ERJ Jay

Now I may be naive, but with aircraft in the desert, and guys on RDG because "we're overstaffed", why did FDX get almost 4X the contract that UPS did?

U.S. airlift contracts go to AMR, Delta, others - Yahoo! Finance

U.S. airlift contracts go to AMR, Delta, others

• On Thursday September 17, 2009, 6:37 pm EDT

WASHINGTON (Reuters) - A team including AMR Corp (NYSE:AMR - News), Delta Air Lines Inc (NYSE:DAL - News), Northwest Airlines Inc and US Airways Group Inc (NYSE:LCC - News) has won a U.S. Transportation Command contract worth up to an estimated $1.58 billion for international airlift services, the Pentagon said Thursday.
Work is expected to be completed by September 2010, with a minimum guarantee of $327.8 million, the Pentagon's daily contract digest said.
Separately, a team including Fedex Corp (NYSE:FDX - News) won a similar Transportation Command deal worth up to an estimated $1.51 billion with a minimum guarantee of $222.6 million, the Pentagon said.
It said a team led by United Parcel Service Inc (NYSE:UPS - News) also won an international airlift contract from the command worth up to $331.7 million with a minimum guarantee of $74.4 million.
A spokesperson for the command could not immediately be reached for additional details.
(Reporting by Jim Wolf; Editing by Bernard Orr)

Freightpuppy

I just dosed off on the couch so I may be a little slow but what does our manning situation have to do with this?

Worldguy

This is business as usual. Notice the guarantee is a fraction of the overall contract award. The contract "award" is potential business, normally adhoc. FEDEX, UPS, UA etc... do not normally get the bulk of the adhoc but clearly will get some of it.

If you look back at the awards for the last decade you will see similar numbers.

ERJ Jay

Nothing really, but if UPS has extra airplanes and crews, it seemed to me that this would be a good source of additional/alternate revenue. Maybe I'm wrong.

HazCan

Dude, I got news for ya. We've got a ton of extra planes and bodies too, so it has nothing to do with manning. The company gave us a paycut, as opposed to your RDG...so things aren't that different between brown and purple.

Shaggy1970

Yeah, but did you see all the lines added for ANC MD-11 F/O? Wow I guess bussiness is really picking up!

Laughing_Jakal

I wonder if the DOD can implement some kind of 4a2b mechanism on FDX......Because as we know...... a guarantee is not a guarantee.

Vman

The amount/% of the award depends on the number of CRAFT pilots...

Salty?

CactusCrew

It is also determined by the amount that each respective company bids on.

Historically speaking, UPS does not go out of its way to seek what it considers low yeild revenue opportunities.

You would think that in these trying economic times, UPS would seek as many forms of revenue as possible ... that is just not true.

It is much easier to seek concessions from employees to cut costs, than it is to seek "lower" yeilding revenue opportunities to increase/maintain profits ... IMHO

UPS is a 100 year old successful company that is resistant to change on many levels.

MaydayMark

Salty,

Is CRAFT the same as CRAF? See link below

Civil Reserve Air Fleet - Wikipedia, the free encyclopedia