2/18 CLT Crew News Session

[Travelpro72]

Running an airline is a tough business and this economy isn't helping any. That said, I listened to what was said in the crew news session and it sounds like the adults on Peanuts. The pilot talking about the US product and how it's not competitive cracked me up as I already knew what the response would be. I listened to Isom feed the soup and break down cost, cost and what drives people to choose an airline. The pilots question wasn't answered when asked, "Why would a passenger choose US over Jetblue on a competing route when they offer so much more for basically the same price"? I know what some are gonna say but let me stop ya in your tracks. US obviously isn't turning people away or doing any better than other carriers. The management team while faced with a difficult environment to operate in believe what the want to believe and see what they want to see. US isn't operating in an environment that every other airline isn't. The airline is run by bean counters. PERIOD! ! ! There is NO focus on passenger comfort or employee satisfaction beyond a new beverage cup or new seats on a plane that the majority of your customers won't see. It's great to have a financial savvy team to strive for profitability but ya need individuals that understand customers and employees. I'm glad the lights are still on but for how long with this type of managing? Hmmmm

 

[N965VJ]

Here's what I heard: If the company can't make money this year, bankrupcy and liquidation are the plan B.

When was there ever a Plan B at US?

 

[cltbwimob]

We came close to turning an operational profit in 4 qtr 09. Yields are improving and most carriers are optomistic for 2010.

But, I was really wondering did a manager actually make the comments that were in Beachboy's post? Were those comments actually in a crew news session?

 

[luvthe9]

Could he be setting the stage for concessions?

Maybe they should be all on the management side and give up there up 200% bonuses on their base salary for these idiots that can't run an airline, yet blame the employees when we are already the lowest paid in the industry. This employee group should demand there resingnation.

 

[N903AW]

Did he really say that? If so, I bet there are alot of shareholders who would like to know. Could he be setting the stage for concessions?

As far as this front line employee is concerned, the concession stand is CLOSED!! If any cuts or cost reductions are to be made, they need to start at the top and trim the fat in the management/corporate ranks!

 

[gaucho99]

But, I was really wondering did a manager actually make the comments that were in Beachboy's post? Were those comments actually in a crew news session?

No, not in those words...All he said was the losses over the past two years were covered by borrowing money and we don't have that option anymore to keep borrowing money to sustain losses. Beachboy's comments were his interpretation of the above statement.

 

[BoeingBoy]

But, I was really wondering did a manager actually make the comments that were in Beachboy's post? Were those comments actually in a crew news session?

That was the gist of it - US needs to be profitable for 2010 because the ability to raise cash is used up. However, one needs to look at a lot of various comments and then put them together. First, "profitable" and not burning cash are two different things, and not burning cash is the goal because of the covenant in the credit card agreement. FWIW, on a cash basis US basically broke even in 2009 even though it reported a net loss.

Second, in another remark concerning the Express carriers Isom said that Republic was on the hook to loan US money if asked (no amount given). So are all sources of cash dried up or is Republic a potential source of cash? Plus something not mentioned - I believe US is able to issue more shares than are outstanding. At $7/share currently another 50 million shares is worth $350 million less underwriter's fees.

So while US definitely isn't in good financial shape, it's not quite the doom and gloom that Isom made it out to be.

Jim

 

[jimcfs]

Second, in another remark concerning the Express carriers Isom said that Republic was on the hook to loan US money if asked (no amount given). So are all sources of cash dried up or is Republic a potential source of cash? Plus something not mentioned - I believe US is able to issue more shares than are outstanding. At $7/share currently another 50 million shares is worth $350 million less underwriter's fees.

With the news today that Republic is the launch customer for the new Bombardier jet, they can't have all that much money to lend out.

 

[700UW]

They are not the launch customer, they are the first airline in North America to order it and I doubt they have outlayed any cash yet and aircraft are usually financed and not paid for out of cash reserves, and the first delivery isnt for five years.

 

[BoeingBoy]

I'm assuming it'd be like the 3rd quarter of 2008 - tens of millions and not hundreds of millions and relatively short term - a year. For their size, they have about as much cash as US, but probably don't have the cash covenants to deal with that US has. Plus they've got that all but guaranteed profit from their express contracts which US doesn't have.

Jim

 

[etops1]

I heard that if Delta/NW makes money this year, that Continental will agree to merge with US and keep the US name.

Ok now ...That is hilarious!!!

 

[PHL]

When was there ever a Plan B at US?

Well, if you heard Rakesh Gangwal talk about the merger with UA back in 2000, his exact words were "There is no Plan B. We are singularly focused on this merger".

We see where that went.....

 

[cubfan]

I heard that if Delta/NW makes money this year, that Continental will agree to merge with US and keep the US name.

Early April Fools?

 

[Art at ISP]

CO US? Never happen...there is NOTHING from US that CO wants or needs...plus current management would never be tolerated at CO...

I think they are just trying to set the unions up for tough negotiations and concessions, which I agree--you should not give.

Until they treat the employees properly, and realize that employees and customers are assets to be valued, not liabilities to be mistreated, there is no hope for this place.......

 

[etops1]

CO US? Never happen...there is NOTHING from US that CO wants or needs...plus current management would never be tolerated at CO...

I think they are just trying to set the unions up for tough negotiations and concessions, which I agree--you should not give.

Until they treat the employees properly, and realize that employees and customers are assets to be valued, not liabilities to be mistreated, there is no hope for this place.......

As much as I would love to disagree with you Art, I simply just can't . You hit it spot on .