Midatlantic's Future

PITbull said:
I am hoping for major legislation reform in Congress from these self-induced U bk.

I equate Bronner with Lorenzo.

When you files that 1113e motion, you will see a major deterioration of employee morale, and many will cease to be productive, as they look elsewhere for employment. During this process, U will find it quite difficult to emerge from BK, if at all.
[post="180833"][/post]​
AMEN

I basically said the same thing the other day on here on how BK is immoral IMO and they have the balls to call it a TOOL, a HAMMER when what it really is: Paid off politicians by corporate America who make laws to screw the working man, and another reason I believe unions lost their power. We all need to do nationwide what aerosmith said, shut the entire country down until they realize we are serious or unions are dead in the water. It’s BS, we need people that lived in the 30’s to bring back some spirit, right now the GOP and right wing fanatics run the show much the little guys sorrows.
 
Ok, from Docket #6, Motion to Approve Use of Cash Collateral....

"As noted above, as of September 10, 2004, the total amount of Debtors’ cash, cash equivalents and short-term investments (not including any restricted cash set aside for other purposes) was $750.3 million. If AAA’s fair market value of the appraised non-cash Collateral ($883.3 million), as well as the amount of the Other Non-Cash Collateral (over $220 million) is added to such cash and cash equivalents, the total of in excess of $1.85 billion is over 250% of the outstanding balance of the ATSB Loan. If AAA’s $586.9 million distress value of such non-cash Collateral is utilized, the total of over $1.55 billion is over 210% of the outstanding balance of the ATSB Loan. Under any analysis, the ATSB Loan is greatly oversecured, and the Lenders and the ATSB will be are adequately protected in connection with the Debtors’ proposed use of Cash Collateral."

Jim
 
And that's one point where we disagree. The actual unit operating cost of the airplane is about the same as the mainline airplanes, but the other costs (gates, reservations, airport facilities, etc) are not lower. So fully apportioned, the total unit costs are higher than mainline since there are fewer seats to spread those fixed costs over.

As for the company wanting to "MidAtlanticize" mainline employees, no argument there. But the fixed costs still remain.

The fixed costs will no longer be a problem after 1113's and rejections of real property.
 
flyin2low,

1113's won't solve the fixed cost problems - labor isn't generally considered a fixed cost like property, equipment, airport leases.

I've been out today so something may have changed, but thru yeaterday the company has filed motions to reject leases on airplanes (primarily those already parked although one article did mention 23 boeings - can't find that in the filings) and two properties (IIRC, one was a ticket office and the other was something minor).

Of course this doesn't mean that they won't cut fixed costs further down the road. But to operate, certain costs are unavoidable - gates, ticket counters, reservations, hangers, ground equipment, etc - and a smaller plane results in those costs being higher per seat mile than a bigger plane. No way around it.

Jim
 
Oh, on the subject of MDA....

One of the furloughed pilots posted on the ALPA board this morning that he had been advised that his early October class date had been postponed with no firm date. That's all he said, so take it for what it's worth.

Jim
 
seeking,

Sure. U has a site set up at www.transformingusairways.com

and the more specific link to the case information is here.

At the "transformingusairways.com" site clicking on the "Legal Information" button takes you to the case information site, so you can get there either way.

Once there, scroll down in the window and select our case (3rd from the bottom as I type this). You'll get a disclaimer page that you have to agree to ("does not guarantee or warrant the accuracy, completeness, or currentness of the data that is provided herein and shall not be liable"). Then you're at the U case page.

The first on the list is the lead case - that's what I choose (anybody let me know if there's anything in the others worth reading). And there you are.

Jim
 
Back to the subject at hand.

Although I agree with you that logically, running one full A320 once would cost less than two E-170's twice...

You need to keep in mind that it is still cheaper to run two full E-170's twice than it is to run two half full A320's or A319's, right...? We can agree on that I assume.

So then it comes down to why run two flights rather than one, correct?

You mentioned IAH, as you well know, is a CAL stronghold. Now, if you are going to go into a city paring like IAH-PHL, you better go in strong. Because now you are DIRECTLY competiting against another carrier's frequency.

We can agree that most airlines (more or less) tend to match one another's fares, right? So if a passneger wishes to go to/from IAH or PHL and has a choice between CAL and US, and the price is pretty much about the same, then...

It comes down to frequency.

If US only has one flight to CAL's two or three (on the same route), then that hurts our chances to compete head to head.

So does it not make more sense to run two profitable flights, rather than just the one. Plus we can develop the market, in that the better quality of the EMB-170 over the smaller ERJ's will win over passengers over time, while those more concerned with time (business travellers) will be won over by the matched frequency.

CAL cannot counter easily. They either waste cash by running too many ERJ flights to out do our frequency (point of diminishing returns on that), or they lose money running a larger aircraft (more times during the day) to compete with the larger E-170's cabin.

And thus, the competitive advantage of the E-170.

Worst case, we make profit on two flights vs. making profit on your one. I know we can fill the 170's multiple round trips on that route, but a reduced frequency might not fill a A320 or even A319.

It is a new Airways we are building, we need to think and fly smarter. Placing the right sized plane on each route, at each time of the day is important. Offering a better product than our competition is just as important. The E-Jets allow us that flexibility, and quality...
 
RICO,

Where to start...

Yes, IAH is a CAL stronghold. But what is PHL if not a US stronghold.

They seen to have no fear of running 4 mainline flights a day into our stronghold (not those small RJ's you mentioned as being inferior to the 170). Heaven forbid that we should do the same and try to compete.

And as nice as the 170 may be from a customer standpoint, it still says "Express" on the side. To some segment of the market, that will sway the decision of which carrier to book on if the fares are equal and we will not get their dollars.

You are correct in one regard - 4 E170 flights a day cost less to operate than 3 B737 flights a day - in terms of operating the aircraft. But the tradeoff is that the other costs are spread over less seats per flight, meaning the other costs go up on a seat-mile basis. In short, do we make more money, or lose less, by using the 170 instead of the 737? Neither of us know the answer to that.

It was no accident that I just happened to pick the markets I did - PHL & IAH/ATL. Both of those cities are "strongholds" of other legacy carriers (CAL, DAL). Those carriers offer mainline service into our "premier hub". If we are afraid to compete with the legacy carriers, how will we ever compete with the LCC's?

You will never get an argument from me about the need for RJ's. But just filling the sky with them as some form of "salvation" is not going to work. If we (US Airways, not just mainline) are to truly compete with the LCC's, using higher CASM planes in ever increasing numbers is a recipe for failure. Southwest has always known that, JetBlue knows that, Airtran knows that, and I-Air knows that. Or they are all wrong and our departed CEO was right.

Jim
 
Hey, no problem. I had thought someone had already posted the "transformingusairways" link somewhere, but could be wrong.

Jim

ps - hope you have at least a case of "cold ones" available before you start wading through all that stuff.
 
So PitBull,

Are you going to try and pull down the operation PitBull?

What did you expect the company to do when the employee groups would not agree to cut costs?



PITbull said:
When U files that 1113e motion, you will see a major deterioration of employee morale, and many will cease to be productive, as they look elsewhere for employment. During this process, U will find it quite difficult to emerge from BK, if at all.
[post="180833"][/post]​
 
UseYourHead said:
So PitBull,

Are you going to try and pull down the operation PitBull?

What did you expect the company to do when the employee groups would not agree to cut costs?
[post="181109"][/post]​

What the heck are you talking about again? Or are you just use to typing posts with the same blah, blah, blah, blah,...go and sit in a corner somewhere...someone will give you a lollypop.
 
When U files that 1113e motion, you will see a major deterioration of employee morale, and many will cease to be productive, as they look elsewhere for employment. During this process, U will find it quite difficult to emerge from BK, if at all.
[post="180833"][/post]​
[/quote]

SpinDoc replies:

Due to the current work rules, most are
already unproductive. Part of the costs the
company was trying to fix with the labor
negotiations was worker productivity.

There many camps that are currently
analyzing and speculating on US future
survivability. Theyare fairly evenly split
on the chances of US emerging from Ch11.
Watching the Embraer, Bombardier,
and GECAS moves to limit aircraft
deliveries and availability to the company
makes me nervous. Those are 3 of
the biggest creditors of the company and
if several more start cutting off US, then
the house of cards could come crashing
down in rapid order.

The company currently has zero access to
the capital markets and even with lower labor
costs, that will probably not change much.
There has to be a meaningful change in the
way the company operates in order to gain
the confidence of the capital markets. It's
going to be tougher than selling ice to an
Eskimo if you asked me.