Maybe today, but right now they are enjoying having almost half the pilots on year 3 pay or less. Every year their labor costs goes up significantly. In addition to labor groups cost increases, by 2021 Spirit will have over 6.6 Billion in future payments on contractual obligations, that's more than a 700% increase from today where we are currently at 900 million. Spirit only owns 16 of our aircraft, managemeant is in the process of leveraging us up to a dangerous level.

Now that being said we will get significant pay raises in the next contract, we more than deserve them, the market demands it. All I am saying is that we will never get "industry leading" "legacy" pay rates while keeping all of our work rules. A basic calculator and their 2015 10K will show you that.

 

This the same cujo from eagle lounge?

 

I like your analysis, but... I am clearly bad at math, so Cujo can call me an idiot if I'm wrong. But isn't the 6.6 billion cumulative for the next 6 years and beyond, with roughly 950 million+- in contractual obligations every year? Mostly "Flight equipment purchase obligations"? Basically our fleet growth that will enable us to make much more money than we do now?

 

You are correct. However the leases are on 7 and 12 year notes. So even though it is cumulative, the debt we sign up for this year won't be paid for by 2021. Hence by 2021 we will still have close to 6 billion in debt. What worries me is we already have over half the airplanes yet we only have 1/8th of the debt. This tells me most of these deals are back loaded with higher payments due at the tail end of the agreements. And while more airplanes do have potential to generate more revenue, a nice down turn in the economy, a terrorist attack, or God forbid, a fatal accident could all stop the "record" profits music real quick. We aren't big enough or important enough for the DOJ to bail out if things go South. A lot of us want to leave for greener pastures but a lot of dudes wanna make Spirit a career. The new contract needs to not only be super competitive and represent true fair market value, but it also needs to be sustainable. I see Spirit as a big tanker ship that is slowly starting to pile on the containers. When the North Atlantic is calm all is well. Throw in a nice winter storm and next thing you know, the top heavy debt and finiacial structure of this Airline will flip us over and take us to the bottom.

 

How about comparing legacies to the most profitable airline in North America, flying 757s masquerading as Airbuses? Our seat capacity ALONE should put us at THE TOP paid Airbus operator. Remember, middle of the pack now includes profit sharing and massive retro. Comparing successful, yet debt-laden airlines with one having tons of cash in the bank. Spirit can save a lot of money outside of pilot pay. An increase in airfare of $5 per leg would go unnoticed, but on a 140 pax flight would be $700. On a 3 hr leg, that's $233 and hour that can go where it should go.

 

Sounds like a management troll. Look its pretty evident that the company can pay us a lot more than they do now. Its pretty evident the company can pay us like the other airlines. They just don't want to. Plane and simple, they just don't want to. And we won't get a dime more unless the company is forced to do it. I read the nc update email. I'm not optimistic.

 

You should be dividing total profit by amount of pilots to give a more accurate picture of what an airline can afford.

 

But but but but Spirit has a billion dollars in the bank, and and and and our airplanes hold more people.

 

To put in perspective...

Southwest just came back to the table and offered an additional 1.8 Billion dollars to get their deal done for a total cost of 2.8 Billion. That comes out to $340,000 per pilot for this deal, and that was to jump their pay up from an already high base. Scale that down and Spirit would have to come up with 476 million (and probably more considering we are starting from a much lower base) for our deal.

Southwest came up with that cash after analysts and investors have been calling for them to code share, charge for bags, etc.. and they have no first class with $17K tickets to charge. Their costs were already 40% above ours.

Remember when we were something like $46 mil apart and couldn't get it done? Southwest was 1.8 billion apart and looks like they got it done.

 

Thanks for the answers!!