Originally Posted by
SharpestTool
Carl,
Put on your magic imagination hat. You're RA.
OK.
Originally Posted by
SharpestTool
You go to the annual shareholders meeting and give your presentation, complete with pie charts and graphs that show you are kicking the world's butt. One of those charts show PS expenditures for 2014. Another shows year over year increase in said expenditures since the inception of profit sharing. A major stock holder hits you in the Q&A following your presentation. He says he has put a significant fortune into Delta stock and expects a hefty dividend for his effort. Then he asks whether that 1.1 billion could be better utilized in the form of dividends for stockholders? You of course stress that is important to share the wealth with the employees and that it ultimately increases teamwork, etc,etc.
The BIG Holder then says, fine, whatever, but how much is it going to cost us next year.
"Well, er, um,..., sir, the cost is zero because I can't tell the future."
Of course I or RA wouldn't say that. The only correct answer to that question would be: "There's no way to determine next year's profit sharing cost because we don't know what the profit will be...or if they'll be one."
It would be a similar answer if a shareholder demanded to know what next year's fuel costs will be. Or next year's maintenance costs.
Originally Posted by
SharpestTool
C'mon Carl. Quit embarrassing yourself.
Again man, personal insults don't help to make your case. You have to deal in facts.
Originally Posted by
SharpestTool
RA is going to tell this guy what he expects to hear. PS is a cost of doing business. As such it is accounted for. He will quote his modeling that will establish a range of probability. From the range of probability a cost estimate will be derived and budgeted for.
This is where I think you're getting confused. There's a huge difference between planning, accounting, budgeting, etc., and
costing out a dollar amount in Section 6 negotiations. That process results in a dollar figure that contractual changes
will produce in future years. Items like profit sharing would never be accepted by the NMB as a line item on a costing sheet because you cannot put a dollar figure on
future profit sharing. Once the NMB gets involved, it's all about the costing of each contractual gain/concession. An item that could be 1 billion or zero won't be accepted by the NMB. Unless of course DALPA agrees to costing out the unknowable.
Carl