Originally Posted by
MudPupppy
What job security?
Don’t assume we are safe. Saab’s are no longer money makers with the oil where it is and our Pro-rated contracts. Saab leases start expiring later this year and more in 2009. Unless oil goes down, Saabs will be returned. And we know for a fact Beaches are gone.
Q’s might not be growing as much as they thought. Majors are trying to reduce capacity and are more concerned about mergers then Qs. CAL has an option to get more Qs, the date for the decision was April 1, 2008. Yet now they are saying they aren’t hiring for the Q. Leads me to believe either more Qs won’t be in the near future, or new Qs will cancel out the airplanes leaving. If there are no Qs coming in the near future?….. Uncle Phil even said, “If Colgan doesn’t become profitable by Q3 2008, drastic changes will be made” speaking to investors.
I sure hope I’m wrong, but always keep resumes and options ready. No one is safe…except for SWA of course...
All of PCL's flying is on a capacity purchase agreement. Colgan's is pro-rate and at risk meaning we eat all the cost of operating the flight including fuel, selling the tickets etc. We also get all the profit (for the most part). The United contract is the same. Cal in IAH is pro-rate. PCL hates pro-rate because of the associated risk of fuel price hikes etc. It's exactly like hedging fuel. Hedging fuel doesn't get you gas cheaper than the spot market; it just fixes the price over a specified amount of time. Expect to see our flying shift as our contracts become ammendable this year with US Airways and United. You can bet that PCL will go for a CPA with these carriers, or pull the flying away from them and farm it out somewhere else. The saabs are still very profitable. They just are not profitable under out current agreements.
Only 17 saabs are leased. The rest are owned either by colgan or PCL or PCL corp or whoever is screwing this pooch lately. 5 1900's are leased and 1 is owned. All 137 PCL crj's are leased. I'd also hedge a bet that when PCL rebids all of the EAS flying, they will have no intent on winning. Those planes would make more money under a new CPA with an existing or new carrier. Not sure what's going on with the q400 options. Apr 1 08 was the date, but CAL doesn't exercise those options; pcl does. Maybe the next batch of planes will go to another carrier. MAybe PCL will sell the options. MAybe the q400 options will start replacing saabs. Even with the options, we can't take delivery of those new planes till 2009 according to the deal in the 10K. With that being said, I'd say that we don't need more crews for the q400 in the near term. Read the 10K. It's probably 200 pages long, but it is very revealing. A lot of the myth's are put to rest now that colgan is public.
http://phx.corporate-ir.net/phoenix....dHRhY2g9T04%3d
So here is my peanuckle/culligan conspiracy theory:
PCL bids high on the eas flying and has no intention of winning it. THose saabs and crews are either 1. shifted to new flying at UAL or wherever, or 2. those crews will displaced to the q400. I'd also bet that if we don't get a new agreement with Airways soon, we will be shifting our flying away from them. I'd also expect the "yes" union vote this summer to have some sort of effect on cost assumptions for FY08/09 etc. Of course all of this subject to change 1000 times daily. My .02