Originally Posted by
FXLAX
We aren’t taking about one more sim in the falcon building. We are talking about adding a whole other wing, a new building, to the existing training facilities. Then furnishing it with a dozen more simulators. And hiring more instructors. And etc etc. Its either that or pay Atlas to move our freight and pay us a penalty. FedEx was getting heat from Wall Street on capital expenditures. They still are evidence from their continued defense of in the last earnings call. So they scrapped that idea and went with the short term cheaper alternative. This was all pre-COVID. Eventually, I hope, they will build the extra wing because they’ll probably have to in order to expand the way they are currently planning. And because in the long term, it probably is cheaper as the cost of each additional pilot is incremental once the facility is up and running.
Or alternatively they can get scope concessions instead. The big picture here is that management opened up scope for a reason. And it’s probably not in our best interest why they did. So changing the equation to incentivize management NOT to outsource is paramount regardless of what that cost is now.
Lastly, there is no need to wonder why SWA doesn’t outsource. Their pilots’ scope clause doesn’t allow any domestic outsourcing and very little of international. It had nothing to do with regional point to point flying (which expressjet successfully staffed for 18 months). The very little outsourcing their near international scope allows (when it was negotiated before they started international flying), is disincentivized by language in that section of their scope clause. Which is why SWA later chose not to outsource their near international flying and instead do it all themselves.
Scope is everything.
So in your opinion the options FedEx had were to either build a new wing and add several sim bays OR sign a long agreement with Atlas? OK….let’s say they decided to build a new wing, that project will take on average 3-4 years from the moment the decision is made to completion. They needed airplanes and crews NOW.
Now you’re saying express jet is an example of point to point regional jet flying as a success story? I’m not sure Express Jet and success have ever been in the same sentence together (other than the two I typed above).
Words mean very little when responding to wall streets constant nitpicking.
Yes the company opened scope. Anyone know what they are asking? Yeah, me either. I presume is a reduction of penalty payments with regard to unforeseen supply shocks, but I may be wrong and we will find out soon enough.
Once again, and for the final time, you don’t know the true cost of the contract and you don’t know the marginal cost of adding the capacity in house (assuming it was even possible at all in this time frame which it likely was not). Our training capacity is increased given the new utilization of FTDs with visuals for a larger part of training. You don’t even know what our programs capacities are at! Neither do I, but at least I am not running around making claims without facts. I’m simply pointing out things that I do know from personal experience at a previous job that probably came into play in this decision.