for CLE, CO was able to remain marginally competitive due to the smaller market that CLE is, resulting in lack of demand for larger regional aircraft. Then the only remaining market where CO had to compete with their limited scope agreement was at IAH vs. AA at DFW, and CO was only competitive with AA in TX because AA had a similar scope agreement. As soon as CO merged with UA, they re-allocated ALOT of larger higher yielding regional aircraft from UA to EWR and IAH to take advantage of increased revenue opportunities and re-allocated the smaller lower yielding regional aircraft from CO to hubs like IAD, CLE and DEN, where there was not as much need for the larger higher yielding regional aircraft.

Long story short, CO only did OK with its limited scope agreements because their network didn't require the use of larger regional jets. Although as soon as larger regional jets became available, they jumped on the opportunity to use them. Just like AA would have.


User currently offlinetoltommy From United States of America, joined Dec 2003, 3308 posts, RR: 5
Reply 36, posted (2 years 3 months 2 weeks 1 day 4 hours ago) and read 9370 times:

Quoting HPRamper (Reply 29):
At Fedex Express there is a policy of PSP which starts with taking care of your people first, which in turn results in better service, which brings and keeps customers driving profit.

Comparing Fedex to an airline of any kind is like comparing apples and bricks. Fedex doesn't face the cost pressures an airline does. As a frequent Fedex user, I can tell you that the price to ship an overnight letter only goes up, not down. There's no Orbitz type website to compare the price to ship a package via various companies. Airlines OTOH can be price shopped very easily, and fares continue to drop.


User currently offlineHPRamper From United States of America, joined May 2005, 4144 posts, RR: 8
Reply 37, posted (2 years 3 months 2 weeks 1 day 4 hours ago) and read 9350 times:

Quoting toltommy (Reply 37):
Comparing Fedex to an airline of any kind is like comparing apples and bricks. Fedex doesn't face the cost pressures an airline does. As a frequent Fedex user, I can tell you that the price to ship an overnight letter only goes up, not down. There's no Orbitz type website to compare the price to ship a package via various companies. Airlines OTOH can be price shopped very easily, and fares continue to drop.

Fedex is first and foremost an airline, before it is a delivery company. It faces margins that are every bit as thin as a passenger airline. And why should the financial habits of a company dictate or justify how they treat employees?


User currently offlineTWA85 From United States of America, joined Feb 2012, 226 posts, RR: 0
Reply 38, posted (2 years 3 months 2 weeks 1 day 4 hours ago) and read 9308 times:

Quoting HPRamper (Reply 38):

Fedex is first and foremost an airline, before it is a delivery company. It faces margins that are every bit as thin as a passenger airline. And why should the financial habits of a company dictate or justify how they treat employees?

Lets put it this way, comparing FedEx and AA is liking comparing BNSF and Amtrak. Yes FedEx and AA are both airlines, however the HUGE AND ONLY difference between them is, a pallet of freight doesn't complain where as a passenger does if they are not treated right. FedEx does not need to provide there customers with in flight WiFi and entertainment or Food and Beverages. The cost savings of not having to provide these services allows FedEx to invest more funds into its employees. Also FedEx does not need the use of many regional aircraft as anytime an aircraft that is not full leaves an out station, all FedEx needs to do is route that aircraft through other out station to pick up more freight on the way to FedEx distribution centers/hubs. It does not matter how many times a pallet of freight has to stop enroute to its final destination as long as it gets there safely in a timely mannor. The cost savings of much higher asset utilitazatin allows FedEx to further invest more funds in its employees. AA (and any other passanger airline) by far does not have anything close to either of these luxurays.


User currently offlineRevelation From United States of America, joined Feb 2005, 12961 posts, RR: 25
Reply 39, posted (2 years 3 months 2 weeks 1 day 4 hours ago) and read 9282 times:

Quote:
(lots of fedex vs aa comparisons)

C'mon folks, aren't we dragging this too far off-topic?

Any updates on what APA and AMR are doing in response to the judge's decision?

Given how long the judge has given AMR to stay in BK, it seems the status quo just might drag on for quite a while, no?



Inspiration, move me brightly!
User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17824 posts, RR: 46
Reply 40, posted (2 years 3 months 2 weeks 1 day 3 hours ago) and read 9190 times:

Quoting TWA85 (Reply 39):
however the HUGE AND ONLY difference between them is, a pallet of freight doesn't complain where as a passenger does if they are not treated right

Well that and there are essentially only 2 major worldwide freight carriers, where as there are a few more than 2 worldwide network carriers.



E pur si muove -Galileo
User currently offlinemcdu From United States of America, joined Apr 2005, 1487 posts, RR: 17
Reply 41, posted (2 years 3 months 2 weeks 23 hours ago) and read 9013 times:

Quoting Flaps (Reply 16):
I have been pilot, manager and consultant in this industry for 25 years and have been seated at every place around the table through these types of "negotiations".

For relevance to the plight of the legacy airline pilots, which carrier did you work for as a pilot?

The armchair analyst that are more than willing to determine path and future for the AA pilots often have never been in the position the AA pilots find themselves.

The legacy pilots have been pulled down due to an industry that has dangled jobs at lower and lower wages with a never ending supply of pilots willing to work for less than the other group. Every time a startup entered the market the bar was lowered on wages and benefits. This became the barometer that the legacy management wanted to negotiate from.

Hardly has an airline manager set their own pay at the level of an upstart company. The greed by the mangers in this industry has been collassal. The unions didn't crater AA. Irresponsible leadership and their consultants have placed AA into CH11. The employees shouldn't be the fix for poor management decisions. Time for these so called mangers to be held accountable for what they have created.


User currently offlineSJUSXM From United States of America, joined Aug 2006, 294 posts, RR: 0
Reply 42, posted (2 years 3 months 2 weeks 23 hours ago) and read 8971 times:

Quoting mcdu (Reply 41):
The legacy pilots have been pulled down due to an industry that has dangled jobs at lower and lower wages with a never ending supply of pilots willing to work for less than the other group. Every time a startup entered the market the bar was lowered on wages and benefits. This became the barometer that the legacy management wanted to negotiate from.

Wages have NEVER been the issue. Each term sheet, including the 1113 implemented sheet has pay raises. It's all about scope and benefits. And it's not just a startup with lower benefits. It's United, Southwest, Delta, Spirit, US Airways, JetBlue, Virgin America, Frontier and every regional in the country. It's not the pilots fault that the industry has changed, but they do need to accept that it has changed. Every other employee at AA has figured this out, even the flight attendants with their harshly anti-management stance have accepted that their lot is better off by accepting the latest term sheet rather than let the judge impose the original proposal.



AT7, ER3, ER4, ER5, CR7, E70, E75, F100, M82, M83, 722, 732, 738, 752, 762, 763, AB6, 320, 321, 772, 77W
User currently onlineincitatus From Brazil, joined Feb 2005, 4068 posts, RR: 13
Reply 43, posted (2 years 3 months 2 weeks 18 hours ago) and read 8807 times:

Quoting mcdu (Reply 41):
Hardly has an airline manager set their own pay at the level of an upstart company.

Why limit to airlines? Typically CEOs of larger, established companies have higher compensation than CEOs of new entrants. I am not saying that is the way it should be, but was your expectation that airlines were going to be an exception? Why?

Quoting mcdu (Reply 41):
The unions didn't crater AA. Irresponsible leadership and their consultants have placed AA into CH11. The employees shouldn't be the fix for poor management decisions. Time for these so called mangers to be held accountable for what they have created.

Airlines are very low-margin businesses and labor costs are a significant share of expenses. If there is one thing that can sink an airline quickly, it is labor costs out of line with competitors. A well-run airline controls labor costs. It does look like that is what American is (finally) trying to do, albeit with a draconian measure. If we are to list bad decisions by American in the past, delaying labor cost reductions would probably be listed on top.



Stop pop up ads
User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 44, posted (2 years 3 months 2 weeks 18 hours ago) and read 8779 times:

Quoting mcdu (Reply 41):
The legacy pilots have been pulled down due to an industry that has dangled jobs at lower and lower wages with a never ending supply of pilots willing to work for less than the other group.

That's the law of supply and demand, not the "fault" of anyone.

Quoting mcdu (Reply 41):
This became the barometer that the legacy management wanted to negotiate from.

... because that became the barometer that investors used to measure legacy management.

Airlines are publicly-traded companies that exist to return value to shareholders, so if other airlines were returning more value to their shareholders by paying their people less, working their people more, and/or just having fewer people per unit of output to begin with, it's not management's "fault" and certainly not "greed" to expect their own labor groups to adjust to that new market reality. That is, after all, management's fiduciary responsibility.

Quoting mcdu (Reply 41):
The unions didn't crater AA.

Nor did management.

Both sides worked very hard to do the right thing. The 2003 deals were extremely painful and difficult, but they absolutely worked - in the short-run. In the period from 2004-2006, AMR was outperforming its legacy peers.

But, in the end, both sides were unwilling to do what was necessary to get AMR to where it needed to be. The AMR mainline unions were, for years, to one extent or another simply unwilling to recognize the new economic reality in which AMR found itself (see your own comment above re: new entrants, continually lower labor costs, etc.). Their denial ranged from the ridiculous (implying Arpey is a murderer) to the comical (implying the company must be cooking the books) to the downright stupid (implying AA's planes are unsafe). Similarly, AMR's management was unwilling, for years, to accept this reality and "pull the trigger" on bankruptcy earlier, after it had already become clear that the 2003 concessions - while real, tangible, and admirable - simply were no longer sufficient for the "new normal" post-Delta/Northwest/United/USAirwayx2 bankruptcies.

Both management and labor deserve blame for what went wrong, and both deserve enormous credit for what went right.

Quoting mcdu (Reply 41):
Irresponsible leadership and their consultants have placed AA into CH11.

Highly oversimplified, and false.

Looking back now in hindsight, it becomes clear from the experiences of Delta, Northwest, United and USAirways in bankruptcy that it ultimately all comes back to the union contracts - the pilots especially, and the mechanics to a lesser extent (FSCs, flight attendants and the other smaller groups were basically just along for the ride). The union contracts are the driver of so many facets of how an airline's business model operates.

And in AMR's case, relative to their post-bankruptcy peers (to say nothing of the non-union and/or new entrant carriers), not only were direct labor costs higher (both because of higher wages, benefits and pension obligations, but also because of lower productivity and/or far less outsourcing), but AMR's revenue generation was also hampered by restrictions and limitations that prevented AMR from doing all the things Delta, Northwest, United and USAirways did post-bankruptcy to become competitive and successful. To name but a few: operating more large RJs, growing internationally, expanding domestic codesharing, reinvesting in their fleets (new and refurbished), and on and on.

Now, none of this is to say that AMR management didn't make plenty of bad decisions and stupid mistakes in the last decade - they absolutely did. I can provide a list of my own - and I'm sure any AA employee can provide their own as well, But even given that, no amount of brilliant leadership was going to change the fact that AMR's costs and revenue-generating capabilities were simply noncompetitive with their post-bankruptcy peers, unless of course you consider filing for bankruptcy to be "leadership." (And I doubt that even the unions, whatever their misgivings about management's decisions, would have called bankruptcy "leadership.")

Quoting mcdu (Reply 41):
The employees shouldn't be the fix for poor management decisions.

First off, again, "poor management decisions" alone did not get AMR where they are. Various forces conspired to put AMR in the financial position it finds itself in. But as to the solution, of course employees should be a part of it. Every single element of the business should. And labor is a big element of the business.

Quoting mcdu (Reply 41):
Time for these so called mangers to be held accountable for what they have created.

Well, the head "manager" the unions blame is now gone. So that's a start on the whole accountability thing.

[Edited 2012-09-07 21:16:52]

User currently offlinemcdu From United States of America, joined Apr 2005, 1487 posts, RR: 17
Reply 45, posted (2 years 3 months 2 weeks 7 hours ago) and read 8598 times:

Quoting incitatus (Reply 43):
Why limit to airlines? Typically CEOs of larger, established companies have higher compensation than CEOs of new entrants. I am not saying that is the way it should be, but was your expectation that airlines were going to be an exception? Why?

Why? Because every time an airline like Vangaurd, AirSouth, Midway, JetTrain, Skybus, MaxJet etc enter a market with wages well below the industry average the management teams come to labor and tell them the labor cost must be reduced to compete. However, the managers are not willing to lower their compensation package to match those of the upstart to help reduce the cost disadvantage between the upstart and the established carrier.

This is the double standard that exist with management and labor at the airlines. A good leader is willing to make a sacrifice to support team. Lead by example and the rest will follow.

In the case of the AA employees, they gave significant concessions to help keep the airline out of bankruptcy previously. AA leadership squandered the good will and pocketed any financial gain these cuts provided while continuing to operate AA as their own personal piggy bank.

This is not about Regional Jets. AA has had the ability to fly the CR7 and they also chose the expensive option of owning Eagle. The slow footed and irresponsible AA management kept Eagle to a point that it had little value and could not be sold. Is that the fault of labor that AA brain trusts could not see what was happening in the industry? Also, I don't believe scope is the answer to solve the AA issues. While I abhor WN they have shown that an airline is not dependent on farming out ones own flying to commuter airlines to be profiable. Also, WN has one of the highest labor cost of any carrier.

The APA has been painted as the bad guy in this deal. However, the term sheet offered to them by AA leadership was so heinous the judge would not even approve it as being worthy of consideration. In fact this entire thread is the result of the AA being forced to modify the terms they presented to the judge. So AA leadership can't even enter a courtroom and present a solid plan. They must be sent back to fix errors and resubmit. How many "do-overs" does an inept leadership team get before the enterprise disappears?


User currently offlineRevelation From United States of America, joined Feb 2005, 12961 posts, RR: 25
Reply 46, posted (2 years 3 months 2 weeks 4 hours ago) and read 8425 times:

Quoting mcdu (Reply 45):
The APA has been painted as the bad guy in this deal. However, the term sheet offered to them by AA leadership was so heinous the judge would not even approve it as being worthy of consideration. In fact this entire thread is the result of the AA being forced to modify the terms they presented to the judge.

My reading of public sources says all that was questionable was the policies on domestic code shares and on furloughs, and that AMR's spokesman has said it will impose most of the more-severe contract terms established in April.

Ref: http://www.washingtonpost.com/busine...-11e1-a93b-7185e3f88849_story.html

Ref: http://www.star-telegram.com/2012/09...udge-says-american-can-reject.html

Quoting mcdu (Reply 45):
So AA leadership can't even enter a courtroom and present a solid plan. They must be sent back to fix errors and resubmit. How many "do-overs" does an inept leadership team get before the enterprise disappears?

While I share your concerns about management salaries and bonuses, which aren't often mentioned when folks talk about how an airline is a business responsible to shareholders, it would have been impossible to predict what the judge would or would not accept, so getting some pushback is not at all unexpected. In fact the judge ruled most of the plan was "soild" (to use your word) and told them exactly what needed to be changed to get his OK.

It's clear to me that the union is now even more committed to toxic future relationships with management.

Add that to a potential merger with US, and AA will become the most toxic work environment of all the majors worldwide.



Inspiration, move me brightly!
User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17824 posts, RR: 46
Reply 47, posted (2 years 3 months 2 weeks 3 hours ago) and read 8395 times:

Quoting mcdu (Reply 45):
AA has had the ability to fly the CR7

A whole what, 50 shells? Whoopie.

Quoting mcdu (Reply 45):

The APA has been painted as the bad guy in this deal. However, the term sheet offered to them by AA leadership was so heinous the judge would not even approve it as being worthy of consideration. In fact this entire thread is the result of the AA being forced to modify the terms they presented to the judge. So AA leadership can't even enter a courtroom and present a solid plan.

The judge accepted pretty much 99% of the agreement. APA is delusional to begin with, but if they think that was a "win", they are getting to North Korean delusional levels.

Quoting mcdu (Reply 45):
they also chose the expensive option of owning Eagle.

It's interesting you're willing to throw Eagle to the whims of the market driving down wages to obscene levels at regionals, but don't see the same thing happening to mainline.

Quoting mcdu (Reply 45):
However, the managers are not willing to lower their compensation package to match those of the upstart to help reduce the cost disadvantage between the upstart and the established carrier.

I am sure AMR management is a special slice of hell, full of analysis paralysis, blindly chasing Harvard MBAs throwing money at them to gate aircraft that a high school grad could do, running regressions no one needs, stuck in a rut of AMR's proud history but doing nothing for the future, and hiring consultants to do the work their own employees should be doing in the first place, but there is a place for good compensation packages to find and retain good employees, and reward them when they meet or exceed their metrics. AMR could probably lose a third of its employees and no one would miss them, but again that's a drop in the bucket compared to labor rates, scope, and work rules.



E pur si muove -Galileo
User currently offline93Sierra From United States of America, joined Apr 2010, 420 posts, RR: 0
Reply 48, posted (2 years 3 months 2 weeks 2 hours ago) and read 8303 times:

Make the pilots unhappy...deal with the results. AA is going to have a lot of MX write ups and the worlds slowest taxi times
My heart goes out to the pilots and hope somehow this gets resolved with the pilots getting what they deserve. Shame on this whole situation.

"American 238 higher is available" ....."xxx center American 238 is fine at 23000"
Burn some gas boys!


User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 49, posted (2 years 3 months 2 weeks 1 hour ago) and read 8172 times:

Quoting mcdu (Reply 45):
Because every time an airline like Vangaurd, AirSouth, Midway, JetTrain, Skybus, MaxJet etc enter a market with wages well below the industry average the management teams come to labor and tell them the labor cost must be reduced to compete.

... because every time one of those airlines entered the market, Wall St went to management teams at the legacy airlines and said, "why are you paying your people more for doing the same job?"

Quoting mcdu (Reply 45):
In the case of the AA employees, they gave significant concessions to help keep the airline out of bankruptcy previously.

Significant, yes, along with painful, difficult and admirable. But, in the end, also insufficient.

Quoting mcdu (Reply 45):
AA leadership squandered the good will and pocketed any financial gain these cuts provided while continuing to operate AA as their own personal piggy bank.

An oft-repeated by entirely false meme perpetuated largely by AMR's unions to try and divert attention from their own complete and entire complicity with the incentive-based (stock option) compensation scheme they have become so dead-set against in the last few years.

I'm not here to defend the efficacy of the stock option incentive compensation AMR management received in the last several years, but one thing is certain - the unions knew about it, understood it, and indeed supported it from the outset.

To say that somehow AMR management "pocketed" the concessions of union members is to simply ignore basic accounting. The "cuts" the unions agreed to were cash costs, that started reducing AMR's expenses the instant they were put into place. The stock options granted to management was non-cash, and in fact had no value unless AMR management was able to steer the stock price upward.

And, of course, that was the thinking from the beginning - it would align management's incentive's with those of the thousands of AMR employees who also received stock options in 2003. Stock price goes up, and both management and employees saw their stock options gain value.

Quoting mcdu (Reply 45):
This is not about Regional Jets.

You're right - it's about way, way more than that.

Quoting mcdu (Reply 45):
AA has had the ability to fly the CR7

Yep - all 47 of them. Meanwhile, Delta operates 250+ of that class of jet, United over 150, and USAirways over 200.

I don't understand how anybody looking at those numbers could think AMR's mainline scope clause was competitive. It was not.

If you don't like that AMR wanted to replace mainline jets with large RJs, that's perfectly fine and understandable. But don't hate the player, hate the game - AMR is just being competitive with what their peers already "got away" with doing five years ago.

Quoting mcdu (Reply 45):
The slow footed and irresponsible AA management kept Eagle to a point that it had little value and could not be sold.

I agree AMR management were stupid to wait so long to sell Eagle. But, then again, Eagle would probably be a somewhat more attractive opportunity for a potential buyer today if it had been allowed, 5 years ago, to ramp up its flying of more economic 70- and 90-seat jets like its competitors largely did.

Quoting mcdu (Reply 45):
Is that the fault of labor that AA brain trusts could not see what was happening in the industry?

Both sides missed lots of trends of "what was happening in the industry." Management certainly did. But so did the unions.

Quoting mcdu (Reply 45):
Also, I don't believe scope is the answer to solve the AA issues.

Neither do I, but it is still one of several major union-contract-driven competitive disadvantages AA has to contend with.

Quoting mcdu (Reply 45):
While I abhor WN they have shown that an airline is not dependent on farming out ones own flying to commuter airlines to be profiable.

True.

AA could emulate the Southwest model. Eliminate 95% of international flying, park everything that isn't a 737, outsource heavy maintenance, and eliminate all flying to small cities.

Quoting mcdu (Reply 45):
Also, WN has one of the highest labor cost of any carrier.

... which, as their CEO recently as much as admitted, are sooner or later going to be "addressed."

Quoting mcdu (Reply 45):
the term sheet offered to them by AA leadership was so heinous the judge would not even approve it as being worthy of consideration

You're right. He only approved 95% of it, and gave AMR a blueprint for how to get his approval for the other 5%.

I'm not saying I'm happy about it, but to say that the Judge's ruling on the company's APA 1113 motion was anything but a near-entire success for the company is entirely out of touch with reality. The unions themselves have concluded as much already.


User currently offlineDeltaMD90 From United States of America, joined Apr 2008, 7978 posts, RR: 51
Reply 50, posted (2 years 3 months 2 weeks 1 hour ago) and read 8170 times:

Quoting 93Sierra (Reply 48):
My heart goes out to the pilots and hope somehow this gets resolved with the pilots getting what they deserve. Shame on this whole situation.

My heart goes out too but doing MX write-ups and wasting more of the company's money is childish and unprofessional. If they partake on that they deserve whatever happens to them



Ironically I have never flown a Delta MD-90 :)
User currently offlineRevelation From United States of America, joined Feb 2005, 12961 posts, RR: 25
Reply 51, posted (2 years 3 months 2 weeks 1 hour ago) and read 8136 times:

Quoting DeltaMD90 (Reply 50):
My heart goes out too but doing MX write-ups and wasting more of the company's money is childish and unprofessional.

Labels such as childish and unprofessional really don't mean a thing.

Some people here might have felt that the adult and professional thing to do would have been to accept AMR's last and final offer, but the vote indicates the union members don't share that feeling.

There's no doubt morale on the pilot's side is going to sink even lower because this decision makes it clear their future is going to be worse than things are now. In short it removes the glimmer of hope some may have still been holding.

Clearly the pilots won't feel any motivation to bust their butts for AMR.

These are a bunch of old dogs. I wouldn't expect them to be learning any new tricks.



Inspiration, move me brightly!
User currently offlineMir From United States of America, joined Jan 2004, 21865 posts, RR: 55
Reply 52, posted (2 years 3 months 1 week 6 days 23 hours ago) and read 8023 times:

Quoting commavia (Reply 49):
Meanwhile, Delta operates 250+ of that class of jet, United over 150, and USAirways over 200.

Because those pilot groups voted to relax scope to that extent. But if you went to them now and asked them if they regret that decision, I'd bet most of them would say yes. I can't really blame the AA pilot group for not making the same bad decision.

Quoting commavia (Reply 49):
.. because every time one of those airlines entered the market, Wall St went to management teams at the legacy airlines and said, "why are you paying your people more for doing the same job?"

And the management teams should have said "our payscales are sustainable - wait a year and those guys will be gone". They'd have been right.

Quoting Revelation (Reply 51):
Clearly the pilots won't feel any motivation to bust their butts for AMR.

Can't blame them, really. What's a contract worth if one of the parties can go to a judge and get it voided if they decide they don't want to be bound by it anymore?

-Mir



7 billion, one nation, imagination...it's a beautiful day
User currently offlineusairways787 From United States of America, joined Jun 2005, 290 posts, RR: 2
Reply 53, posted (2 years 3 months 1 week 6 days 22 hours ago) and read 7991 times:

Both AA, and that Judge are absolutely disgusting human beings. My heart goes out to everyone at AA.


"Pre departure walk around complete, all doors closed, ready for pushback"
User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 54, posted (2 years 3 months 1 week 6 days 20 hours ago) and read 7830 times:

Quoting Mir (Reply 52):
I can't really blame the AA pilot group for not making the same bad decision.

Nor can I. But I also can't blame management for asking for the same deal the management teams at AA's legacy peers got.

Both sides acting rationally from their own respective perspectives, but ultimately each side's desired outcome is to a certain extent mutually exclusive.

Quoting Mir (Reply 52):
And the management teams should have said "our payscales are sustainable - wait a year and those guys will be gone". They'd have been right.

Well, they seem to have been sustainable at Delta, Northwest, United and USAirways, all of whom exited bankruptcy with lower labor costs and far more flexible union contracts, and seemed to have "sustained" themselves.

Quoting Mir (Reply 52):
Can't blame them, really. What's a contract worth if one of the parties can go to a judge and get it voided if they decide they don't want to be bound by it anymore?

Very true - said contract would not appear to be worth much.

But, again, thus the state AMR finds itself in when its competitors used bankruptcy to force lower labor costs and more flexible contracts on their unions. Don't hate the player, hate the game. Much as many - myself included - may not like that reality, and find it highly unfortunate what bankruptcy did to airlines, and their employees, in the last decade, reality is reality - no matter how much some people want to try and pretend otherwise.

AMR was at a competitive disadvantage for not doing the same as Delta, Northwest, United and USAirways (twice) did.


User currently offlinemcdu From United States of America, joined Apr 2005, 1487 posts, RR: 17
Reply 55, posted (2 years 3 months 1 week 6 days 18 hours ago) and read 7711 times:

Quoting commavia (Reply 49):
... because every time one of those airlines entered the market, Wall St went to management teams at the legacy airlines and said, "why are you paying your people more for doing the same job?"

And those Wall St. folks are also the same people that brought us TARP. Yes, they are the people that everyone should answer to. Seems ironic that Wall St. never asked management why they were not paying themselves less to emulate the low cost carriers.... That is because Wall St. is complicit in the destruction of the average American (that is all Americans not just AA employees) worker. AA forced themselves into BK to eliminate the union contracts. This has been an orchestrated event that is despicable to watch. Just like the UA pensions and the NW/DL simultaneous BK's, airline managers are like sharks in a feeding frenzy with the ability to wield cuts against labor.

Passnegers complain about poor service, delayed flights etc. Yet, the airline managers only want to create minimum wage jobs of transient employees with no vested interest in the product. They provide marginal staffing levels for a perfect operation with no delays or irregular operations. Perhaps if your friends in Wall St. had half a brain they would realize the best customer service comes from employees that want to stay there long term and not looking to get another job, feel disenfranchised or that they are not given the tools or proper amount of support staff to do the job. This industry has become an abomination of what it should be thanks to Wall St., Greedy Airline managers and consultants that are seriously inept in executing their job.


User currently offlineMir From United States of America, joined Jan 2004, 21865 posts, RR: 55
Reply 56, posted (2 years 3 months 1 week 6 days 16 hours ago) and read 7562 times:

Quoting commavia (Reply 54):
Well, they seem to have been sustainable at Delta, Northwest, United and USAirways, all of whom exited bankruptcy with lower labor costs and far more flexible union contracts, and seemed to have "sustained" themselves.

The cycle has to be stopped at some point. We can't just keep going around and around. Now it's AA who will be imposing a draconian bankruptcy-aided contract. Then they'll have a competitive advantage over UA, who will go into bankruptcy and get a similar contract. Then both AA and UA will have an advantage over DL, who will go into bankruptcy and get a better contract, and then they'll have an advantage over AA, and we'll go back to where we started. That is just not sustainable.

We can choose to just say "get your own labor costs in order, we're not helping you guys out anymore". I don't blame AA for doing what they're doing (though I do think they shoulder a lot of blame for letting it get to this point), I blame the government for letting them do it.

-Mir



7 billion, one nation, imagination...it's a beautiful day
User currently offlinekoruman From , joined Dec 1969, posts, RR:
Reply 57, posted (2 years 3 months 1 week 6 days 15 hours ago) and read 7542 times:

Quoting usairways787 (Reply 53):
Both AA, and that Judge are absolutely disgusting human beings. My heart goes out to everyone at AA.

Sure, but the problem is that in the USA you permit this absurd situation of "bankruptcy protection", which encourages venal executives to divert the company's wealth to themselves, and then effectively steal their employees' entitlements afterwards.

You need the sort of system other capitalist countries enjoy. If you bankrupt the company, it is liquidated. And if as an executive you failed in your legal duties to shareholders, you are personally liable for the money lost.

In the system we have here in Australia, as soon as AA's management filed for bankruptcy the management of the company would have moved into the hands of independent adminstrators whose sole job was to protect the creditors, and above all the staff. AA management would have been immediately terminated and advised that if any evidence arose of maladminstration - including decisions to award themselves unsustainable remuneration - that money would be reclaimed from them and they would be disbarred from future executive employment or corporate adminstration roles.

And then US Airways would have acquired the failed company from the admininstrator.

It is absurdly anti-competitive and anti-capitalist that AA management can bankrupt the company but then hang on in power and choose who gets to buy or run the company. It's like those countries which allow a rapist to choose to marry or maim his victim.

In my world, you break it, you're gone.


User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 58, posted (2 years 3 months 1 week 6 days 12 hours ago) and read 7447 times:

Quoting mcdu (Reply 55):
And those Wall St. folks are also the same people that brought us TARP.

No argument. Again - you're arguing over how you want the world to be, I'm arguing this is the way the world is.

If you don't like the impact that bankruptcy has had on the industry or its employees, and the fact that airline management has used bankruptcy as a business strategy, trust me, I'm with you. But again - that is the way the world is. AMR management, and unions, actually tried - for whatever selfish and/or selfless reasons - to resist the bankruptcy path for nearly a decade. That was admirable. But, in the end, it was impossible for AMR to be competitive when all of their legacy peers had done it.

To have Delta, Northwest, United and USAirways twice restructure their businesses, and exact major concessions from labor unions, and then for AMR not to do the same thing, one way or another, with or without bankruptcy, would essentially have guaranteed that AMR went out of business long-term.

Quoting mcdu (Reply 55):
Yes, they are the people that everyone should answer to.

True, which is why I find it all so ironic that now the unions are so loudly trumpeting the words of these very same people with regards to a merger.

Quoting koruman (Reply 57):
Sure, but the problem is that in the USA you permit this absurd situation of "bankruptcy protection", which encourages venal executives to divert the company's wealth to themselves, and then effectively steal their employees' entitlements afterwards.

The concept of bankruptcy reorganization in general is not a bad thing - it is a big part of what encourages entrepreneurs to take risks, and thus one of the big reasons, in my view, why the U.S. economy continues to have one of the strongest and most vibrant entrepreneurial elements of any economy in the world.

To paint with such a broad brush and suggest that Chapter 11 is simply a system that allows executives to "divert the company's wealth to themselves" is ridiculous - the vast majority of Chapter 11 filings in this country are from very small companies for whom there was really not much "company wealth" to begin with. In most cases, companies really are just trying to get a "do-over" and try and restructure their businesses to be successful. And I'm not sure that's such a bad thing.


User currently offlinebennett123 From United Kingdom, joined Aug 2004, 7809 posts, RR: 3
Reply 59, posted (2 years 3 months 1 week 6 days 12 hours ago) and read 7420 times:

Seems to me that "restructuring THEIR business" means that the staff, and their creditors, (particularly those with long term commitments) get shafted.

Incidentally, how many of those creditors then end up in Chapter 11.

IMO, the message of Chapter 11 is to live for today, tomorrow could be cancelled.


User currently offlinekoruman From , joined Dec 1969, posts, RR:
Reply 60, posted (2 years 3 months 1 week 6 days 11 hours ago) and read 7402 times:

Quoting commavia (Reply 58):
To paint with such a broad brush and suggest that Chapter 11 is simply a system that allows executives to "divert the company's wealth to themselves" is ridiculous - the vast majority of Chapter 11 filings in this country are from very small companies for whom there was really not much "company wealth" to begin with. In most cases, companies really are just trying to get a "do-over" and try and restructure their businesses to be successful. And I'm not sure that's such a bad thing.
Quoting bennett123 (Reply 59):
Seems to me that "restructuring THEIR business" means that the staff, and their creditors, (particularly those with long term commitments) get shafted.

Incidentally, how many of those creditors then end up in Chapter 11.

Precisely.

I can take Commavia's point that Chapter 11 may give a company a second chance.

But it is inherently unfair and anti-capitalist unless it is an express pre-condition that the entire management team and Board of Directors be dismissed at that time from the company in question and indeed disbarred from similar positions elsewhere for, say, 15 years.

I repeat, if it's a publically listed company and you break it you should be removed from office, you certainly shouldn't be permitted to remain in charge and steal your employees' entitlements to pay the bill for your own prior incompetence or greed. Executive pay is high on the pretext of job insecurity. And therefore if you preside over an airline which declares bankruptcy it should be you flipping burgers in McDonalds for the next ten years, not your employees.

Tom Horton has taken a company with $22 billion revenue into bankruptcy. The automatic consequences should be loss of personal wealth and eligibility to hold a management position in any company.


User currently onlineByrdluvs747 From United States of America, joined Jul 2004, 2465 posts, RR: 1
Reply 61, posted (2 years 3 months 1 week 6 days 11 hours ago) and read 7383 times:

I haven't been keeping track. Does this automatically mean that ULH flying with competitive costs is now possible for AA?


The 747: The hands who designed it were guided by god.
User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 62, posted (2 years 3 months 1 week 6 days 10 hours ago) and read 7373 times:

Quoting bennett123 (Reply 59):
Seems to me that "restructuring THEIR business" means that the staff, and their creditors, (particularly those with long term commitments) get shafted.

Pretty much.

Quoting koruman (Reply 60):
But it is inherently unfair and anti-capitalist unless it is an express pre-condition that the entire management team and Board of Directors be dismissed at that time from the company in question and indeed disbarred from similar positions elsewhere for, say, 15 years.
Quoting koruman (Reply 60):
Tom Horton has taken a company with $22 billion revenue into bankruptcy. The automatic consequences should be loss of personal wealth and eligibility to hold a management position in any company.

Well, the American brand of capitalism is far less punitive towards failure than you seem to be. And I'm very glad it is.

Nonetheless, that's rather meaningless to the actual point of this discussion, or the topic it covers, which is that bankruptcy is what it is, like it or not, and it was what it was before AMR ever filed. Whether you or I or anyone else likes or doesn't like the concept of Chapter 11, or its consequences, the reality is that it is here, and every one of AMR's legacy peers systematically used it as a business strategy to gain leverage over the creditors and extract substantial cost reductions, efficiency and flexibility from their labor unions. AMR has no choice but to compete.

Quoting Byrdluvs747 (Reply 61):
I haven't been keeping track. Does this automatically mean that ULH flying with competitive costs is now possible for AA?

By my reading, the more draconian term sheet AMR wants to impose would have no restrictions on duty time beyond FAA limits. The proposal the pilots rejected last month would have additionally included a provision that all flights greater than 8 hours which at all overlap with the "Circadian low" (0200-0559) will require a 3rd pilot, and that any flight scheduled over 12 hours will also require a pilot crew bunk.


User currently offlineblueflyer From United States of America, joined Jan 2006, 4179 posts, RR: 2
Reply 63, posted (2 years 3 months 1 week 6 days 10 hours ago) and read 7326 times:
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Quoting mcdu (Reply 45):
However, the managers are not willing to lower their compensation package to match those of the upstart to help reduce the cost disadvantage between the upstart and the established carrier.

There will always be an upstart that thinks it can do it for less than the others, because it has the newest automation, because it started at just the right time when unemployment was sky high and people were willing to work for half peanuts, because.... etc. You get the idea. When does this stop? When everyone works for minimum wage everywhere?

Quoting commavia (Reply 58):
The concept of bankruptcy reorganization in general is not a bad thing

Except vendors and employees get royally screwed...

Quoting koruman (Reply 60):
I repeat, if it's a publically listed company and you break it you should be removed from office, you certainly shouldn't be permitted to remain in charge and steal your employees' entitlements to pay the bill for your own prior incompetence or greed.

I strongly disagree. While I do think it is unfair that management and executives seem to be the ones feeling the least amount of pain usually, your proposal ignore several key elements:
-It will drive competent executives out the door at the first sign of trouble to try and avoid being liable for a possible bankruptcy down the line, and it will be very difficult to replace them, probably pushing into bankruptcy a number of companies that might have been saved if its executives had stayed put to right the ship;
-Turn-around experts that are brought in to help or replace current management when the situation looks dire will all retire, again putting into bankruptcy companies that might have been saved;
-There are cases where a bankruptcy is almost unavoidable when all your competitors have gone through it and used the process to drastically lower cost, shed debts and remove non-performing assets.

A better bankruptcy reform would impose limits on the duration of the proceedings and the number of assets that can be disposed, require a certain debt-to-equity ratio to qualify for a bankruptcy reorganization, allow only one filing per 10 or 20 years and align employees pay and conditions to no lower than the least generous similarly-sized competitor in the industry.

Perhaps after the company has exited bankruptcy, it might be wise to impose the selection of a new board of directors, several of which would be independent.



I've got $h*t to do
User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 64, posted (2 years 3 months 1 week 6 days 9 hours ago) and read 7296 times:

Quoting blueflyer (Reply 63):
When does this stop? When everyone works for minimum wage everywhere?

When supply and demand are at equilibrium. As long as there is somebody willing to do the same job for less, there will always be downward pressure on wages - just as with the price of any other product or service in a free market.

Quoting blueflyer (Reply 63):
Except vendors and employees get royally screwed...

Again, no argument.

Bankruptcy is like the forest fire that clears away the underbrush and allows the sunlight to get down to the forest floor. On a macro level, that means that it allows the economy to continually restructure itself - creative destruction - clearing away the failed ideas, bad management, uneconomic terms and inefficient businesses and ensuring that the most capable, best-managed, and most efficient market actors survive.

On a personal, human, level, the unfortunate, but inevitable and/or necessary consequence of that bankruptcy process is that vendors and employees do often get harmed.

But again, to bring this back to AMR, it is instructive to remember that AMR tried to avoid bankruptcy. The company made it years longer than its peers and was able to hold out despite a weakened balance sheet, bad decisions, noncompetitive labor contracts, and on and on. But in the end, the competitive pressure from all the other network airlines filing for bankruptcy was more than AMR could withstand.

Quoting blueflyer (Reply 63):
A better bankruptcy reform would impose limits on the duration of the proceedings and the number of assets that can be disposed, require a certain debt-to-equity ratio to qualify for a bankruptcy reorganization, allow only one filing per 10 or 20 years and align employees pay and conditions to no lower than the least generous similarly-sized competitor in the industry.

Perhaps after the company has exited bankruptcy, it might be wise to impose the selection of a new board of directors, several of which would be independent.

I submit that those one-size-fits-all approaches would never work. Every company is different, every industry is different, and every situation is different. Having some external entity totally unfamiliar with the inner workings of a given business set arbitrary limitations on which assets can or can't be kept, regardless of their economic value, or determining how a company should capitalize itself, or how much it should pay employees, would be disastrous.

Who gets to decide what the appropriate ratio of debt and equity is for an airline versus a retailer versus a software company? What happens when the industry evolves and changes and a new capital structure becomes the norm? Who gets to determine what counts as a "similarly-sized" company, or the same "industry?" And what if a reorganized company has no interested in pattern bargaining like their peers, and wants to try something new post-bankruptcy which would lead to a different compensation structure for employees?" How is a bankruptcy court, or trustee, or whoever going to decide that?


User currently offlineRyanairGuru From Australia, joined Oct 2006, 5940 posts, RR: 5
Reply 65, posted (2 years 3 months 1 week 6 days 9 hours ago) and read 7275 times:

Quoting commavia (Reply 58):
In most cases, companies really are just trying to get a "do-over" and try and restructure their businesses to be successful

OK, but in doing so they are 'rewarding' those who fail

Quoting commavia (Reply 58):
And I'm not sure that's such a bad thing.

When it's mom and pop and their diner doing it tough then it probably isn't an issue. However when we are talking about multi national corporations (including airlines) then Ch11 puts them at a significant competitive advantage compared to corporations in the UK, Australia and other countries and other countries where they would simply have been left to go bust. This grossly distorts the international playing field.

Quoting koruman (Reply 60):
But it is inherently unfair and anti-capitalist unless it is an express pre-condition that the entire management team and Board of Directors be dismissed at that time from the company in question and indeed disbarred from similar positions elsewhere for, say, 15 years.

  

Quoting blueflyer (Reply 63):
It will drive competent executives out the door at the first sign of trouble to try and avoid being liable for a possible bankruptcy down the line,

True, that does happen here. But if the company is on its way into bankruptcy anyway any "competent" executive should have already bailed so as not to have their name and reputation indellibly marked by the bankruptcy.

Quoting blueflyer (Reply 63):
There are cases where a bankruptcy is almost unavoidable when all your competitors have gone through it and used the process to drastically lower cost, shed debts and remove non-performing assets

I'm not (and don't think Koruman is) arguing with AA's use of Ch11, rather the fact it exists at all.

And describing it as "unavoidable" suggests the extent to which Ch11 has become institutionalised as part of a process. That is inherently wrong: if your company fails then it's failed. You should not expect 'society' (however understood) to let you have a second chance.



Worked Hard, Flew Right
User currently offlinepar13del From Bahamas, joined Dec 2005, 7662 posts, RR: 8
Reply 66, posted (2 years 3 months 1 week 6 days 9 hours ago) and read 7268 times:

Quoting mcdu (Reply 41):
The legacy pilots have been pulled down due to an industry that has dangled jobs at lower and lower wages with a never ending supply of pilots willing to work for less than the other group.

All well and true, but the reality was / is that people need jobs. Scope may preserve jobs at legacies and make those pilots the top of the hill, but it does nothing for those outside and created a business option for others to start carriers where pilots can get jobs, the profession is not the domain of one set of pilots.

Quoting koruman (Reply 57):
Sure, but the problem is that in the USA you permit this absurd situation of "bankruptcy protection",

A number of countries protect creditors when a company fails usually with the option of seeing whether the company can continue as a viable entitity, they just don't call it Chpt.11

Quoting koruman (Reply 57):
In the system we have here in Australia, as soon as AA's management filed for bankruptcy the management of the company would have moved into the hands of independent adminstrators whose sole job was to protect the creditors, and above all the staff.

In the USA case, the judge is the ultimate authority, it can be viewed that you would prefer the judge and his staff run the airline versus professionals getting the approval of the judge.
So the question really is, in your country who exactly are these independent persons who take over the leadership of the company when the airlines declares bankruptsy?
We have seen numerous industires where financial experts with no knowledge of the industry attempt to make decisions based on numbers only, the results are not always pretty.

Quoting blueflyer (Reply 63):
Except vendors and employees get royally screwed...

On the vendor side, the question can be for how long?
Vendors take chances ,companies starts out on 30 day net, then when trouble starts they hedge their bets by going 60, then 90, 120 etc. The principle is that they believe that if they extend credit the company will get a chance to recover and in the long run the risk would have been worth the long term rewards.
Chpt.11 is no different, the court then provides the short term hedge on the thought that the long term rewards will be worth the risk, to the vendors, employees, travelling public and the country at large where the number of person of interest are vast.


User currently offlineRevelation From United States of America, joined Feb 2005, 12961 posts, RR: 25
Reply 67, posted (2 years 3 months 1 week 6 days 5 hours ago) and read 7099 times:

Quoting mcdu (Reply 55):
Seems ironic that Wall St. never asked management why they were not paying themselves less to emulate the low cost carriers....

The question should be asked, but the reality is that the executive class always takes care of its own.



Inspiration, move me brightly!
User currently offlinelightsaber From United States of America, joined Jan 2005, 13536 posts, RR: 100
Reply 68, posted (2 years 3 months 1 week 6 days 4 hours ago) and read 7032 times:
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Quoting commavia (Reply 64):
Bankruptcy is like the forest fire that clears away the underbrush and allows the sunlight to get down to the forest floor.

Excellent analogy. Once a company is in bankruptcy, the fire has gone out of control. The bankruptcy process is far from ideal. Partially as it is fighting fires rather than purely rational planning.

Quoting usairways787 (Reply 53):
Both AA, and that Judge are absolutely disgusting human beings.

Why do you say that about a judge? A judge applies the law. They should not, unless they are the Supreme Court, be making law. e.g., how the GM bankruptcy went. I hope everyone realizes how that bankruptcy went down is impacting all unionized companies.

Quoting RyanairGuru (Reply 65):
OK, but in doing so they are 'rewarding' those who fail

Only if creditors are willing to finance the new entity. What do we do, restart with no one having seniority? BK isn't ideal, but countries with a well defined bankruptcy law benefit economically in the long run as some of those 'more risky' investments pay off.

Quoting LAXdude1023 (Reply 2):
Just when you thought things at AA couldn't get more cuddly.

  

Quoting 93Sierra (Reply 48):
"American 238 higher is available" ....."xxx center American 238 is fine at 23000"
Burn some gas boys!

So they would rather go into Chapter 7? How would you make AA more competitive? DL going from 50 to 76 seat RJs will force AA to do the same. Or would you rather the business go to WN?

Quoting Revelation (Reply 51):
Clearly the pilots won't feel any motivation to bust their butts for AMR.

These are a bunch of old dogs. I wouldn't expect them to be learning any new tricks.

Then AMR will have to come up with work rules to overcome the slowdown. Why doesn't AMR have paperless cockpits like B6 so that pilots may leave work earlier and not spend unpaid time on paperwork?

The reality is that AMR's work rules are not productive enough. The 'old dogs' will have to relearn. In particular once the maddogs are retired. The A319s should (are they?) come with paperless cockpits from day 1.

Quoting RyanairGuru (Reply 65):
then Ch11 puts them at a significant competitive advantage compared to corporations in the UK, Australia and other countries and other countries where they would simply have been left to go bust.

But not all companies are able to pull out of Ch11. See Oracle.    If it is such a disadvantage, why do those other nations not implement a ch11? I'm not saying I like the process, but not all companies pull through. Examples are TWA (acquired), NorthWest (acquired), PanAm, and Eastern.



Lightsaber



Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
User currently offlineusairways787 From United States of America, joined Jun 2005, 290 posts, RR: 2
Reply 69, posted (2 years 3 months 1 week 6 days 4 hours ago) and read 6971 times:

[quote=lightsaber,reply=68]Why do you say that about a judge? A judge applies the law. They should not, unless they are the Supreme Court, be making law. e.g., how the GM bankruptcy went. I hope everyone realizes how that bankruptcy went down is impacting all unionized companies.[/quote

Because it's disgusting how the judge will side with management after they are the ones who put it there, makes me wonder if there was a side deal going on. They hold the labor accountable instead of going after management and asking questions and doing investigations. The labor is the one bearing the brunt of the piss poor management decisions, and it has continued, and will do so until someone says enough is enough. They all live like kings, while labor just lost their only bargaining chip. One sided deal if I do say so.

US787



"Pre departure walk around complete, all doors closed, ready for pushback"
User currently offlinemcdu From United States of America, joined Apr 2005, 1487 posts, RR: 17
Reply 70, posted (2 years 3 months 1 week 5 days 23 hours ago) and read 6765 times:

Quoting lightsaber (Reply 68):
But not all companies are able to pull out of Ch11. See Oracle.    If it is such a disadvantage, why do those other nations not implement a ch11? I'm not saying I like the process, but not all companies pull through. Examples are TWA (acquired), NorthWest (acquired), PanAm, and Eastern.

The difference in the recent round of BK's of airlines are that they are strategic in their method. They enter BK with significant cash, undervalue their assets to create balance sheets that look unprofitable. In the case of TWA/EAL/PAA those were not strategic, they were of necessity due the the actual finances of the company.

Quoting lightsaber (Reply 68):
Why doesn't AMR have paperless cockpits like B6 so that pilots may leave work earlier and not spend unpaid time on paperwork?

I hate the ask, but what "unpaid" work are pilots doing at AA? If it is unpaid then what consequence does that have to the bottom line? I suspect you are referring to Jepp revisions, but can't be sure what you are talking about. However, AA is in the process of implementing the ipad for paperless cockpits. The Airbus is not a paperless airplane, companies flight operations have to become paperless. You could make a DC-3 paperless if you wanted to.


User currently offlineblueflyer From United States of America, joined Jan 2006, 4179 posts, RR: 2
Reply 71, posted (2 years 3 months 1 week 5 days 23 hours ago) and read 6737 times:
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Quoting commavia (Reply 64):
When supply and demand are at equilibrium.

If labor is to be subject to the whims of the marketplace, why can't the fate of companies as well? Why do they deserve the protection of a market-distorting process like bankruptcy?

Quoting commavia (Reply 64):
creative destruction

Creative destruction is very much a free market idea, it is not about the government establishing rules to protect weak companies from their competitors and debtors. It's much more about letting bad companies die and entrepreneurs build new ones from the ashes.

Quoting RyanairGuru (Reply 65):
But if the company is on its way into bankruptcy anyway

But what if it may still be saved? Under commavia's proposals, executives will head out the door rather than try and save the company so they can't be blame for its failure, thereby increasing the chances the company will go bankrupt instead.

I don't like the current bankruptcy process, but I really don't think making executives liable for bankruptcies is the best way to go. I think it will increase bankruptcies, not decrease them. Reforming the process itself seems far more useful to me.

Quoting commavia (Reply 64):
I submit that those one-size-fits-all approaches would never work.

It hasn't worked in the past and won't work in the future, but I didn't say the reforms I proposed needed to be apply in a uniform way to every company. Businesses large and small are already categorized for tax and compliance purposes, for example, so why can't they be when it comes to bankruptcy? What's so wrong about setting standards to try and ensure that only companies with the best chances of survival even go through the process? In a way, it is close to the government choosing winners and losers, but by giving losing companies a mechanism to avoid death isn't the government already involved in the process anyway?



I've got $h*t to do
User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 72, posted (2 years 3 months 1 week 5 days 22 hours ago) and read 6619 times:

Quoting mcdu (Reply 70):
They enter BK with significant cash, undervalue their assets to create balance sheets that look unprofitable.

First off, a balance sheet does not indicate any level of profitability - that's the income statement. Second, how do you believe publicly-traded airlines have systematically "undervalued their assets" to make their balance sheets look weaker than they actually are?

Quoting blueflyer (Reply 71):
If labor is to be subject to the whims of the marketplace, why can't the fate of companies as well? Why do they deserve the protection of a market-distorting process like bankruptcy?

Companies - especially airlines - are already very much "subject to the whims of the marketplace."

As for deserving "protection," it is true that one effect of Chapter 11 is to give reorganizing companies some protection from creditors, and the ability to restructure contracts including labor agreements.

I think it's important to distinguish that, while I agree with you that bankruptcy has in many cases now become a strategy, it isn't as if AMR is, in general, just jumping into bankruptcy for fun in order artificially drop their labor costs below the market. It was, generally speaking, the other way around - the industry's labor costs have been consistently running lower than AMR's for years, and AMR is now simply using bankruptcy to make the "adjustment" that it was unable to make through consensual deals with its unions in the last five years.

Quoting blueflyer (Reply 71):
Under commavia's proposals

What proposals? I didn't propose anything.

Quoting blueflyer (Reply 71):
In a way, it is close to the government choosing winners and losers

It's not "close to" government picking winners and losers - that is just what it would be.


User currently offlinekoruman From , joined Dec 1969, posts, RR:
Reply 73, posted (2 years 3 months 1 week 5 days 21 hours ago) and read 6625 times:

Quoting blueflyer (Reply 63):
There are cases where a bankruptcy is almost unavoidable when all your competitors have gone through it and used the process to drastically lower cost, shed debts and remove non-performing assets.

This is the most telling comment in the entire thread.

Translated into English, it means that the state of bankruptcy law in the USA encourages airine executives to administer their airlines badly, while remunerating themselves handsomely. They can then plunge the airline into bankruptcy protection in order to balance the books by stealing their employees' entitlements to offset the cost of their incompetence, all the while retaining their own control of the organisation!

But what is worse, is that several people including blueflyer are stating that executives are wilfully abusing Bankruptcy Protection for strategic advantage, and that airlines which would not otherwise enter bankruptcy end up doing so in order not to be strategically disadvantaged. I would argue that American bankruptcy laws need to be balanced by legal monitoring of all executive emails and other correspondence for the previous two years, and that if evidence is found that any company has entered bankruptcy protection for strategic reasons like that the entire management team and Board of Directors should face custodial prison sentences of a minimum of ten years time served.

That would return to a capitalist model, and ensure that there was no strategic competitive advantage to be obtained from the process.


User currently offlineMir From United States of America, joined Jan 2004, 21865 posts, RR: 55
Reply 74, posted (2 years 3 months 1 week 5 days 21 hours ago) and read 6583 times:

Quoting commavia (Reply 72):
the industry's labor costs have been consistently running lower than AMR's for years, and AMR is now simply using bankruptcy to make the "adjustment" that it was unable to make through consensual deals with its unions in the last five years.

What's to say that after AMR comes out, some other airline will go back in and get competitive? Eventually, that's going to lead to AMR going back into bankruptcy because the contract they got under bankruptcy is no longer competitive because everyone else has been through bankruptcy in the meantime. At some point, the cycle has to be broken.

-Mir



7 billion, one nation, imagination...it's a beautiful day
User currently offlineXT6Wagon From United States of America, joined Feb 2007, 3432 posts, RR: 4
Reply 75, posted (2 years 3 months 1 week 5 days 21 hours ago) and read 6570 times:

Quoting commavia (Reply 72):
As for deserving "protection," it is true that one effect of Chapter 11 is to give reorganizing companies some protection from creditors, and the ability to restructure contracts including labor agreements.

It also gives creditors extra legal rights. I think many miss that. In chapter 11 the creditors "own" the company as much as anyone. It prevents the company from just paying off just one or two debt holders who have other ties outside of the debt.

The whole goal of Chaper 11 is to preserve as much of the value of the company while balancing the needs of the various creditors against each other. Sometimes this results in an asset sale like F9 went through. Sometimes it means leaving a working company who can continue to pay on valid debts that are reasonable.

Its also not exactly a free ride for the "owners" of the company. The common stock becomes worthless paper. So all those executives people love to hate get a pretty nasty haircut on thier net worth.


User currently offlinegigneil From United States of America, joined Nov 2002, 16347 posts, RR: 85
Reply 76, posted (2 years 3 months 1 week 5 days 20 hours ago) and read 6510 times:

Quoting mcdu (Reply 55):
And those Wall St. folks are also the same people that brought us TARP

You mean TARP, the program that saved 11 million jobs, stopped the entire economy from collapsing, was entirely repaid years ahead of schedule, and made the government (read here: taxpayers) nearly 30% on its investment? Yeah, gotta hate all that buddy.

You might not like facts, but they exist regardless.

NS


User currently offlineRevelation From United States of America, joined Feb 2005, 12961 posts, RR: 25
Reply 77, posted (2 years 3 months 1 week 5 days 19 hours ago) and read 6472 times:

Quoting blueflyer (Reply 63):
Quoting commavia (Reply 58):
The concept of bankruptcy reorganization in general is not a bad thing
Except vendors and employees get royally screwed...
Quoting Mir (Reply 74):
What's to say that after AMR comes out, some other airline will go back in and get competitive? Eventually, that's going to lead to AMR going back into bankruptcy because the contract they got under bankruptcy is no longer competitive because everyone else has been through bankruptcy in the meantime. At some point, the cycle has to be broken.

Are we all forgetting the shareholders get wiped out during BK?

In this case, the shareholders of the next instance of AA are the ones sitting today on the creditors committee, and of course it won't be in their interest to be back in BK any time soon.

In the past we've seen those creditors get "rewarded" with shares worth about 30 cents on the dollar of what they are owed by the last instance of AA, and stockholders are lucky if they get a penny.

If AA emerges from BK, the stockholder base will be these creditors, presuming they feel it's better to come out of BK versus liquidation. If AA does well and the stock climbs, the stockholder base will broaden.



Inspiration, move me brightly!
User currently offlineRDH3E From United States of America, joined Mar 2011, 1823 posts, RR: 3
Reply 78, posted (2 years 3 months 1 week 5 days 8 hours ago) and read 6388 times:

Quoting usairways787 (Reply 53):
Both AA, and that Judge are absolutely disgusting human beings. My heart goes out to everyone at AA.
Quoting usairways787 (Reply 69):
Because it's disgusting how the judge will side with management after they are the ones who put it there, makes me wonder if there was a side deal going on.

Have you thought that just maybe, perhaps, the judge is a rational human being and can see that AMR's pilot costs are grossly misaligned with reality and that they need to be whacked? And that the Union was holding the whole company hostage? Never occurred to you did it?

Quoting gigneil (Reply 76):
You might not like facts, but they exist regardless.

NS

x2

[Edited 2012-09-10 07:49:31]

User currently offlineLAXdude1023 From India, joined Sep 2006, 7808 posts, RR: 25
Reply 79, posted (2 years 3 months 1 week 5 days 8 hours ago) and read 6398 times:

Quoting usairways787 (Reply 69):
One sided deal if I do say so.

It isnt whatsoever. AA is where it is because of bland management with no vision and Unions that are out of control and unrealistic. Both need to join 21st century.



Stewed...Lewd...Crude...Irreverent...Belligerent
User currently offlineN737AA From United States of America, joined Aug 2008, 270 posts, RR: 0
Reply 80, posted (2 years 3 months 1 week 5 days 6 hours ago) and read 6373 times:

Quoting HPRamper (Reply 37):
Fedex is first and foremost an airline, before it is a delivery company. It faces margins that are every bit as thin as a passenger airline. And why should the financial habits of a company dictate or justify how they treat employees?

The more you talk, the more I wonder what world you live in....Just sayin'

N737AA


User currently offlineRyanairGuru From Australia, joined Oct 2006, 5940 posts, RR: 5
Reply 81, posted (2 years 3 months 1 week 5 days 5 hours ago) and read 6359 times:

Quoting usairways787 (Reply 69):
They hold the labor accountable instead of going after management and asking questions and doing investigations.

I might be putting my foot in it here since I'm not au fait with the ins and outs of the bankruptcy litigation process, but I take it that you are aware that as a general principle of common law the judge does not have any "investigative" function?

Presuming there is nothing unique about bankruptcy hearings, management would have put their case and labor would have put their case, they will cross examine each other to pick holes in the other argument, and the judge decides who was the most convincing on the basis of the facts and evidence presented to him. If he were to go out and "investigate" or "ask questions" of evidence not presented to him or directly relevant to the case then there would have been a mistrial or at the very least an appeal on the basis of (a) appearance of bias or (b) having regard to an irrelevant consideration.

Don't like it? Write to your Congressman

[Edited 2012-09-10 10:59:09]


Worked Hard, Flew Right
User currently offlineblueflyer From United States of America, joined Jan 2006, 4179 posts, RR: 2
Reply 82, posted (2 years 3 months 1 week 5 days 4 hours ago) and read 6351 times:
Support Airliners.net - become a First Class Member!

Quoting commavia (Reply 72):
What proposals? I didn't propose anything.

My bad, I meant koruman's.



I've got $h*t to do
User currently offlinemcdu From United States of America, joined Apr 2005, 1487 posts, RR: 17
Reply 83, posted (2 years 3 months 1 week 5 days 3 hours ago) and read 6345 times:

Quoting gigneil (Reply 76):
You mean TARP, the program that saved 11 million jobs, stopped the entire economy from collapsing, was entirely repaid years ahead of schedule, and made the government (read here: taxpayers) nearly 30% on its investment? Yeah, gotta hate all that buddy.

It was the wall st folks that put the country in the position of needing TARP not the taxpayer. If it was such a great investment, as a taxpayer where do I get my check? It made those on Wall St plenty for cratering the economy in the first place.

The out of control banking, wall st gangs are equally portrayed with airline management. I have yet to see any manager create anything in the industry. Many of the "ideas" they create are shelved quickly, TED, Song, CalLite, Metrojet are a few shining examples of incompetence in leadership. The employees get no say in these disastrous ventures. We get lip service about how each "new" idea is going to be a revolutionary change to the industry. When they go wrong, just as anticipated it is the employees that must pay with job, wage and benefit cuts. Never does the management team own their mistakes. You guys can defend management all you want but there are not too many destitute airline managers. Nor are there airline managers that are working for less money today than in 2001. The employees in this industry have subsidized inept leaders and consultants. The majority of legacy employees are paid well less than they were earning in 2001. In lieu of your trite "facts", I'll use SCOREBOARD.


User currently offlineRDH3E From United States of America, joined Mar 2011, 1823 posts, RR: 3
Reply 84, posted (2 years 3 months 1 week 5 days 2 hours ago) and read 6349 times:

Quoting mcdu (Reply 83):
I have yet to see any manager create anything in the industry

I'm going to try to keep a level head with you. But do you think that UAL, DL, and AMR were built solely by the ingenuity of the Pilots/FA's/Rampers & CSRs? Certainly the Union staff is integral to what they've become, but management also has it's role and has clearly done 100x what you've given credit for.

Quoting mcdu (Reply 83):
If it was such a great investment, as a taxpayer where do I get my check?

Your lack of understanding of the financial system, and subsequent willingness to bash it is unbelievable.   


User currently offlineEaglePower83 From United States of America, joined Oct 2011, 284 posts, RR: 0
Reply 85, posted (2 years 3 months 1 week 5 days 2 hours ago) and read 6344 times:

Quoting RDH3E (Reply 84):
I'm going to try to keep a level head with you. But do you think that UAL, DL, and AMR were built solely by the ingenuity of the Pilots/FA's/Rampers & CSRs? Certainly the Union staff is integral to what they've become, but management also has it's role and has clearly done 100x what you've given credit for.

Yeah, management teams from decades ago. Certainly not any in the last 10-15 years.
Lower management along with employees in the trenches have kept these leviathon organizations afloat while the vision-less upper management teams have flung poo on the wall to see if it sticks, while not really risking any of their own skivies.
I guess most of that can be said about most of corporate America.......

I tend to believe corprations have a much higher likelihood of faltering when their founding leaders leave or pass on.
The new regimes that take over after the founders rarely care about the long term fortune of the organization and it's people/services it provides.
They just want their short term cash and then run away.


User currently onlineincitatus From Brazil, joined Feb 2005, 4068 posts, RR: 13
Reply 86, posted (2 years 3 months 1 week 5 days 2 hours ago) and read 6345 times:

Quoting EaglePower83 (Reply 85):
I guess most of that can be said about most of corporate America.......

Most Americans have a sweet life and have no grasp of how sweet they've had it. If America wanted to "dump Corporate America", any country would take them in a beat.



Stop pop up ads
User currently offlineMAV88 From United States of America, joined May 2011, 183 posts, RR: 0
Reply 87, posted (2 years 3 months 1 week 5 days 1 hour ago) and read 6339 times:

Quoting gigneil (Reply 76):
Quoting mcdu (Reply 55):
And those Wall St. folks are also the same people that brought us TARP

You mean TARP, the program that saved 11 million jobs, stopped the entire economy from collapsing, was entirely repaid years ahead of schedule, and made the government (read here: taxpayers) nearly 30% on its investment? Yeah, gotta hate all that buddy.

You might not like facts, but they exist regardless.

NS

One way to look at it: The American auto makers could be a case study in bad management, poor vision and poor innovation. Toyota, Honda, etc. came in and wiped the floor with them. If you ask me, they should have let the automakers fail. It's not our faults states that rely heavily on their jobs, Michigan for example, never bothered to diversify their economies.


User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17824 posts, RR: 46
Reply 88, posted (2 years 3 months 1 week 5 days 1 hour ago) and read 6343 times:

Quoting mcdu (Reply 83):
I have yet to see any manager create anything in the industry.

The hub? The reservation system? The loyalty program? Ancillary fees? Nearly every revenue generating opportunity? Every money making, and losing, route?



E pur si muove -Galileo
User currently offlineLAXdude1023 From India, joined Sep 2006, 7808 posts, RR: 25
Reply 89, posted (2 years 3 months 1 week 5 days 1 hour ago) and read 6336 times:

Quoting mcdu (Reply 83):
I have yet to see any manager create anything in the industry.

That could win an award for most absurd thing written in this thread. Managment makes almost all decisions regarding new routes and fleet. In the case of the APA, they have been a huge block for expansion (particularly long haul routes and larger RJ's that could be used for new routes).

This one is a two way street. AA managment has been anything but stellar, but the APA lives in another demsion as well.



Stewed...Lewd...Crude...Irreverent...Belligerent
User currently offlineRyanairGuru From Australia, joined Oct 2006, 5940 posts, RR: 5
Reply 90, posted (2 years 3 months 1 week 5 days 1 hour ago) and read 6335 times:

Quoting EaglePower83 (Reply 85):
The new regimes that take over after the founders rarely care about the long term fortune of the organization

To be fair to managers, they are legally obligated to put the interests of their shareholders (who want quick profit and subsequent raises in share price) first. If they are seen to put the interests of labor ahead of the members of the corporation that could lead them into court.

Quoting mcdu (Reply 83):
The employees in this industry have subsidized inept leaders and consultants.

Management in the last decade has been somewhat lacklustre, I'm not denying that. But what the employees are really subsidising are their own careers: US would certainly have gone into Ch7 and maybe another carrier as well (most likely UA or NW) had the employees not accepted cuts/had them imposed on them



Worked Hard, Flew Right
User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 91, posted (2 years 3 months 1 week 4 days 23 hours ago) and read 6310 times:

Quoting mcdu (Reply 83):
I have yet to see any manager create anything in the industry.

Look harder.

Quoting mcdu (Reply 83):
Many of the "ideas" they create are shelved quickly, TED, Song, CalLite, Metrojet are a few shining examples of incompetence in leadership.

Interesting examples, considering they stand in stark contrast to AA's management, which - to my knowledge - has never pursued any of these airline-within-an-airline ventures, which I agree are stupid and a waste of time and resources.

Quoting mcdu (Reply 83):
The employees get no say in these disastrous ventures. We get lip service about how each "new" idea is going to be a revolutionary change to the industry. When they go wrong, just as anticipated it is the employees that must pay with job, wage and benefit cuts.

Welcome to capitalism.

That's how it works, and I am amazed that some airline employees think the normal rules that apply everywhere else in the world don't apply to them. In a capitalist system, employee have to live with the decisions management makes - if the management team makes the right decisions, good, and if the decisions are bad, than bad. Or, they leave. That's life.

If somebody doesn't like the direction things are heading, and an employee is "anticipating" that things will "go wrong," that employee is free to leave before the ship sinks. Not sure why some think that in the airline industry you can allegedly watch the slow motion train wreck, stick around for it, act shocked when its apparently-obvious consequences actually occur, and then blame someone else for not taking advantage of your own supposed clairvoyance.

The U.S. airline unions' fixation on seniority über alles, whatever its other outcomes positive or negative, has created a disincentive for workers to act as rational economic actors, as they would in virtually any non-union job in any other industry.

Quoting mcdu (Reply 83):
Never does the management team own their mistakes.

... except when they get fired, which happens often. Airline management teams serve shareholders, and as such, unlike most unionized airline employees, are fired when they do not deliver what shareholders want.

Quoting mcdu (Reply 83):
The employees in this industry have subsidized inept leaders and consultants. The majority of legacy employees are paid well less than they were earning in 2001.

From my perspective, that view is tragically myopic - you are mixing up the cause and the effect.

Airlines have not been "subsidizing inept leaders and consultants." Airline management has not been screwing employees and unions, and thus lowering the prevailing price of, and demand, for, labor in the airline industry. It's the other way around - prevailing labor costs have been progressively coming down in various areas, and airline managements have simply been responding to that trend as is their singular primary fiduciary responsibility (to generate value for shareholders). All of the "greedy airline executives" in the world conspiring together could never reduce labor costs in the airline industry one iota as much as the far more powerful, and persistent forces of the market already have.

So if you are an airline mechanic in the U.S. today, mad about the falling price of your labor, far less of your "blame" should be directed at "greedy airline executives" and far more at the at workers TIMCO, AAR, etc., to say nothing of Aeroman, HAECO, Ameco, etc. who are willing to do the same job for less money. And, ultimately, you should direct the vast majority of "blame" at passengers themselves, who have shown time and time again that they simply do not know nor care where their plane is overhauled. Thus, while many American AMTs may vigorously dispute that mechanics at lower-cost vendors, with less FAA oversight, are truly doing comparable work, the truth is that commercial aviation safety, at least on the face of it, appears to be getting consistently safer, and until that changes, most people will continue to reward the airline that outsources and punish the one that doesn't.

Similarly, if you're a pilot in the U.S. today, mad about the falling price of your labor, far less of your "blame" should be directed at "greedy airline executives" and far more at the good engineers in Montreal who, twenty years ago, conducted the engineering that produced a profitable (then) 50-seat jet capable of sub-continental ranges, thus spawning an entire industry of jets flown willingly by pilots willing to do the same job for less as a way to build hours or for whatever reason. Similarly, many start up airlines have been more than able to attract pilots willing to work more hours, for lower pay, with less attractive benefits.

These are but just two of various examples of how airline managers have simply been responding to the trends impacting them from outside their individual companies. Indeed, again, airline managers would frankly not be doing their jobs if they didn't outsource, lower pilot costs, etc., as that would effectively mean that they were willingly directing value to labor at the expense of shareholders. Put another way, in the parlance of classical economics, the opportunity cost of not taking these various cost-saving actions mean that airlines couldn't afford not to do them - they have no choice.

Quoting EaglePower83 (Reply 85):
Yeah, management teams from decades ago. Certainly not any in the last 10-15 years.

There has been tons of innovation in the last 10-15 years, it's just that unlike the innovation in the previous 10-15 years before that, much of it has not directly benefited labor (or indeed in some cases has harmed its interests).

Ancillary fees and price disaggregation, global joint ventures, the reemergence of 2-class small jets, new interactive market and distribution platforms, outsourcing overhauls, etc. Perhaps not as flashy as CRSs or frequent flyer programs, but important nonetheless.

But, alas, the last 10-15 years haven't been a great time for the kind of innovation that dominated the 1980s and 1990s. The 1980s and 1990s were a time of near-continual explosive growth, with massive jumps in volume and revenue, cheap fuel, and lots of money in the hands of a few industry actors most effective at surviving deregulation.

Those days are, needless to say, over. And, also needless to say, it's easier to "innovative" when the money is plentiful. The airline industry has been in a near-perpetual state of survival mode since 9/11 that it is only now, a decade later, beginning to emerge from.


User currently offlinealuminumtubing From United States of America, joined Jul 2008, 367 posts, RR: 12
Reply 92, posted (2 years 3 months 1 week 4 days 22 hours ago) and read 6264 times:

The APA board unanimously approved a strike vote today. AA is treading lightly so far, so it will be interesting to see who blinks first. I know a strike may not be legal, but I am not sure if that will prevent one from occurring. I am a middle of the road guy, just calling it like I see it based on what my fellow crew members are saying. This is not the forum for specifics.

User currently offlinegigneil From United States of America, joined Nov 2002, 16347 posts, RR: 85
Reply 93, posted (2 years 3 months 1 week 4 days 21 hours ago) and read 6230 times:

Quoting mcdu (Reply 83):
If it was such a great investment, as a taxpayer where do I get my check?

That money goes to paying back the 8 years of debt the previous administration piled on us.

Most people like the country running well, as opposed to demanding their cut. I guess that's the difference between good and bad people.

Quoting MAV88 (Reply 87):
It's not our faults states that rely heavily on their jobs, Michigan for example, never bothered to diversify their economies.

I don't care whose fault it is. I'd prefer those million people have jobs. I can do without the extra $12 a month it cost me.

NS


User currently offlineMAV88 From United States of America, joined May 2011, 183 posts, RR: 0
Reply 94, posted (2 years 3 months 1 week 4 days 21 hours ago) and read 6204 times:

Quoting gigneil (Reply 93):
Quoting MAV88 (Reply 87):
It's not our faults states that rely heavily on their jobs, Michigan for example, never bothered to diversify their economies.

I don't care whose fault it is. I'd prefer those million people have jobs. I can do without the extra $12 a month it cost me.

NS

To each his own. You're rewarding failure. I don't care if it's an investment firm, or a car manufacturer.

States like Ohio and Michigan, the poster children for the Rust Belt, have failed and the Government bailed them out.


User currently offlineHPRamper From United States of America, joined May 2005, 4144 posts, RR: 8
Reply 95, posted (2 years 3 months 1 week 4 days 21 hours ago) and read 6198 times:

Quoting N737AA (Reply 80):
The more you talk, the more I wonder what world you live in....Just sayin'

  
A world where, clearly, even a publicly traded company can take care of its employees - non-union employees at that - and still keep the respect of Wall Street and the blessings of the shareholders. Your world must be a very sad and cynical one.


User currently offlineTan Flyr From United States of America, joined Aug 2000, 1920 posts, RR: 0
Reply 96, posted (2 years 3 months 1 week 4 days 21 hours ago) and read 6173 times:

[quote=Flaps,reply=13]And they did that out of the goodness of their hearts and their concerns over the long term viability of the company and all of their fellow coworkers? Allow me to call bullsh@t on that. They did it to protect their own behinds and nothing more. AA took a gamble by staying out of bankruptcy as long as they did. They tried to protect their shareholders and their employees by not wiping out pensions and investments through the courts. This was a noble effort and well thought of at the time by those same groups that are now vilifying them for not doing so. AA took a chance and they lost. That is unfortunate but it is what it is. Had it been successful, no doubt the pilots would be claiming all the credit just as they are now dishing out the blame.



well put.


User currently offlineMir From United States of America, joined Jan 2004, 21865 posts, RR: 55
Reply 97, posted (2 years 3 months 1 week 4 days 19 hours ago) and read 6064 times:

Quoting Revelation (Reply 77):
In this case, the shareholders of the next instance of AA are the ones sitting today on the creditors committee, and of course it won't be in their interest to be back in BK any time soon.

Not in their interest, sure, but that doesn't mean it won't happen. If various airlines use the BK process to one-up everyone else with favorable contracts, the cycle will repeat itself eventually, even if the time between bankruptcies for an individual airline are relatively long.

-Mir



7 billion, one nation, imagination...it's a beautiful day
User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 98, posted (2 years 3 months 1 week 4 days 19 hours ago) and read 6069 times:

Quoting Mir (Reply 97):
If various airlines use the BK process to one-up everyone else with favorable contracts, the cycle will repeat itself eventually, even if the time between bankruptcies for an individual airline are relatively long.

Just like - in reverse - how, in the 1990s, airline unions used pattern bargaining and [insert competitor airline]+1 to continually drive labor costs up. Like with so much else, it really is a 2-way street, and like with so much else, the market will eventually settle at some point of equilibrium.


User currently offlineRevelation From United States of America, joined Feb 2005, 12961 posts, RR: 25
Reply 99, posted (2 years 3 months 1 week 4 days 19 hours ago) and read 6016 times:

Quoting Mir (Reply 97):
Not in their interest, sure, but that doesn't mean it won't happen. If various airlines use the BK process to one-up everyone else with favorable contracts, the cycle will repeat itself eventually, even if the time between bankruptcies for an individual airline are relatively long.

Indeed. It just shows that it takes a "special" kind of investor to want to invest in an airline.

Personally, I think that "special" kind of investor is a fool.

Quoting commavia (Reply 98):
Like with so much else, it really is a 2-way street, and like with so much else, the market will eventually settle at some point of equilibrium.

Which IMHO means sane investors wouldn't touch airline stocks with a barge pole.



Inspiration, move me brightly!
User currently offlineHPRamper From United States of America, joined May 2005, 4144 posts, RR: 8
Reply 100, posted (2 years 3 months 1 week 4 days 19 hours ago) and read 6017 times:

Quoting Revelation (Reply 99):
Which IMHO means sane investors wouldn't touch airline stocks with a barge pole.

Not in any long-term way.

If one is smart and very aware of the situation, a lot of money can be made short-term.


User currently offlineN737AA From United States of America, joined Aug 2008, 270 posts, RR: 0
Reply 101, posted (2 years 3 months 1 week 4 days 10 hours ago) and read 5865 times:

Quoting commavia (Reply 91):
Quoting mcdu (Reply 83):
The employees get no say in these disastrous ventures. We get lip service about how each "new" idea is going to be a revolutionary change to the industry. When they go wrong, just as anticipated it is the employees that must pay with job, wage and benefit cuts.

Welcome to capitalism.

That's how it works, and I am amazed that some airline employees think the normal rules that apply everywhere else in the world don't apply to them. In a capitalist system, employee have to live with the decisions management makes - if the management team makes the right decisions, good, and if the decisions are bad, than bad. Or, they leave. That's life.

If somebody doesn't like the direction things are heading, and an employee is "anticipating" that things will "go wrong," that employee is free to leave before the ship sinks. Not sure why some think that in the airline industry you can allegedly watch the slow motion train wreck, stick around for it, act shocked when its apparently-obvious consequences actually occur, and then blame someone else for not taking advantage of your own supposed clairvoyance.

The U.S. airline unions' fixation on seniority über alles, whatever its other outcomes positive or negative, has created a disincentive for workers to act as rational economic actors, as they would in virtually any non-union job in any other industry.

Well put....most union members believe they are entitled to the best pay and benefits even though they do not perform but to the lowest acceptable standard, and many times they don't even perform at an acceptable standard in terms of productivity. Unfortunately for them their jobs are going to those places that the people prove that they are willing to work.

Quoting commavia (Reply 91):
So if you are an airline mechanic in the U.S. today, mad about the falling price of your labor, far less of your "blame" should be directed at "greedy airline executives" and far more at the at workers TIMCO, AAR, etc., to say nothing of Aeroman, HAECO, Ameco, etc. who are willing to do the same job for less money. And, ultimately, you should direct the vast majority of "blame" at passengers themselves, who have shown time and time again that they simply do not know nor care where their plane is overhauled. Thus, while many American AMTs may vigorously dispute that mechanics at lower-cost vendors, with less FAA oversight, are truly doing comparable work, the truth is that commercial aviation safety, at least on the face of it, appears to be getting consistently safer, and until that changes, most people will continue to reward the airline that outsources and punish the one that doesn't.

Funny thing is that most AMT's at the airlines got their start at places like these and most will admit that they would never go back because they actually require you to work productively or you will be fired, something that the union's have forgotten about.....actually working productively.

N737AA


User currently onlineincitatus From Brazil, joined Feb 2005, 4068 posts, RR: 13
Reply 102, posted (2 years 3 months 1 week 4 days 8 hours ago) and read 5809 times:

Quoting Mir (Reply 97):
If various airlines use the BK process to one-up everyone else with favorable contracts, the cycle will repeat itself eventually,

Do not take that for granted. Wages often suffer pressure in the other direction. A little scarcity in a particular skill in the job market pushes wages up. If companies in a particular industry keep on cycling through labor cost reductions it can only be because those wages are way out of line with the rest of the economy.

Many people say there is an impending pilot shortage. If true, wages will reflect the shortage and increase naturally.



Stop pop up ads
User currently offlineXFSUgimpLB41X From United States of America, joined Aug 2000, 4229 posts, RR: 37
Reply 103, posted (2 years 3 months 1 week 4 days 7 hours ago) and read 5800 times:

Quoting commavia (Reply 98):

Just like - in reverse - how, in the 1990s, airline unions used pattern bargaining and [insert competitor airline]+1 to continually drive labor costs up. Like with so much else, it really is a 2-way street, and like with so much else, the market will eventually settle at some point of equilibrium.

If you look at inflation charts, airline union labor costs have never kept pace with it... it has been a continual down trend since the early 70s. There was a single blip around 2000 where they finally kept pace, but that was quickly "corrected."

Now we are dramatically below the trend line. So, no... it is not a 2-way street.



Chicks dig winglets.
User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17824 posts, RR: 46
Reply 104, posted (2 years 3 months 1 week 4 days 7 hours ago) and read 5781 times:

Quoting XFSUgimpLB41X (Reply 103):
it has been a continual down trend since the early 70s.

ie since deregulation, which would explain a lot. Fares have gone the same way.



E pur si muove -Galileo
User currently offlineRevelation From United States of America, joined Feb 2005, 12961 posts, RR: 25
Reply 105, posted (2 years 3 months 1 week 4 days 6 hours ago) and read 5703 times:

Quoting MAV88 (Reply 87):
One way to look at it: The American auto makers could be a case study in bad management, poor vision and poor innovation. Toyota, Honda, etc. came in and wiped the floor with them. If you ask me, they should have let the automakers fail.

It'd be interesting to hear how you explain GM's turnaround then, as well as Chrysler's a few decades ago.

Quoting MAV88 (Reply 87):
It's not our faults states that rely heavily on their jobs, Michigan for example, never bothered to diversify their economies.

The reality was that the liquidation of GM would have cost all of us more in terms of paying out unemployment than what the bailout cost. Both the previous and current administrations realized that. Everyone involved (shareholders, union workers, management) took a haircut.



Inspiration, move me brightly!
User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 106, posted (2 years 3 months 1 week 4 days 6 hours ago) and read 5673 times:

Quoting XFSUgimpLB41X (Reply 103):
If you look at inflation charts, airline union labor costs have never kept pace with it

And nor should it.

The prevailing market price for any good or service - including an hour of labor for a worker in a given job or skill - is driven by supply and demand, not inflation. As such, it is only natural that in the last few decades, the "price" (or cost, as measured by wages and other compensation) of airline labor has, in general, declined because you have had many more people willing to do these jobs at lower cost (supply up), and less people needed to do these jobs because of automation and outsourcing (demand down). That's simple economics - when supply goes up and demand simultaneously goes down, there is pretty much only one way price would go.

Quoting XFSUgimpLB41X (Reply 103):
it has been a continual down trend since the early 70s

Yep - the same general trend can be observed for a whole host of goods and services in the United States - including, not coincidentally, airfares.


User currently offlineTVNWZ From United States of America, joined Feb 2006, 2413 posts, RR: 2
Reply 107, posted (2 years 3 months 1 week 4 days 5 hours ago) and read 5618 times:

Quoting Revelation (Reply 105):
Quoting MAV88 (Reply 87):One way to look at it: The American auto makers could be a case study in bad management, poor vision and poor innovation. Toyota, Honda, etc. came in and wiped the floor with them. If you ask me, they should have let the automakers fail.
It'd be interesting to hear how you explain GM's turnaround then, as well as Chrysler's a few decades ago.

We also tend to forget that Japan and Germany basically started with freshly designed plants after WWII because we bombed them into rubble. And we gave a big government bailout to our former enemies to construct those nice new plants.
We, however, were left with older plants that had to quickly change over from a war economy to a peacetime economy.

Detroit got its bailout some half century after Japan and Germany partly because of WWII and partly because of our economic policy to keep the Yen artificially propped up so Japanese imports were cheaper. There is no vacuum. The worldwide economy has many, and varied, consequences for all of us.


User currently offlineapodino From United States of America, joined Apr 2005, 4317 posts, RR: 6
Reply 108, posted (2 years 3 months 1 week 4 days 5 hours ago) and read 5611 times:

Quoting RyanairGuru (Reply 90):

To be fair to managers, they are legally obligated to put the interests of their shareholders (who want quick profit and subsequent raises in share price) first. If they are seen to put the interests of labor ahead of the members of the corporation that could lead them into court.

This is a big problem in the US imo. I know what the laws say...and I don't necessarily agree with it. It is mentioned on here often that the purpose of companies is to make money for shareholders and not to provide jobs for employees. The problem this creates is that profit at any cost has become the norm....rather than profit coming as a result of doing the right things (I.E. Taking care of employees and treating customers right). But the biggest problem is that the guys at the top need to assume more of the risk...and it seems like when shareholders get wiped out and front line employees get screwed, the guys at the top never pay the price at all.

The other big problem is everyone wants instant results, which results in little long term planning anymore (this is not just limited to the airline industry, but the american economy in general), where long range planning is needed dearly, rather than the short term stuff.

The other thing is that if these companies are truly acting in the shareholders interest, then why is there all the Chapter 11 filings, which wipe out the shareholders completely?


There has been a lot of talk about innovation in this industry, and how there has been very little of it in recent years. I don't entirely agree with that. JetBlue came along, and offered a good product with a good IFE that helped them get where they are... and Virgin America is doing the same thing. The jury may still be out on VX, but B6 has been very successful. AA has not innovated anything in recent years, and neither has UA. DL hasn't really either, but unlike other players DL does have a good long range vision, and most importantly, the employees and managers are on the same page. In order for a company to be successful, this has to be true at the company. You are not seeing it at AA, or UA at the moment, and the only way for these companies to succeed long term is for this to happen.

Quoting commavia (Reply 106):

The prevailing market price for any good or service - including an hour of labor for a worker in a given job or skill - is driven by supply and demand, not inflation. As such, it is only natural that in the last few decades, the "price" (or cost, as measured by wages and other compensation) of airline labor has, in general, declined because you have had many more people willing to do these jobs at lower cost (supply up), and less people needed to do these jobs because of automation and outsourcing (demand down). That's simple economics - when supply goes up and demand simultaneously goes down, there is pretty much only one way price would go.

The problem with this line of thinking is that in the past ten years, the Supply of qualified pilots has gone down, which means that wages should go up. What has happened instead is that that airlines simply lowered their hiring standards, which artificially created more supply and kept wages depressed. If the airlines had kept the same hiring standards that they always have, wages would have naturally had to go up due to reduced supply. With the new regs coming out on this issue, keep an eye on the supply of pilots at the regional level and lets see what happens now.


User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17824 posts, RR: 46
Reply 109, posted (2 years 3 months 1 week 4 days 5 hours ago) and read 5601 times:

Quoting apodino (Reply 108):
I don't entirely agree with that. JetBlue came along, and offered a good product with a good IFE that helped them get where they are... and Virgin America is doing the same thing

B6 is cheap--incredibly cheap. They would have been as successful, perhaps even more so w/o the IFE. VX is a total disaster.



E pur si muove -Galileo
User currently offlineRDH3E From United States of America, joined Mar 2011, 1823 posts, RR: 3
Reply 110, posted (2 years 3 months 1 week 4 days 5 hours ago) and read 5581 times:

Quoting apodino (Reply 108):
The other thing is that if these companies are truly acting in the shareholders interest, then why is there all the Chapter 11 filings, which wipe out the shareholders completely?

Once the directors of the company have realized they cannot sustain the organization their responsibility shifts from the shareholders, to the creditors. Which is formalized through the BK process. The creditors essentially become the new shareholders. It would be the same outcome for the shareholders (going to zero) and a worse outcome for the creditors (getting closer to zero) if the company were to CH 7 liquidate instead of CH 11 reorganize.


User currently offlinecommavia From United States of America, joined Apr 2005, 11973 posts, RR: 62
Reply 111, posted (2 years 3 months 1 week 4 days 5 hours ago) and read 5590 times:

Quoting apodino (Reply 108):
the Supply of qualified pilots has gone down, which means that wages should go up.

Not so fast.

If, as you claim, the supply of "qualified" pilots has, in fact, decreased, that is only half of the equation. What about demand? Has any U.S. airline been doing massive hiring of new "qualified" pilots that would drive the price up?

Quoting apodino (Reply 108):
What has happened instead is that that airlines simply lowered their hiring standards, which artificially created more supply and kept wages depressed.

And what does that tell us about the market's evolving requirements for that particular job, and how customers view that evolution?

The same could be said about many job categories in recent decades. As technology, costs and markets change, companies change the requirements for potential applications (in either direction) and that naturally impacts the price of that labor (in either direction).

Quoting apodino (Reply 108):
With the new regs coming out on this issue, keep an eye on the supply of pilots at the regional level and lets see what happens now.

Absolutely. Any regulation that raises hiring standards for commercial airline pilots will have the obvious effect of constraining supply which, holding supply constant, would lead to higher prices for that labor.


User currently offlineapodino From United States of America, joined Apr 2005, 4317 posts, RR: 6
Reply 112, posted (2 years 3 months 1 week 4 days 5 hours ago) and read 5564 times:

Quoting commavia (Reply 111):

If, as you claim, the supply of "qualified" pilots has, in fact, decreased, that is only half of the equation. What about demand? Has any U.S. airline been doing massive hiring of new "qualified" pilots that would drive the price up?

During the RJ boom, the supply of pilots at the regional level skyrocketed, and created massive demand at that level. When they couldn't fill the classes at the traditional standards, they lowered those standards to get pilots in seats, rather than raise pay so that they could attract the best. Yes that demand has tapered off in recent years as 50 seaters are no longer profitable, but at the time time that is what happened.

Quoting MaverickM11 (Reply 109):

B6 is cheap--incredibly cheap. They would have been as successful, perhaps even more so w/o the IFE. VX is a total disaster.

I know a lot of people that work at B6, and they treat their employees well from what I can see. Their costs are lower than legacy that is true, but I wouldn't use the word Cheap to refer to them, Cheap is a word best reserved for NK.


User currently offlineTVNWZ From United States of America, joined Feb 2006, 2413 posts, RR: 2
Reply 113, posted (2 years 3 months 1 week 4 days 3 hours ago) and read 5445 times:

Quoting apodino (Reply 112):
During the RJ boom, the supply of pilots at the regional level skyrocketed, and created massive demand at that level. When they couldn't fill the classes at the traditional standards, they lowered those standards to get pilots in seats, rather than raise pay so that they could attract the best.

Pay equates to "best." Don't think so or the Yankees would win every year.


User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17824 posts, RR: 46
Reply 114, posted (2 years 3 months 1 week 3 days 7 hours ago) and read 5050 times:

Quoting apodino (Reply 112):
I know a lot of people that work at B6, and they treat their employees well from what I can see. Their costs are lower than legacy that is true, but I wouldn't use the word Cheap to refer to them, Cheap is a word best reserved for NK.

It's cheap in terms of fares. B6 a) offered a service that wasn't offered in such volumes at the time from JFK and b) did it at obscenely low fares. The IFE was merely a nice afterthought.



E pur si muove -Galileo
User currently offlinemiaami From United States of America, joined Jul 2007, 635 posts, RR: 0
Reply 115, posted (2 years 3 months 1 week 3 days 7 hours ago) and read 5025 times:

AA announces new regional flying partner now that APA contract is abrogated.


http://blogs.star-telegram.com/sky_t...lot-and-flight-attendant-base.html


User currently offlineLAXdude1023 From India, joined Sep 2006, 7808 posts, RR: 25
Reply 116, posted (2 years 3 months 1 week 3 days 3 hours ago) and read 4836 times:

Quoting aluminumtubing (Reply 120):
That, is the choice of the traveling public. I know who I want my family with.

Unfortunately, as a society, the choice we have made is to make everything as dirt cheap as possible when talking about the airlines. Im happy to pay the higher fares to get the flights and airline I want. I just dropped $3K for a round trip to Europe in economy. The flights were full and I wanted a OneWorld carrier so I was happy to do it.

However, I dont think that attitude prevails with the US flying public. As a result, the airline has to adjust to the markets. Its a tragedy of the society we are.



Stewed...Lewd...Crude...Irreverent...Belligerent
User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17824 posts, RR: 46
Reply 117, posted (2 years 3 months 1 week 3 days 3 hours ago) and read 4818 times:

Quoting EaglePower83 (Reply 118):
When I'm sitting in my chair, IN THE SKY, I want the best of the best up front, with their employer, my ticketing airline, paying them the market value of their highly skilled services and not a penny less.

That's fine, but there's no correlation between safety and pay



E pur si muove -Galileo
User currently offlineapodino From United States of America, joined Apr 2005, 4317 posts, RR: 6
Reply 118, posted (2 years 3 months 1 week 3 days 2 hours ago) and read 4770 times:

Quoting MaverickM11 (Reply 123):

That's fine, but there's no correlation between safety and pay

There is some truth to this...as pay is determined by longevity and carrier and not necessarily flying ability. That being said though, not all carriers are the same even though the "one level of safety" motto is still out there. As a general rule the legacies have much tougher hiring standards than the regionals and with furloughs and everything you are much more likely to have an experience pilot at a major than a regional. That is not to say that the regional pilots are all bad, and in fact with hiring at the majors at a standstill in recent years added to the fact that entry level pay at majors can be lower than 10 year captain pay at a regional, you have a lot of excellent captains at the regional level who have plenty of experience. That being said though, because the goal of the regionals in the long term is to be as cheap as possible, many times a lot of things get through the cracks at the regional level that would never get through at the majors. This is one of the factors that led to Colgan 3407. Also the workrules and scheduling practices at the regionals can make even the most experienced pilot exhausted, and I want rested crews flying my airplanes. You don't see this problem much at the majors though.

Quoting LAXdude1023 (Reply 122):

Unfortunately, as a society, the choice we have made is to make everything as dirt cheap as possible when talking about the airlines. Im happy to pay the higher fares to get the flights and airline I want. I just dropped $3K for a round trip to Europe in economy. The flights were full and I wanted a OneWorld carrier so I was happy to do it.

Part of the problem there is that many airlines have convinced the public that flying can be done as cheap with the same cockpit crew. We now know that in the quest for this, shortcuts have been taken...often with dire consequences.

Quoting aluminumtubing (Reply 120):

You Sir, get it. Do people want a Captain with 25,000 hours of worldwide experience or do they want a novice willing to work for very low wages. If low fares are more important than experience, fine. That, is the choice of the traveling public. I know who I want my family with.

Here is the thing...if you look at most of the routes flown by mainline crews in the US, they almost all have LCC competition save for overseas flights, which will always be mainline anyways. At most of the airports where the service is mainly RJ's, there tends to not be as much LCC competition. And those are where the fares are higher. So you can either fly on a regional jet for a higher fare, or drive somewhere to get a lower fare, but a mainline flight. How does this make sense if the Mainline flights cost more to operate?


User currently offlineXT6Wagon From United States of America, joined Feb 2007, 3432 posts, RR: 4
Reply 119, posted (2 years 3 months 1 week 3 days 2 hours ago) and read 4723 times:

Quoting EaglePower83 (Reply 118):
When I'm sitting in my chair, IN THE SKY, I want the best of the best up front, with their employer, my ticketing airline, paying them the market value of their highly skilled services and not a penny less.

AA's problem wasn't how much they were paying, its that they were getting nothing back for it.

AA desperately needed to thin the pilots out, and get the remaining ones to work industry standard hours. The low productivity per pilot was murdering the bottom line even at below market wages. AA would have been dancing all the way to the bank if it could have achieved WN's payscale with WN's productivity.....

Well ok, they also needed the pilot UNION to stop holding the entire company hostage and dictate all policy. The complete and total lack of flexiblity in AA's ability to buy planes they need, in the size they need is a huge issue. The second is the Unions control over where and how AA flys the Aircraft. As stupid as it is to have management running to the union in a "mother may I" fashion for pretty much any international route changes, it gets worse when the union says "hell no" to any plan that didn't involve lots of pay offs outside of the company you know, making more money and employing more pilots by having these new routes.

To be clear, from all that I've read its the union management thats well out of control, not the employees themselves past believing the fairytails that the union has spun about the true state of total pay vs productivity relative to the rest of the industry.


User currently offlinegigneil From United States of America, joined Nov 2002, 16347 posts, RR: 85
Reply 120, posted (2 years 3 months 1 week 3 days ago) and read 4634 times:

Quoting aluminumtubing (Reply 120):
That, is the choice of the traveling public. I know who I want my family with.

Not from an educated pov you don't.

Years of service doesn't equate to being good at your job. There's no system for rewarding the "best". Just those who are "still here".

Don't get me wrong - I think most professional atps are great. But there are people with lots of experience who are awful, and a lot of relatively young ones who are amazing.

NS


User currently offlinealuminumtubing From United States of America, joined Jul 2008, 367 posts, RR: 12
Reply 121, posted (2 years 3 months 1 week 3 days ago) and read 4596 times:

Quoting gigneil (Reply 126):
Not from an educated pov you don't.

Years of service doesn't equate to being good at your job. There's no system for rewarding the "best". Just those who are "still here".

Don't get me wrong - I think most professional atps are great. But there are people with lots of experience who are awful, and a lot of relatively young ones who are amazing.


Yes, it is definitely my POV. I will be the first to admit that with a couple college degrees and 30 years as an airline pilot, I may not have an "EDUCATED POV". Oviously, experience does not guarantee perfection. But you know as well as I do, experience does matter in any field. On average, the more experienced a person is, the better.

[Edited 2012-09-12 15:21:32]

[Edited 2012-09-12 15:22:18]

User currently offlineRevelation From United States of America, joined Feb 2005, 12961 posts, RR: 25
Reply 122, posted (2 years 3 months 1 week 2 days 21 hours ago) and read 4477 times:

Quoting aluminumtubing (Reply 127):
On average, the more experienced a person is, the better.

Interesting that you should choose the word "average" because it fits right into what the previous poster was trying to say.

The word average certainly implies to me that there are a bunch in the middle, but also some on the bottom and on the top, and the point is the system really doesn't weed out the bottom and reward the top, it just rewards longevity without regard to merit.



Inspiration, move me brightly!
User currently offlineXFSUgimpLB41X From United States of America, joined Aug 2000, 4229 posts, RR: 37
Reply 123, posted (2 years 3 months 1 week 2 days 19 hours ago) and read 4410 times:

Quoting Revelation (Reply 128):
The word average certainly implies to me that there are a bunch in the middle, but also some on the bottom and on the top, and the point is the system really doesn't weed out the bottom and reward the top, it just rewards longevity without regard to merit.

Technically it does weed out the bottom since everyone is held to the same standard. The top get rewarded with instructor positions and such.



Chicks dig winglets.
User currently offlineapodino From United States of America, joined Apr 2005, 4317 posts, RR: 6
Reply 124, posted (2 years 3 months 1 week 2 days 16 hours ago) and read 4403 times:

Just saw an article in the Dallas Morning News stating that AA will freeze the pensions on Nov 1. Could this mean a massive retirement is coming just before then?

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