|
|
Now, let's talk about "At Risk" pay, vs. a "Pay Raise".
I don't want to trade one for the other, because it is self correcting. If we get a big pay raise, that will come out of the profits, i.e. the overall profit will be lower, due to 'costs' going up. So we in effect are already trading one for the other, why should we pay for a pay raise, twice?? When it comes to, "Do you want a pay raise or profit sharing?" my answer is, I want BOTH. When Delta was going into bankruptcy, and again on the way out, they asked us to give BOTH, our DB plan AND TWO PAY CUTS. Not one or the other, BOTH. As is being pointed out by our LEC guys, Profit Sharing is "At Risk", so you cannot count on that as a substitute for a pay raise, it's not. It's 'at risk' pay. We need to return our regular pay to at least 2004 levels, add in some inflation, and KEEP profit sharing untouched, since we never know how much it will be. |
Originally Posted by sailingfun
(Post 1822103)
Good article in AvWeek about fuel and fleet plans. Anderson is quoted as saying we have not altered our fleet plan for the lower cost of fuel. The article also refutes some of the wildely inaccurate estimates on fuel costs and yearly savings for Delta posted here. Our cost per gallon is going to come in at 2.45 to 2.50 a gallon in the first quarter. It was 2.62 4q last year.
You don't have to read avweek, the military's R/C airplane magazine, this was in the January 20th call on 4Q2014 that we all listened to back on January 20. Here were the fuel highlights that I don't believe are in dispute:
Paul Jacobson: Moving onto fuel, fuel expense declined by $342 million for the quarter, driven by the sharp decline in market fuel prices. Our all in fuel price was $2.62 per gallon which was $0.43 lower year-over-year. Our results this quarter included $180 million in settled hedged losses which were offset by $105 million profit at the refinery. At December 31st we had $925 million in hedge margin posted with counterparties which we suspect will be substantially reduced by June 30 based on current prices. Based on current prices, we are projecting an all in fuel price of $2.45 to $2.50 per gallon for the March quarter. For the full year we are forecasting an all-in price of $2.25 to $2.35 per gallon which is approximately $0.50 to $0.60 lower than 2014. These lower prices should produce over $2 billion in lower fuel expense including hedges. For 2016 we are well positioned for full downside participation should fuel remain at these levels. As I mentioned, the refinery made $105 million profit for the December quarter which represents $151 million improvement versus last year. Richard H. Anderson - Chief Executive Officer We actually use pretty high fuel prices in all of our planning and this was a shared experience with Ed and I, we’ve learned this over the years that planning with a low fuel price will only disappoint and planning with a high fuel price if you end up being wrong and the fuel price is lower, you’ll be pleased. But it’s really important when you’re planning an airline over the long term, or making a 30 year MPV decision on buying an airplane to use a very high fuel price otherwise you’re not going to get an ROIC and a free cash flow number that you’re going to like. Paul, our fuel price for our assumption for our budget was $2…? Paul A. Jacobson - EVP and Chief Financial Officer $2.82. Richard H. Anderson - Chief Executive Officer $2.82 even though we knew it was going to be lower. But that way you plan the capacity on a much more muted basis and you make sure that you put the strategies in place to hold yield and RASM. From either RA, GH or PJ:
|
Originally Posted by DeadHead
(Post 1822203)
If, hypothetically, we were to be approached by a TA (similar to AMR) that removed profit sharing altogether, what kind of pay percentage increase would you consider to be sufficient?
I realize this is an extreme scenario, but clearly you believe we should have profit sharing taken into account directly through compensation which would eliminate downturn risk. It's certainly a valid point, but it is extremely important to quantify that amount so we can say definitely that we conceded profit sharing (based on $XX billion profit) for a XX% compensation increase. A value can be assigned to almost anything. Further everything has intrinsic (tangible) and implied (foreseeable) value. In my opinion in the next 2-4 weeks both of those values with respect to profit sharing will never be exceeded. With the value of profit sharing so high I would not even consider negotiating it away for ONLY pay rates. But I believe there will never be another time to hand it back to management with a polite "No Thank You" and add more value to our contract overall. We could negotiate a contract where we add to already improved contract provisions in Scope, Vacation, Sick, 401K match and Pay Rates without returning Profit Sharing to management. Or, We can negotiate a contract where we add even MORE to already improved contract provisions in Scope, Vacation, Sick, 401K match and Pay Rates returning Profit Sharing to management. Which scenario do you embrace? |
BAG HOLDER: An investor who is on the wrong side of a stock for an extended period of time, with the consistent belief that he or she is in fact correctly predicting its direction, despite strong evidence to the contrary. Typically, this person loses most or all of his or her money in the process. -Urban Dictionary
The concession we have collectively agreed to make (and seem content to continue to make) with regard to Profit Sharing is that it can go from "Shock & Awe" to Blink and Yawn. Buy Low. Sell High. |
Originally Posted by Check Essential
(Post 1822230)
The question we should be asking ourselves is why we are even asking the question.
|
1. Its in the corporate by laws not their contract. They get it whether they like it or not. Current management holds it over their heads. To paraphrase one of my several "A" friends there: We demand a pay raise, management counters by implying profit sharing makes up for less in pay rates. 2. Its capped to IRS limits. I'll never make enough for this to matter but for many of them 9.8% (this year) puts a number of their A's into the cap and they get cutoff. |
Originally Posted by shoelu
(Post 1822319)
Patently false.
Also incorrect. |
Originally Posted by shoelu
(Post 1822319)
Patently false.
Also incorrect. My source for "1." is a lifelong friend and "A" at Southwest and for "2" a post to the SWAPA message boards (lengthy and I didn't have permission to copy) comparing Delta PS to Southwest PS. |
Originally Posted by Timbo
(Post 1822253)
Now, let's talk about "At Risk" pay, vs. a "Pay Raise".
I don't want to trade one for the other, because it is self correcting. If we get a big pay raise, that will come out of the profits, i.e. the overall profit will be lower, due to 'costs' going up. So we in effect are already trading one for the other, why should we pay for a pay raise, twice?? When it comes to, "Do you want a pay raise or profit sharing?" my answer is, I want BOTH. When Delta was going into bankruptcy, and again on the way out, they asked us to give BOTH, our DB plan AND TWO PAY CUTS. Not one or the other, BOTH. As is being pointed out by our LEC guys, Profit Sharing is "At Risk", so you cannot count on that as a substitute for a pay raise, it's not. It's 'at risk' pay. We need to return our regular pay to at least 2004 levels, add in some inflation, and KEEP profit sharing untouched, since we never know how much it will be. So right now to me GM is less that current plus profit sharing and is more at risk in a downturn. |
My source for "1." is a lifelong friend and "A" at Southwest and for "2" a post to the SWAPA message boards (lengthy and I didn't have permission to copy) comparing Delta PS to Southwest PS. |
| All times are GMT -8. The time now is 04:08 PM. |
|
Website Copyright © 2026 MH Sub I, LLC dba Internet Brands