$6 billion in profits (my projection for 2015) = 29% profit sharing

$10 billion profit = 54% profit sharing

All this on top of our 20% plus date of signing C2015 hourly increase.

We don't need to fund our increases with concessions.

 

We would be fools to consider any change in profit sharing (PS).


First off PS is now part of our contract, status quo, so to speak. Why should we have to put it up for consideration at all?

The company may want to decrease it - who cares?

Even if we did decide to monetize it how could we be sure we are getting a good "rate of return?"

PS is growing very quickly so lets enjoy it. If the company wants to drag out C2016 let them - our PS will help minimize the pain. If fuel continues its slide who knows how high PS can go.

Oh yeah, I forgot about the dreaded "Black Swan" (BS) event. Well we have to stop worrying about something we have no control over.

Besides if we do have a BS event everything would be on the table - it would be an all hands on deck to save the company type of deal.
And we know what that means - Labor takes it in the shorts permanently, management takes a temporary hit but that reaps a windfall for "saving the company."

So in reality, if we decide, foolishly in my opinion, to "monetize" PS in order to inoculate ourselves against a BS event we must realize that it would only help for a very limited range of BS event. Too small an event would not matter, too large an event and we get hit with a Force Majeure anway.

So maybe, just maybe, we might get a good rate on monetizing our PS. And then maybe, just maybe, we have a BS event of just the right size magnitude that our profits are permanently affected but the company does not hit the Force Majeure range.

I for one would be willing to take my changes on this.

Dont touch PS!

Scoop - My 2 cents

 

Well said. We gave up some PS in C2012. Any reductions to PS should not be any part whatsoever of the upcoming negotiations PERIOD! Fool me once......

 

You forget a fundamental fact of business. When profit margins reach the 15% level capital and increased capacity flood the market. We might hit 5 to 6 billion next year but after that new airlines and more seats will pop up everywhere.
Much like OPEC the big 4 airlines in the US are trying to mine every dime they can get now with little thought to the future. OPEC has finally received the message and now wants to keep oil in the 70 to 80 range but they are to late. The question is will airline managements be to late.
Pigs get fed, hogs get slaughtered!

 

Eastern Airlines VII could start up and just ruin everything with their 2 airplanes. GMAB

 

Ok, then like scoop said...there isn't much downside in playing out C15 negotiations...

 

Perfect saying to keep the sheep in line. How come RA and "gang" do not get slaughtered?<---Because they deserve what they get paid. Along with that statement, they also believe they are worth every penny.

Sailing, keep bringing up reasons and drivel as to why we should not demand better pay/benefits It is entertaining and straight out of the book.

I still love you man!

TEN

 

Future start ups will hopefully continue to get crushed. But VX, JB, Spirit and a couple others are stuck in permanent growth mode and will spam capacity domestically, at a likely increasing rate. Just wait til VX gets a billion in play IPO money to capacity dump and yield trasn with, not to mention the rest. The fake royal dual subsidized Gulf carriers and some Asian carriers will also spam capacity. Especially if they think (and why wouldn't they?) that the big 3 or 4 here lead by DAL will accomidate their growth by pulling down to preserve yields?

PS or not, this is a collision course with destiny that this current management team (at all the legacies) will have to face. Their current stratedgy or ducking and running and gifting capacity to fuel their competitor's growth will not work at all long term. It remains to be seen which ones, if any, have the executive talent to be up to the task. Especially when it will be a very expensve war, at least short-medium term, to fight. Its far more profitable in the short term to execute a losing stratedgy in the long run.

 

Because the company knows that Wall St knows that the company could get their friends across the table to take an increase in pay that when given a reduction in PS ends up meaning a bigger bottom line number for the company.

 

You somewhat miss the point of what I am saying. As we reach a sustained 15% profit margin we should introduce additional capacity into the system to insure that large amounts of startup capital don't flood into airlines. Trust me it will, it always does. I believe management focus on short term profits is going to bite Delta and the other big airlines in the not to distant future.