Originally Posted by
Scoop
1. We are only negotiating a 3-4 year deal. If current conditions hold this period should be wildly profitable. Obviously the further out you go the greater that this can change. Lets play the averages and let our profit sharing provide us with $$$$. If we don't think we can sustain these kind of profits margins lets at least get one more section 6 out of it.
Good response. The area that makes the discussion germane is your use of the qualifier, "should". We
should, but might not. Whether or not this would be a good time to convert some of our profit sharing formula to pay rates is something I expect our reps to discuss.I want to keep profit sharing. I like the connection it gives us to the operation. I'm also not opposed to converting a portion of it into "above and beyond" pay rates.
Originally Posted by
Scoop
2. When people correctly point out that PS is more at risk in my mind they are referring to a black swan event permanently reducing profits. In these type of events all compensation is at risk. If it is a lesser event - profits should quickly return.
I don't think it takes a black swan. I think a bad acquisition or poorly executed merger could hurt profitability, but not trigger pay cuts. Ask United pilots how the last 6 years have gone. That's 2 negotiating cycles for us.
Originally Posted by
Scoop
3. The industry and company have changed drastically in the last decade. DAL is has been making ever increasing profits in a down economy. Consolidation has reshaped the industry and helped to minimize irrational below cost ticket pricing. DAL is running a much leaner and more efficient operation that can consistently produce large profits.
The threat from the state-owned airlines has grown, too. Will our government continue to block cabotage and foreign ownership? A change to those protections could trigger a situation where profitability drops, but not dramatically enough to see us going back to bankruptcy court.
Dropping foreign ownership restrictions could result in a few state-owned airlines going after the Big 3 in the US. Being gobbled-up by a foreign entity that can hide profits because we're now a private company owned by an emirate or kingdom could be "troublesome".
Originally Posted by
Scoop
List some examples of the kind of events that will permanently affect our profits but that would not also risk the industry leading pay-rates we are demanding?
I'm not clairvoyant, nor am I a keen accountant. I went to bed on Sept 10, 2001 oblivious to a threat I learned a lot about over the following years. The first few years saw my pay actually go up - even though my airline was wildly unprofitable. I'm not smart enough to figure out all the possible scenarios that could lead to something that kills profits, but allows us to maintain pay rates.
Should I ignore my "pilot sense" and not worry about risk I can't predict?