Here comes the BK threat from the company

[WorldTraveler]

No, no, no, Commavia, you can’t possibly say that BK is just another business strategy because if it is then it isn’t an immoral option which is what you have been listening to from the fAAn club for the last how many years… all parroted from the same AMR execs who have been collecting stock options for all of their “good deeds” while AA has been systematically been brought to the breaking point.
Either BK is a valid business strategy – and is not immoral – or it is immoral and it will continue to be immoral when AA ultimately has to do the same thing that other airlines have done.
You and your fab three or four defenders of mgmt might want to confer and get the story straight…. We’ll give you a hint though that BK is in the US legal code… so not quite sure how you or anyone can argue that BK is immoral if it is part of the legal code.
Or perhaps you can come up with an answer for whatever other parts of the US legal code are in fact immoral.
And I am sure that we would want to defend pay cuts as being the “morally right” thing to do, would we?
I see you want to continue with the same line of thinking that the rest of the fAAn club uses – that other airline employees have suffered far more so AA employees should be thankful that they have not endured the same fate?
Do you three or four have a morning conference call to try and get your talking points all lined up?
BTW, the other companies may be FORMERLY FAILING but AMR is CURRENTLY FAILING. As FWAAA notes, AA’s equity is priced at BK levels and the expectation on Wall Street (which is more than a little confused what to do overall), is more than clear that AMR is not worth as much as airlines a whole lot smaller and with far fewer assets.
As such, continuing to compare what AA employees have today is rather pointless until AA reaches the same level of sustainability as its peers. At that point how about you trot out your pom poms and tell AA employees how well they have fared?
You are right that part of the reason that other airlines have been able to grow their revenue is because they have the right tools including aircraft to go after new revenue streams for them - which has often meant tapping into AA’s revenue.
I doubt very seriously that AA will choose to or succeed in placing a 90-100 seater at AA, partly because the economics still are not favorable for a plane of that size using mainline costs. Even B6 w/ its lack of legacy costs is moving away from the 100 seater to more and more larger 150 and larger jets. Higher fuel prices make it even harder for smaller aircraft to be cost efficient at mainline.
Further, AA still faces structural issues as a result of being a smaller airline trying to compete against DL and UA which are much larger; you have certainly noticed that DL is reducing 50 seat capacity and consolidating connecting traffic into more and more mainline flights because that is the most cost-effective way to carry passengers. The 50 seat and other RJs are a poor substitute for mainline jets on the domestic network but the costs will quickly prove unworkable when AA is forced to use less efficient jets against standard size 150-160 seat mainline jets that form the backbone of the domestic fleet… remember that DL and WN as the two largest domestic carriers are very close to carrying 50% of the US domestic market and because of their size the two of them drive how the rest of the industry can successfully compete in the US domestic market.
FWAAA is correct that it does make sense for AMR to have placed orders for aircraft prior to going into BK – but it is fairly common knowledge that A and B both received concessions in the contracts that AMR can’t reject those aircraft which were ordered in BK and those aircraft must remain parts of the AA fleet post-BK. The fact that no other manufacturer won a share of AA’s order says the chances are very small that AA will introduce another aircraft type at least until a few years after BK – and they still will be putting huge numbers of new aircraft into service in the near future.
So, it is highly unlikely that AA will get a 90 or 100 seat aircraft in their fleet which means the ability of competitors to erode AA’s markets will likely continue.
What AA could benefit from is the ability to deploy the 76 seat versions of the 170 and CR9 which have become standard in the US industry and which APA will have a harder time convincing a judge that AA should not be allowed to do. Given those types of aircraft are in high demand, I doubt that AA will succeed in putting significant numbers of those aircraft in service for quite some time… meaning again that AA’s revenue will continue to be under assault from airlines that do have the right tools right now.
But I do appreciate you acknowledging that AA does have a revenue production product which is what I have been saying for quite some time…. I was just at ORD and was amazed at the number of passengers DL was boarding on both its LGA and JFK service – all on large RJs. As we know from DOT data, DL IS carrying average fares comparable to AA and UA – so you are absolutely right that the right tools go a long way to helping generate revenue, esp. in highly competitive markets.
For those who are tired of hearing this talk of BK, the only reason it persists is because AMR continues to push the limits of what can financially occur; they have occurred huge losses and are now one of the most leveraged airlines in the US – in an industry that already has some of the highest debt ratios in the business world. Just like with the US debt downgrade, at some point, you reach the limits and you have to restructure the business. It is NOT a given that AMR can continue to borrow money, even at higher interest rates.
ON that note, it is worth noting that AMR previously has said that they have pledged nearly all of their existing assets as collateral for existing loans. Therefore, it is highly possible that AMR will not be able to obtain Debtor in Possession financing which are the secured loans that a company takes out as they enter bankruptcy in order to provide the financing to get through bankruptcy. Given that AMR had several billion dollars in debt due this year and have announced they have renegotiated only part of it, they may be forced to start draining their cash coffers for debt repayments. If they also have to use that $6B in cash to ensure they can ride through a later BK, then it doesn’t look like quite so much after all. Debt payments are typically stopped or renegotiated in BK so AMR might be forced to file based on its inability to renegotiate its debt repayments and its inability to be able to pledge anything else as collateral to obtain DIP financing.
Add in the fact that there remain real fears that the US and Europe might be heading into another recession and that banking might get hit hard (a sector that is heavily concentrated in London where AA derives the majority of its European revenue), and it might be very risky for AA to continue to try to restructure outside of BK.
All of this talk isn’t intended to scare you but to help you and others realize that things could change very quickly and dramatically for AA employees; those who are prepared can weather what lies ahead. Having plenty of options to choose from could be a by product of having prepared; if you can continue on with life as you now know it, so be it. It is entirely possible that you could end up in a BETTER position by having prepared for the worst and then be able to respond faster and better than others.

 

[OldGuy@AA]

Thus, all of these back-and-forth arguments here get a bit academic about whether Group X at AA get paid more or less than the comparable group at Airline Y, etc. The key here is that regardless of where AA's groups are relative to the industry (and in almost every case, their cost is at or near the top in the industry), it's sort of a meaningless argument since other airlines have basically outsourced much of the comparable work. Put another way: comparing the cost of an AA employee to a comparable employee at, say, Delta or United, totally misses the point that those other airlines have basically eliminated most of the people that used to do many of those jobs - overhaul, ground handling, flying, etc. have in many cases shifted to regionals and/or third parties (in some cases in foreign countries)

As for "hiring more management" - AA has laid off tons of management (broader sense here of people level 1 and up) in the last decade. They have, however, also added lots of new VPs and MDs, and that is totally inexcusable - I agree - especially considering that some of the VPs they already had were such useless wastes of life.

As for the Eagle divestiture - as was already discussed, no new debt is being taken on. AMR is basically just keeping the debt it already had as the price of offloading Eagle, which to me seems like a really, really good deal for AMR and AA.

Let's take these one at a time.
If the other airline employees that do the same job we do make more money per hour and have better benefits than we do even after BK that is how we figure AA isn't being reasonable. The fact that O/H is contracted out is a little more complicated. Firstly it wasn't too long ago that Carmine Romano who was in charge of maint. in Tulsa stated that, due to the contract work we were doing at the time, AA basically was getting the labor in TULE for FREE! So when it came close to the time of negotiations, all the contract work had to go because it gave us leverage. Also think of the advertising campagn AA could have by pointing out that the SWA 737 people are flying on is maintained in El Salvador by untrained people and being pencil whipped by management. Also challenging the FAA to inspect these foreign facilities as they do us to make the playing field more even. They won't because it would cause them to pay us more. Think about it. The FAA is discriminating against AA because they refuse to inspect foreign facilities that do maint on airliners that are based and fly in the United States. Sounds like they could win that one pretty easy.

The "Tons" of management laid off have not been seen here in Tulsa. As a matter of fact, they have created jobs for managers. The continuous improvement program was created not long ago and a woman (with no aircraft maint background to anyone's knowlege) was hired off the street at a $91,000 salary plus bonuses of course. Attendance managers were hired also so supervisors could no longer manage sick time use by their employees. So apparently you have not been to Tulsa or you (more likely) have nothing to back up your statement.

As far as the Eagle divesture. When it became obvious that people were not willing to pay airline prices to fly on "Buddy Holly" airplanes Eagle started flying RJs seemingly overnight. If you for one minute think that any money came out of the Eagle bank account to pay for those then keep drinking the kool aid. AA paid for every last one of them. At the time SWA had billboards that said "Tulsa to Dallas. No if ands or props" Ever since Crandall split everything off, when there was profit it was AMR when there was loss it was AA. AA bore all the cost for development and continued law suits against SAABRE and got none of the revenue back. In fact SAABRE gouged AA for computers, printers and their so called up keep. This served to funnel more money away from AA. CAARGO had no overhead but cash got funneled to that too. Eagle has been siphoning cash from AA for years. AA has always paid their bills but got none of the profit.
AA has been handing routes and gates to Eagle left and right and would love to give them more.

In a nut shell it comes down to AA management hiding money in lots of different areas. The bottom line is that AA has continued to show millions in losses quarter after quarter with Arpey and his band of 40 theives not being held accountable. Yes, AA has more mechanics than the others so their labor costs at a glance are higher. But what are the labor costs per employee? That is never talked about. Please quit trying to sell the company snake oil to us. We have been lied to too many times and we're tired of hearing it. If I was as much of a miserable failure at my job as Arpey has proven time and again to be then I would expect to be fired. The fact that he and his cronies have not been told to hit the bricks tells us that this is a plan to destroy the pay structure. In other words....... Don't P**s on our back and tell us it's raining.

Hey Strike..... I am on your side on this one. Go figure...... haha

 

[OldGuy@AA]

No but you should see three or four doctors.

Management doesnt have the trust of the workforce for many reasons, Shared Sacrifice is one of them. The fact that they add things like Profit Sharing to their cost outs.The Supplimental Medical is another, they sold this to the membership as a supplimental for Retiree medical, then cancelled the plan and pocketed nearly $80 million dollars. Now they want to pocket another $57 million by terminating the Prefunding. Sure it doesnt go directly to the General Fund but it allows other funds to stay in the General Fund.

We see management spending tons of money and claiming lossses, we did our part, nearly doubled productivity and took pay cuts on top of that. If they cant make it and give back a measly $190 million out of the $24,000,000,000 they are taking in this year, less than 1% of total revenues, then there's no hope and we may as well get what we can instead of investing more years at low wages to a dying company.

Bob you have a way of saying in two short paragraphs what it would take me two pages to say. Thank you!

 

[OldGuy@AA]

Your local president sold you guys out! That's what you get when a non-amt is elected president! Doesn't affect fleet, so why should he care??

Geeze Strike. I am agreeing with you again! How is that happening? haha

 

[OldGuy@AA]

About agreeing to further concessions - because AA's overall labor costs per ASM are higher than any of its competitors, at some point in the future, AA's employees will be forced to choose between changes in their contracts or the end of AA. Many chest-thumpers will say (GWB-style) "bring it on" or "we'll burn the place down before agreeing to additional conessions" (as they did at EAL) but history shows that when push comes to shove, most legacy airline employees will keep showing up for work no matter what contract is imposed upon them. Not everyone wants to start over again at the bottom of another airline's payscale. I realize that plenty of AA employees have done so throughout their career, having started at EAL or Trump or TWA or PanAM or National or many other airlines. When AA files for Ch 11 protection, some workgroups will probably fare better than others.

For example, the market rate (hourly pay rates) for line maintenance is rising well beyond AA's AMT book rates, and as I predicted before, AA line AMTs will probably see some increases in hourly pay rates after a Ch 11 filing while other workgroups will likely see reductions. As has been repeated here often, many of the contract changes will be to work rules of pilots and FAs to make them fly more hours for the money they're already earning. Because fewer pilots and FAs will be needed, AA's costs will go down.

So what you are saying is that since AA has more mechanics than SWA or (plug airline here) and since (plug lowest here) pays X dollars for their 2000 mechs then AA must pay the same X dollars for their 8000 mechs. They can A- lay off 6,000 mechanics and create havoc on the line stations when bumping rights are used. B- Pay line guys X-2 dollars per hour (they have always paid us at least 2 dollars less) and then take what is left and devide it by the remaining 2000 and that will be the pay for O/H. Or C- file BK and completely gut the pay structure.

I got an idea........ Since the CEO of SWA makes less than half of what Arpey makes, lets adjust Arpey's pay.........Oh no AA is BIGGER than SWA so we can't do that. We never talk about how much more our management gets compensated compaired to their peers at other airlines. But it makes no difference that there are more employees at AA also. The total labor cost for AA must match SWA. So you management pukes want to have your cake and eat it too? The money train has come to a stop. We can no longer afford to have the money we lost go to line Arpey and his cronie's pockets. OldGuy has got Strikeforce's back again.

 

[jersey777]

Spot on. And that's the biggest issue -- scope. Reduce some of the scope restrictions, and it would make AA more agile. But the unions are going to fight tooth and nail to protect jobs at the expense of growing company revenue.

------------------------

Fluff & others... Bankruptcy is not a foregone conclusion. It is avoidable by a wide margin if the unions figure out how to work with the company.

But the unions don't trust the company or take em at their word when they say the economic targets are what they say they are...

It will take a more proactive version of the 2003 agreements to avoid bankruptcy. And none of the unions want to admit that, or take what will be perceived as another step backward.

Outside analysts and pundits aren't saying AMR is headed towards bankruptcy simply because of what the company is saying or doing. The company has laid the cards out on the table for a while. We've seen enou of what's behind the kimono to know it ain't pretty.

What has some outsiders convinced there will be a filing is the public positions taken by the unions..

This ain't a doomsday situation yet. Cancer can be survivable if you don't argue with the doctor for three or four years over the right course of treatment.

What disgusts me about this whole thread is that you and some others (you know who you are) are practically salivating at the mouth with the prospect of a bankruptcy and what it would do to the employees of American Airlines.....union and non-union.

See, one big problem I see in this country is that somehow it has become popular that the bar be lowered across all sectors of employment in this country and no one seems to mind. It seems that if one person does not have a benefit or salary package of their neighbor, they would rather see the other guy lose something rather then fight for something that would better themselves.

 

[FWAAA]

What disgusts me about this whole thread is that you and some others (you know who you are) are practically salivating at the mouth with the prospect of a bankruptcy and what it would do to the employees of American Airlines.....union and non-union.

I disagree with your characterization of E as "salivating" at the prospect of an AA bankruptcy. From where I sit, there's only one poster that fits that description (and we all know who that is). E has even posted that he agrees with Arpey on the morality of Ch 11. He ain't salivating. I ain't salivating. I'm merely observing and writing about it. It makes you angry, sure, but I'm not gonna stop writing just because it pisses people off.

See, one big problem I see in this country is that somehow it has become popular that the bar be lowered across all sectors of employment in this country and no one seems to mind. It seems that if one person does not have a benefit or salary package of their neighbor, they would rather see the other guy lose something rather then fight for something that would better themselves.

It makes a lot of people uncomfortable that they don't have employment for life, free from the need to worry about what others in the USA (and all over the world) are willing to do to take away their employment security. Unfortunately, many people do need to worry some about keeping their skills and employment value one step ahead of the other guy. If you don't, that other guy will take your job. Maybe not today or tomorrow, but eventually he'll replace you because he does what you do cheaper or better or more efficiently. He may live down the street or he may live in El Salvador or China or someplace else. Some people will be insulated from this competition by law or by privilege (airline executive management being prime example).

Problem is, there are thousands of FAs at Delta that don't enjoy your work rules. Same thing at B6. And millions of people graduate from high school and college each year and are willing to become FAs and work for peanuts. Look at all the low-paying regionals that have managed to hire sufficient numbers of FAs at a fraction of your pay. Unfortunately, times change and what was once a glamorous entry-level low-pay starter job morphed into a decent-paying, pension-earning lifelong job. But all those kids at the LCCs and regionals didn't get the memo and they're willing to undercut you. Sure, the members of the APFA can eventually engage in self-help (once all the RLA hurdles are cleared) but that ain't gonna change the competitive landscape. There will still be millions of young men and women willing to replace you (either at AA or at a competing airline).

Economic rent is a fun thing to enjoy if you have the power, but it isn't easy hanging onto that power.

 

[care2purchasefood?]

Well, we all know how the BK threat goes. We the fa's and APFA voted NO on the restructuring agreement back in 2003. Look how that turned out with the vote being re-opened and all of a sudden 1400 new yes votes appeared. I'm sure the same will happen again with the APA. Someone will be paid off to have it happen, just like John WAArd and Laura GlAAding did back in 2003 when they got paid off to switch the vote.

Let AA file BK. Who gives a crAAp! The company can't place the new aircraft (Airbus, 787, 737-700/900) on property until the pilots agree to pay on the them. If the company files BK, we will probably not see any of those new aircraft ever set foot on the property.

I'm sure AA (AMR) stock is close to being tossed out of the NYSE too!

 

[commavia]

If the other airline employees that do the same job we do make more money per hour and have better benefits than we do even after BK that is how we figure AA isn't being reasonable. The fact that O/H is contracted out is a little more complicated. Firstly it wasn't too long ago that Carmine Romano who was in charge of maint. in Tulsa stated that, due to the contract work we were doing at the time, AA basically was getting the labor in TULE for FREE! So when it came close to the time of negotiations, all the contract work had to go because it gave us leverage. Also think of the advertising campagn AA could have by pointing out that the SWA 737 people are flying on is maintained in El Salvador by untrained people and being pencil whipped by management. Also challenging the FAA to inspect these foreign facilities as they do us to make the playing field more even. They won't because it would cause them to pay us more. Think about it. The FAA is discriminating against AA because they refuse to inspect foreign facilities that do maint on airliners that are based and fly in the United States. Sounds like they could win that one pretty easy.

Again - AA can pay you less then what some workers in comparable jobs at some airlines are getting paid, but still have higher labor and maintenance costs in part because AA still does so much of this work! This isn't hard! It's fairly simple, and again why these arguments get a little academic. It may be that certain classes of workers are getting paid a bit more in similar jobs at other airlines, but if those airlines employ - as an example - 3,000 M&E employees at those wages and AA employs 10,000, who has the higher cost? Again - I don't think even the most radical unionist here would argue that, all else being equal, Tulsa will never be the same cost as El Salvador or Beijing. And if that is the cost that you are competing against, the math isn't hard to do.

And as for your suggestion that AA should do some big P.R. campaign to sh*t all over other airline's maintenance, and play up how all of AA's overhauls are done in the U.S., it's a noble idea but meaningless. U.S. consumers have shown again and again that they don't know, and when they do know, they simply don't care. They will continue to book the fare that is $5 cheaper whether the plane is maintained in Tulsa or TIMCO or El Salvador. The FAA may perform more oversight of AA (as I had one M&E guy put it to me, "they can show up here [Tulsa] whenever they want, but have to make an appointment when they go overseas") but, again, whether you like it or not, this is the reality AA has to operate with. FAA oversight is what it is - it may not be fair, but it is what it is - for AA and AAers.

So apparently you have not been to Tulsa or you (more likely) have nothing to back up your statement.

So apparently you have never been to headquarters. AA has laid off thousands of management (again, I mean people level 1 and up, not 55 and below) in the last decade. If you have ever been to headquarters, then you obviously would know that I don't need "anything" to back up that statement - it's just reality. I was never commenting on the hiring and/or laying off of managers at specific locations - including Tulsa. Having never worked in Tulsa, I will of course take your word for it - I was simply speaking of the company as a whole. And, you obviously missed the part of my post where I lamented and criticized how AA has added numerous VPs and MDs in the last several years - which is absolutely ridiculous and inexcusable. AA should be reducing VPs, not adding them, and should have gotten rid of a lot of VPs years ago who are sadly still there. I'm not debating that point for a second.

As far as the Eagle divesture. When it became obvious that people were not willing to pay airline prices to fly on "Buddy Holly" airplanes Eagle started flying RJs seemingly overnight. If you for one minute think that any money came out of the Eagle bank account to pay for those then keep drinking the kool aid. AA paid for every last one of them. At the time SWA had billboards that said "Tulsa to Dallas. No if ands or props" Ever since Crandall split everything off, when there was profit it was AMR when there was loss it was AA. AA bore all the cost for development and continued law suits against SAABRE and got none of the revenue back. In fact SAABRE gouged AA for computers, printers and their so called up keep. This served to funnel more money away from AA. CAARGO had no overhead but cash got funneled to that too. Eagle has been siphoning cash from AA for years. AA has always paid their bills but got none of the profit.
AA has been handing routes and gates to Eagle left and right and would love to give them more.

In a nut shell it comes down to AA management hiding money in lots of different areas. The bottom line is that AA has continued to show millions in losses quarter after quarter with Arpey and his band of 40 theives not being held accountable. Yes, AA has more mechanics than the others so their labor costs at a glance are higher. But what are the labor costs per employee? That is never talked about. Please quit trying to sell the company snake oil to us. We have been lied to too many times and we're tired of hearing it. If I was as much of a miserable failure at my job as Arpey has proven time and again to be then I would expect to be fired. The fact that he and his cronies have not been told to hit the bricks tells us that this is a plan to destroy the pay structure. In other words....... Don't P**s on our back and tell us it's raining.

Huh? This delusional comedy just lowers the entire credibility of organized labor. "When there was profit it was AMR when there was loss it was AA?" Seriously? This is such B.S.! AA is not hiding money anywhere - it's all reported publicly four times each year for all to see - including your union. AMR can't just make this stuff up - there are specific laws and regulations that govern how, when and where AMR must book investments, revenues, costs and investments. Since SABRE was an internally developed system without a determinable useful life or valuation, it was expensed, not capitalized. That's just how it works - at every publicly traded company, not just AMR. There is no such thing as profit at AMR, loss at AA - it's all AMR, and has been for every quarter since May 1982.

What disgusts me about this whole thread is that you and some others (you know who you are) are practically salivating at the mouth with the prospect of a bankruptcy and what it would do to the employees of American Airlines.....union and non-union.

I what saddens me about this whole thread and just about every thread here is that you and so many others seem to see it as so black and white - if somebody doesn't agree with you, they clearly hate and want to screw you. You act as though you and your union, and your employer, operate within a vacuum without any competition and without any exposure to economic reality.

Here, in the real world, every single other major U.S. carrier has used bankruptcy to free and dump pensions, outsource overhauls to third parties and/or foreign countries, laid off thousands of additional workers, gutted union contracts and work rules, outsource more and more of their flying to regional operators, and on and on. In so doing, they now have a competitive advantage over AA. Whether you want to recognize that reality or not doesn't make it any less reality. Thus, all that some here are discussing is that somehow, some way, AA has to eventually match their competition, and perhaps it may - sadly - be inevitable that AA has to use bankruptcy to do it, just like their competitors.

Nobody is "salivating" or relishing bankruptcy - it is an astoundingly sad and tragic thing that will harm lots of people and livelihoods. But, alas, this is the definition of moral hazard in modern America: when every one of AA's competitors has used the bankruptcy process to abrogate contracts and default on obligations, how is AA (and its employees) to compete?

 

[WorldTraveler]

Hey Comm,
perhaps the reason no one wants to believe your (and others) line about why this BK will ultimately be in the best of AMR and those employees is because you continue to distort the reality of what other airline employees have and have not lost.
AA employees are not dumb... they can see that tens of thousands of employees at other airlines have it a whole lot better off than you try to paint it - at the very same time that you try to convince AA people that they aren't nearly as bad off - while the company is standing by ready to ram under set of concessions down their throat.
.
Why don't you just stick to the airplanes and routes and all the other stuff in your arguments about why BK is going to be so good - because you 1. aren't convincing any AA employees that they are any better off and 2. because AA employees know for a fact that other airline employees took the bitter pill and have been regaining alot of what they lost for several years now?
.
AA employees are no where near ready to regain anything 8 years after taking concessions that were just as severe as the other guys - with the exception of the pension losses. And I will remind you once again that UA and US employees and ONLY DL PILOTS are the ones who lost anything as a result of their pensions. All other DL and NW pension plans were frozen - which means those employees lost NOTHING. And the DL pilots and UA and US employees became creditors of the company as a result of the pension terminations and either the employees or the unions on their behalf have sold most of the stock which they received in the reorganized companies.
.
If work rules are so superior at AA to those other airlines, then logic would say those other airline employees would be rising up to challenge their mgmt to have what AA has. Yet no one is holding AA as an example to be followed. Perhaps because those other airline employees are doing far better than AA employees already. Perhaps that also explains why DL FAs have voted multiple times to NOT seek union representation - because the myth that the grass is greener elsewhere is simply a myth.
.
So your attempts to convince AA employees how "good they have it" is not only factually wrong but is morally disgusting in light of the fact that everyone with half a brain recognizes that there are more cuts coming at AA - but not at other carriers.
When the damage assessment is finally completed after AA completes its next round of cuts, there is no doubt that AA employees will have paid a far higher price than their peers at AA's closest peers DL and UA.
.
You shouldn't be surprised that no one accepts your line because AA employees know full well the state of affairs in the industry and don't need anyone to try to distort those facts as well as because the cold, hard reality is that you and your buds continue to live with complete blinders on regarding what will surely happen in a feeble attempt to try to prop up your own self pride that AA has in fact been run better than those other airlines.
.
Nobody bought it on the first page of this thread and they don''t buy it now and they won't buy it as the next round of cuts is rolled out.

 

[strikeforce]

It makes a lot of people uncomfortable that they don't have employment for life, free from the need to worry about what others in the USA (and all over the world) are willing to do to take away their employment security. Unfortunately, many people do need to worry some about keeping their skills and employment value one step ahead of the other guy. If you don't, that other guy will take your job. Maybe not today or tomorrow, but eventually he'll replace you because he does what you do cheaper or better or more efficiently. He may live down the street or he may live in El Salvador or China or someplace else. Some people will be insulated from this competition by law or by privilege (airline executive management being prime example).

It's done cheaper because our own gov't has sold us out. Show me that it's done better or more efficiently???? Why don't you ask the UAL mechanics about the Chinese doing it better or more efficiently??? Anyone can whip maintenance if they're told to do it. Too bad the flying public doesn't really know the conditions of the airplanes when they come back from China or El Salvador.

 

[IORFA]

The company can't place the new aircraft (Airbus, 787, 737-700/900) on property until the pilots agree to pay on the them. If the company files BK, we will probably not see any of those new aircraft ever set foot on the property.

This statement is debatable. AA doesn't see it that way, except for the 787. IF AA files for bankruptcy, the planes will be here even faster. Any judge will be easier and faster to deal with than the APA. I must say I have no problem with APA's negotiations. They are APA's negotiations and they can conduct them as they please.

I'm sure AA (AMR) stock is close to being tossed out of the NYSE too!
[/quote]

A little fact about that. The stock has to be under $1 for a specific amount of time before it is even a threat to be de-listed. Even at that point the NYSE still doesn't have to do it the first day it makes the letter of the law for de-listing. Nonetheless, it does have to be under $1 for the process to even start.

 

[OldGuy@AA]

Huh? This delusional comedy just lowers the entire credibility of organized labor. "When there was profit it was AMR when there was loss it was AA?" Seriously? This is such B.S.! AA is not hiding money anywhere - it's all reported publicly four times each year for all to see - including your union. AMR can't just make this stuff up - there are specific laws and regulations that govern how, when and where AMR must book investments, revenues, costs and investments. Since SABRE was an internally developed system without a determinable useful life or valuation, it was expensed, not capitalized. That's just how it works - at every publicly traded company, not just AMR. There is no such thing as profit at AMR, loss at AA - it's all AMR, and has been for every quarter since May 1982.



Com, are you going to deny the fact that American Airlines paid all the development costs for SAABRE as well as every law suit settlement? And when SAABRE was sold did the money go towards American Airlines' profit? Now who is delusional??? Your biggest problem is that you think that everyone is too dumb to figure anything out. I will never claim to have an MBA or any kind of business prowess. All I have ever done is work on aircraft starting as a 17 year old in the Air Force. But 35 years later (26 at AA) I have seen many things. I have heard Crandall tell me that a mechanic is a mechanic. Doesn't matter if he works for AA or Jiffy Lube. (By the way I never saw a Jiffy Lube guy sign off a log book or pattern card) I heard Carty tell me that Delta and United mechanics only made two or three dollars more and hour than us but that is not a lot of money. And then refuse to give us the difference in pay. I heard Arpey tell us that we would share the sacrifice and then was shown pictures of a $1.5 million condo in Hawaii by the director (in Tule) that just bought it with his bonus money. I was also told there would be accountability from the top down and to date there has been no accountablity as far as anyone in management is concerned. Anyone with an A&P license signs their name to their work and promises the work was done according to the manual and the part, engine, aircraft is airworthy. There is a responsibility that goes with that signature and it is worth more than what AA is willing to pay. If they want to fly the airplanes somewhere else rather than pay us a fair wage for what we are responsible for then let them. But some day airplanes will fall out of the sky. We have already seen how SWA has had a few problems with 737s becoming convertable top airplanes but they are the darling of the industry and bullet proof. Oh I almost forgot.... Crandall threw mechanics and inspectors under the bus for the DC-10 incident in order to get a good deal on Super 80s from Douglas. (you gonna deny that too?) Also remember most of all........... If/When AA goes belly up the UNION employees can look themselves in the eye in the mirror and say they did what they could do to keep AA going. The management at AA is so morally bankrupt that people like you will blame the workers. The facts speak for themselves. Every offshoot company in AMR was bought and paid for by American Airlines. I would like to ask others not to respond any more to this pompus knowitall.

 

[commavia]

Com, are you going to deny the fact that American Airlines paid all the development costs for SAABRE as well as every law suit settlement? And when SAABRE was sold did the money go towards American Airlines' profit?

Of course AA paid for SABRE - back then, SABRE was AA! SABRE was developed internally within AA - it didn't become a standalone company until years after it was created. Again - that is how it works at any other company in America. When you develop processes and systems internally, they are expensed and not capitalized under specific circumstances enumerated by SFAS 142. It's not as if AMR made this up, or chose how to account for SABRE - they had to comply with accounting regulations that applied equally to all companies.

And as for when SABRE was spun off, of course the money went to AMR - which is the holding company that reports consolidated financial reports and has since 1982. Those proceeds were then sunk back into AMR, and by far its largest subsidiary, American Airlines, and to AMR shareholders.

All I have ever done is work on aircraft starting as a 17 year old in the Air Force. But 35 years later (26 at AA) I have seen many things. I have heard Crandall tell me that a mechanic is a mechanic. Doesn't matter if he works for AA or Jiffy Lube. (By the way I never saw a Jiffy Lube guy sign off a log book or pattern card) I heard Carty tell me that Delta and United mechanics only made two or three dollars more and hour than us but that is not a lot of money. And then refuse to give us the difference in pay. I heard Arpey tell us that we would share the sacrifice and then was shown pictures of a $1.5 million condo in Hawaii by the director (in Tule) that just bought it with his bonus money. I was also told there would be accountability from the top down and to date there has been no accountablity as far as anyone in management is concerned. Anyone with an A&P license signs their name to their work and promises the work was done according to the manual and the part, engine, aircraft is airworthy.

When are you going to get it? I'm not defending management here or impugning anything you have or haven't done, gotten or not gotten, or have or haven't had to put up with over the years. This isn't about you vs. me, or you vs. management. This is about AA vs. its competitors.

To be very clear here: I'm not parroting the management line because I can't defend what somebody else has said or done 20 years ago. I am simply stating my opinion based on the U.S. airline industry as I see it, which is this:

(1) Today more capacity in the U.S. than ever is flown by low-fare airlines that often don't have unions and/or have far lower labor costs than AA

(2) Today every single one of AA's legacy network competitors have filed for bankruptcy at least once, and used that bankruptcy process to abrogate commitments, default on obligations, freeze and/or dump pensions, outsource overhauls, outsource more and more flying to regionals, tear up work rules, and/or lay off thousands

(3) AA's employees in just about all labor groups are near the top of the hourly pay scales in the U.S. airline industry, and even if not the top paid, are often the most expensive on a unit basis because AA labor is less efficient and productive (again, because hasn't outsourced work nor nearly as much flying as competitors)

(4) Given (1), (2), and (3), and believing that the airline industry - for most customers - has now become largely a commodity business driven by price, I believe that someday, some way, some how, AA will have no choice but to find a way to lower costs and become more productive - and that will have to involve labor, just as it has at virtually every other U.S. airline that has either lower costs and/or higher labor productivity than AA.

I am not disputing any of the ills you say you've experienced over the years - I would have no way to since I haven't lived your experiences. "Some" want to bait me and are trying to put words in my mouth by suggesting that somehow I am a management stooge who parrots the company line and wants to screw the unions and labor. Trust me - I've been ignoring "that" for years. Nothing could possibly be further from the truth - I want so desperately for AA and its employees to succeed, but I also recognize that they need each other to succeed, and I also believe that in order for AA to succeed it will, again, ultimately have to lower its costs and change its business model, and that will ultimately require labor (again, just as it has at just about every other legacy carrier).

There is a responsibility that goes with that signature and it is worth more than what AA is willing to pay. If they want to fly the airplanes somewhere else rather than pay us a fair wage for what we are responsible for then let them. But some day airplanes will fall out of the sky.

Okay, I hear you, but in the meantime, other airlines are sending their aircraft to third parties and foreign countries for overhaul, and there are mechanics there that are willing to get paid far less than what you make for signing off. I don't know what they're signing off on - that's your area of expertise, not mine. But those airlines, their shareholders, the FAA, and perhaps most importantly their customers, all seem to be fine with that. So, again, in the meantime, what is AA to do to be competitive? As the saying goes - don't hate the player, hate the game.

If a tree falls in the forest and nobody is there to hear it, did the tree fall? If every other airline has now outsourced overhauls to third parties and/or foreign countries, and the planes aren't falling out of the sky, and shareholders/regulators/passengers don't care, does it matter? I know it does to you guys, and frankly it does to me too, but it doesn't seem to matter to a whole lot of other people. That's just reality.

 

[odie01]

Of course AA paid for SABRE - back then, SABRE was AA! SABRE was developed internally within AA - it didn't become a standalone company until years after it was created. Again - that is how it works at any other company in America. When you develop processes and systems internally, they are expensed and not capitalized under specific circumstances enumerated by SFAS 142. It's not as if AMR made this up, or chose how to account for SABRE - they had to comply with accounting regulations that applied equally to all companies.

And as for when SABRE was spun off, of course the money went to AMR - which is the holding company that reports consolidated financial reports and has since 1982. Those proceeds were then sunk back into AMR, and by far its largest subsidiary, American Airlines, and to AMR shareholders.



When are you going to get it? I'm not defending management here or impugning anything you have or haven't done, gotten or not gotten, or have or haven't had to put up with over the years. This isn't about you vs. me, or you vs. management. This is about AA vs. its competitors.

To be very clear here: I'm not parroting the management line because I can't defend what somebody else has said or done 20 years ago. I am simply stating my opinion based on the U.S. airline industry as I see it, which is this:

(1) Today more capacity in the U.S. than ever is flown by low-fare airlines that often don't have unions and/or have far lower labor costs than AA

(2) Today every single one of AA's legacy network competitors have filed for bankruptcy at least once, and used that bankruptcy process to abrogate commitments, default on obligations, freeze and/or dump pensions, outsource overhauls, outsource more and more flying to regionals, tear up work rules, and/or lay off thousands

(3) AA's employees in just about all labor groups are near the top of the hourly pay scales in the U.S. airline industry, and even if not the top paid, are often the most expensive on a unit basis because AA labor is less efficient and productive (again, because hasn't outsourced work nor nearly as much flying as competitors)

(4) Given (1), (2), and (3), and believing that the airline industry - for most customers - has now become largely a commodity business driven by price, I believe that someday, some way, some how, AA will have no choice but to find a way to lower costs and become more productive - and that will have to involve labor, just as it has at virtually every other U.S. airline that has either lower costs and/or higher labor productivity than AA.

I am not disputing any of the ills you say you've experienced over the years - I would have no way to since I haven't lived your experiences. "Some" want to bait me and are trying to put words in my mouth by suggesting that somehow I am a management stooge who parrots the company line and wants to screw the unions and labor. Trust me - I've been ignoring "that" for years. Nothing could possibly be further from the truth - I want so desperately for AA and its employees to succeed, but I also recognize that they need each other to succeed, and I also believe that in order for AA to succeed it will, again, ultimately have to lower its costs and change its business model, and that will ultimately require labor (again, just as it has at just about every other legacy carrier).



Okay, I hear you, but in the meantime, other airlines are sending their aircraft to third parties and foreign countries for overhaul, and there are mechanics there that are willing to get paid far less than what you make for signing off. I don't know what they're signing off on - that's your area of expertise, not mine. But those airlines, their shareholders, the FAA, and perhaps most importantly their customers, all seem to be fine with that. So, again, in the meantime, what is AA to do to be competitive? As the saying goes - don't hate the player, hate the game.

If a tree falls in the forest and nobody is there to hear it, did the tree fall? If every other airline has now outsourced overhauls to third parties and/or foreign countries, and the planes aren't falling out of the sky, and shareholders/regulators/passengers don't care, does it matter? I know it does to you guys, and frankly it does to me too, but it doesn't seem to matter to a whole lot of other people. That's just reality.

That's a good post commavia , and I'll have to say I agree somewhat with what you are saying, BUT, reality is, AA is not willing to negotiate with the mechanics. It's the take it or leave it arrogant attitude, that really pisses me off, especially after we have given up pay and benefits in 2003 to save the company. It wouldn't take much by the company to offer us back full sick time, vacation, shift differential, and the little stuff that other mechanics have in and out of the airline industry. We are tired of the stall tactics, and the NMB is a joke.