The seats may be filled, but if you don't charge a price to cover the cost of moving that seat, then you will still lose money in the end.

The usual ALPA cheerleaders on this board the last few days. Planning the US Airways funeral, complete with picking out the flowers and obituary statements. The situation that US Airways pilots are involved in is due to ALPA’s attempt to help United Airlines pilots with the impending merger with US Airways a few years back.

The Arbitrator is now absent from the scene. (It would be helpful if CVG767, ALPA expert for communications for Delta, updates us on the Mr Nicolau’s, current activities) The Pilot “neutrals” one from United, who worked closely with Paul Rice, who happens to be a United Pilot, helped shaped the Nicolau award. The other “neutral” was from Continental Airlines who happens to be a good friend of John Prater, President of the Airline Pilots Association.

Arbitrator Bloch who handled the Delta, Northwest pilots merger, also was the arbitrator of the US Airways and America West dispatchers. His finding were 180 degree’s from the pilots arbitrator.

Interesting reading.

http://jamhoff.com/PDFs/ArbitratorDecisionAward.pdf

Yeah and that same arbitrator delivered a relative position list to Dal/Nwa, in fact it is almost a carbon copy of the Nic. Typical east, twist the facts to meet twisted logic.

Arbitrator Bloch's (arbitrator of the Northwest Delta pilots seniority) comments.

"However, West’s claim that U.S. Airways emerged from bankruptcy “only because it [was] acquired by a stronger enterprise”10 is reflected neither in the KPMG audit report (cited by West)11 nor in any other portion of the evidence. Instead, each carrier had something to contribute. Airways, for example, was much larger. It served almost twice as many destinations as AWA and carried twice the number of passengers.12 Airways has substantially more cash on hand, following the merger agreement."

Yeah, maybe if you'd read it you'd understand why integrating a small group of dispatchers is different then integrating a large group of airline pilots.

"9. This is not to say one could not construct some sort of mid-ground that would attempt to incorporate a methodology utilizing both a mechanical and a date of hire approach. Several factors militate against this. First, these are relatively small units. The West group is comprised of 37 individuals. The East local has 120 active employees with 32 currently on furlough (as of the date of the hearing.) It is logistically difficult to mold a hybrid list, given this small a unit. Moreover, unlike pilot mergers, which often involve companion considerations including aircraft types, differing status and categories and a variety of additional distinctions, the instant case is considerably more basic. These employees, on the other hand, perform the same functions, in essentially the same manner and will operate under a combined agreement that features no fence or any of the other arcane elements peculiar to pilot cases."

there are many dogs that have squatted before US Airways pilots.

http://web.mit.edu/airlinedata/www/2...0PERSONNEL.htm

All41--I don't think we'll ever see eye-to-eye on the USAir seniority issue. You've seen my prediction: you'll have a joint contract by this winter, either under the threat of an 1113 hearing, or as the product of that hearing.

As an aside, none of my comments are stated in the hope that USAir returns to ALPA. I think the USAir pilots, if they were to come back, would be an enormous drain on the resources of our union (especially the MCF). (My apologies to the America West guys; I know you're stuck in a situation not of your making.)

Don't you think that's a little harsh? I won't have a problem flying the new US when both lists are combined. They're both professional groups and should be able to put all this aside when the time comes.

IF there is a bankruptcy, this is not the same environment that the airlines have seen in the past. The possibility of liquidation is much greater. There are fewer places to find money and even fewer willing to invest in USAirways. If you do survive another bankruptcy, I assure you that the West pay will go down before the East pay comes up. If the company can convince a judge that it should go into chapter 11, the West pilot pay will be among the things that it will not be able to afford. So y’all all have fun on that salary. The Delta attempt, demonstrated that there is not enough money in the world for another pilot group to willingly combine with this mess. No matter what happens in court, there is too much bad blood for this to work out unless both pilot groups come to the table and hammer out something reasonable. If the company goes under because of the arrogance of the two pilot groups and management, no one will have any sympathy – not the government, not the taxpayer. The world will say that capacity needed to be cut and you were not worth saving. So, once again, I urge you to put emotions aside and hammer out a deal- not because you think that the other side is right, but because you know that you must to survive. Time is running out.

Why would the US Airways pilots consider coming back to ALPA. The greatest pleasure, kicking all the Mon 12pm to Fri 11am, holidays off, overpaid desk flyers out of office.

Ah yes the MCF (Major Contingency Fund) ALPA nationals threat that brings airline management to their knees.

Midwest pilots had ALPA's threat of the "MCF" and many others, lip service.

ALPA News Release

Bankruptcy is a real possibility for USAirways and it is surprising none of the east pilots understand what is going on around them. From what it seems here, there is no recognition at all of an impending bankruptcy as speculated by many analysts, and the evasion of their seniority arbitration seems to be immortal (in their minds). When your revenue is down 21% yoy there aren't many quarters you can keep this up, and LCC's cash is getting low. I bet they are chapter 11 by December with a bankruptcy judge combining the pilot group- the one remaining part of a merger announced four years ago- by the early spring. Forget contract ratification and all of the silly arguments about ALPA vs. USAPA. If you are a USAirways pilot, two events are on the horizon: pay cuts and Nicolau seniority.

In fact I have a video below of three America West pilots trying to take something from an Australian pilot, his flying experience and job.

YouTube - Is That a Knife

The Judge has already said he will not impose extra costs on the company or force a contract. What this order says is that USAPA has the legal obligation to negotiate in good faith, something that can, I'm sure, be subject to further litigation.

You mention the infamous LOA 93. The brilliant strategists at US Air (East) did not negotiate a snapback for LOA 93. The company is on record that there will be no snapback, thus no pay raise for the East. The Flight attendents for the East did get a snapback - the pilots did not put ironclad langauge in their LOA.

I actually hope that the East would get their snapback, it will raise the bar for an eventual contract (sometime before the next iceage I guess - and I'm not talking about the Pixar cartoon). There will have to be much weeping and wailing before we ever get to a real contract, I expect that will commence next spring - provided there still is a US Airways around.

I believe there is a third possibility. US Airways is sold in pieces - the Shuttle, the West operation and the East operation. Parker wants consolidation and he wants to bring shareholders some cash. Look at all the Wall Street raiders - they split a struggling company in pieces to get the most out of the deal.

Now I have to mail my info (facts) to a target audience. Good day sir.

That is exactly what is being considered by the industry powers. Last that I heard, The east and shuttle operations were going to be sold to American, and the west op is going to Mesa who wants to get a leg up on Republic. Enjoy working for JO boys. Y'all are perfect for each other :D

Kind of an unlikely scenario, in my opinion. First, I don't see Mesa as having the financial wherewithal to absorb another airline (or part of one). Second, I don't believe AMR would want to part with any precious cash in order to acquire assets of dubious value. The shuttle (either USAir's or Delta's) is not worth what it once was, given the meltdown on Wall Street.

The name of the game now is cash preservation. Both Mesa and AMR have limited cash to play with, and are busy enough trying to manage their companies through the current economy. Even a cash-free deal would cost too much.

I don't think AMR is too interested in inheriting the east pilots. Considering their actions so far, any seniority merge over at AA would just start a new disaster in a new place. Not even close to being worth the trouble.

Now ASSETS of the east operation, maybe, but not employees.

It seems perhaps the most likely outcome (if UAL doesn't flop first), is a fire sale at U. Many carriers would be interested in various assets and then they can hire (read choose) who they want employee wise, but first bring back any furloughed employees that carrier may have.

Maybe mergers are the "old" way of doing things and asset acquisition will be the way of the future and the industries preferred method of consolidation.

I never really considered it before, but I guess APA would have a pretty big issue with acquiring assets and pilots, while they have guys on furlough.

Regardless, I think AMR is going to work with the assets they have, rather than go on a buying spree.

Crap. I am now convinced that the end is near... I find myself agreeing with eaglefly... Seriously, though, I think you're right -- why enter into a mess of a merger (especially with the new merger laws in place) when you can buy pieces. It makes no sense from a management perspective... Douggie isn't stupid (he may be an impulsive fool, but he isn't dumb). If he allows the airline to continue to fall apart (not just the pilots, but the F/A's are having issues, the customer complaints are high, etc), he won't even have to take the hammer to US. It will break apart itself... He stands to make a lot of money selling it off in pieces (a lot more than a sale to a single buyer).

As for bankruptcy by winter or spring, where do you guys come up with this stuff? Do you just pick arbitrary numbers and dates? There is nothing that points to impending doom. At the present rate they're losing money, US can last another 18-24 months before even being in danger of liquidation (note, I said at present rate of loss). Most non-airline analysts are predicting the beginning of an economic recovery by this Fall or next Spring. That would stretch out US (and UAL for that matter)'s life for a while longer.

And, as for the guys that think Parker will take US in Ch 11 just to get a pilot contract, give me a break. The dangers (and downsides) to a BK filing are pretty severe (as in will they even emerge, what effect will there be on current shareholders -- of which he is one, etc...). If US goes into BK, it will be a while from now and it will be because they are facing destruction -- not just for a contract...

As for whoever asked about the post-merger new hires, yes there are a few of us (although finally, none are left on property). And, I can tell you from my own opinions and those of my buddies hired/ furloughed me, most of us are pretty neutral. As a whole we supported ALPA in the vote (east or west), didn't listen to most of the ramblings in the cockpit, support the Nic (if for no other reason that final and binding should mean final and binding...), but we also understand where the East guys are coming from. They are angry and beaten down. They are frustrated at how they are treated and how their careers have turned out. But, being sympathetic does not we agree with them in trampling the West guys to try and make up for things. I would say that we are just neutral in the whole thing. (Besides, who knows if we will ever get recalled...)

Agree with eaglefly ?

Don't tell your friends this..........that would be very bad.

;)

In all seriousness too, I think that anyone out there whose belief is that Parker's plan is to just muddle along for the next 18-24 months in the hope that "things will work out, because the economy will surely improve and then U will be fine" is a tad nieve. Even if the economy improves, U can't survive with the status quo remaining as 2 seperate carriers in perpituity. Even if he can synregize as one very soon, U is still on the ropes.

The industry seems as though it's waiting and searching for a relief valve in the form of one carrier that will liquidate and provide the catalyst that it needs to right-size itself to a healthier size. A liquidation that involves selling assets and shrinking might be enough. It would still mean MANY more pilots of that carrier (perhaps the bottom 40-50%) would be left without a chair and that's not good, but necessary for the industry as a whole. The lack of cohesion COULD put U ahead of UAL in the future. Remember the winter revenue will drop (as usual) significantly and early next spring someone is likely ripe to pop. Many of the carriers have HUGE debt issues maturing early next year as well.......not a good combination. Parker needs to either take this division head on if he plans to save U or just wait until he has the excuse (and financials) to open the bidding.

Again it seems a race (at least NOW) between UAL and U. USAPA's legacy may be that they commited professional seppuku in the name of seniority..........lets hope they can live with that legacy should their actions push U over the brink.

Are there any debt covenants that USAir is in danger of bumping up against? Credit card company holdbacks?

There are some debt payments that come due starting next year. I just tossed my 10k statement that was part of the annual report but I believe it was 330 million next year and around 250 mill per year after that for 8 years. That is what most of us are talking about.

Separate operations are not the huge burden you may think. There are pilot issues that relate to the seniority list such as filling of vacancies and displacements, but from a company standpoint you are not losing too much by having, essentally, two different operations under one certificate. We have the same uniforms, the same FOM, and the same maintenance and ground handling but our ops specs for the West are slightly different (we can do more types of approaches than the East and we have 180 minute ETOPS vs 120). Essentially you have East bases doing their thing and West bases doing theirs. The economies of scale are already there in the size of the two operations,.

Will we be split up? Who knows, but it would not be that hard to do. And while mr Walt may wish us to be taken over by Johhny O, we can honestly say that we have worked for the worst major airline in existence. There's reasons Us Air cratered twice, and those reasons are made abundently clear each time we fly through PHL, CLT or BOS.

While I agree with you that this is an idiotic way to run a railroad, every day I am more and more afraid that this is exactly what Parker is doing. For a while I was holding out hope that this was part of some grand scheme of his to save the airline. Now I'm just afraid he doesn't have a clue what to do to save the place and he is just muddling along hoping someone else dies first. I think it is more than a "tad" nieve. I think it's downright crazy. But, actions certainly do speak louder than words... (Or in his case, a total lack of actions...)

I was just saying that I don't think Parker will cruise into BK just to settle the pilot contract. There are too many negative ramifications... Looking at the numbers, US could just wallow along for the next 2 years frittering away money. Or Parker could make a killing if he can figure out how to sell off the parts. But, the problem with that is who has the money to buy the parts these days? Mesa doesn't have the money. AirTran has expressed "interest" in a West Coast operation, but do they have any money? Southwest could come in and buy the West operation and dismantle it to have a total lock on PHX (like they did with ATA in Midway), but that does no good for the pilots (just ask the ATA guys).

Either way, US is on the ropes and unless we can figure out how to get along (as hokey as that sounds) AND get some real leadership to turn the place around, it will continue to be a slow drive towards the cliff. (I could be wrong, maybe Doug really is a genius and is secretly saving the airline -- all while plotting to take over the world...)

You don't happen to remember what those debt payments were for, or who they are to, do you? Those were the numbers I thought, but a buddy of mine pointed out a statement on page 38 of the 10K that says US prepaid 400 million to Citi (370 million after transaction fees), and the "virtually all of the rest" of the 1.6 billion is due in 2014. Now I can't find anything in the 10K about what is due in upcoming years (I'm not referring to the capital lease and interest payments associated with equipment/ facility leasing).

I was thinking more along the lines of minimum cash requirements and what that may trigger.

Minimum cash (or liquid assets) is $850 million (to Citi), after the $400 million early payoff last year. But, they can pay early until this Fall on a 1-for-1 credit to a max of $100 million (in other words lowering the required cash on hand to $750 instead of the current $850 million).

I wonder what U's figure is for being able to pay for a BK ?

Every company has a point they MUST go to BK when the hit a certain point of cash.

Conference call paints a heck of an optimistic picture.

$700 million in A/C financing
$200 million in raising cash

Look at 8:00 and 30:00 for discussion on EMB-190s going away.

Jamie Baker asks a question about future transactions at 31:00. Says Doug has a record of successful transactions between BK carrier and solvent carrier (Baker's words, not mine) and asks Doug to comment. Doug starts to say that he didn't (as if "didn't know") but stops and says he can't talk about this.

Well, if doug says everything is fine, then that's good enough for me. It's settled then....................U is in good shape.

:rolleyes:

Selling the 190s
 

It looks like cash is getting scarce at LCC- they are considering dumping the 190s... Burning the furniture for sure. How many pilots will get inevitable pink slip if this happens. LCC sure looks like a weak player.

Still all this talk of doom for US Air, yet they were the only legacy to post a profit this quarter. Maybe yall should start focusing on other airlines that are taking losses.

Is a loss for the quarter really a loss when you increase your cash position by $500 million and pay down your debt $20 million at the same time? The only reason some carriers posted a loss was that they had things to write off.

The 190s are worth more now on the street than what LCC paid for them. Consider them gone as the transaction will net LCC $$$ and at the same time capacity will be reduced.

Not arguing the "weak player" part of your statement, because they aren't the strongest out there. But, maybe Doug is finally doing something about the logjam in negotiations and is finally taking action to bring the Nic into play. (Anyone want to bet that a cram-down contract, ie Kirby deal, is offered in exchange for keeping the 190's and not furloughing additional East pilots...).

Since the 190's are NOT part of the min fleet count, this is the biggest gun management has to point at USAPA's (the East pilots) heads. It doesn't make a lot of business sense to park cheap, efficient, passenger-loved planes, unless it is for another reason... So, who will blink first????

They won't park them. They will sell them to Republic so they can use them on their Midwest Airlines operation. If I recall, Republic already loaned Airways a good bit of money. Republic could forgive the debt and call it a "down payment".

WHile all of us have our speculations with the 190 comments yesterday, it boils down to what is the most likely reason for even bringing them up. LCC needs to cut capacity, any fleet reduction can only come from the 190s, save a few airframes out east. LCC is doing cash advances on their credit (what is left of it), has massive balloon payments due in a few years and an industry- leading cost saving pilot contract. I just can't see the management team suddenly get excited about merging the pilot group especially when they know they can get away with keeping the east pilots on a very low wage scale. Parker gains nothing by merging the pilots except for increased costs. That is why I see management solving two problems at once: reduces another fleet type/ reduces capacity and also based on what Kirby said yesterday they can actually make some money off the deal. Unfortunately, regardless of the reason, it looks like there will be 300 fewer pilots at USAir real soon. Does anyone know how the furlough would work, given the pilots groups are separated?

If the East costs are so much lower than the West, why aren't they parking West planes and shifting that flying to the East? Do the West guys have contract protection to keep that from happening?

We're talking about the airline that just yesterday reported earnings of $58 million (42 cents/share) from fuel-hedging contracts; ie, unrealized gains. Take away the fuel hedging, and the airline operation lost $95 million, or 77 cents/share.

So, the airline lost $95 million flying airplanes, is discussing reducing their fleet by selling their EMB-190's (furloughs), corporate travel is down, RASM is down, and has few assets left to leverage.

I think we're focusing on the right airline. This is a thread about US Airways, after all.

And, oh yeah, they have two pilot groups that are like oil and water right now. Back to that discussion.