I'm not afraid.
05-31-2009, 11:00 AM
#1
Gets Weekends Off
Thread Starter
Joined APC: Jan 2007
Posts: 745
I'm not afraid.
I’m posting my thoughts on a system wide strike in this forum because I believe that there are many individuals that have been around and have an idea about how to get things done.
We all see the problems in this industry. It’s clear that there are more things wrong than right. The Pilot has been greatly devaluated and management is doing their best to make money off the backs of their employees. Following the boom after deregulation the aviation industry experienced an unnatural growth as new jet-airlines emerged from all realms of the industry. It seems that airlines after deregulation tried to lower the price and increase capacity to make an extra quick dollar and at any cost.
One of the worst aspects of the current situation is the psychological warfare that we must suffer through. Did Continental Airlines award flying to Chautauqua because they were better or significantly cheaper? Or was it to play two pilot groups out against each other and thus weakening both groups. Go jet is another prime example.
It is also clear that that no one pilot group can change the situation. If one group manages to negotiate an industry leading contract another company with a lesser contract will likely benefit from it as they become more competitive. Therefore some pilots are actually apprehensive about getting a better deal. I do not think however that management is inherently evil. I believe that we a just a part in the proverbial race for the bottom.
We are responsible for the way were treated. When we are threatened with pay cuts and furloughs, we coward and give in and herein lies the problem. Instead of accepting pay cuts pilots need to not be afraid of furloughs. Pilots need to be furloughed and companies need to shrink. The industry is experiencing wide fluctuations following deregulation. Let me explain:
The Airline Deregulation Act has contributed to a reduction in fares when adjusted for inflation. Today the yield per revenue passenger mile (RPM) is about .04$ as opposed to .0849$ in 19781. People who were not previously able to fly can now take use of public aviation. In some cases, it is cheaper to buy an airline ticket than a bus or train ticket, both of which demand much less capital investment and have much lower operating costs than air transportation. Available Seat Miles (ASM) have also increased to meet the growing demand as inflationary rates of air fares were much lower than the national inflation rate, allowing more levels of the American society to “catch up” to the costs of air travel. In the quest for lower prices, Delta Air Lines pioneered the hub-and-spoke system which placed the bulk of RPM on larger planes between hubs which lowered the fares.
These changes did not come without cost. The Airline Deregulation Act changed the economic stability, financial health, and structure of the airline industry. The airline industry has become financially unstable since deregulation. Advocates of deregulation emphasize huge financial gains in the nineties. These profits were however countered with an even greater loss in the early 2000’s, which are most often explained by the terrorist attacks of 9/11. However, this trend was seen before the terrorist attacks and historical data suggests that similar patterns had occurred before.
Cyclical economic data has been observed by the Airline Transport Association (ATA) since 1938. The early years of commercial aviation from 1938 to 1959 show a steady increase in profits caused by the growing industry. With the introduction of the Jet Airlines in the 1960’s, which laid the base for the business structure known today, the profit pattern became that of a first order damped oscillation system with peaks and valleys somewhat equal. The damping factor was the ability of the government to change fares as a direct response to demand. As an example the cost of an RPM increased from .0663$ to .1280$ between 1973 and 19841 following the Yom Kippur War and the subsequent fuel crisis. In contrast with the latter, the price of an RPM decreased following the beginning of the gulf war and 9/11 and in both cases the RPM price raised while profits increased, indicating a lag between the oscillation of profits and RPMs. There is a saying that airlines are always the first to feel a crisis and the last to benefit from a prospering economy. This can be explained by the lag between economic cycles and the adjustment in the airline industry. Interestingly, the cycles of the airline industry have been quite consistent in terms of frequency. It can be determined that the fundamental frequency of an oscillatory graph based on airline profits is 0.0938/year. The period of the industry cycle can therefore be established as the reciprocal of the frequency, 10.7 years2. This cycle period is therefore endogenous caused by the lag between demand/orders and acquisitions of aircraft and not significantly affected by events such as 9/11. The greater the lag, the more aggravated the cycle amplitude becomes. Prior to deregulation, industry lag was minimal since the federal government could react quickly to changing needs and acted as a damper on the system. This created an economic cyclical sine wave similar to that of neutral stability. Exogenous factors such as international problems, fuel crisis, and economic cycles have a relatively small impact on period but a large impact on amplitude.
The idea of the Airline Deregulation Act was that market forces could adjust for fluctuations in demand without active control from the CAB. This reliance on market forces created an increase in the relationship between available seat mile (ASM) shortfall per year and ASM gain, which indicates that the market response is more aggressive than the previous regulatory response. The ASM gain prior to deregulation was .56, which means that the ASM shortfall was fulfilled by 56% the next year. In comparison the domestic post-deregulation ASM gain was .86 and the world ASM gain was .73. The delay between the ASM shortfall and ASM gain has been increased to 2.8 years after deregulation2. The relationship between ASM gain and ASM fulfillment delay are two fundamental factors from which economic stability can be estimated. The relationship between gain and delay can result in three levels of economic stability: positive stability, neutral/oscillating stability, and negative stability. In a root-locus system a critical boundary line separates negative and positive regions and the boundary line itself is an exponential graph with asymptotes in both the Y and X axis that represents neutral stability. The relationship between gain and delay is such that to maintain economic stability an increase in gain requires a decrease in delay. Otherwise the system falls into the negative region of profit/economic stability. The airlines prior to deregulation displayed a neutral oscillation in profits indicating that they were at or close to the critical gain/delay boundary line. Airlines today are often in fear of losing their market share and are therefore reluctant to raise their prices. This causes the industry to react slowly to market changes, which means increased delay. This coupled with large ASM gains resulted in an exponentially unstable oscillation in profits. These growing peaks and valleys have caused an equally transient entry and exit of carriers in the airline industry. With each valley, more airlines are forced to merge or shut down their operation because they simply can’t cope with the economic instability. This reduction in carriers is likely to be one of the factors that will stabilize the industry eventually. This stabilization of the industry may present a problem for the traveling public as the industry becomes inherently regulated by the dominating companies themselves also known as an oligopoly.
Until then, we need to stand strong and change the damage that has already been done. I believe that only a system wide strike where every airline is affected can change things. only then do we have enough leverage to change things overnight. A lot of us will get furloughed some will possibly get fired. Radical as it may seem, we would be doing our industry a favor. By placing a cap on operating costs that cannot be moved we will take out one of the variables that assist in this unstable oscillation. A system wide strike would also bring every airline to the same level. I’m sure most of you guys are more knowledgeable than I when it comes to striking and unions. Please offer your thoughts on how to make this happen.
I'm in the beginning of my career; i have a family and I may lose my job, however, we need to help the industry shrink to a realistic level. Pilots is THE most responsible employee group of the industry and if we don't take charge and change things; nobody will.
We all see the problems in this industry. It’s clear that there are more things wrong than right. The Pilot has been greatly devaluated and management is doing their best to make money off the backs of their employees. Following the boom after deregulation the aviation industry experienced an unnatural growth as new jet-airlines emerged from all realms of the industry. It seems that airlines after deregulation tried to lower the price and increase capacity to make an extra quick dollar and at any cost.
One of the worst aspects of the current situation is the psychological warfare that we must suffer through. Did Continental Airlines award flying to Chautauqua because they were better or significantly cheaper? Or was it to play two pilot groups out against each other and thus weakening both groups. Go jet is another prime example.
It is also clear that that no one pilot group can change the situation. If one group manages to negotiate an industry leading contract another company with a lesser contract will likely benefit from it as they become more competitive. Therefore some pilots are actually apprehensive about getting a better deal. I do not think however that management is inherently evil. I believe that we a just a part in the proverbial race for the bottom.
We are responsible for the way were treated. When we are threatened with pay cuts and furloughs, we coward and give in and herein lies the problem. Instead of accepting pay cuts pilots need to not be afraid of furloughs. Pilots need to be furloughed and companies need to shrink. The industry is experiencing wide fluctuations following deregulation. Let me explain:
The Airline Deregulation Act has contributed to a reduction in fares when adjusted for inflation. Today the yield per revenue passenger mile (RPM) is about .04$ as opposed to .0849$ in 19781. People who were not previously able to fly can now take use of public aviation. In some cases, it is cheaper to buy an airline ticket than a bus or train ticket, both of which demand much less capital investment and have much lower operating costs than air transportation. Available Seat Miles (ASM) have also increased to meet the growing demand as inflationary rates of air fares were much lower than the national inflation rate, allowing more levels of the American society to “catch up” to the costs of air travel. In the quest for lower prices, Delta Air Lines pioneered the hub-and-spoke system which placed the bulk of RPM on larger planes between hubs which lowered the fares.
These changes did not come without cost. The Airline Deregulation Act changed the economic stability, financial health, and structure of the airline industry. The airline industry has become financially unstable since deregulation. Advocates of deregulation emphasize huge financial gains in the nineties. These profits were however countered with an even greater loss in the early 2000’s, which are most often explained by the terrorist attacks of 9/11. However, this trend was seen before the terrorist attacks and historical data suggests that similar patterns had occurred before.
Cyclical economic data has been observed by the Airline Transport Association (ATA) since 1938. The early years of commercial aviation from 1938 to 1959 show a steady increase in profits caused by the growing industry. With the introduction of the Jet Airlines in the 1960’s, which laid the base for the business structure known today, the profit pattern became that of a first order damped oscillation system with peaks and valleys somewhat equal. The damping factor was the ability of the government to change fares as a direct response to demand. As an example the cost of an RPM increased from .0663$ to .1280$ between 1973 and 19841 following the Yom Kippur War and the subsequent fuel crisis. In contrast with the latter, the price of an RPM decreased following the beginning of the gulf war and 9/11 and in both cases the RPM price raised while profits increased, indicating a lag between the oscillation of profits and RPMs. There is a saying that airlines are always the first to feel a crisis and the last to benefit from a prospering economy. This can be explained by the lag between economic cycles and the adjustment in the airline industry. Interestingly, the cycles of the airline industry have been quite consistent in terms of frequency. It can be determined that the fundamental frequency of an oscillatory graph based on airline profits is 0.0938/year. The period of the industry cycle can therefore be established as the reciprocal of the frequency, 10.7 years2. This cycle period is therefore endogenous caused by the lag between demand/orders and acquisitions of aircraft and not significantly affected by events such as 9/11. The greater the lag, the more aggravated the cycle amplitude becomes. Prior to deregulation, industry lag was minimal since the federal government could react quickly to changing needs and acted as a damper on the system. This created an economic cyclical sine wave similar to that of neutral stability. Exogenous factors such as international problems, fuel crisis, and economic cycles have a relatively small impact on period but a large impact on amplitude.
The idea of the Airline Deregulation Act was that market forces could adjust for fluctuations in demand without active control from the CAB. This reliance on market forces created an increase in the relationship between available seat mile (ASM) shortfall per year and ASM gain, which indicates that the market response is more aggressive than the previous regulatory response. The ASM gain prior to deregulation was .56, which means that the ASM shortfall was fulfilled by 56% the next year. In comparison the domestic post-deregulation ASM gain was .86 and the world ASM gain was .73. The delay between the ASM shortfall and ASM gain has been increased to 2.8 years after deregulation2. The relationship between ASM gain and ASM fulfillment delay are two fundamental factors from which economic stability can be estimated. The relationship between gain and delay can result in three levels of economic stability: positive stability, neutral/oscillating stability, and negative stability. In a root-locus system a critical boundary line separates negative and positive regions and the boundary line itself is an exponential graph with asymptotes in both the Y and X axis that represents neutral stability. The relationship between gain and delay is such that to maintain economic stability an increase in gain requires a decrease in delay. Otherwise the system falls into the negative region of profit/economic stability. The airlines prior to deregulation displayed a neutral oscillation in profits indicating that they were at or close to the critical gain/delay boundary line. Airlines today are often in fear of losing their market share and are therefore reluctant to raise their prices. This causes the industry to react slowly to market changes, which means increased delay. This coupled with large ASM gains resulted in an exponentially unstable oscillation in profits. These growing peaks and valleys have caused an equally transient entry and exit of carriers in the airline industry. With each valley, more airlines are forced to merge or shut down their operation because they simply can’t cope with the economic instability. This reduction in carriers is likely to be one of the factors that will stabilize the industry eventually. This stabilization of the industry may present a problem for the traveling public as the industry becomes inherently regulated by the dominating companies themselves also known as an oligopoly.
Until then, we need to stand strong and change the damage that has already been done. I believe that only a system wide strike where every airline is affected can change things. only then do we have enough leverage to change things overnight. A lot of us will get furloughed some will possibly get fired. Radical as it may seem, we would be doing our industry a favor. By placing a cap on operating costs that cannot be moved we will take out one of the variables that assist in this unstable oscillation. A system wide strike would also bring every airline to the same level. I’m sure most of you guys are more knowledgeable than I when it comes to striking and unions. Please offer your thoughts on how to make this happen.
I'm in the beginning of my career; i have a family and I may lose my job, however, we need to help the industry shrink to a realistic level. Pilots is THE most responsible employee group of the industry and if we don't take charge and change things; nobody will.
Last edited by Joachim; 05-31-2009 at 11:19 AM.
05-31-2009, 11:22 AM
#2
Gets Weekends Off
Joined APC: Apr 2006
Position: 737 FO
Posts: 260
You have some valid points. However, one of the biggest problems with improving our situation is the Railway Labor Act. It pretty much handcuffs us and gives us little leverage in the bargaining process. If we had the ability to strike as soon as our contracts were over, it would give us a much stronger position. As it is now, management can drag their feet for years, i.e. Air Tran.
A system wide strike would currently be illegal and there would be serious ramifications for the unions. They would be fined heavily and the individuals involved could be fired with cause.
I appreciate the intent of your post. However, it is absolutely not possible under the RLA. It would turn out worse, not better, for all of us.
A system wide strike would currently be illegal and there would be serious ramifications for the unions. They would be fined heavily and the individuals involved could be fired with cause.
I appreciate the intent of your post. However, it is absolutely not possible under the RLA. It would turn out worse, not better, for all of us.
05-31-2009, 11:36 AM
#3
Kerbal Rocket Surgeon
Joined APC: Dec 2007
Position: DTW 717A
Posts: 1,099
When the RLA was applied to airlines 73 years ago the DC-3 was the newest greatest thing, and grass runways were just starting to be replaced with pavement and cement. Competition between city pairs was hardly present. Without competing airlines, a strike at just one airline could shut down the air transportation system for entire regions. Congress met the need to ensure that one carrier's labor disputes could not shut down the nation's air transportation system by applying an existing law for Railways to Airlines..
Flash forward to 2009 and the RLA is completely out of place in our industry. If any airline were to experience a labor strike it would hardly cripple the nation's transportation system. In fact the competition between airlines is now so commonplace throughout the country that airline companies would be best served to expedite labor negotiations in order to prevent losing their marketshare to the numerous competitors that now exist.
The RLA is a relic, and it no longer belongs in this industry.
Flash forward to 2009 and the RLA is completely out of place in our industry. If any airline were to experience a labor strike it would hardly cripple the nation's transportation system. In fact the competition between airlines is now so commonplace throughout the country that airline companies would be best served to expedite labor negotiations in order to prevent losing their marketshare to the numerous competitors that now exist.
The RLA is a relic, and it no longer belongs in this industry.
05-31-2009, 11:38 AM
#4
Gets Weekends Off
Thread Starter
Joined APC: Jan 2007
Posts: 745
Originally Posted by QCappy
You have some valid points. However, one of the biggest problems with improving our situation is the Railway Labor Act. It pretty much handcuffs us and gives us little leverage in the bargaining process. If we had the ability to strike as soon as our contracts were over, it would give us a much stronger position. As it is now, management can drag their feet for years, i.e. Air Tran.
A system wide strike would currently be illegal and there would be serious ramifications for the unions. They would be fined heavily and the individuals involved could be fired with cause.
I appreciate the intent of your post. However, it is absolutely not possible under the RLA. It would turn out worse, not better, for all of us.
A system wide strike would currently be illegal and there would be serious ramifications for the unions. They would be fined heavily and the individuals involved could be fired with cause.
I appreciate the intent of your post. However, it is absolutely not possible under the RLA. It would turn out worse, not better, for all of us.
05-31-2009, 11:57 AM
#5
Line Holder
Joined APC: Jun 2008
Position: Bluebus
Posts: 99
Originally Posted by QCappy
I appreciate the intent of your post. However, it is absolutely not possible under the RLA. It would turn out worse, not better, for all of us.
And therein lies the method in which they keep us from doing it. Fear of reprocussion. If everyone stood together, there is absolutely nothing they could do without us slapping them right back again and again...and again.
We would win. They cannot produce enough skilled labor fast enough to take anyone of us out of the loop. Unity is the power. Now, where is the unity??
05-31-2009, 12:08 PM
#6
Gets Weekends Off
Joined APC: Apr 2007
Position: New Hire
Posts: 255
I'm down...Let's do it, we really don't have anything to lose. When England told George Washington they were going to arrest him for citing revolution he just gave them the finger. Now it seems only rich folks are above the law, but the common man must abide by them. Enough is enough.
05-31-2009, 01:23 PM
#8
Banned
Joined APC: Sep 2007
Posts: 1,480
Originally Posted by Joachim
So what is the best method to release us from the RLA. I'm thinking about writing a letter, but that probably won't do much. Does anyone have a clear idea how this works?
05-31-2009, 01:54 PM
#9
Gets Weekends Off
Joined APC: Jan 2009
Posts: 314
Originally Posted by Joachim
Did Continental Airlines award flying to Chautauqua because they were better or significantly cheaper? Or was it to play two pilot groups out against each other and thus weakening both groups. Go jet is another prime example.
05-31-2009, 02:01 PM
#10
Gets Weekends Off
Joined APC: Jul 2007
Position: B-737 FO
Posts: 112
I agree whole heartedly, the industry needs to shrink... hence the capacity cuts that are already occurring. However, what would you be trying to accomplish with an nationwide strike? More money? Job Protection?? Good luck.
The airlines are a business -- PERIOD!! The airlines are not in existence to make you and me money at all. In the eyes of the airlines, we are the problem. That is why you will NEVER see the airlines lobbying congress for more stringent rules regarding pilot qualifications, crewrest, and training. They WANT a giant pool of pilots available. Why wouldn't they?? They can pick and choose the best and brightest among us. If we don't like it... no problem...they'll get the next guy in line to step up who is just as "qualified" (according to the FAA) as you or I. Aside from the recent tragedy with the Colgan accident, safety is at an all time high. As much as people gripe and complain about the pay and work rules, people below us in the commercial aviation pipeline are chomping at the bit to fill our shoes. Face it, there are enough people that can "meet the current FAA standards" who will accept the wages that are already in place.
Obviously, I'm a big believer in free market capitalism, supply and demand, yada yada. I would love to make more money!!! All the years as a professional pilot, time away from home, instructing, military deployments, ramen noodles, jet lag, and lack of sleep lead us to say, "Gosh darn it... I'VE PAID MY DUES!!" When we go to a SWA, DAL, FEDex, UPS, etc... we feel entitled to the pay day!!
At the end of the day, the airline industry doesn't care about your feelings, the size of the fleet, domestic vs. international, number of cities, or anything else. It cares about making MONEY!! If doing the above things makes money, then they'll do it!!
As I said in a previous thread, if you want to raise the pay, then you've got to "up the FAA standards" to weed out the riff raff. People love to fly!! It truly was my childhood dream as I'm sure it was for many of you. Because of this love affair with aviation, there will always be an abundance of folks who will do it for peanuts. The airlines know it all too well. As much as I think our profession deserves generous financial compensation due to the years of training and sacrafice it takes to make it to the big airlines, I am at my core a strong believer in businesses controlling their costs to stay competitive. I would love a COLA every year. Who wouldn't!?!? Having a union strong arm a business to give COLA when they're losing money really isn't making the company economically viable. All you have to do is look at GM and Chysler.
Don't get me wrong!!! What is happening at airlines like Midwest, UAL, and AMR with domestic codeshare is criminal. Furloughing people and then codesharing the same routes is flat out wrong. This is where Scope and codeshare protection is so important.
What I'm ultimately saying is that any business has the obligation to its shareholders to make money, stay competitive and keep costs down.
Fire away...
The airlines are a business -- PERIOD!! The airlines are not in existence to make you and me money at all. In the eyes of the airlines, we are the problem. That is why you will NEVER see the airlines lobbying congress for more stringent rules regarding pilot qualifications, crewrest, and training. They WANT a giant pool of pilots available. Why wouldn't they?? They can pick and choose the best and brightest among us. If we don't like it... no problem...they'll get the next guy in line to step up who is just as "qualified" (according to the FAA) as you or I. Aside from the recent tragedy with the Colgan accident, safety is at an all time high. As much as people gripe and complain about the pay and work rules, people below us in the commercial aviation pipeline are chomping at the bit to fill our shoes. Face it, there are enough people that can "meet the current FAA standards" who will accept the wages that are already in place.
Obviously, I'm a big believer in free market capitalism, supply and demand, yada yada. I would love to make more money!!! All the years as a professional pilot, time away from home, instructing, military deployments, ramen noodles, jet lag, and lack of sleep lead us to say, "Gosh darn it... I'VE PAID MY DUES!!" When we go to a SWA, DAL, FEDex, UPS, etc... we feel entitled to the pay day!!
At the end of the day, the airline industry doesn't care about your feelings, the size of the fleet, domestic vs. international, number of cities, or anything else. It cares about making MONEY!! If doing the above things makes money, then they'll do it!!
As I said in a previous thread, if you want to raise the pay, then you've got to "up the FAA standards" to weed out the riff raff. People love to fly!! It truly was my childhood dream as I'm sure it was for many of you. Because of this love affair with aviation, there will always be an abundance of folks who will do it for peanuts. The airlines know it all too well. As much as I think our profession deserves generous financial compensation due to the years of training and sacrafice it takes to make it to the big airlines, I am at my core a strong believer in businesses controlling their costs to stay competitive. I would love a COLA every year. Who wouldn't!?!? Having a union strong arm a business to give COLA when they're losing money really isn't making the company economically viable. All you have to do is look at GM and Chysler.
Don't get me wrong!!! What is happening at airlines like Midwest, UAL, and AMR with domestic codeshare is criminal. Furloughing people and then codesharing the same routes is flat out wrong. This is where Scope and codeshare protection is so important.
What I'm ultimately saying is that any business has the obligation to its shareholders to make money, stay competitive and keep costs down.
Fire away...
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