buzzer

Nothing wrong with the question but having employee's wages or worth tied to revenue isn't good. If it could fluctuate with revenue then employees/pilots would be making much less in bad years at any airline. Should you work for free if the company is losing money? Now for those who are responsible for profitability, they can take cuts when they don't perform.

Hedley

More just curious about ULCC financials than anything. Since the pandemic the legacies have really gone after leisure travel since business travel has declined which has a negative affect on others. After the fees to pay for bags, drinks, etc, the LCC's aren't really that much of a deal compared to the low cost seats on a legacy with a much larger network. I have jumpseated on Frontier numerous times and thought it was a pretty good product for what it is advertised as, but biggest problem was the lack of frequency. It's hard to compete with 3-4 flights per week when a much bigger company is charging roughly the same price with that many flights per day.

As to your comment about revenue, it will be a very important issue to have a valid response prepared as the company drags their heels. They will argue that expecting a ULCC to pay legacy pilot rates is like female professional athletes demanding to be paid the same as the men. Same game, same rules, completely different revenue streams yielding different results. On the other hand, in this market if they don't come up with significant rate increases, the legacies will hire all their pilots. Not trying to stir the pot, just someone watching from the bleachers. These are crazy times where career airlines are competing for pilots that regionals wouldn't consider just 5-10 years ago.

dracir1

Ah but here's the problem w/ your comparison. Women are born women (not trying to get into a gender debate). F9 CHOSE their model. No one made them operate in a ULCC fashion. If they wanted, they could change models and be full service, charge more per ticket and pay more. Because they don't is not the employee's fault (or even choice).

Revenue is independent of cost. The company can make changes that will increase (or decrease reveune). If we had twice the planes and pilots, we'd have twice the revenue. The only way to get that size is to increase pay to compete.

Stayontarget

Common thought but it’s not even close. Our average ticket after all ancillaries is less than $130. I don’t think I’ve seen more than 50% of a flight with checked bags. The vast majority it’s 25% or less. So the majority of people save those $$ that would bring the cost to a similar price as a legacy.

Random example. April 3 on AA basic economy is $134. Still have to pay for seat, bags, ect. If desired. F9 is $39 with same restrictions. Only 30% of the cost. And while to us pilots that hardly makes a dent to pay the difference to a large percentage of the population that makes a huge difference. Im sure you will find flights that F9 is comparable in price but the majority of the time it’s way cheaper.

To answer your original question. We finally made a profit in 2023. 3-6% forecast in 2024.

Stayontarget

To the second part:

They can try but BB already mentioned in the recording for this thread the pay increase has very little effect on the CASM. The Q4 earnings call they mention the long term forecast has the contract included and they still expect to see double digit margins. The argument for us to expect anything less than parity falls flat quickly based on their own words. They are almost making our own arguments for us.

fcoolaiddrinker

And margins are a more accurate measurement of a company’s ability to pay.

Aero1900

That's true but they can still play every card they have to delay the inevitable. I think that when speaking publicly, the CEO is thinking about the stock price way more than anything else. All these talks and interviews people keep parsing thru are intended for the investors. I think Biffle is far more concerned with what Wall Street thinks than giving away a negotiating point to us.

They can and will try to delay and fight the NC on every penny and then it'll be up to us to vote.

I hope everyone supports the Union and the NC

dracir1

I'm not really sure what "support" you are referring to. The UNION is a huge animal w/ tons of committees - some do more than others. The NC is 3 people and a bunch of lawyers trying to work out the details of a new contract.

Because we have a say so (vote) in this, any "support" we give should be contacting your rep and letting them know which changes you would like to see. If enough people come up w/ the same changes, then it should make its way to the NC and into the contract. Now, I'm not sure if this is actually happening because I haven't seen any definitive feedback about the SPECIFIC things we as a pilot group really want (I have seen what we're asking for so I ASSUME they are one in the same).

But as far as support...think of the union like a professional service provider - you PAY them a percentage to provide a service. It is a thankless job but the union (ALPA) is paid rather well to do it.

They work for us - remember that.

Hedley

I think the ULCC business model will definitely have to change to survive. The legacies changed to compensate for the loss of some of their traditional high dollar business travel and aggressively go after leisure travel, including offering cheap seats to compete with ULCC's. My hope is that you guys can get a good deal and force them to adapt. Going to be a fight though and contract negotiations always suck.

Stayontarget

Most businesses have to evolve to stay ahead and I think you’re correct this is no different. Seems like our big next move is more bases and day trips. If it’s successful I expect others will follow and change until that cost advantage is also marginalized and we are forced to adapt again.