"been There; Done That!


Dec 29, 2002
Dear Council 40 Members,

Management is in the process of developing a NEW "business plan" to address
Southwest entering Philadelphia. Their response to this insurgence is to
let the employees know that "everything is on the table". Management is
presently reviewing their business plan and will let Labor know what needs
to be done.

Our CEO has written another "Sincerely Dave" letter that will be coming to
all employees by postal mail in the next few days. Dave states in his letter
that... "the brutal fact is that we cannot compete" with low cost carriers
(LCC) on one critical factor that can make or break the airline--cost".

Folks the question needs to be posed, "what have you done with the cost
savings we granted this management to the tune of $1.2 Billion? If you input
into the CASM equation SW labor costs and USAirways in percentages OUR labor
costs are lower. However, if you input the non-human assets of USAirways,
we will see an INCREASE in the CASMS. What this means is that this
management has yet to address the non-human asset part of the equation
(revenue) in order to bring the CASM DOWN. Competition is not new to our
airline; it is in fact, "the nature of the beast". We have fought the
competition before and we will do it again. However, management must do
their part and they must address the CASM evaluation by tackling the
problems that prevent us from competing effectively, and that is:

1. Restructure and simplify the fares.
2. Over utilize gates, planes.
3. Fix route structure.
4. No frills.

Keep in mind that USAirways operates as a Hub and spoke system which has a
higher cost factor; unlike Southwest, who operates point to point. It does
no good to compare apples to oranges unless we are all on the same playing
field with regard to the "business model". If management wants us to all be
on the "same team", address those issues first and evaluate and gage the
company from that stand point.

Please send the CEO's letter back to Corporate Headquarters and tell Dear
Dave, "Been there; done that!"!

AFA PIT Local 40
I couldn't have said it better.
I always send my letters back and I think we should pass the word: Everyone send back the letter along with some notes on it about how we feel. If he got a couple thousand of these wouldn't that be great!

Keep in mind that USAirways operates as a Hub and spoke system which has a higher cost factor; unlike Southwest, who operates point to point.

Kind of frightening, isn't it. The industry leaders, the Analysts, Even the Press and the employees are asking the same questions over and over and over and over...
How can you intentionally cripple the mainline hub and spoke model by shrinking to unprofitability. A contradiction of working business models which evaD has already confessed is the reason other Network carriers are able to hold their own -- they didn't shrink -- they retained the diversity of their network which is sustaining them through this industry shakedown. This is a BK transitional team – that’s all.

How can you constantly drum on in every Friday’s message comparing cost structures with LCC, when you have no intention to match their business model. Other than the employees taking a 50% pay cut and thus lowering the employee cost per seat mile from 4cents to 2 cents, what else can the employees contribute. Total costs for the LCC would still be 7cents CPSM while ours would be 10cents CPSM. So is it labor or is it those who manage the assets of this Organization – Those assets other than labor. This is a BK transitional Management Team – that’ all.

Kind of frightening to hear evaD say he doesn’t have all the answers. Which of the answers do you have, then. Can we pay you comparably for those.

It's been how long that SouthWest has been in Baltimore? What was the M.O. of Southwest on the West Coast when we shrunk to profitability (PSA). Do our Labor reps on the BOD deserve an explanation why this Management hasn't formulated a plan with the 1.2Billion cost savings provided by labor except for "business as usual", "Business survive in spite of Management", "It's labor's fault" -- Executive Mentality. They’re only a BK transitional Team.

After all this time, our Executive team confesses it doesn’t have some of the answers. Well you know what Management does when it ain't got answers. Yep, they look to the only theory of Management which is physical, which is visible, which is concrete, which requires less mental capacity to grip with their hands around its neck -- Yep, It's labor. It's the easy alternative to the facet of a weedy team which has no feel for the pulse of the industry. Unlike the abstracts of innovation, development and application, Labor Costs are of substance. Labor costs are of a substance understood by Bankers, Wall Street, the Press, the public and Politicians as well. If Management plays its propaganda instrument well they might yet again sway public opinion against labor. Because Labor Costs – you can see. If Management wallows in confusion long enough, it might have a new opportunity to sway a presiding Judge as well. Sway him with labor costs. Why? Because, as evaD says, you can put it on the table and look at it. Effective abstract competitive models are very hard for a judge to see. They’re merely a transitional team.

Kind of frightening that this team, just seemed to recognize in the last several months, that it hasn’t planned on running an airline. I guess that’s what you get when you hire an executive team, constructed of professionals, who’s expertise is the Psychology of Negotiations and Management by Litigation. I’ve always felt these guys were a transitional team for leading a business through BK. Kind of frightening that they want to believe they understand the dynamic complexities of a rapidly evolving market. They are a transitional BK team – a pretty good one – but that’s all they are. A one trick poney.
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  • #5

Thank you for your post. You have exceptional "insight". It amazes me.
What I'm half tempted to do is return the letter to Dave's office @ CCY, after circling the word "Colleague" with a red marker and making the following notation:

I think you should do so.

Also add that if he'd like to work on the longest furlough list in the industry you'll be more than happy to help.

If we're cutting costs, why spend the yearly salary of a junior FA sending out bull**** letters to the entire employee group, HALF OF WHICH ARE INACTIVE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!