chipmunn , what is up with this?

jetmechline

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Aug 22, 2002
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[DIV align=center]Furloughedagain [BR]Member
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[P][SPAN class=smallp][FONT size=1]Total Posts: 5[BR]Last Post: 10/9/2002[BR]Member Since: 8/22/2002[BR]Member ID #: 463[BR][/FONT][/SPAN][/P]
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[P][SPAN class=BodyFont]The following is a letter written by Dave to one of the pilot-employees who was offering some suggestions regarding the restructuring. Dave''s response is a bit troubling.[BR][SPAN class=BodyFont]***********************************************[/SPAN][/SPAN][/P]
[P][SPAN class=BodyFont][SPAN class=BodyFont][FONT color=#0066ff]There is reason to believe the comments are accurate. I''m looking into this and will respond when I know more.[BR][BR]Chip [/FONT][/SPAN][/SPAN][/P]
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[P]chip,[/P]
[P]Have you been able to confirm this post? If so,what is your thoughts on this ?[/P]
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C

chipmunn

Guest
[P align=justify][FONT face=Times New Roman size=3]Jetmechline:[/FONT][/P]
[P align=justify][FONT face=Times New Roman size=3]Furloughedagain said: The following is a letter written by Dave to one of the pilot-employees who was offering some suggestions regarding the restructuring. Dave's response is a bit troubling.[/FONT][/P]
[P align=justify][FONT face=Times New Roman size=3]Chip said: There is reason to believe the comments are accurate. I'm looking into this and will respond when I know more.[/FONT][/P]
[P align=justify][FONT face=Times New Roman size=3]Jetmechline said: Have you been able to confirm this post? If so, what is your thoughts on this?[/FONT][/P]
[P align=justify][FONT face=Times New Roman size=3]Chip comments: The email posted on this website under the thread titled Dave’s Gloomy Forecast was sent to a US Airways pilot from our chief executive.[/FONT][/P]
[P align=justify][FONT face=Times New Roman size=3]The issue for all airlines is that revenue is not hitting projections. The problem started in the summer and was exasperated in September by the fear of flying during the one-year terrorist attack anniversary. The negative trend is continuing in October and there is concern, within the Executive Suites of all airlines, there will be further revenue erosion if war breaks out in the Middle East. [/FONT][/P]
[P align=justify][FONT face=Times New Roman size=3]The lack of revenue is being compounded by increasing costs for fuel, war-risk insurance premiums, and security. On a positive note, reports indicate the Seabury group is making excellent progress renegotiating aircraft lease expense reductions, but that may not be enough to stem the red ink.[/FONT][/P]
[P align=justify][FONT face=Times New Roman size=3]Earlier this week CS First Boston airline analyst Jim Higgins said, The combination of under-funded pension plans and dreadful equity market performance may result in companies having to contribute cash to their pension plans that is far above historic levels. The primary problem is the bond market with depressed yields, which is causing pension plans to become under funded. When plans become under funded, the company is required by law to make plan contributions.[/FONT][/P]
[P align=justify][FONT face=Times New Roman size=3]With airlines experiencing cash outflows mandatory pension contributions would accelerate the cash burn rate and reduce liquidity, thus the economy and bond market.[/FONT][/P]
[P align=justify][FONT face=Times New Roman size=3]In regard to productivity, as I have repeatedly said W-2 is not the primary labor expense issue, it's the so called lifestyle issues, lack of technology, and certain union work rules that provides a high head count. Some of the restructuring agreements will provide productivity improvements, but this will take time during a period where non-labor costs continue to rise and revenue continues to fall.[/FONT][/P]
[P align=justify][FONT face=Times New Roman size=3]I understand the Dave Siegel or Jerry Glass, senior vice president of employee relations, have not contacted ALPA and in my opinion Dave used this opportunity to plant a seed on a pending problem that may need to be addressed in the future. In addition, I believe it may be best for the employee group to not respond to RLA issues with senior management and leave this responsibility to union leaders.[/FONT][/P]
[P align=justify][FONT face=Times New Roman size=3]Chip[/FONT][/P]