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fxramper
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Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 1:16 am

 no 

 twocents 

So the AALPA got a new union president. 57/67 AA pilot, Lloyd D Hill got the nod, with a confidential ballot. I saw this coming a few weeks ago when I was at my uncle's birthday party and he was discussing the upcoming problems AMR would face. I tried to see past it and listen to other people about a potential "mega order" for AA at the Show.

Boy, was I wrong.  no 

article

Pilots at American Airlines ousted their union leaders and opted for a slate that promised to take a tougher stance with the carrier's management. In statements that seem to bode poorly for future labor-management relations at AA, newly elected union president Lloyd Hill says current union leaders tried too hard to find a middle ground with AA's management. He adds that the union's current proposal for a 30.5% raise for pilots "is not nearly enough."

From airline analyst Mike Boyd, who I don't agree with a lot on, but this is spot on.

Boyd tells AP that AA's "management really has screwed this up. Two years ago they had collaboration (with the union). Today, I don't even think they're going to have cooperation."

So they sabotaged the DFW-PEK route and are gonna cost AA a nice Boeing order anytime soon. Congratulations Arpey!  bigthumbsup   bigthumbsup 
 
RDUDDJI
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 1:25 am

Quoting FXramper (Thread starter):
So they sabotaged the DFW-PEK route and are gonna cost AA a nice Boeing order anytime soon. Congratulations Arpey!

Sorry, I just don't see the connection between angry employees and capital investment...

I want a 30% raise too, but my company ain't gonna stop doing business to give it to me...
Sometimes we don't realize the good times when we're in them
 
contrails
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 1:30 am

I see some difficult days ahead for AA. Employees have had salaries cut and benefits reduced, and the want that reversed. I can't say that I blame them.
.
Flying Colors Forever!
 
Lumberton
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 1:36 am

Quoting RDUDDJI (Reply 1):
Sorry, I just don't see the connection between angry employees and capital investment...

I certainly do. Arpey & company fouled up badly with that last round of executive bonuses. The employees are not happy and the unions seem to be in little mood to compromise.

Quoting Contrails (Reply 2):
I see some difficult days ahead for AA. Employees have had salaries cut and benefits reduced, and the want that reversed. I can't say that I blame them.

 checkmark 
I'm simply astonished at the lack of leadership at AA. The employees gave until it hurt. I wouldn't be surprised to see a strike at some point, or at the very least, a new CEO, one more along the lines of a leader, rather an a "manager".

Flame away.
"When all is said and done, more will be said than done".
 
ikramerica
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 1:36 am

AA pilots are greedy, plain (plane) and simple.

Just a clue, guys. It isn't the 1990s anymore. Things have changed. Adapt or perish.
Of all the things to worry about... the Wookie has no pants.
 
N276AASTT
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 1:40 am

Quoting Contrails (Reply 2):
Employees have had salaries cut and benefits reduced, and the want that reversed. I can't say that I blame them.

Doesn't help when the top 1000 or so execs in AA management received huge bonus checks from AA stocks back in April.
Dejale Caer tu el Peso! YOMO
 
justloveplanes
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 1:43 am

Quoting Lumberton (Reply 3):
I'm simply astonished at the lack of leadership at AA. The employees gave until it hurt. I wouldn't be surprised to see a strike at some point, or at the very least, a new CEO, one more along the lines of a leader, rather an a "manager".

I couldn't guess how much it hurt at AA, but at least they kept their pensions. DL, UA, NW, and US all probably lost theirs. CO's lost theirs in the early 90's. AA folks have at least something to be grateful for relative to all the other majors, despite the pain.
 
AAR90
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 1:47 am

Quoting FXramper (Thread starter):
So the AALPA

Who or what is AALPA?  covereyes 
*NO CARRIER* -- A Naval Aviator's worst nightmare!
 
BigAppleCoder
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 1:51 am

Quoting Contrails (Reply 2):
I see some difficult days ahead for AA. Employees have had salaries cut and benefits reduced, and the want that reversed. I can't say that I blame them.

No, you can't blame the employees for trying to get back what they lost, especially with management appearing to want to bleed the company dry with their bonuses. The pilots union has effectively served notice to management that relations are going into the toilet. Unfortunately, a 30.5% (or more) raise just isn't feasible in light of high fuel prices and softening demand. Management is in an unenviable spot. If they acquiesce to the pilots then the mechanics and flight attendants will be pounding on the door for their share. If they don't then the pilots union will strictly enforce work rules and drive up costs anway. Either way, AA is going to need major help to avoid bankruptcy.
 
airtran737
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 1:52 am

How does AA base their aircraft pay, is it weight or seats? The 787 is going to replace the 767, and being that it is roughly the same size as the 767 there should not be any sort of pay increase for flying it.
Nice Trip Report!!! Great Pics, thanks for posting!!!! B747Forever
 
ShannoninAMA
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 1:54 am

Quoting AAR90 (Reply 7):
Who or what is AALPA?

Im wondering the same thing...hmm


What about


American
Air
Lines
Pilot
Associaion?



Shannon  half 
Shipwreck alert. Head on over to Airspaceonline.com.
 
bigjku
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:02 am

Quoting Lumberton (Reply 3):
I certainly do. Arpey & company fouled up badly with that last round of executive bonuses. The employees are not happy and the unions seem to be in little mood to compromise.

Didn't the pilots turn down a proposal to be involved in just such a program at various points? They did not want profit sharing or company stock from what I remember. They simply wanted raises.

Quoting Ikramerica (Reply 4):
AA pilots are greedy, plain (plane) and simple.

Just a clue, guys. It isn't the 1990s anymore. Things have changed. Adapt or perish.

 checkmark 

Honestly, what do they expect? They want to keep their pensions and get huge raises which is just absurd. Defined benefit plans like Pensions are going the way of the Dodo and anyone asking for more than a 30% raise is just nuts. While it is certainly a high skill job the average pilot for American Airlines is doing pretty well all things considered. I would hazard to guess that executive pay, even including bonuses, is a pretty small line item expense compared to a 30% raise for every pilot in the company.

These morons are going to negotiate themselves right out of jobs by killing the company.
 
Fleet Service
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:04 am

Do a little research, you'll see the APA 'Cleans House' around contract time on a fairly regular basis.

A new slate is elected, vowing change and promising 'Action' until they actually get into office and promptly get a dousing with the cold water of reality,just like with politicians.

There is also the fact that the isn't a pay rate for the 787 on the books yet, AA doesn't want to end up like Delta did a few years back with a nice shiny new airplane and the lack of a pilot pay rate hindering their usage of it.


Make no mistake, AA will be a large 787 operator in the years to come,but they aren't ordering anything until the contract is hammered out.
Yes, I actually *do* work for an airline,how about you?
 
ikramerica
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:05 am

Quoting Justloveplanes (Reply 6):
despite the pain

Can someone quantify the "pain" these AA pilots are in? Other than having pay cut, if you just were to take a snapshot today, and not know how they have been injured, what is their payscale and benefit package?
Of all the things to worry about... the Wookie has no pants.
 
MCIGuy
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:08 am

For now, but it's a shame that the union interferes with the company purchasing equipment that it needs to be competitive. Oh well, ALPA won't exist in 20 years anyway, maybe 10, the way it's going.
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MaverickM11
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:08 am

Quoting FXramper (Thread starter):
Congratulations Arpey!

I don't blame Arpey. The APA would be doing this if Arpey gave them everything they wanted.
E pur si muove -Galileo
 
justplanenutz
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:09 am

Anybody know how long it would be until a strike if AA accepted there would eventually be one and just rode it out? I know the contract becomes amendable in April 2008, but how long after that could the APA strike? Its never too early to make next summer's travel plans.
 
bmacleod
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:10 am

At this rate, I don't expect an order until 2009 at the earliest.....
The engine is the heart of an airplane, but the pilot is its soul.
 
bigjku
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:10 am

Quoting BigAppleCoder (Reply 8):
No, you can't blame the employees for trying to get back what they lost, especially with management appearing to want to bleed the company dry with their bonuses.

The total was estimated at $70 million. American stock rose to almost 3 times its previous value in the last 2 years. This generated billions of dollars in capital for the company. Pilots had a chance to be in on a stock driven bonus plan and have repeatedly said no. I did not see them crying for management when they all took paycuts because the stock prices sucked.

What the pilots want is a promise of higher pay regardless of how the company performs. That is just not realistic in the modern business environment.
 
EXAAUADL
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:14 am

Quoting RDUDDJI (Reply 1):
Sorry, I just don't see the connection between angry employees and capital investment...

LOL....that's funny.
 
MCIGuy
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:15 am

Quoting RDUDDJI (Reply 1):
Sorry, I just don't see the connection between angry employees and capital investment...

It's because they're union and they can cripple the company if the company does something they don't like. Those days are coming to an end however.  Smile
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floridaflyboy
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:16 am

Quoting Justloveplanes (Reply 6):
I couldn't guess how much it hurt at AA, but at least they kept their pensions. DL, UA, NW, and US all probably lost theirs. CO's lost theirs in the early 90's. AA folks have at least something to be grateful for relative to all the other majors, despite the pain.

NW did not lose their pension. It's still intact.
Good goes around!
 
EXAAUADL
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:16 am

Quoting N276AASTT (Reply 5):
Doesn't help when the top 1000 or so execs in AA management received huge bonus checks from AA stocks back in April.

That's partyl teh unions fault. They wanted mgmt to be paid based on performance, while they themselves dotn want to be paid based on financial performace. AMR shares rose and mgmt got paid...there is no screw up here. I saw on CNBC this morning that AMR shares are down liek 23% year to date. If mgmt gets big bonuses for 2007, then I'll agree with the union.
 
WAH64D
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:18 am

Quoting BigJKU (Reply 11):
Honestly, what do they expect? They want to keep their pensions and get huge raises which is just absurd. Defined benefit plans like Pensions are going the way of the Dodo and anyone asking for more than a 30% raise is just nuts. While it is certainly a high skill job the average pilot for American Airlines is doing pretty well all things considered. I would hazard to guess that executive pay, even including bonuses, is a pretty small line item expense compared to a 30% raise for every pilot in the company.

These morons are going to negotiate themselves right out of jobs by killing the company.

If the company hadn't well and truly shafted them, they wouldn't be in this position in the first place. The only reason AA is still in existance is due to the Pilots mx and cabin staff taking pay-cuts to keep the company afloat. Some of you talk badly of European unions and Labour Laws, it would appear that its no different on your sunny shores. AA is a bloated, inneficient joke of an operation and it wouldn't last 2 minutes anywhere outside the United States. Big changes need to be made to consolidate a fleet that is too high in aircraft types/manufacturers and completely inneficient.

Pension plans are going the way of the Dodo to keep the shareholders happy, pure and simple. I think AALPA are spot-on in their stance. Too many concessions have been made and its time to draw a line in the sand. AA must be prepared to give something back to its staff in return for the concessions they accepted to keep the company going.
I AM the No-spotalotacus.
 
MaverickM11
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:24 am

Quoting WAH64D (Reply 23):
If the company hadn't well and truly shafted them,

They didn't! The APA shafted itself.

Quoting EXAAUADL (Reply 22):
They wanted mgmt to be paid based on performance, while they themselves dotn want to be paid based on financial performace.



Quoting BigJKU (Reply 18):
Pilots had a chance to be in on a stock driven bonus plan and have repeatedly said no.
E pur si muove -Galileo
 
airtran717
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:28 am

The argument always stands when you start talking unions and negotiations and pay, etc. Most employees truly do deserve more money than they get. But the bottom line I learned, after 3 contract negotiations at FL, is this:

Do you want more this or that from a new contract, or are you willing to shut the company down and stand in the unemployement line for what you believe you deserve? Doesn't make sense to me. I'd rather keep my job for the time being, until I can find something better... status quo is always better than no job at all....

717
 
Fleet Service
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:31 am

Quoting EXAAUADL (Reply 22):
I saw on CNBC this morning that AMR shares are down liek 23% year to date.

It's not just AMR that is down double digits percentage wise, the sector as a whole is down year to date.The cost of fuel is impacting all the airlines at this point.
Yes, I actually *do* work for an airline,how about you?
 
slvrblt
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:33 am

Quoting FXramper (Thread starter):
So they sabotaged the DFW-PEK route and are gonna cost AA a nice Boeing order anytime soon. Congratulations Arpey!

I've noticed that you, FXramper, usually try to have the negative slant on things to say about AA. Got something against AA, or are you jealous?

Quoting Contrails (Reply 2):
I see some difficult days ahead for AA. Employees have had salaries cut and benefits reduced, and the want that reversed. I can't say that I blame them.
.

No....we have not taken any paycuts or any other cuts, for that matter, since the misery following 9/11, so that's wrong. And unlike some other carriers, we have our pensions (so far)!

Quoting Ikramerica (Reply 4):
AA pilots are greedy, plain (plane) and simple.

No, not all of the guys are that way. But if their leadership thinks they are getting 30% ++ raises, I suggest the pilot union may want to look up the word "bankruptcy" in Webster

Quoting N276AASTT (Reply 5):
Doesn't help when the top 1000 or so execs in AA management received huge bonus checks from AA stocks back in April.

I don't have as big a problem with that - we got stock options too, I'm not management. I would be angry if it were outright cash bonuses flowing along with huge paychecks, like at some other carriers...my "stock options" have increased roughly 50+% too, due to the market. Keep this in perspective please. The fact remains, this management team has kept AA out of bankruptcy, and whatever you all say, the unions have a far better relationship with management right now than I have seen in years, especially during Crandall's tenure. I work here - you don't.

Don't get me wrong - I think our management has failed dreadfully in communicating the extent of the stock option thing and making sure rank and file understood it, WAY before it was reality. But it isn't like it was hidden. And compared to other major corporations, I was surprised to find our executive folks aren't paid as highly as some other companies.

I also think they need to start thinking about "giving back" SOME of the stuff that we lost after 9/11. No, maybe not all of it, ( I'd still rather be employed) but it's time for a little giveback. Pick the cheapest thing, it's the symbolism that would go a long way.
..everything works out in the end.
 
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fxramper
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:35 am

My apologies...I meant APA, not ALPA. Seeing those ALPA lanyards on the ramp too much.  blush 
 
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chrisnh
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:38 am

If an order comes in 2009 for a plane that is already sold out till well into the next decade, when could AA expect their 787s? And do they have enough duct tape and wire to keep the planes they have aloft until then?
 
n844aa
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 2:41 am

Quoting WAH64D (Reply 23):
AA is a bloated, inneficient joke of an operation and it wouldn't last 2 minutes anywhere outside the United States. Big changes need to be made to consolidate a fleet that is too high in aircraft types/manufacturers and completely inneficient.

No, AA in August 2001 was a bloated, inefficient joke of an operation with too many fleet types/manufacturers. Say what you will about their current state, but they've clawed their way back to profitability, all the while paying down debt and avoiding bankruptcy. Also don't forget that the Wright restrictions are finally fading away, something else that hasn't helped the bottom line. Labor strife is par for the course, and maybe it'll eventually doom the company, but it's not like they haven't responded successfully to a lot of challenges over the last six years in particular, and the last thirty years generally.

While I'll readily admit the various American airlines' shortcomings compared to particular carriers around the world, the domestic market here is pretty competitive and mature. I'm not sure how you can make the blanket statement that the biggest airline in the world couldn't compete anywhere else. The federal bankruptcy code is a lenient -- perhaps overly so -- course of restructuring available to struggling airlines, sure, but a.) AA hasn't availed itself of that, and b.) stories of government airline bailouts are, in general, greatly exagerrated.
New airplanes, new employees, low fares, all touchy-feely ... all of them are losers. -Gordon Bethune
 
jacobin777
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 3:00 am

Quoting Lumberton (Reply 3):

I certainly do. Arpey & company fouled up badly with that last round of executive bonuses. The employees are not happy and the unions seem to be in little mood to compromise.

.....they were "stock-based" bonuses, which management for almost every company gets..aviation or non-aviation.....

Quoting Ikramerica (Reply 4):
AA pilots are greedy, plain (plane) and simple.

 checkmark 

Quoting Lumberton (Reply 3):

I'm simply astonished at the lack of leadership at AA. The employees gave until it hurt. I wouldn't be surprised to see a strike at some point, or at the very least, a new CEO, one more along the lines of a leader, rather an a "manager".

Arpey has been with AA for decades....he knows AA probably better than anyone else in the world...

Quoting Justloveplanes (Reply 6):
I couldn't guess how much it hurt at AA, but at least they kept their pensions. DL, UA, NW, and US all probably lost theirs. CO's lost theirs in the early 90's. AA folks have at least something to be grateful for relative to all the other majors, despite the pain.

 checkmark 

Maybe AA should go into bankruptcy like the other legacies..that would allow him to renegotiate all of the union contracts...maybe the unions would enjoy that... stirthepot 

Quoting BigAppleCoder (Reply 8):
No, you can't blame the employees for trying to get back what they lost, especially with management appearing to want to bleed the company dry with their bonuses.

....do you have any idea what you are talking about? Management didn't "steal" money from AA.....the stock did well and they got stock-based compensation..it happens with all industries.....

Quoting BigJKU (Reply 18):
Pilots had a chance to be in on a stock driven bonus plan and have repeatedly said no.

 checkmark ..don't blame management for the bad decisions of the unions...

Quoting BigJKU (Reply 18):
What the pilots want is a promise of higher pay regardless of how the company performs. That is just not realistic in the modern business environment.

.... checkmark 

Quoting WAH64D (Reply 23):
The only reason AA is still in existance is due to the Pilots mx and cabin staff taking pay-cuts to keep the company afloat.

...and what carrier didn't? Maybe they should have gone the way of DL...

"Grinstein's results are all the more remarkable given the neat trick he pulled off: He ultimately won support of employees despite slashing their pay by up to 42%, eliminating 23,600 jobs and abolishing their defined-benefit pension plan."*

*forbes.com

Quoting MaverickM11 (Reply 24):
Quoting WAH64D (Reply 23):
If the company hadn't well and truly shafted them,

They didn't! The APA shafted itself.

 checkmark 

Quoting SLVRBLT (Reply 27):
I suggest the pilot union may want to look up the word "bankruptcy" in Webster

 checkmark ....

Quoting SLVRBLT (Reply 27):
The fact remains, this management team has kept AA out of bankruptcy

 checkmark 
"Up the Irons!"
 
AeroWesty
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 3:00 am

Quoting BigJKU (Reply 18):
American stock rose to almost 3 times its previous value in the last 2 years. This generated billions of dollars in capital for the company.

I having a bit of a hard time with this statement. The market capitalization of AMR has certainly risen since the low-low days of the summer of 2003, but since AMR can't act as its own shareholder, it really doesn't see any direct benefit in "capital", unless it issues shares to purchase another company. The usual beneficiaries of a higher share price are the shareholders and executives with bonuses tied to stock performance.

Quoting SLVRBLT (Reply 27):
I've noticed that you, FXramper, usually try to have the negative slant on things to say about AA. Got something against AA, or are you jealous?

Being a realist and bringing a topic to the forum isn't necessarily having something against AA. I've seen FX post and talk about many good things about AA as well.
International Homo of Mystery
 
bigjku
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 3:20 am

Quoting WAH64D (Reply 23):
Pension plans are going the way of the Dodo to keep the shareholders happy, pure and simple.

Somewhat but as much as that the longer lifespans of people simply does not work well with a pension system. Those non-productive people are sticking around longer sucking up money. Just like any defined benefit plan, and yes I would include Social Security and any other wealth transfer to retired workers, it will eventually have more people pulling money out than it will have money on the way in.

Quoting AeroWesty (Reply 32):
I having a bit of a hard time with this statement. The market capitalization of AMR has certainly risen since the low-low days of the summer of 2003, but since AMR can't act as its own shareholder, it really doesn't see any direct benefit in "capital", unless it issues shares to purchase another company. The usual beneficiaries of a higher share price are the shareholders and executives with bonuses tied to stock performance.

Oh I agree. But a higher stock price allows them a lot more options when it comes to financing. It makes the shareholders happy, allows them to make more money in the event they did issue stock and generally improves the financial image of the company. Granted the company does not get paid directly based on its stock price but it does drive a lot of other financial aspects around the company and generates capital as a result.
 
AeroWesty
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 3:34 am

Quoting BigJKU (Reply 33):
Oh I agree. But a higher stock price allows them a lot more options when it comes to financing.

I made note of your post because of the way you closed it:

Quoting BigJKU (Reply 18):
What the pilots want is a promise of higher pay regardless of how the company performs.

What has changed in the landscape of employment that an honest day's work doesn't equal an honest day's pay for the employees? An employee shouldn't have his/her base pay tied to the whims of the stock market. Profit-sharing is and should remain an entirely separate issue from base pay.

[Edited 2007-06-21 20:35:01]
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474218
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 3:46 am

Quoting Contrails (Reply 2):
I see some difficult days ahead for AA. Employees have had salaries cut and benefits reduced, and the want that reversed. I can't say that I blame them.

And the flying public wants lower airfares, you can lower fares and raise the pay and benefits to your employees only a certain amount, then you start to lose money.

Quoting N276AASTT (Reply 5):
Doesn't help when the top 1000 or so execs in AA management received huge bonus checks from AA stocks back in April.

Rather than complain about how much management gets paid, why not strive to get in to management yourself? My brother use to complain all the time that I got more pay and better benefits because I was in management. However, everytime he was offered a supervisors job he turned it down, because he didn't want the responsibility and longer work days that go with a management position.
 
bigjku
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 3:51 am

Quoting AeroWesty (Reply 34):
What has changed in the landscape of employment that an honest day's work doesn't equal an honest day's pay for the employees? An employee shouldn't have his/her base pay tied to the whims of the stock market. Profit-sharing is and should remain an entirely separate issue from base pay.

Thats all well and good but there is a risk-reward to profit sharing and stock incentives. If the company does well you stand to earn more and if it does bad you will earn less. Since management was taking more risk with thier incetive based pay they got to reap those rewards and the pilots did not.

Last I saw the average pay for a pilot at AA was somewhere in the ballpark of $100,000. That seems like plenty of compensation to me. The primary complaint seems to be management got something and we did not.

I think an honest days pay for an honest days work is fine, but $100,000 is plenty honest. If they were paying $25,000 and basing the rest on stock performance that would be one thing. But base pay being where it is any increase should be performance based rather than simply moving up everyones pay up 5% each year.
 
DAYflyer
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 3:53 am

Quoting Ikramerica (Reply 4):
AA pilots are greedy, plain (plane) and simple.

Just a clue, guys. It isn't the 1990s anymore. Things have changed. Adapt or perish.

Sounds like they want to pay raise themselves straight to the unemployment line when they bankrupt the carrier.
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AeroWesty
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 4:06 am

Quoting BigJKU (Reply 36):
The primary complaint seems to be management got something and we did not.

When I read the link, it said in 2003 the pilots had taken a 23% pay cut, along with benefit reductions, to help the company avoid Chapter 11. I'm not intimate enough with the details to know if their pay and benefits have been frozen since 2003, or if they've received incremental raises to cover the cost of living since then.

It appears to me that the percentage the pilots are asking for is a reinstatement of their former pay, plus a reasonable extra for inflation, since the company is now on better footing. The bonuses the executives received were exactly that, bonuses from the company, whether in stock options, cash, etc. It's not unreasonable to say "okay, if we're in good enough shape to be handing out millions to those who guided us through the past few years, it's time to start handing it out to others who made a sacrifice as well." The executive bonuses weren't just free to AMR as a result of a rise in their stock price.
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WAH64D
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 4:16 am

Quoting AeroWesty (Reply 38):

When I read the link, it said in 2003 the pilots had taken a 23% pay cut, along with benefit reductions, to help the company avoid Chapter 11. I'm not intimate enough with the details to know if their pay and benefits have been frozen since 2003, or if they've received incremental raises to cover the cost of living since then.

It appears to me that the percentage the pilots are asking for is a reinstatement of their former pay, plus a reasonable extra for inflation, since the company is now on better footing. The bonuses the executives received were exactly that, bonuses from the company, whether in stock options, cash, etc. It's not unreasonable to say "okay, if we're in good enough shape to be handing out millions to those who guided us through the past few years, it's time to start handing it out to others who made a sacrifice as well." The executive bonuses weren't just free to AMR as a result of a rise in their stock price.

 checkmark 

Very well said.
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EXAAUADL
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 4:17 am

I think AA, DL and UA might have to end up leasing 787s from IFC
 
adh214
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 4:24 am

Everytime I see these debates, I am reminded of an idea for labor compensation. Instead of talking about pay rates and work rules, the management could simply offer to pay the pilots 20% of the revenue (or someother appropriate figure). The pilots could then decide how they want to split this up themselves. (per hour, per segment, size of aircraft, etc.)

Instead of being a game of "I want more..." this would align the interested of the pilots with management and the shareholders. Everyone would be working together to increase revenue.

For example, the pilots might determine that flying a nonstop from say DFW to Beijing would bring in a great deal more revenue per hour worked than using the same time to fly nonstops between DFW and SAT.

Finally, don't forget management took major paycuts in 2003 as well.

Andrew
 
bigjku
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 4:29 am

Quoting AeroWesty (Reply 38):
It appears to me that the percentage the pilots are asking for is a reinstatement of their former pay, plus a reasonable extra for inflation, since the company is now on better footing.

Perhapse the company is on better footing because it is no longer overpaying the pilots...
 
charlienorth
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 4:30 am

Quoting JustPlaneNutz (Reply 16):
Anybody know how long it would be until a strike if AA accepted there would eventually be one and just rode it out? I know the contract becomes amendable in April 2008, but how long after that could the APA strike? Its never too early to make next summer's travel plans

Under the Railway Labor Act..this could go on for a couple years,it's unpredictable how long it could take for a strike,there is mediation,super mediation,voting,a Presidential Emergency Board could be called if there is a strike and that adds more time to the whole mess,I've always disliked contract time,the rumors and whining get too annoying,guys do dumb-ass things,the company pushes back hard,it seems like you rake four years building a house and two years trashing the place, I don't blame the APA membership for pushing for improvements in their contract,and when I see postings about unions being dead in 10 years makes me hope I never work for any of you.
Work hard fly right..don't understand it
 
ikramerica
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 4:34 am

Is anyone who is crying for the pilots going to actually answer my question re: what the pilots are paid now?

It's an important question...
Of all the things to worry about... the Wookie has no pants.
 
TeamAmerica
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 4:35 am

Quoting FXramper (Thread starter):
management really has screwed this up.

If the union is unhappy you automatically assume management is to blame? I don't see it.

Quoting RDUDDJI (Reply 1):
Sorry, I just don't see the connection between angry employees and capital investment...

Without an agreement with the pilots AA cannot commit to the B787. They need to know what it will cost to fly it before buying.

Quoting Contrails (Reply 2):
Employees have had salaries cut and benefits reduced, and the want that reversed. I can't say that I blame them.

Can't blame them...but we certainly can criticize them. They are not being realistic.

Quoting Lumberton (Reply 3):
I'm simply astonished at the lack of leadership at AA. The employees gave until it hurt. I wouldn't be surprised to see a strike at some point, or at the very least, a new CEO, one more along the lines of a leader, rather an a "manager".

I'm curious what you would consider "leadership". Harry Potter might make a fine CEO, waving his wand and making everyone's happy. Short of that, what could any CEO do that would satisfy all the interested parties?

Quoting Ikramerica (Reply 4):
AA pilots are greedy, plain (plane) and simple.

Just a clue, guys. It isn't the 1990s anymore. Things have changed. Adapt or perish.

 checkmark Bring back the CAB! Those were the good ol' days... old 

Quoting N276AASTT (Reply 5):
Doesn't help when the top 1000 or so execs in AA management received huge bonus checks from AA stocks back in April.

The pilots were aware of the deal when it was offered to management employees and made no objection to it at that time. Also notable that the pilots turned down offers of profit sharing (so I'm told).

Quoting AirTran737 (Reply 9):
The 787 is going to replace the 767, and being that it is roughly the same size as the 767 there should not be any sort of pay increase for flying it.

 checkmark  But try and convince the pilots! It will be an easier plane to fly, so why should they be paid more? Seems that SQ tried to argue that point regarding the A380 and lost.

Quoting BigJKU (Reply 11):
These morons are going to negotiate themselves right out of jobs by killing the company.

 checkmark Looks like the Miami pilots are flexing their muscle now, with the same mindset that killed Eastern...seems they will never learn.

Quoting Fleet Service (Reply 12):
Make no mistake, AA will be a large 787 operator in the years to come,but they aren't ordering anything until the contract is hammered out.

Exactly right. Rumors of a big 787 buy are nothing more than that. AA is deep in debt and the market looks to be turning south again. Oh, and the pilots want a huge raise. sarcastic 

Quoting BigJKU (Reply 18):
The total was estimated at $70 million. American stock rose to almost 3 times its previous value in the last 2 years. This generated billions of dollars in capital for the company. Pilots had a chance to be in on a stock driven bonus plan and have repeatedly said no. I did not see them crying for management when they all took paycuts because the stock prices sucked.

 checkmark And I've pointed out before that management staff are employees too! The unions certainly demand that the company honor agreements with them...so how could they expect the company NOT to pay out as agreed with the management group? Managers are employees just like pilots are, and deserve equal treatment in observation of agreed compensation.

Quoting WAH64D (Reply 23):
Pension plans are going the way of the Dodo to keep the shareholders happy, pure and simple. I think AALPA are spot-on in their stance. Too many concessions have been made and its time to draw a line in the sand. AA must be prepared to give something back to its staff in return for the concessions they accepted to keep the company going.

Your post seems self-contradictory. If AA is bloated and inefficient, how can they make a profit with which to give something back to the staff? If they don't buy new aircraft, how can they simply the fleet as you suggest? You propose a scenario where AA spends on staff and capital simultaneously...which is a practical impossibility given their enormous debt and minuscule profits.

Quoting SLVRBLT (Reply 27):
I think our management has failed dreadfully in communicating the extent of the stock option thing and making sure rank and file understood it, WAY before it was reality. But it isn't like it was hidden. And compared to other major corporations, I was surprised to find our executive folks aren't paid as highly as some other companies.

Agreed - the possibility of the payout should have been communicated better. That said...would it have really made a difference had they done so? I think the unions would be mad regardless. "Those guys" got a bonus while we did not - human nature suggests there would be discontent despite better communication.

Quoting SLVRBLT (Reply 27):
I also think they need to start thinking about "giving back" SOME of the stuff that we lost after 9/11. No, maybe not all of it, ( I'd still rather be employed) but it's time for a little giveback. Pick the cheapest thing, it's the symbolism that would go a long way.

OK...name it. What symbolic and not-too-costly gesture could AA make to demonstrate their good will? Fair enough to say that AA should do something. Much harder to say exactly what that something would be. airplane 
Failure is not an option; it's an outcome.
 
MaverickM11
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 4:39 am

Quoting Adh214 (Reply 41):
Instead of being a game of "I want more..." this would align the interested of the pilots with management and the shareholders. Everyone would be working together to increase revenue.

They did. The union said no.

Quoting AeroWesty (Reply 38):
It's not unreasonable to say "okay, if we're in good enough shape to be handing out millions to those who guided us through the past few years, it's time to start handing it out to others who made a sacrifice as well."

What if the stock tanked? Management wouldn't be cast as villains, and the hypocritical APA would surely have not been sympathetic and I guarantee you they'd still be threatening for more money all the same.
E pur si muove -Galileo
 
AeroWesty
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 5:02 am

Quoting BigJKU (Reply 42):
Perhapse the company is on better footing because it is no longer overpaying the pilots...

That wasn't your original argument. It was the pilots were asking for something someone else got which they didn't.

Quoting MaverickM11 (Reply 46):
What if the stock tanked? Management wouldn't be cast as villains, and the hypocritical APA would surely have not been sympathetic and I guarantee you they'd still be threatening for more money all the same.

Well the stock had already tanked, it was down near $1 per share at the time the pilots and other employees gave up substantial compensation. I understand the argument that the executives took more of a risk-based compensation, and are reaping the rewards of that now, but how much of that could be qualified as "back pay" for what they gave up? I don't have those numbers at hand--what the executive team sacrificed vs. what they reaped in return.

All the pilots are asking for is to have their old pay reinstated (+ inflation), and not what they "lost" in the intervening years--unless the "signing bonus" would make up about a year's worth of salary and benefits (23% times 4 years). Perhaps someone with more knowledge of the figures than the link provided in the opening post could clarify those issues.
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WAH64D
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 5:13 am

Quoting TeamAmerica (Reply 45):
Your post seems self-contradictory. If AA is bloated and inefficient, how can they make a profit with which to give something back to the staff? If they don't buy new aircraft, how can they simply the fleet as you suggest? You propose a scenario where AA spends on staff and capital simultaneously...which is a practical impossibility given their enormous debt and minuscule profits.

Reduce shareholder dividend. Let them take the hit for a change.
I AM the No-spotalotacus.
 
PGNCS
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RE: Why AA Won't Order Boeing (for Now).

Fri Jun 22, 2007 5:20 am

Quoting Ikramerica (Reply 4):
AA pilots are greedy, plain (plane) and simple.

I might think you were right if Arpey's compensation wasn't around $24,000,000 last year. Who is greedy? Oh, yeah, it's those pilots that gave up several billion dollars.