Originally Posted by
Bucking Bar
Our E&FA team is good. It is a shame we do not employ it properly. Politics drive our evaluations. We avoid asking the right questions at the opportune time.
We have failed to evaluate the benefit of insourcing. When the Compass question was raised, I was disappointed to learn our MEC's evaluation was based on bankruptcy economic modeling that was irrelevant after the restructuring and merger. We needed new numbers. Resolutions were passed asking for the MEC to perform its job and obtain economic analysis, the Delta reps voted for "no action" while the NWA Reps disagreed along a straight party line vote. Obviously ... politics drove our "no action" on an economic evaluation of insourcing, or recovering our flying.
Questions we need to look at include:
(1) What is the long term effect on our bargaining power as jobs are outsourced?
(2) How much money is lost by Delta pilots, as jobs are outsourced and they wait until later in their career to become "mainline" pilots? (lost longevity)
(3) How much money is lost by Delta pilots due stagnation?
(4) From the union perspective, what are the threats to the relevance and continued viability of ALPA if outsourcing continues, or grows?
(5) What are the risks and threats during future economic downturns?
(6) What can we do to ensure Delta pilots are treated at least equally to other employee groups in corporate transactions?
(7) How has outsourcing harmed ALPA's relevance?
The DPA might just answer a couple of those questions for us. (Note: I am not a DPA supporter and believe our best shot is properly employing ALPA to achieve restoration)
I agree with most of your post. There are two things however that need to be considered. The first is that the numbers used during the 1113 hearing were expected costs post bankruptcy. I don't believe the merger reduced the mainline costs so not a big change there. The second issue is that you make the assumption that if the mainline took over all the outsourced flying that it would remain the same. That is a very bad assumption. There is a point where you price yourself out of the market and lose the feed. The net result could actually be a loss of mainline jobs not a gain.
The very difficult question is how do you determine what the network could effectively fly if the mainline took over all the flying. Would you gain 1000 RJ jet jobs but lose 1000 mainline jobs with less feed because you could no longer compete in many feed markets.
The numbers showed that on the smaller RJ's below 70 seats that was the case. For every RJ job we gained we would lose a higher paying job because of loss of feed. The real question is where is the break point. I believe its with the EMB170/175 and they should be at the mainline. Others might put it at the 70 seaters and many at all jets. I suspect if we scoped every jet Delta outsources today many would be stunned at how few mainline jobs it created. If your competitor can pick up a passenger in BUF and fly them to JFK cheaper then you can to take them on to FCO you lose that passenger. Eventually you lose the BUF to JFK route.
There are quite a few airlines with much tighter scope then we have out there. As far as I can tell every single one of them has hired few pilots or has pilots on furlough then Delta since the flood of Chapter 11 filings.
The big job loss at the Delta mainline was not because the mainline block hours went down. In fact the mainline block hours in June of 07 prior to the merger were almost exactly the same as in 01 yet we had 2500 fewer line pilots. Those 2500 jobs lost were due to work rule changes.
The big variable in all of this is getting every airline to start bring jet jobs back to their respective mainlines. If that is done then there would be a balance of feed and there would not be massive shifts in flying.
I think a excellent start would be for Delta to bring the E170/175 into the mainline. Some of that flying would be dropped in the transition as no longer cost viable but the net result I think would be a significant gain in mainline jobs. Not 1 for 1 as the jets come over but still a large gain.
This takes pressure off other airlines to allow outsourcing larger jets especially the CAL/UAL deal and a possible future contract at AMR if the NMB ever allows them back into mediation.