Cnbc Reports

[GeezLouis]

I just finished watching CNBC this morning. Michael Boyd and Julian Moltaldis were interviewed about the webcast yesterday, and whether Seigel's cost cuts were valid or hype. Both analyst cited the cuts as very necessary to stave off a very real fight for USAir's survival.

A few notes:

Michael Boyd said that he was very impressed by the fact that Seigel waived the present 4.5 mil parachute option and elected to stay the course with USAir while taking cuts himself. His opinion was that Seigel was commited to turning the airline around. He said "If USAirways can get these cost cuts, this can be a robust competitor in 18 months. The question is if labor decides to come to the party or not." In summary, Boyd's opinion was basically "it's either take the cuts or get in the unemployment line."

Julian's sentiments were very similar. Sorry, I can't remember his remarks exactly.

Now that the industry analyst's have spoken, it's time for the website analyst's to speak. I'm sure it will be more of the same trash and bash "concession stand is closed" banter, without any valid alternatives to these problems.


Regards

 

[USFlyer]

I have to admit ... Siegel's decision not to take the $4.5 million golden parachute and his offering to be paid at the level that LCC CEOs are paid was a surprise move. He's too young to let US fail and, in my opinion, wants to save the carrier. If he really felt US had zero chance of survival, he would have taken the $4.5 million.

 

[Long Gone]

The U BOD constructed Siegel's contract, they can change his exit price to any amount at any time. How many employee's knew Wolf's and Gangwald's severance amount before the fact? When Siegel hits the door it will very hard to determine what his exit price was for a lengthy time.

 

[oldiebutgoody]

I'll tell you, I want to get behind Siegel as much as anybody. I just haven't seen anything that gives me any confidence AT ALL. There are MANY things that could have already been done, or even in the works, and they ARE NOT. Rather than institute the changes that Dave says are "necessary" and "inevitable", all I see is the same stupid scheduling operations and worst of all, press reports. Even things that Dave COULD have and SHOULD have put in a positive light he hasn't, apparently using the opportunity to "stick it" to the employees again. I really hope he has some kind of REAL plan, because the blood's about gone from this turnip. :blink:

 

[skyflyr69]

. I really hope he has some kind of REAL plan, because the blood's about gone from this turnip. :blink:

what plan do you think he should have? all you people need to read the company bulletins wall st. journal etc. back in 2002 when Mr. siegel came aboard he said U should be a "super regional" and he is doing his plan to the "T".
wake up, with a marketing agreement with UAL and soon to be in the star alliance there is no "union wish plan." your mainline will most likely stay the same, maybe grow a bit but nothing like pre 9/11.
get your thoughts geared to the REAL plan like he said in 02 , "super regional" Union denial is fatal.

 

[oldiebutgoody]

what plan do you think he should have? all you people need to read the company bulletins wall st. journal etc. back in 2002 when Mr. siegel came aboard he said U should be a "super regional" and he is doing his plan to the "T".
wake up, with a marketing agreement with UAL and soon to be in the star alliance there is no "union wish plan." your mainline will most likely stay the same, maybe grow a bit but nothing like pre 9/11.
get your thoughts geared to the REAL plan like he said in 02 , "super regional" Union denial is fatal.

NO, NO, NO,
I didn't mean THAT plan. We ALL know THAT one. The one that turns over all the flying that made US Airways a successful airline in the past to RJs; flying large jets into small cities in the NE and Carolinas. The plan I want to hear is the one that gives UAIR even the SLIGHTEST chance of survival. Haven't seen it yet. Seriously doubt that one even exists!

 

[deltawatch]

If I made 1.5 mil last year, I could get by on $400,000.00 for a couple of years!

 

[More Facts and Less Emotion]

If he really felt US had zero chance of survival, he would have taken the $4.5 million.

I believe you are right. He must believe the plan can work.

 

[colorado_cowboy]

If he really felt US had zero chance of survival, he would have taken the $4.5 million.

I believe you are right. He must believe the plan can work.

Wrong!
If the airline fails he's got the employees to blame, no problem there. If he takes the $4.5 million and runs and by chance someone steps in and saves the airline (which IMO isnt likely to happen) then he'll be looked at as a failure.
The concessions the employees have given already have been squandered now he wants more.
If Dr. Bronner sees no point in giving more money to an airline that continues to bleed why should the employees? Job security? Yeah right ... tell that to the 27,000 that have already lost their jobs.

 

[OldpropGuy]

If Dr. Bronner sees no point in giving more money to an airline that continues to bleed why should the employees? Job security? Yeah right ... tell that to the 27,000 that have already lost their jobs.

Excellent point!

 

[mweiss]

If Dr. Bronner sees no point in giving more money to an airline that continues to bleed why should the employees? Job security? Yeah right ... tell that to the 27,000 that have already lost their jobs.

Because for Bronner the money he already gave is a sunk cost. Unless he thinks the additional cash would net a larger return than no additional cash, there's no point in doing it.

Just a hunch, and none of us have the numbers to reasonably do the analysis, but I think the net present value to the employees of another concession is greater than the net present value of no more concessions.

In order to calculate both ways, we'd need to know how much longer US will be flying without the concessions, and how much longer US will be flying with them. It's pretty clear that the latter number (of months) is larger than the former.

Of course, such a calculation doesn't take into account the opportunity cost of working for US (namely, that you're not working somewhere else). My gut says that those who could be working elsewhere for a greater return have already done so.

 

[RowUnderDCA]

That's an obvious, rational, clear-headed observation. Most won't even comprehend it, at least not in this context.

 

[Reservation Agent]

There is No Plan.........

I believe Mr Siegel will leave around the end of April...

There is no plan..........


He will blame his departure on the employees as usual...The employees failure to give in to continious threats of bankruptcy, furloughs, the end of the world...doom & gloom...

No vision...No plan.......

How much thought and creativness did it take for the last 6 months to only think of taking more from the employees....

No plan.......No plan to grow, expand, market, improve service, fix the airline & improve morale.....It is everyone else's fault...The U employees....., or Delta or Southwest or Jet Blue ......that we have out-priced our product, and lowered our level of service, while the Southwest's and Jet Blues have offered lower fares, better service and still pay their employees well.....

Mr Siegel has also stated that consolidation in the airline business is comming....
Sounds to me like designs of a sell-off or merger is still anticipated, or why would he have said that?...

There is NO Plan!......

There are about 33 days until April 30th....

 

[USA320Pilot]

In summary, Boyd's opinion was basically "it's either take the cuts or get in the unemployment line."

USA320Pilot comments: The more I see of the "Going Forward Plan" evolve the more impressed I am with US Airways' opportunity to restructure the airline and finally become truly competitive.

Regards,

USA320Pilot

 

[mwereplanes]

In summary, Boyd's opinion was basically "it's either take the cuts or get in the unemployment line."

USA320Pilot comments: The more I see of the "Going Forward Plan" evolve the more impressed I am with US Airways' opportunity to restructure the airline and finally become truly competitive.

Regards,

USA320Pilot

Now we're getting somewhere. Chip, since you are impressed with what you see I have a big favor to ask. Please explain to me what the "going forward plan" is.

I must be dense because I did not hear it in the webcast. Give me the details as to what we are going to do. Let's assume that Dave gets exactly what he asks for from all the employees. What is the plan. Please be specific. Jets, routes, pay rates, work rules, staffing, etc... You know give me the particulars.

Dave must have been talking too fast because I missed it. Tell me the plan. So I can get aboard this wizardly management train and get to the promised land.

Thanks.

mr