American looking to "right-size" the company and staffing levels for the Fall and 2021

Discussion in 'American Airlines' started by jimntx, May 21, 2020.

  1. La Li Lu Le Lo

    La Li Lu Le Lo Veteran

    Joined:
    May 29, 2010
    Messages:
    6,123
    Likes Received:
    2,570
    Cut the guy a break.

    Fear is making him delusional. He can't accept the severity of the situation. I am not saying AA will go bankrupt mind you. I am saying they are in a very vulnerable state right now.
     
    • Agree Agree x 1
  2. V.O. Reason

    V.O. Reason Veteran

    Joined:
    May 3, 2019
    Messages:
    582
    Likes Received:
    78
    I’m not deluding myself in saying it’s not bad, of course it is.
    As far as Delta and others say no layoffs, well I guess we will see when the fall traffic remains low and their bottom line continues to get worse.
    And I’m curious if WN is in such wonderful shape why is their CEO out in the public supporting an extension of the CARES act.
    You would think if there in such a good place he would say we are good don’t need the help
     
    • Agree Agree x 1
  3. La Li Lu Le Lo

    La Li Lu Le Lo Veteran

    Joined:
    May 29, 2010
    Messages:
    6,123
    Likes Received:
    2,570
    It would not matter. The other 3 would simply absorb the fallen airlines assets and it would be business as usual just as it has been with every other airline bankruptcy or merger.

    I really don't understand why you think it would be DIRE when noone is flying anyway? We have too much airline and not enough passengers right now. You really think losing one right now would matter to the general public who is not flying anyway? NOPE!!!

    The guy is just trying to cope.


    Well no.... they use computer modeling to see who could potentially be affected. The key word there is POTENTIALLY. However that potential is NEVER 100 percent realized. Even if you are in the middle of the list that is no guarantee you are going to get hit. Been through that sh*t show too many times.
     
  4. La Li Lu Le Lo

    La Li Lu Le Lo Veteran

    Joined:
    May 29, 2010
    Messages:
    6,123
    Likes Received:
    2,570
    What the hell are you talking about?

    Of course you are deluding yourself.

    You stated that American Airlines is in no worse shape than any other airline. You are turning a blind eye to the fact they have been financially damaged due to prolonged aircraft grounding, the fact they have a high debt load, and the fact they ran themselves low on cash doing stock buy backs. Your statement is totally oblivious to those facts. All the fuel savings in the world from those nice shiny new airplanes means dick if they are sitting on the ground soaking up sun.

    I am not saying they are going to go bankrupt but dammit V.O.R. tune into Reality FM would you?
     
  5. La Li Lu Le Lo

    La Li Lu Le Lo Veteran

    Joined:
    May 29, 2010
    Messages:
    6,123
    Likes Received:
    2,570
    Call it a beta test. :D :D :D
     
  6. V.O. Reason

    V.O. Reason Veteran

    Joined:
    May 3, 2019
    Messages:
    582
    Likes Received:
    78
    Debt load is only a part of this equation,
    Just about every company airline or not carries debt, the real issue is how much cash is on hand.
    Which prior to the virus AA had plenty of cash on hand.
    Now nobody has cash because of this mess, so that should mean all the airlines are in trouble.
    That is what these government loans were all about to put cash in the airlines pocket.
    Nobody is going to generate any cash I don’t think for at least a year or more.
    So yes the downsizing is very important and that’s why I’m on the fence about an extension of the payroll help when the truth is AA needs to cut headcount
     
  7. CremaDiLimone

    CremaDiLimone Veteran

    Joined:
    Jun 8, 2016
    Messages:
    1,691
    Likes Received:
    150
    when i read this as his top piece of evidence of aa's doom:

    ...then i know the author is very disingenuous.

    take time to listen to the earnings calls.
     
  8. CremaDiLimone

    CremaDiLimone Veteran

    Joined:
    Jun 8, 2016
    Messages:
    1,691
    Likes Received:
    150
    #833 CremaDiLimone, Aug 1, 2020
    Last edited: Aug 1, 2020
    right. you keep saying that aa has planes parked in the desert..so, ua, southwest and delta have full planes flying around the nation and world?

    delta, united and southwest are in no position to pick up aa's pieces, if aa goes under. if aa goes under, it would be a matter of days before everyone else did, because of the advantage a business has in chapter 11 over it's competitors. aa learned that in the 2000s.

    this is not 1991 (i had this debate with someone else) where aa and dl were making money for years and were able to pick up eastern's and pan am's scraps to get even stronger.

    no one is making money today. the airlines and govt realized months ago the danger for the entire american airline industry.

    that article, the author compared aa's april-may-june cash burn rate with dl's and ua's june cash burn rate.
     
  9. La Li Lu Le Lo

    La Li Lu Le Lo Veteran

    Joined:
    May 29, 2010
    Messages:
    6,123
    Likes Received:
    2,570
    AA debt.... higher than it's competitors

    AA cost.... high due to new aircraft purchases and higher headcount than competitors.

    AA revenue.... low.

    Cash on hand..... well that is the wildcard isn't it. At least for me. I suspect AA has far less cash on hand than competitors due to aggressive stock buy backs.

    As far as planes in the desert... that is usually a term for retired aircraft so I am going to clarify that the grounded aircraft I am talking about is the 737 MAX (I assume you already knew that but I wanted to make sure) which has damaged AA's bottom line over a long period of time.

    I believe AA can pull out of this but in my opinion they need to cut deeper than they have announced and cut services to low yield destinations. I don't know if they can legally do that or not but if they can they damn sure need to. Some destinations are simply not worth the fuel and maintenance cost. Not to mention the labor cost (who if it is a small yield destination are most likely contractors anyway so F em).
     
    • Agree Agree x 1
  10. CremaDiLimone

    CremaDiLimone Veteran

    Joined:
    Jun 8, 2016
    Messages:
    1,691
    Likes Received:
    150
    the debt is a fact. more debt than any other legacy carrier.

    the fact of the matter is, ua and delta also have debt. they are not generating revenues to get their debt in line during this time, just as aa isn't.

    with no revenues, never mind the debt - no airline is generating revenue to pay day to day expenses. this is why the govt. and airlines acted quickly to get the cares act through.

    aa did buy back stock. more so than any other legacy carrier. the fact is, aa had more cash on hand at the beginning of this covid era than any other legacy carrier.

    you can't expect corporations to generate $20 billion in profits, not share that $20 billion with shareholders/employees and then keep $20 billion in cash on hand for some unforseen catastrophic event. especially an airline..an industry that has always had low profit margins.

    corporations give their cash back to shareholders. aa did so during the oil/jet fuel windfall time of 2015-2017, not really through dividends, but through buy-backs.
     
  11. Real tired

    Real tired Veteran

    Joined:
    Jul 29, 2007
    Messages:
    732
    Likes Received:
    342
    1938? I think that's just the starting point.

    The contract says the company can go down to 2600 TOTAL base maintenance in all departments, plus do line work and it doesn't count against the 50%.

    Anybody ever read the section in the contract about "situations beyond the companies control"?

    What about Force Majeure? I already lived that one.

    These companies can do what ever they want in these times. Our contract be damned. I don't think the company is too afraid of the big, powerful "Association" and the back stabbing, IGM members it contains.

    Plus, I don't see many senior people taking the buyout after the list came out, so the numbers may swell from 1938.
     
    • Agree Agree x 1
  12. Kev3188

    Kev3188 Veteran

    Joined:
    Oct 5, 2003
    Messages:
    17,994
    Likes Received:
    9,373
    If ever there was a Force Majeure event, this is it. Don’t be surprised to see that invoked all over the place come 10/1...
     
    • Agree Agree x 3
  13. BigTex

    BigTex Member

    Joined:
    Mar 10, 2020
    Messages:
    41
    Likes Received:
    2
    #838 BigTex, Aug 1, 2020
    Last edited: Aug 1, 2020
    I am sure AA will do as they please with impunity. No doubt about that. Southwest got %27 of the workforce to bite...Delta %20. We will see how one month of offering early outs/leaves does for AA. Predictions?
     
    • Agree Agree x 1
  14. dfw gen

    dfw gen Veteran

    Joined:
    Dec 1, 2011
    Messages:
    3,624
    Likes Received:
    2,579
    Wonder why they keep extending the deadline. The official line is that they want to see if they get anymore free money from uncle Sam. On the other hand they are trying to sell it hard, wonder if there aren't as many takers as they hoped.
    Problem is this management team has no creabilty with its employees....
     
    • Agree Agree x 1
  15. Real tired

    Real tired Veteran

    Joined:
    Jul 29, 2007
    Messages:
    732
    Likes Received:
    342
    Predictions? In senior PIT, not many.

    Why take an early out when you're only 70?
     
    • Funny Funny x 2

Share This Page