Originally Posted by
acl65pilot
Check;
Who pays our paycheck? Who is still losing billions a year? Yep, one in the same.
I agree that the company does not need to make billions to pay us what we are worth, but they cannot lose billions either. They need to create a business plan that can survive in this type of competitive market. I have looked at these JV's with our a morsel of personal agenda. Here is what I see:
First, I would love it if we could just fly all of the routes and not have any JV's but in this day and age, that is just a dream and will never happen. So how do we sit their and trap as many of the customers that we are aiming to trap? Easy JV's.
AF-KLM is a historic type of business and Pilots Association type of deal. It involves three unions and three business entities. It is making 12 billion dollars in revenue a year. Yes, we could have made some of our premium revenue with out them, but nothing close to what we are making now. That in the end is good for the business, and should be good for us.
I would like to take it one step farther than the AF deal and make the company pay us a percentage of the revenue for agreeing to the terms of the JV.
Back to the AF deal. We have three (actually four if you include the second pilot union at AF) pilot unions that have stuck a deal to divide the North Atlantic pie up. We got just better than half that growth. Not bad, not great, but better than the other three groups. ( Perspective, not what I want here) When the market grows I bet we see some previous or current routes flown by them but over half have to be flown by us. It is inclusive scope and I give our MEC kudos for getting that type of language.
Fast forward to the JAL deal. Two companies and fighting for one company who has the unwavering backing of a government that no matter how dire the situation is will not lose face for the Japanese people. Ugly, not exactly fair? Yep, but it is what it is.
With that in mind, lets look at what we as a business and we as an association need to be mindful of.
First, Japan and the US just signed an Open-Skies Agreement that is anything but open. It is one sided, and our Fifth Freedom Rights are basically worthless. As an association we have wording in our PWA that states how many slots have to operate by us, but the company many have to abandon them if we do not gain a Domestic Japanese business partner. Em are the ugly facts. That for you and I translates in to no hiring, loss of jobs and probably a few furlough. Not going for shock value here, just reality.
Second, the Japanese economy is second only to ours, and the Chinese economy will be the largest in the next ten years, so it is very mindful of a pilot union to realize that we need to connect all of this premium cargo and passenger traffic with a domestic airline. DAL needs JAL more than JAL needs us.
I hope that we do not have to give away the farm, and from what I am seeing this deal will be really good in terms of long term sustainable growth in the form of seats for the pilots of Delta Air Lines. If we are successful in getting a partnership with an airline that is going to cut as they say they are going to cut, then I am all for it. Why? It makes business sense. When it generates money for Delta it puts our demands for overall compensation in to perspective.
Lets look at what you are stating in regards to the MEC. I am in utter agreement that we need to get better wagers, and agree with PG that we need to figure out a plan to do it. Since the no longer let pilot go in the bank much less touch the money, we need to realize that DAL needs to probably make over 35 billion a year in revenue to pay down its liabilities and pay us what we are worth. These two JV's will make that a very real possibility. I do not want to be the biggest airline, just the best and most financially successful.
I also think, that barring maybe one more airline (after JAL) in particular we should be very careful of any more JV's. We have the globe covered now. This should set the business up nicely.
In 2012 this plan that they are working on should set us up nicely to have better passenger connect options and betting pricing power than any other airline out there. That my friend equates to profit, or paying down of debt, or new aircraft purchases. That all equates to the ability to demand and receive the C2K+... that every one wants.
In the end we want the same things, but I will side with PG in the fact that we as pilots need to look at the whole pie and realize that DAL probably pays more in interest a year than they pay us. We need to pay down debt from mistakes in the past, we need to renew our fleet, and we need to have a business plan that can sustain the airline in good times and in bad. When that happens, and we were a part of it, we BETTER get compensated for our worth.
I do not disagree with you at all. I want to see us hire, make 400K a year, get 20% in our DC, have a catchup for the older guys, myself upgrade and make money, etc. It is just very hard to do that with a failed business plan.
You do a fantastic job vetting management's talking points and talking yourself out of a raise. I wouldn't feel bad though, as there is a faction at every airline that does the same thing. Everyone that complains about current pay and work rules need not look any further than the closest mirror.
The fact is, should all airline pilots demand the same pay that the DAL pilots were making 9 years ago, we would all be on the same page give or take a couple of years. AA's, UAL's, CAL's contract are amendable, and DAL's is coming up soon. There would be some variations in work rules, but overall it would be a wash. With all pilots making the same rates, no airline would be "uncompetitive." That term "competitive" is a management control word, meant to lower your expectations through fear for your job and livelihood.
This line of thinking also gives a false weight to the impact of the pilots contract - as if the pilot contract alone is enough to sink an airline. Can you name an airline that was driven to insolvency because the pilots made too much money? Second, if low pilot costs are the answer, why did so many airlines like Skybus go out of business, and why is a top-paying airline like WN thriving?
Another issue to consider is how well of a job your management is doing running the operation. Let's say you accept a concessionary contract and save the airline $250 million in costs. Now the airline goes out and blows a $100MM fuel hedge contract, pays the executives $100MM in bonuses, blows a huge wad on self-inflicted "operational issues" etc.. What have you really accomplished by accepting a concessionary contract? All you have really done is subsidize a shoddy management team, and helped to minimize the damage and embarrassment of their incompetent management. This is what is going on at my airline. What good has our massive concession of 2003 done for us? NOTHING. They have only allowed a shoddy management team to stay in office YEARS longer than they should have.
When you say that the airline is losing "billions", are you sure? What do you know about accounting? If you had a corporation, and wanted to hide profits, could you show a huge "loss" with an army of accountants and actuaries at your disposal? I'll bet you could.
A couple of years ago, my airline said we were 23 billion in debt. We had pilots pulling their hair out and screaming from the rooftops that we needed massive concessions just to keep the company solvent. After several losing quarters, we were suddenly 13 billion in debt. $10 BILLION in debt vanished overnight. To this day, none of the concessionaires can explain how that happened. Yet they were
SO SURE that we were doomed without the pilots "saving" the airline through concessions. (BTW, the executives enjoyed massive bonuses the whole time the airline was "sinking")
The last point I will touch on is the assuredness so many pilots have on these global business ventures that are being set up by management. How do you know that this hook-up is in your best interest? IOW, what experience and/or expertise do you have in the field of airline operations, other than gut feelings and/or emotion. You are trusting management, Flounder. Does that sound like a safe plan? Do you also trust the analysts too? Guys like Mike Boyd, that said AA's acquisition of TWA would be the "crown jewel" in our operation? You trust guys like Dick Anderson and Doug Steenland?
You should be looking at all of these proposals with a cynical eye, not an optimistic one. What has history taught you? When has management ever done you a favor? Is their long-term goals in YOUR interest, or in THEIR interest? Will they cash out to the tune of tens of millions, and leave you on a furlough list?
Face it - most of the "absolutes" on this board are just OPINION, and not based upon anything except EMOTION. It is management's job to make sure they facilitate this, and they have done a masterful job. Your OPINION and $1.89 will get you a cup of coffee at Starbucks.