Real Airline??
 

Pinnacle Airlines Corp.'s chief warned Friday that a three-month-old restructuring effort is still a work in progress with an uncertain outcome.

President and CEO Sean Menke said officials had made progress, but weren't sure they could avoid a Chapter 11 bankruptcy filing.

"Something I'm starting to sense through comments I've received from employees is a feeling that we're somehow out of the woods," Menke wrote in a letter to 8,000 employees. "It's important for everybody to understand that while we've made some progress, the challenges requiring us to initiate the restructuring plan still remain."

He continued, "We still have work to do to reduce our costs and we still have work to do to make our partner agreements profitable."

The company has negotiated temporary rate increases for its least profitable flying, but Menke said, "Unless we have long-term agreements in place, the best way for us to improve our financial performance and ensure a viable future for our company may still be the court-supervised Chapter 11 process I explained earlier."

Menke's letter seemed intended to reinforce previous calls for shared sacrifice, including concessions from unionized workers such as pilots, said analyst Helane Becker of Dahlman Rose & Co.

The company has proposed 5 percent pay cuts companywide, but no agreement has been reached with the major unions.

"I think his message to pilots is this deal has to be permanent," Becker said. "It can't be temporary. We need to get everybody on board. We need to get our partners, lenders, employees, all on board."

Pinnacle shares closed Friday at $1.24, down 5 cents, in NASDAQ trading.

Menke pointed out the Memphis-based regional airline operator's troubles are shared across the regional airline industry.

Mainline carriers such as Delta and United contract with Pinnacle to fly shorter routes that are less profitable for the bigger airlines. Regional profits have taken a hit as mainline partners squeeze out costs to maintain profitability in the face of permanently higher fuel prices.

Menke encouraged employees to read a gloomy assessment of the regional airline industry that appeared in a recent Aviation Week magazine blog.

Its author, Darren Shannon, saw no clear solution to the industry's troubles, concluding, "It simply cannot survive with the current business model."

Becker agreed with the author's conclusion, but said the problem can be solved by regional airline companies assuming more risk and asserting control over revenues.

"Our view has been that the regional airline industry is broken," Becker said. "They've got to go back to being real airlines."

The guy's right! This sure is working for republic. Maybe we should get on board.

Shared sacrifice??? How will Menke manage to survive on $425k a year??? Can we please pass around a hat for the man!?

Let it burn...

So the best plan management can come up with is to start breaking your promises?

That's a sound strategy.

Every regional is a dirtbag outfit. We exist because airline management is screwing mainline employees. If one regional doesn't do the flying then another will.

Awesome that they use an fNWA 747 tail for the article too.

I thought that was a nice touch.

Oh!! Didn't you hear the good news????? We are getting some new aircraft! Except that isn't a 74, it is the new Q Four THOUSAND. However, at 287 feet long and still only a few feet above the runway, rotation (or the lack there of) can be a bit tricky to master.

They'll replace the Saabs but keep the pay rates. And bidding for the seats will be anything but seniority based. 9L guys first, ShyGuy last ;)

curious - what does our fearless ceo get paid anyway, twenty bucks says its more then triple any line pilot !

If it's so easy, go apply!

Fearless? This guy seems to be afraid of everything and for that matter wants to pass that fear along to you. What kind of regional CEO references a biased, doom and gloom article regarding the Regional Airline Industry in a letter to his employees? I guess I missed that section in my management classes and all leadership courses I've ever taken. And yes, of course he's paid well and is looking for more, he wants 5% of your pay, mine, the guy next you, the crew behind you and all those who support our operation. He's using fear and intimidation to take from those fearful employees with his ambiguous emails that he positions as effective communication, give me a break!

Maybe not the best example, but if and when a new President is elected and takes over the problems of the previous administration does he immediately overestimate the current problems, emphasize the negative issues and then proceed cite the numerous articles explaining why the US cannot suceed? Or does he do what he is elected (or hired) to do and think outside the box to provide a workable situation to progress toward success without taking a percentage, through intimidation, vague communication or fear, from each American that did not cause the problem in the first place and has suffered through below average wages, poor work rules and a general disrespect? There are other options, more viable and effective. I've heard those that defend our leader, I use that term loosely, and they are entitled to their opinion, just as I am entitled to mine. Let's hear it all together.... VOTE NO!

i do find it funny that each company doom/gloom email has the "fwd fwd fwd to all managers and employees" in the header to make sure we see it haha

I have done "it", been there, and lived "it". "it" isn't so hard, just lucrative.

I can run the company into Chapter 11 just as well as Sean and Trenary. Hell, I'll even do it for HALF of what's Sean's making!

And probably half the time :p

what causes me concern is reading the leadership bios on the pennacle home page and seeing all the airline-corpses these folks have left in their wake.

It seems like a diabolicly constructed roll-call of execs deliberately recruited from destroyed businesses. I kept expecting to open the next profile and find a photo of Dr. Evil petting Mr. Bigglesworth.

I reckon pilots are the only one who have their backgrounds checked.

Everoyne wants to single out management, what about the board, they're the ones that hire the CEO, and probably have a say in other executive positions as well (ie. CFO). In no way am I defending Trenary/Menke, but these clowns on the board need to be cleaned out as well

That is precisely my point.
Its not just one person.
Everybody got hired by somebody.
That "somebody" didnt do much research and isnt very good at holding their employee accountable for performance.
but then again....holding people accountable for their performance is so old fashioned.
Once upon-a-time....if ya failed...ya got fired. and there were no golden parachutes.
That lack of occupational mortality has lead to many leaders feeling a sense of impunity for thier whimsical maneuvers.
But leaders ALWAYS lead. They either lead up...or they lead down.
They get paid either way.
In fact, its almost like being on the other end of the contract. Excellence is irrelevant....its actually a waste of effort to exceed expectations. Do you get paid more for doing a great job? no. Do you get promoted faster if you do a great job? no.
There is no incentive for either end to excell. Nor any true penalty for under-performing.
no lift...no drag. Entropy
Cannot possibly succeed under any realistic (or even wildly hypothetical) business model.
Theres a whole bunch of folks that a lot smarter than me that must have it all figured out and are just waiting to spring the surprise happy-ending on us.
Just in case they are reading this.... ok already....uncle....I give...whats the punch-line?
The suspense is KILLING ME.

Don't get "performance" mixed up.

They get paid on a different set of performance measurable's. Those measurable's just so happen to contradict the performance measurable's that other employees are interested in.

The management team that hired the personnel currently staffed are fully aware of the performance "achievements" of their cohorts. They are leading in a manner that is best for the B.O.D. that places the company in a manner where they can maximize handouts, subsidies and diversification of contracts. That is a direct conflict of interest in the take home pay of pilots.

I think we have the winner.