Another depressing letter
 

Just where will the bottom be in this industry?


Sunday, July 14th, 2013

More Concessions?

Hello New York --

As you are undoubtedly aware, USAir management is asking your MEC to broker a deal to achieve further cost reductions as related to pilot labor. I’ll give a very brief history, a best and worse case scenario, and call for you to advise Phil & Me how you’d like us to proceed.

How we suddenly got here:
Delta Airlines CEO Richard Anderson announced during a recent Wall Street investors teleconference that he had Pinnacle, GoJets and Compass as low cost regional feed providers and that 50% of Delta’s feed (which itself is about 50% of the total Delta operation) was performed at Pinnacle costs. A clause in Delta’s Air Services Agreements (ASA) allows Delta to reset what it pays to its more costly feeders to closely align with the more ‘competitive’ rates. This occurs whenever larger aircraft are placed into service and/or at given time intervals. So, in short, Delta says a large portion of it’s domestic operations are performed at these low rates and by 2017 all of it's regional flying will be at those rates.

USAir/AA’s game-plan is not only in flux, but it’s being watched and supervised by Wall Street, the courts and management types who have something to prove to the world. For these reasons, they compelled to match their biggest competitor’s (Delta’s) costs. Hence the request for concessions.

Your MEC did meet with Scott Kirby and the rest of the USAir Senior Management recently where the above was discussed with more specificity. The new USAir bosses seem genuinely interested in the well-being of their acquisition and want to honor the deals we struck with AMR that honor our sacrifice and performance. Hence the concept of a B Scale: Leave us alone, while throwing the unborn into a future cost structure that has a downward trajectory.

My crystal ball is foggy. I have no way of knowing whether Pinnacle style pay-rates and career progressions are part of a sustainable regional airline model. Nobody knows how Delta’s other feeders are going to react when forced to slash their costs (and inevitably lower pilot pay rates). But that isn’t really the point, because that’s in the future. USAir wants to prove to Wall Street that they can run the operation with a similar or better cost structure today.

I do believe the tightening requirements of Part 121 First Officers will greatly reduce the number of individuals willing to slave away for $25k. There simply is no justification for an ATP qualified pilot to be earning anything less than a salary truly commensurate. The regional airline industry must quickly wean itself off the notion that someone who has invested the time and energy necessary to become an ATP (even a restricted ATP) is going to work for $25k a year. Like crack addicts, the sooner there is an intervention, the sooner the healing can begin. Management must shift to the new paradigm, and quickly. Those who get it right first will have the cream of the pilot crop.

What’s the worst case?
We get Comair’ed. Using Comair’s size as a rough model, I can tell you that I think it entirely realistic that AAG (the new AMR) could retire the Eagle certificate by mid 2016 to early 2017.

What’s the best case?
That’s actually a trick question: there is no best case right now. Ideally, management grows us and takes a bold, industry leading step to attract and retain pilots and provides a cradle to grave career progression with compensation befitting ATP pilots while honoring the pain and sacrifice this work group has endured. Having seen the plan, I can safely say that's not the works.

Again, I don’t have a crystal ball, but it’s no secret AAG is about to order several dozen planes. Maybe we will get a few new aircraft to offset the departing ones. Maybe not. And next time AAG wants to buy a few more, we’re going to have face this same issue again: will we match the industry's lowest cost carriers in exchange for aircraft?

Status quo is not good, and isn't sustainable. Eagle can not survive with the status quo. Worse than the airline shutting down, it means stagnation for everyone until the lights get turned out. If you’re a senior CA, you’ll stay that way. If you’re the most senior FO, you’ll probably stay FO. With no growth, with nobody coming in the bottom, there will be no career progression.

Sadly, I think this is a concern no matter how many concessions we give. If AAGdoesn’t invest in Eagle and keep us a bright, shining star and chooses to instead give nice, new airlines to some other carrier I believe Eagle will implode faster than management can wind it down. Performance will quickly languish, dependability will plummet, and FOs will leave for greener mainline or international pastures. Or leave the industry altogether.

The choice ahead is tough. It’s something pilot groups have been facing for quite some time and the pattern is well established: Do I take a haircut and live to fight another day? Or do I stand and say “no more!”

I, for one, am not inclined to attempt to match the industry's lowest costs. Right now they ARE the outliers. I can’t imagine anyone struggling to get an ATP and then going to any airline other than the best paying one. But if we match them, then they become the new de facto standard and the entire industry will follow and we will absolutely eat this at the next amendment round, if not before.

Make no mistake, we’re not alone. Republic, Air Wisconsin and Skywest pilots to name a few are in negotiations with their respective managements over pilot compensation. They’re probably being told they need to acquiesce quickly lest Eagle pilots lower the bar further!

The race to the bottom continues, and we haven’t found bottom yet.

Ladies and Gentlemen of New York, as I wrote when I ran for office, I’m not inclined to enable that race any further. I have outlined the risks involved, but right now I am inclined to invite Mr. Kirby to place his new aircraft elsewhere if it requires me to allow him a B Scale. I represent you, dear friend, to management. You elected me to this position, and contrary to our Chairman’s email of a few days ago, I am completely comfortable with the concept of the Status Reps (MEC) functioning in our role of governance in that ALPA is a Republic, not a democracy. I am completely comfortable voting NO on something that I believe is so wrong it doesn’t even warrant going out for a general pilot ratification.

Now is the time for you to speak up if you feel I am misguided or plain wrong. My understanding is that there is a vote on Monday on how to proceed. If you have comments, suggestions, or feedback please email me ASAP at


Regards,
-sam-

I like this guy.

They can't shut us all down. Maybe if the airways/American regional carriers mec's got together they could all stand up together and tell aag to pound sand, therell be no cocessions today. Put those union dues to use other than that lousy magazine. As I've said on here a million times...isn't that the point of a union?

Why doesn't your union sack up and draw a line in the sand?

Two very strong facts to consider in your decision making process. Skywest recently had the rate reset and we are not looking to reset for another 5ish years. Skywest is not going to take concessions in our current negotiations. They are a profitable company even after the rate reset.

Do not fall for them telling you that Skywest is taking concessions. Hold the line.

The unfortunate is that this is why the airline union model doesn't really work. What you have are numerous trade unions representing the best interests of their respective groups.

What's needed is one national union for all US airline pilots to be involved in. The union establishes requirements for pilot certification in conjunction with the FAA. Requiring a certain experience level to even be considered for airline employment. As such, the union drives wage negotiations at all unionized airlines to correspond to the minimum rate for any type of aircraft operated in the US 121 fleets. The union also requires seniority to be based on membership in the union.

I can't stand hearing the "Delta" name.
I associate it with annoyance. All the ride reports questions and anytime the word regional and Delta is formed in a sentence it's negative.
Delta it the bully in the school yard, their day will come when they get what they paid for.

Good contribution. Delta asking for ride reports is nonsense. Bullies.

http://www.reactiongifs.com/wp-conte...angry-eyes.gif

I guess that sounded silly. What i was trying to say was that if you fly around the ATL area all you hear from every delta airplane is "Got any ride reports?" "Got any ride reports for the climb?", "How about 320?", "Anything at fl300?".
What i was trying to get at is that the world doesn't revolve around Delta. When i need to get a word in on the radio i have to listen to them go on and on about where the good rides are. People can't check on, someone may need an immediate deviation but noooooooo Delta needs a ride report.

Delta Delta Delta……. Sick of it.

Delta = Negative

When it comes to competing? Why? Why do we have to be at Pinnacle level? Let Delta get what they pay for. Delta isn't the be all end all. They aren't the only airline in the sky. If Airways really wants to compete with them then build an Oil Refinery.

Doesn't SKW have a rate reset in 2015? And by 2017 be close to Pinnacle? Serious question. This is what we are being told.

Anyone go on JC and read the Delta thread with PinnDeavor Air? Man, that's a load of you know what... Not to threadjack but... this... Pinnacle sets the standard for regional airlines | Jetcareers

Where's the industry GTFO EJECT button...

Hey seafeye, try a new avatar. I'm thinking Jan Brady.

Poor Jan. She was cute, but certainly no Marsha. Always a bit sad.

http://www.sitcomsonline.com/photopo...ady_000067.jpg

Sounds like you an MEC that gets it.

I think this letter is inspirational. I hope eagle holds the line, and I have confidence that our mec will too when that crappy deal is offered here.

No, it sounds like an LEC that might get it. The MEC letter seemed to be advocating further concessions.

Oh for **** sake, why yet again does some ******* have to go and mention 9E...

Does you Vajayjay hurt to?

Are you an ex OH guy?

When they would ask for ride reports to Bamako Control always made me laugh.


....station calling???

That's not very nice. Are you a Delta guy or have some reason to defend them?

Yes,it is.An alliance between airlines would be nice.I doubt that would ever happen.Most people do not have the stomach for what SHOULD happen,to wit : Compas/Pinnacle/Go Jets would be excluded in everything -no jumpseats,no hiring from there,etc.Companies that vote for paycuts need to be cut off and die on the vine.

You think that's bad, wait until this afternoon. The AE MEC is about to vote on concessions that include a B Scale.

Are you seriously unable to get a word in with the center controllers?
Don't hear much of that on approach, but enroute I rarely hear the frequency saturated.

Should be noted that Compass is able to keep their costs low via low longevity. Most senior pilot on property is just shy of 6 years, and we've just heard the flow will begin in the fall. After that, the senior pilot will be approximately 5 years, with the junior captain at 3 years.

The Compass contract is in no way concessionary, and our creation isn't suspect, as GoJets is (union busting operation).

Just general commentary for those who may not be familiar with Compass. Don't want anyone assuming that concessions have been voted in or imposed. Still working under the agreement that the Northwest MEC negotiated on our behalf (this occurred before Compass hired its first pilot) in 2007.

Another depressing letter
 

Please. Compass is a B scale operation. They are no better than anyone else. No worse but no better.

Like I said, Im gonna ride this puppy till it crashes and burn.

Vote NO.

So that means at one point Comair and ASA were too? Or what criteria are you using to come to this conclusion.

Another depressing letter
 

Regionals are concessionary by nature. Comair was, and ASA is. Don't pretend that compass is any different. Don't get me wrong. I think compass is probably the prettiest pig at the dance but its still a pig.

Ok well you first said B scale operation, implying it to be comparable to GJ/9E and lumped in with Franks idea of no JS, Hiring Etc. Now it's not. So which one is it? Everyone I know from Pinnacle loves it over there.

No sir, you have been switching between how to vote... you will crumble and vote yes. You are weak and thrive on spreading fear to the younger ranks. You will understand that this will not really hurt the up and coming pilots but will severely hurt the senior pilot. You will vote yes!!!

You are right,I really don't care what happens here. If we get to vote, I will flip a coin and vote based on that.

The company already knows what the future is regardless of a yes or no vote.

We Dont have any control over it.

Another depressing letter
 

If you research the beginnings of compass you will see why I refer to it as a B scale airline. Not trying to give anyone a history lesson today. I just was trying attempting to bring you back to reality a little bit. Compass is no better...... or worse than any other regional. Look it up. It's beginnings are not as squeaky clean as you think they are.

NWA bankruptcy, management wanted 76-seat lift and to park some DC-9s. NWA and ALPA negotiated the creation of Compass. Part of the compromise was that it was a place for NWA pilots to go in case of a furlough (flow-down), and in turn it would be a "breeding ground" for future NWA pilots. The NWA MEC negotiated the contract, and we remained under Delta's MEC control until 2009.

Where's the conspiracy?

I'm not saying Compass is anything but a regional airline. Just pointing out that they hadn't signed a concessionary contract nor had they been created as GoJets was.

Hang on a sec...Maybe that is what is needed.How about offering an "up and out" policy :You agree to upgrade at the first offer-no holding out for a better base,etc.Then,after two years-that's it,you're gone.You should have 1,000 pic or better and it would solve the "lifer problem".Pay about $50/hr.,no matching 401K,minimal insurance,but hey,the "I'm just here for the 1,000 PIC and I'm out" crowd would be happy,hmmm ? Plus,it would not affect anyone currently on the property.You're welcome.

Another depressing letter
 

They have not been around long enough to take a concessionary contract. When it's there turn they will. Please don't get me wrong here. I am not attacking compass at all. I just cannot stand the my regional is better than your regional stuff. Fly safe. CYA.

I am well aware of it considering some of my relatives had to vote on it. But they are still not like GJ or the new 9E, still a regional though you're right about that.

Good luck finding many companies that have never voted in concessions at any level.

Your list is about to get a lot bigger also, as all of the remaining regionals will vote in concessions.

I am only going to say this one... I agree with you 100% :D

It might not have been created as GoJet was but it was created a B scale workplace. Yes regionals are all B scales but Compass was built as a B scale operator. AA is trying to build something similar with Eagle. They are talking about hiring guys under a B scale but with the ability to go to AA in a flow sometime in the future. We know flows haven't worked but they continue to reinvent the wheel.