There is no way to answer that unless you can predict the future profits of the company. In 2000 the company was generating margins like today and everyone said the industry was fundamentally changed and would be profitable forever. By Spring of 2001 we were losing money fast and the industry had experienced its biggest revenue drop ever.
Long term over the next 15 years I suspect we would gain income by moving at risk income to fixed income. Shorter term over the next 3 to 5 years we probably would lose income. It depends on what future value is assigned to the profit sharing if a swap is made. By 2PM today we will have a better idea where the company may attempt to go with PS.

Bold is VERY important. It's the first step, and the IAM vote for DAL FA's will be next.
IF the AA pilots vote down their TA and keep the "industry average adjustment", expect RA to try and pump up our rates as much as possible with the raises we are GOING to get standalone AND via PS shifting, that way it will really turn the screws on AA. I also think the Co. would try and minimize gains in other areas and attempt to "Buy us off" with even more rate increases.

IF AA pilots pass the TA, I think we will see less drive by the CO to change PS, we will go ahead and have actual work rule improvements, and our rates will probably look like AA+x%.

To the other point, I think we would sell it for a profit actually. It's easy math to both sides, and if the MEC sees that it is being sold for a loss I know they would reject that. Heck, that wouldn't even make it past the new NC Chair!

Plus, I don't advocate getting rid of it completely (and neither does the Co.), I like the "upside protection" it provides (and the motivation for the whole company to perform well), that being said I'd rather have as much of it as possible, as soon as possible.

I'd also consider an estimated PS paid quarterly (say 3-4%) or monthly payout (1-2%) with the excess amount paid the following Feb. and keep the accrual formula the same.

I disagree with a "cap" or eliminating the 20% above XXX, that would be a bad idea.

Probably the smartest thing the company could have done in C2012 is increased the % of payout but then asked for a cap, instead of getting a decrease.

Then they would have had all of the benefits of PS but a cap to protect themselves if they became wildly profitable.

Why would we give up $1 billion? Some want to move PS to pay rates and most seem to want to keep it as is; either way we still get the money. I don't see any leverage from something we aren't going to give up.

We have leverage. The company is wildly profitable and our peers have comparable contracts. The only time constraint is if we think one of those will change.

It's academic, but it's good to discuss the concept.

To me it's gambling either way because we don't know what future profits will be. But if the profits over C2015 are good and PS pay would have been substantially greater than guaranteed pay then the "reduce at-risk pay" crowd will have cost us money, but vice versa as well. Either way, it's gambling.

Not to mention the reduce at-risk pay crowd is also gambling that the guaranteed rates won't be at-risk if there is a downturn. Which to me is likely.

So, let's call it what it is, the "reducing at-risk pay gamble". :D

Do we want the American contract to pass or fail? What's better for us?

Of course if this management team has positioned the airline as they hope it is, we could be profitable in bad years. The economy isn't exactly going gangbusters right now and especially in 2013-2014 but look how we did.

Besides, isn't the next 3 to 5 years the life of C2015?

Wait, I thought the company hadn't made up its mind, and hadn't discussed it with ALPA since openers are still weeks away.

Now you're saying the company has given ALPA its position?

The "Concession" Narrative
 

Delta C2K was the finest contract ALPA and this industry have and may ever produce.

Two incontrovertible truths:

1. Everything of which we have been disposessed from C2K is a concession.

2. Everything which we posess in lieu of C2K is a concession.

The argument that handing Profit Sharing back to managment with a polite no thank you is a concession is not even ironic. Its duplicitous.

Yet, somehow that is the narrative has been submitted by the counterarguments to ALPA initiatives to restore our profession. Not surpisingly, it is the agrument submitted by the select few who have managed to turn contractual concessions to their advantage. Worse, they seek to pospone remedy to those concessions because they benefit in the near term by continuation.


ALPA should have conrfronted their concessionary narrative with argument similar to mine above, supported the restoration of C2K contract provisions IN FULL and defined with certainty the necesssity to return profit sharing back to the source it came from if contract and career restoration is truly the objective.

Playing the waiting game....

TJG

Um in order to return to C2K, you would have to return our retirements, not just the pay rates. Don't see that happening!