Eagle's plan
The $75 million in employee-related costs targeted at American Eagle represent about 13 percent of the airline's total labor costs, Garton said. Eagle has 13,500 employees.
Eagle is asking its 3,000 pilots, represented by the Air Line Pilots Association, for $43 million in cost cuts, the most of any labor group.
The airline proposed cutting captains' flight-hour pay rate by 5 percent, eliminating one week of vacation and cutting the company's 401(k) contribution. It also wants to negotiate pay rates for pilots to fly larger 60- to 76-seat regional jets. Eagle now flies 47 regional jets with over 70 seats but cannot fly more because of restrictions in the American Airlines pilots contract.
Tony Gutierrez, the Eagle chairman of the pilots union's master executive council, told pilots that the union will analyze the cost-cutting proposals and look at alternative savings ideas.
"Following this analysis, ALPA will begin negotiations with the intent to negotiate a consensual deal with management that is workable from both sides of the table that provides management with justifiable cost savings while protecting the quality of life for all Eagle Pilots and its ability to recruit new pilots," Gutierrez said in a statement.
Eagle and American Airlines are still working to define how much regional flying Eagle will feed to American, Garton said. American executives have said they want more domestic routes flown by regional carriers like Republic Airways or SkyWest Airlines, in addition to more routes with Eagle.
Although AMR has considered divesting Eagle in the past, Garton said the current business plan is to restructure Eagle to be financially strong. He added that the plan is based on feeding only American Airlines and not trying to win new regional business from other airlines.
"Depending upon how big of a chunk of that flying Eagle has, we may be the same size, we could be bigger, we could be smaller," Garton said. "I think it's really too early to answer how big Eagle will be."
American Eagle's 1,800 flight attendants are being asked to cut $9.2 million with wage freezes and scheduling changes.
"Not only did we take a step back, we're time-traveling back to the 1980s on what they want from us now," said Robert Barrow, president of Eagle's Association of Flight Attendants master executive council, adding that the cost cuts were greater than expected.
"They are asking for provisions that are not even cost savings."
For example, Barrow said, if he were a flight attendant on a multisegment flight from Mexico with a three-hour layover at Dallas/Fort Worth, he could be asked to fly another quick trip over his lunch break.
Eagle is asking to keep flight attendants' pay frozen at their current seniority-based scale in the first year of a proposed eight-year contract. Pay increases of 1.5 percent are offered in the third and fourth year of the contract. Eagle also wants to eliminate flight attendants' personal days and one week of their vacation.
The Transport Workers Union, which represents 3,500 mechanics, ground workers and flight instructors at American Eagle, is being asked for $12 million in concessions but was upbeat after meeting with Eagle executives Wednesday.
"The one thing I am pleasantly optimistic about is they have a somewhat viable plan as opposed to what I saw at American Airlines," Little said. "One of the parallel tracks is to stay under AMR and work as a wholly owned group, and the other part of the plan is to go independent and look at a self-run company and being very competitive."
