First of all, it's easy to say that the contract that was voted down doesn't do enough to get the F/As back to where they were before the concessions of 2003.
The airline industry is in a new world. Between the recession post Y2K, 9/11, and the 2008 recession following the collapse of the financial markets, airlines can't "print money" like they did in the late 1990s.
Businesses no longer are willing to pay obscene walk-up fares for last-minute travel. My wife's employer, in the financial services sector, has had a travel ban in place for nearly 2 years. To get travel approved requires 2 layers of supervisor approval.
The airlines are making money, because they charge for everything that used to be included in air fares, including talking to a live person to make a reservation, sitting in the front of the coach cabin and getting early boarding, checking bags, food in domestic coach, etc.
Second, the APFA supported Parker & Co. buying AA
, because they didn't like Carty, Arpey, and Horton. I know that AA
employees have pined for the good old days of Bob Crandall, but they detested him, when he was running AA
, especially during contract negotiations.
The fact that Parker's team offered an industry-leading contract, which was increased after DL
increased its F/A pay, certainly showed that Parker and his team wanted to get started on better terms than APFA had with Horton and Arpey. By voting down the TA
, APFA rank-and-file are all but destroying the good will that Parker created by buying AMR/AA out of Chapter 11.
Third, those F/As who say that they can still get $111 million more than they have under the current contract terms don't understand basic economics. Milton Friedman used to say that life was about making choice and undertaking actions meant to improve one's situation.
You don't vote down a contract with an increased value of $193 million, for whatever reason, knowing that there will be no further negotiations, and that the arbritrator has a cap of $111 million, which he could judge as too high for the sake of the company and reduce.
It's one thing to think a stock will continue to rise, and then it starts falling. So, instead of a 50% gain, it's only 40%. The shareholder guess wrong and took a hit on his gain. But, when employees are told that there won't be a better contract, if voted down, by a agreement between management and the union leadership, the rank and file ought to take what they can get, do their part to make the company grow, and have its leadership work even harder during the next negotiations.