Blame the Unions!

[Bob Owens]

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On 1/30/2003 9:27:36 AM eolesen wrote:

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On 1/29/2003 4:38:40 PM Bob Owens wrote:

TWAFA007

What happened to all the money the company made from 1995 to 2000?

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Lots of it went to pay off debt incurred in the early 90's. 1994 year end debt of $5.6B was reduced to $2.2B by year end 1997. Let's also not forget profit sharing paid out during those year.

A larger chunk went to pay for the 110+ new aircraft we bought from Boeing.

How much did I and other shareholders get as dividends on my stock? $0.00
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A lot of it also was wasted on First Class "Modules", putting AA on sports arenas and theaters, the aquisition of bankrupt carriers, the building then abandonment of terminals etc. The TWA deal will haunt this airline for years. For the next several years all the "New hires" will come in at top pay with seven weeks vacation.
Well AA does not pay dividends. However if you were a shareholder in the early nineties and sold it in the late 90s you would have done very well, part of this was due to the buyback of shares which made yours more valuable.

 

[hillrider]

How do airline employees cope with lack the freedom that most people have in their life: the right to fire their employer? When free people decide that the company they work for stinks (or fear it's going bankrupt or whatever), they can take all of their skills, experience, learning, and knowledge to another employer in the industry and roughly make the same amount of money (sometimes more, sometimes less). Isn't this specific freedom a cardinal basis of the "American Dream"?

Union rules dictate that airline employees MUST fall off the earning ladder they exercise your "choice" to change employer within the industry. These employees are effectively the modern version of slaves, and ironically unions gain more power the more airline employees are stripped of their ability to achieve the American Dream.

 

[Bob Owens]

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On 2/4/2003 7:58:04 PM hillrider wrote:

How do airline employees cope with lack the freedom that most people have in their life: the right to fire their employer? When free people decide that the company they work for stinks (or fear it's going bankrupt or whatever), they can take all of their skills, experience, learning, and knowledge to another employer in the industry and roughly make the same amount of money (sometimes more, sometimes less). Isn't this specific freedom a cardinal basis of the "American Dream"?

Union rules dictate that airline employees MUST fall off the earning ladder they exercise your "choice" to change employer within the industry. These employees are effectively the modern version of slaves, and ironically unions gain more power the more airline employees are stripped of their ability to achieve the American Dream.
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You are wrong.
The contract allows the company to hire at any step along the pay scale including top pay. The company chooses not to. Its not the Union its the company. Dont believe me? Go to Local 562's website and look under Article 4(E) Flex Starting.

 

[Buck]

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On 2/5/2003 3:49:14 AM Bob Owens wrote:

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On 2/4/2003 7:58:04 PM hillrider wrote:

How do airline employees cope with lack the freedom that most people have in their life: the right to fire their employer? When free people decide that the company they work for stinks (or fear it's going bankrupt or whatever), they can take all of their skills, experience, learning, and knowledge to another employer in the industry and roughly make the same amount of money (sometimes more, sometimes less). Isn't this specific freedom a cardinal basis of the "American Dream"?

Union rules dictate that airline employees MUST fall off the earning ladder they exercise your "choice" to change employer within the industry. These employees are effectively the modern version of slaves, and ironically unions gain more power the more airline employees are stripped of their ability to achieve the American Dream.
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You are wrong.
The contract allows the company to hire at any step along the pay scale including top pay. The company chooses not to. Its not the Union its the company. Dont believe me? Go to Local 562's website and look under Article 4(E) Flex Starting.

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So Article 4(E) gives the company the right to start an employee at a higher rate if say he lives in New York?

 

[Buck]

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On 2/11/2003 11:58:44 AM Resman1 wrote:

First of all let me say, I am a non-union employee of AA. I will also like to say
the unions are not to blame. Unfortunately our problem and the indusry as a whole is a revenue problem. The day of business travelers paying 10 to 12 times the cost of the lowest excursion fare is over. The problem AA faces is that fixed costs are based upon fare levels that no longer and will no longer exist. The unions are not to blame, management is not to blame, it's the customer who is to "blame". Customers decide the value of a product and you either adjust your costs to be profitable at that level, or you cease to exist. That's what is so absoultely depressing about this whole situation. Management no doubt has made mistakes, but the bottom line is the customers have spoken, they want 198.00 roundtrip to any and everywhere.
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The sad thing is that in the future, as the customer belittles the cost of putting these aircraft in the air, the outlook for employment will shift to other industries. But most of all the safety of the industry becomes a major factor. The custome can have the $198.00 trip to anywhere, but as time goes by they are placing their lives at risk. People who care about aviation and safety of aviation will begin to look elsewhere for their livelihood.

 

[Resman1]

First of all let me say, I am a non-union employee of AA. I will also like to say
the unions are not to blame. Unfortunately our problem and the indusry as a whole is a revenue problem. The day of business travelers paying 10 to 12 times the cost of the lowest excursion fare is over. The problem AA faces is that fixed costs are based upon fare levels that no longer and will no longer exist. The unions are not to blame, management is not to blame, it's the customer who is to "blame". Customers decide the value of a product and you either adjust your costs to be profitable at that level, or you cease to exist. That's what is so absoultely depressing about this whole situation. Management no doubt has made mistakes, but the bottom line is the customers have spoken, they want 198.00 roundtrip to any and everywhere.

 

[MiAAmi]

Its the same with our public school systems. No body wants to give any more money to the schools and yet they wonder why our school systems are a mess.

 

[Buck]

That is exactly right. An electrician or plumber or even a automechanic can obtain rates that match the cost of doing business and the government doesnot interfere. But have airline employees attempt to make gains and it destroys the industry. Government intervenes and wages are forced down. Safety will eventually become a factor. The customer is going to force the these aircraft right into the dirt. My son is looking to become an A&P mechanic. I am discouraging him.

 

[Steiner]

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On 2/11/2003 12:06:15 PM Buck wrote:

The sad thing is that in the future, as the customer belittles the cost of putting these aircraft in the air, the outlook for employment will shift to other industries. But most of all the safety of the industry becomes a major factor. The custome can have the $198.00 trip to anywhere, but as time goes by they are placing their lives at risk. People who care about aviation and safety of aviation will begin to look elsewhere for their livelihood.
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Buck, how about you and I keep quiet about this for a few years and let it be a surprise for everyone? We're going to end up like nurses: everybody wants us but nobody wants to pay us. Maybe the government will allow visas for foreigners to come and be airline employees.

I'm currently thrilled that so many folks have the idea that by squeezing the employees that all the airline problems will be solved. They never consider the fact that some of the employees will wander off and never come back to the airlines, or that the employees will stop doing the "above and beyond" that greases the gears of the airline operation. Typically these are the employees that you want to stay at the airline, the "Audie Murphys" that go the extra mile to keep the operation going and have the skill and talent to handle the emergencies. Chase away your good people and what are you left with?

Are airlines still having problems attracting skilled avionics technicians? Think this will get worse in the future?