Originally Posted by
rickair7777
I think this whole thing is really more about CAL not wanting to pay XJET a relatively high guaranteed profit margin.
If SKW comes in with a new agreement, fine by CAL. If XJET stands alone, they will either need to negotiate a new contract with CAL, or lose flying (probably all of it eventually).
Labor is not the big issue in this deal, but there are a few concerns...
JA is not likely to agree to any deal which would force-integrate the SKW pilots into a union pilot group. It goes against the grain of the company, and it would be quite hypocritical after all the effort they put into squashing alpa last year.
But what Tony said is probably true. SKW will likely get the CAL flying...either by buying XJET under terms acceptable to both parties, or by picking up the pieces after CAL terminates the XJET contract.
The other possibility is that XJET management will voluntarily reduce their contract margins to keep the CAL flying. But will your management cheerfully eat that lost margin...or will they come looking to labor to make up the difference?
My suggestion to the XJET folks would be to make a deal with Jerry. You can probably keep your compensation package and your flying that way, which is not a bad deal in today's regional market. This is alltruistic advice, it will not benefit me to have XJET part of SKW. Actually I would likely benefit more if XJET were left alone to be disassembled by CAL since the SKW group would probably gain flying.
I don't think JA wants contractual freedom to remove your flying, I think he simply wants to avoid a pilot list integration.
I won't say that there was zero whipsaw with the ASA purchase, but in the grand scheme of things there wasn't much and both groups now have essentially equal compensation. Also it would be MUCH harder to whipsaw XJET because of the CAL scope...SKW would need a new certificate to whipsaw you guys because ASA and SKW both operate 70+ seaters.
It is about CAL not wanting to pay what we want to charge them but they also want to keep ALL the prohibited provisions of the CPA as well, like the MFN clause. They want their cake and eat it too. And why not. They wrote the CPA and then sold XJT off for $16 a share. They hold most of the cards and left XJT management with very little leverage other than taking any aircraft released and putting them to work somewhere else. But even that is restricted by clauses in the CPA.
CAL has left the door open for negotiation for a CPA with XJT. They have used SKW as a negotiating tactic. Its a win win for CAL because either they get the savings of the magnitude SKW has offered through the buyout or from XJT as an independent.
If XJT signs a deal with the same "magnitude" in savings that SKW was offering there will not be a release of aircraft. And even if they decided to release aircraft anyways, XJT has first right of refusal on them. There is no guarantee that SKW will get any CAL flying.
Our management has had two great opportunities to come to any of our labor groups for concessions. Once with the original release of the aircraft and then again when the arbitrator ruled that XJT must lower their CPA rate. But neither time have they come to us asking. "It goes against the grain of the company." But you never know.
This is not to say that an the XJT pilots would not be open to an agreement with SKW to address their concerns. I think that if the deal is right, it could benefit everyone.