10-30-2018In the near future, our joint negotiating committees will be passing more substantial proposals at the table based on the joint guidance provided to the committees.
The merger of American Airlines and US Airways has proven to be an enormous financial success. Having played a pivotal role in making this merger come together, the pilots of both airlines have earned the right to share in the upside. As so often occurs in this industry, things change.
American Airlines' financial performance is already in line with industry-leader Delta Air Lines in almost every meaningful category. From pre-tax margin to net profit to passenger yield to total revenue to EBITAR and other categories, American is in line with and in some instances exceeding Delta's financial performance. We have compiled a financial performance comparison chart that drives home these points.
Management recently communicated to investors that "anticipated upside synergies are just beginning." The pilots at the new American Airlines are more productive than Delta pilots by a good margin (four more block hours flown per pilot per month in 2013, according to Form 41 data). That's impressive considering Delta pilots have been on preferential bidding for years. Our productivity will only increase as we make our transition to PBS.
If we are more productive than Delta pilots, we can look management squarely in the eye and demand Delta compensation, including profit-sharing.
We intend to make the case for our pilots flying E175s and other similar-sized aircraft. The pilot shortage at the regional carriers — driven by poverty-level wages for new hires — is real and materializing sooner than the industry anticipated. The carrier that abandons the regional experiment first and commits to a consistent quality product for passengers, with a reliable supply of highly qualified pilots, will win the day. We will strongly encourage management to restore American Airlines to the position of industry leader and innovator, particularly in the area of mainline pilots performing regional jet flying.
During the Conditional Labor Agreement and MOU negotiations, we willingly signed up for a JCBA process with an arbitration back-stop if an agreement cannot be reached. Management wanted a process with certainty. Agreeing to an arbitration back-stop was the price of admission to the merger path. But with the merger succeeding beyond the most optimistic expectations, an arbitrated solution would be a dismal failure for both sides. The opportunity to align our interests with management's and to share in the upside would be lost. Conversely, immediately closing our pay gap with Delta would be the single most tangible sign management could offer to remove any doubt that they are serious about creating a better relationship with the pilots of American Airlines.
We will share more details with you in the near future as negotiations continue and more substantive proposals are passed at the table.
The time to close the gap with Delta is now.
