Lite
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American Carriers And CUSS/CUTE/Handling Agents

Wed Feb 21, 2007 4:08 am

I was wondering why more American airlines, particularly those who have been in financial difficulties over the last few years, have not been quicker to follow the European principle of outsourcing their ground operations wherever possible. At all non-hub airports, and for some carriers even in their bases or hubs, European carriers for both front of house and ramp jobs, use third party handling agents like Penauille Servisair, Swissport, Menzies Aviation or Aviance. They often wear the handling agent's uniform, but are fully trained on the systems of various customer airlines, allowing better utilisation of ground staff. Also, the airline does not have to invest in purchasing and maintaining expensive ground service equipment. Similarly, many airlines have common user check-in, gate and arrivals desks, so that these facilities can be best utilised by different airlines throughout the day.

Is this because of competition for facilities, or because handling agents in America are of such poor standards? In Europe, the handling agents often get bad publicity from airlines and frequent flyers, but we still do a pretty good job, but with the exception of foreign airlines or really small carriers, have not seen handling agents on a big scale in America.
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xjet
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RE: American Carriers And CUSS/CUTE/Handling Agents

Wed Feb 21, 2007 4:13 am

Quoting Lite (Thread starter):
Is this because of competition for facilities, or because handling agents in America are of such poor standards?

Menzies is pretty good on the D ramp in IAH I have heard. However most handling agencies are of poor standards as you suggested. There has been more use of contract ground handling since 9/11 and I predict that it will increse, unfortunately. I think customer service is encouraged in employees when the passengers they are serving are in a way signing their paycheck.
 
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LAXintl
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RE: American Carriers And CUSS/CUTE/Handling Agents

Wed Feb 21, 2007 4:23 am

One of the primary reasons US carriers do not contract in 3rd party handling to even close to the level of other carriers in Europe and Asia do are union contracts which simply bar such handling. Most US carriers have union contracts that require their own employees at stations which support mainline activity.

Secondly, CUTE availability in the US is pretty limited. Many terminal facilities are not common use and under exclusive long term leases to airlines and are only wired for that airlines own computer systems.
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commavia
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RE: American Carriers And CUSS/CUTE/Handling Agents

Wed Feb 21, 2007 5:06 am

Quoting Lite (Thread starter):
I was wondering why more American airlines, particularly those who have been in financial difficulties over the last few years, have not been quicker to follow the European principle of outsourcing their ground operations wherever possible.

There are several major reasons why American carriers have not, to a large extent, yet followed the Europeans in this regard.

First and foremost, as Laxintl said, the vast majority of U.S. carriers have binding union contracts with their ramp workers that prohibit them from outsourcing most or all of their below-the-wing handling at hubs and/or outstations. Now, it is important to note that this is definitely changing. Moves by legacy carriers like Northwest to outsource just about all of their outstations to either their regional affilities and/or third-party ground handling agents are speeding up, and no doubt this is going to continue changing over the next 5-10 years.

Another reason why many American carriers have been coy about the idea of outsourcing ground handling is because of time-critical control. The U.S. airline industry is so vastly large in size, scale and volume than its European counterpart that comparing the two operationally is difficult. Many U.S. carriers have made the decision that at least in hubs, and in many cases at large outstations too, it actually makes sense to control their ground handling in-house because when a schedule disruption mounts, they have found it much more able to get operations back up and running and recover from problems when they control the ramp and ramp workers in-house.

A third reason, which has really only taken on major significance in the last five years since 9/11, is the very important issue of security. Obviously, airlines feel more secure having their own people -- on their payroll -- working below the wing on their planes with fuel, loading/unloading, cargo, etc. This hasn't been a compelling enough factor in persuading some carriers to keep below-the-wing in-house at some smaller outstations, but if/when another terrorist attack happens, it just might.

Quoting Lite (Thread starter):
At all non-hub airports, and for some carriers even in their bases or hubs, European carriers for both front of house and ramp jobs, use third party handling agents like Penauille Servisair, Swissport, Menzies Aviation or Aviance. They often wear the handling agent's uniform, but are fully trained on the systems of various customer airlines, allowing better utilisation of ground staff.

This model is present in the U.S., but not prevelant, for the reasons mentioned above and others. Airlines want their own people working their flights or, in most cases, at the very least someone wearing the uniform and/or nametag of their airline.

Quoting Lite (Thread starter):
Also, the airline does not have to invest in purchasing and maintaining expensive ground service equipment. Similarly, many airlines have common user check-in, gate and arrivals desks, so that these facilities can be best utilised by different airlines throughout the day.

A good portion of the expensive ground service equipment airlines in the U.S. utilize today was purchased decades ago, so it has already long been paid for and has virtually no ownership cost.

As for the CUTE issue and using common-use equipment and departure control technologies, U.S. airlines have to date been extremely resistant to this trend within the U.S. itself -- far more so than keeping below-wing servicing in-house. Airlines in the U.S. have been operating under a certain system -- i.e., they control their own terminals, facilities, gate displays, computer terminals, etc. -- of decades, essentially since the inception of CRS systems. They (at least the major carriers with huge critical mass and large operations in select stations) don't want that to change. They like the freedom and flexibiliy they are afforded by controlling a set space in the terminal and being able to use it however they want, whenever they want. Airports, of course, are getting sick and tired of this and are trying constantly to force airlines out of controlling leases and into more common-use-style lease agreements. For some airports it is working, for some it is not.
 
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RE: American Carriers And CUSS/CUTE/Handling Agents

Wed Feb 21, 2007 5:25 am

Thank you all for the feedback and comments, please feel free to keep them coming, especially your experiences with handling agents in America. I thought a lot of the reason for why handling agents aren't used more in America would boil down to labor relations and the extent of these airlines' operations, so thanks for confirming that.
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Bicoastal
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RE: American Carriers And CUSS/CUTE/Handling Agents

Wed Feb 21, 2007 6:44 am

Quoting Laxintl (Reply 2):
Most US carriers have union contracts that require their own employees at stations which support mainline activity.



Quoting Commavia (Reply 3):
First and foremost, as Laxintl said, the vast majority of U.S. carriers have binding union contracts with their ramp workers that prohibit them from outsourcing most or all of their below-the-wing handling at hubs and/or outstations. Now, it is important to note that this is definitely changing

Yes, the next round of union contract negotiations is going to be particularly acrimonious. Many US airlines want to contract out significantly more of their operations. It's going to be real ugly. Don't most of the IAM contracts expire in 2009?
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star_world
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RE: American Carriers And CUSS/CUTE/Handling Agents

Wed Feb 21, 2007 6:52 am

Quoting Commavia (Reply 3):
A good portion of the expensive ground service equipment airlines in the U.S. utilize today was purchased decades ago, so it has already long been paid for and has virtually no ownership cost.

Just to pick up on this point - you are missing a huge cost element here, which is the maintenance and ongoing support of these systems. The fact that they are old, legacy systems means that they cost several orders of magnitude more to maintain than modern CUTE / CUSS systems. This applies to the terminals and printers themselves, as well as the back office connectivity including the network links back to the hosts. I have been involved in several projects where extremely compelling cases were made to US airlines / airports to adopt a common user system, and the main pushback has been from the unionized workers who have a comfortable living supporting these outdated pieces of junk!

There is simply no question when it comes to the economics of moving to these newer systems though...
 
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RE: American Carriers And CUSS/CUTE/Handling Agents

Wed Feb 21, 2007 6:59 am

I used to live in Berlin and Tegel airport is a good example of what the OP is talking about.

While you don't see the common use here like there, you do see airlines subcontracting their spoke operations. One of my neighbors used to be a CSR for Delta here in Orlando and I was at the airport very early one morning and someone was waving their arms and yelling my name from behind the Frontier counter. Lo and behold it was my neighbor, working that day for Frontier. She said she would bounce around to several airlines. I know that American handles counter duties for Alaska at MCO and I'm sure there are other examples as well.

Cheers,
Dave in Orlando
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RE: American Carriers And CUSS/CUTE/Handling Agents

Fri Feb 23, 2007 6:22 am

Quoting Commavia (Reply 3):
Airlines want their own people working their flights or, in most cases, at the very least someone wearing the uniform and/or nametag of their airline.

Just to respond to that point, at least at the handling agent where I work, there are dedicated teams for some airlines, whereby the majority of the passenger services staff who handle that airline's flights will wear the full airline uniform and been trained not only to our, but to the airline's standards, having an in depth knowledge of that customer airline. Essentially, the passenger should not be able to tell that the PSA is working for a handling agent rather than an airline.
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