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Old 09-02-2007, 06:49 PM   #1  
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Default Another News Ariticle Ref Eagle's Shortage (Printed 09-01-07)

American Eagle, union seek ways to attract pilots


By MARY SCHLANGENSTEIN Bloomberg News
9/1/2007


American Eagle, the commuter carrier for American Airlines, and its pilots union are in talks about incentives to attract more job candidates in a "highly competitive" market.

American Eagle is hiring as many as 700 pilots this year to fill vacancies due to attrition and recalls to American Airlines. American Eagle and American are units of Fort Worth-based AMR Corp.

Commuter carriers are facing a shortage of applicants as major airlines recall furloughed pilots or add new hires.

"We're definitely looking at financial incentives," Dave Ryter, vice chairman of the Air Line Pilots Association at American Eagle, said in an interview Friday. "It's highly competitive for candidates right now."

The carrier, which has about 3,000 pilots, is interested in tailoring what it offers to applicants' qualifications, Jim Winkley, American Eagle's vice president of flight operations, said in an interview.

Ryter and Winkley declined to discuss specific proposals because the talks are ongoing.

"There are different incentives to look at," Winkley said. "We are not offering any incentives now."

American Eagle has reduced
to 800 from 1,000 the hours of total flying experience required for new applicants. The carrier offset that change by modifying its training program to make sure pilots meet the same standards, Winkley said.

The carrier and its union also are in discussions with the Allied Pilots Association, the union at American Airlines, about possible changes to an existing agreement governing the movement of pilots between the two airlines, Ryter said.

The so-called "flow-through, flow-back" agreement in recent years has delayed promotions for American Eagle pilots and could work against the carrier in recruiting, Ryter said. About 600 furloughed American Airlines pilots went to American Eagle after the 2001 terrorist attacks, with about 150 of those remaining at the commuter carrier, he said.

American Eagle is holding job fairs across the country to attract applicants. About 20 pilots a month are moving from the commuter carrier to American Airlines as the larger airline brings back furloughed workers.

"We'd like to see more" applicants for pilot jobs, Winkley said. "We're not seeing as many off-the-street candidates as we used to see."

American Eagle already lets new pilots pick from among its eight operating bases. The union is offering job-placement help for employees who decide to move to another airline, to help open up more senior positions.

The American Eagle pilots' union is "confident that within the next month or two we will have agreements in place" to provide incentives and resolve issues with the Allied Pilots Association accord, Ryter said.

Shares of AMR rose 53 cents Friday to close at $24.51 on the New York Stock Exchange. The stock has fallen 19 percent this year.
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Old 09-02-2007, 06:51 PM   #2  
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(Another Article, but this one includes "stats")

The Bain/Management/ALPA Project has a goal of ridding American Eagle Airlines of senior pilots.

Paradoxically, and at the same time, American Eagle Airlines is actively recruiting pilots as well as offering five hundred dollars ($500) to current pilots to refer a friend.

Is the above paradox by design or merely circumstantial with two distinct phenomena?
Below is some food for thought.

The reason stated by Bain and management for ridding American Eagle Airlines of experienced pilots is to reduce costs. A corollary benefit to ridding American Eagle Airlines of experienced senior pilots is the theory that if the “time to captain” at Eagle were to be reduced then Eagle would be able to attract as many new hire pilots as are needed to accomplish the removal of the senior pilots. This may or may not be true. If a pilot has the option of joining an airline that flies turboprops and turbojets, and has the possibility of being stuck on an island flying a turboprop, or has the option of joining an airline that flies only turbojets, the largest being an E class aircraft or CRJ 900, the pilot may not join the turboprop airline. Time in the left seat of a turbojet is preferable to time in a turboprop when composing a resume. Time as a first officer on a turbojet is also preferable to time as a first officer on a turboprop when composing a resume.

ALPA leadership of course does not know why they want to rid American Eagle of experienced pilot members except that they believe that it is to their political and financial advantage to pander to the gallery of junior pilots who falsely believe that if the senior pilots were to leave it would improve their lot and it would be a wonderful life. That may or may not be true, depending on where a first officer falls on the seniority list.

Unfortunately there is very little communication from ALPA regarding pilot hiring, fleet projections and future airline growth.

Referring to the official seniority list of February 6, 2007 there are three hundred and thirty two (332) furloughed American Airlines pilots flying at American Eagle. Included in the three hundred and thirty two are three (3) furloughed American Airlines pilots that have recently begun long term training.
These 332 pilots will be leaving American Eagle Airlines and if the furlough-recall projections at American Airlines are factual and correct, then these pilots will leave in the short term.

There are four hundred and two (402) American Eagle Airlines pilots that are listed on the American Airlines pilot seniority list.
These are the pilots that ALPA wants to force off the American Eagle property.
Keeping in mind that management has called for the lowering of the longevity at American Eagle we can assume that the above 402 pilots are a part of the senior experienced pilots that management wants to remove from American Eagle.

The combined total of the above two groups is seven hundred and thirty four pilots (734).

If the goal was to reduce the longevity at American Eagle to 12 years, 827 Eagle pilots would need to be removed from the seniority list. Combined with the 332 furloughed American Airlines pilots the total would be 1159 pilots.

Below are some facts and figures regarding pilot numbers at American Eagle Airlines from January 9, 2006 to February 6, 2007, slightly more than one (1) year.

The most junior pilot hired in the class of 1.9.2006 had a seniority number of 2930 on date of hire.

The most junior pilot hired in the class of 2.6.2007, more than one (1) year later, had a seniority number of 2867 on date of hire. A reduction in pilot numbers of 63.

The interesting aspect of the above is that in the same period above (1.9.2006 to 2.6.2007), more than one (1) year, American Eagle hired 283 pilots but the seniority list shrunk by 63 pilots.

That is effectively a loss of 346 pilots (283 new hires plus the seniority list shrinking by 63 pilots) in one (1) year. A year in which American Eagle hired continuously.

The shrinking of the seniority list was not due to abnormal retirements. In the same period above only 36 pilots retired or passed away and included in this number, were 5 furloughed AA pilots. The majority were pilots that just quit American Eagle.

Furthermore, if you examine the seniority list of 1.9.2006 and note the most junior pilot, seniority 2930, and then examine the seniority list of 2.6.2007, and locate that same pilot, you will find that his seniority number is 2589. The pilot’s seniority improved by 341 numbers in just over one (1) year.

Knowing that Bain, management and ALPA want to rid American Eagle of senior pilots, we will use the above mentioned seven hundred and thirty four (734) pilots for the purposes of our discussion.

Before 734 pilots can be removed from American Eagle, 734 replacement pilots would need to be hired, if the airline is to stay the same size. At the stated management goal of 60 new hire pilots a month, it would take more than one (1) year to hire those replacement pilots. That is if there was zero (0) attrition. Attrition would lengthen the time needed to increase the seniority list by 734 pilots. Based on the past year’s hiring rate of approximately 27 pilots a month it would take 27 months (more than 2 and one quarter years) to hire the 734 pilots and once again, only if there was zero (0) attrition.

The problem does not end with hiring the 734 replacement pilots. Those pilots need to be trained. Furthermore, as one (1) senior pilot, more than likely a captain, is removed from Eagle, a junior pilot has to be trained to replace that senior pilot. While that junior pilot is in training to replace the senior captain, another pilot is needed to fly the schedule, so effectively another 734 pilots are needed.

734 new hires first officers in training, 734 upgrade captains in training to replace the 734 senior pilots that Bain/management/ALPA want to remove from American Eagle. That is 1468 training cycles. How much does that cost in this cost conscious era?

Simply put, one (1) new hire pilot is trained, then one (1) replacement captain is trained and then one (1) senior pilot is let go.
Unfortunately it is not that simple.

If American Eagle had a common type rated homogeneous fleet the linear process above could be achievable. Unfortunately, American Eagle has four (4) fleet types and two (2) carrier certificates and there is no guarantee, even with “qualified upgrade training” or “short term training”, whatever it is eventually called, that first officers will choose to upgrade in their current equipment. The fact that some pilots will choose to transition to different equipment when upgrading; will increase the number of training cycles above. The above linear movement is the best case scenario; the worst case scenario could be 2936 (734 x 4) training cycles.

The reality of the situation is that American Eagle would need pilots before any forced attrition could occur.
There are a number of ways that these extra pilots could be obtained.

The simple option is to hire them, if the airline is to stay the same size. Unfortunately, examining past hiring statistics, that is not a simple solution and to complicate the situation the predictions are that a pilot shortage is looming.

Another option is to shrink the airline by parking aircraft or reducing the available seat miles (ASMs). This would result in a “virtual” increase in pilots but the unfortunate consequence of this option is that the airline may not recover its original size.

In January 2006, American Eagle Airlines reported capacity of 1012 million ASMs.
In January 2007, American Eagle Airlines reported capacity of 897 million ASMs.

That is a reduction of 115 million ASMs.

American Eagle flew 115 million less ASMs in January 2007 than in January 2006, an eleven (11) percent reduction.

A third option is to squeeze and force more flying into the schedules of the pilots on the property through degradation of the monthly schedules, reassignment, extension and junior manning. This also has the effect of a “virtual” increase in pilots. Unfortunately this option is not viable in the long term and more suited to managing the short term vicissitudes of a shrinking pilot force. Also, if the pilots resisted being reassigned, extended and junior manned this option would not be viable.

A fourth option is to move the flying off property. American Airlines could secure feed from other regional airlines. This would allow American Eagle Airlines to shrink simultaneously with the shrinking pilot force. The unfortunate consequence of this option is that the other regional airlines may demand a long term “fee per departure” contract. Chautauqua and Trans States currently have 10 year agreements with American Airlines. It would be very difficult to recover this flying once assigned elsewhere.

A fifth option would be to acquire another regional carrier. This option has myriad problems and if history is any indication, the merged airlines shrink back to the approximate size of the larger of the original merged airlines and if the resultant merged airline does not enter bankruptcy, it begins to shed pilots.

Evaluating the current American Eagle fleet vis--vis the airline market only two (2) aircraft are economically viable, the CRJ 700 and marginally, the EMB 145.
There is a limited application for turboprop aircraft in certain markets but that market is diminishing.

American Eagle Airlines currently deploys 25 CRJ 700 aircraft and 108 EMB 145 aircraft, a total of 133 aircraft. If nine (9) pilots (5 captains and 4 first officers) are needed to operate 133 aircraft, the total pilot need would be 1197 pilots.

If the goal was it shrink an airline it would be preferable to have that airline’s remaining aircraft flown by pilots with minimum longevity. A 10 year captain is a lot cheaper than a 20 year captain. To achieve that it would necessitate finding a way to remove the 20 year captains from the property. What would really be cost effective is if the 20 year captains could be removed prior to deploying different and larger aircraft. The pilot unit cost decreases the larger the equipment gauge. The unit cost of a 10 year captain flying a CRJ 900 is cheaper than the unit cost of the same 10 year captain flying a CRJ 700.

What is known about American Eagle Airlines?

The airline is not expanding. Pilot numbers have decreased. Most of the current fleet is becoming obsolete.
There is no announcement of increasing the fleet or deploying larger aircraft. Management and ALPA want to shrink the pilot force by shifting senior pilots off the property.

The question is: What does the future hold for pilots at American Eagle Airlines?

We will continue this discussion in a subsequent update.
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Old 09-02-2007, 07:38 PM   #3  
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Golly, my head is spinning...

Numbers are good though - it's all been "well I think..." on the board until this. Thanks for the post.
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Old 09-03-2007, 08:56 AM   #4  
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Hrm...wonder what the future of the ATR72 at AE will be...
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Old 09-03-2007, 07:18 PM   #5  
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when i left they were talking about replacing them. They will either get new atr's or there were rumors about trying to get bombardier to take out a few seats on the Q400 and make a larger cargo compartment for it. The atr's will probably be removed from MIA though. the saabs who knows...
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Old 09-04-2007, 05:36 AM   #6  
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Excellent analysis Lbell911. Looking forward to reading the update.
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Old 09-04-2007, 04:50 PM   #7  
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I don't work their I just found the news article on the web using google!
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Old 09-04-2007, 06:28 PM   #8  
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the ATR's ain't going anywhere. some of them were free from ATR after the roselawn accident. AMR doesn't want to give an inch of Caribbean routes to their competitors.
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Old 09-04-2007, 06:31 PM   #9  
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I saw "today" the Cpt Promotions were published at Eagle with the most Jr Cpt award was a 1999 seniority!!!!............That's only 8-years to upgrade!!!!
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Old 09-04-2007, 06:40 PM   #10  
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No mystery here... people do not want to sit 8 years in the right seat of a SAAB or ATR. Im from Dallas and could of gone Eagle and been home but I do not want to sit that long in the right seat.
 
 
 
 

 
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