Originally Posted by
SLPII
As the economic melt down continues, the possibility of UPS "parking" pilots and jets seems like it's around the corner.
So what are we saying??
100
200
10 percent?
Or sell everything to DHL?
Some questions since you hypothesize:
What percentage of reduced volume will trigger your scenario in your opinion?
Realize that the aircraft size limits the ability to park and furlough.
Example: If you fly an A300 in the SDF-ORD-SDF market, realizing that much of the volume that is not time sensitive goes by truck (Yes, UPS is extraordinarily optimized. Only goes on an airplane if it can't make service by truck or team drivers) So for discussion, lets say domestic volume drops 25%.
Does UPS give up 75% of the remaining volume so we can park the A300? We do not have limitless smaller airplanes to substitute, though a few can be made) Which leads to the next question.
Are you thinking like a competitor to Fedex regarding market share and service (product) offerings and realize UPS will not backoff from a Fedex market? (Reason Sideshow made the comment about following Fedex).
Example: UPS decides to unilaterally pull domestic capabilty. This means UPS will have to let go of service market share if Fedex does not match the reduction. UPS has demonstrated thet they try to match Fedex service for service offering. They do very well putting it on trucks long before it goes on an airplane already. Reason they can let trucks go before airplanes in some cases since the later products can still make it by plane, the opposite is never true. This optimization makes it difficult to park airplanes and easier to park trucks. Goes back to first question.
How many furloughs do you believe an OT ban would absorb?
In other words, IPA has already demonstrated that an effective OT ban prevented 100 from being furloughed. (even with all the supervisors)
UPS can talk some high volume customers into different offerings, but not many. If you are a mail order company, customers expect NDA delivery times, if you are contracted to UPS and UPS says no more 0800/1030 delivery times, and your competitor uses Fedex with 0800/1030 delivery times, expect UPS to lose the business altogether. Goes back to question 2.
Nice thing having our friends at Fedex- Kind of like a competitor detente <g>