Pilot and Mechanic Shortage

[Bob Owens]

More on the shortage of Mechanics.

http://www.npr.org/2011/12/13/143586152/airplane-mechanics-a-farm-team-for-everyone-else

 

[Birdman]

More on the shortage of Mechanics.

http://www.npr.org/2011/12/13/143586152/airplane-mechanics-a-farm-team-for-everyone-else

Does AA have a strategy for continuing their hiring practice? It doesn't seem as though the TWU's lawyers think the shortage will give us any leverage, as they are preparing the membership for the worse case scenario. I think there will be intense "push back" if the compAAny attempts to lower us even further below the industry median level.

 

[Hopeful]

Does AA have a strategy for continuing their hiring practice? It doesn't seem as though the TWU's lawyers think the shortage will give us any leverage, as they are preparing the membership for the worse case scenario. I think there will be intense "push back" if the compAAny attempts to lower us even further below the industry median level.

Last Monday at JFK, AA started new mechanics in school. For now, it is business as usual.

 

[Veritas]

More on the shortage of Mechanics.

http://www.npr.org/2011/12/13/143586152/airplane-mechanics-a-farm-team-for-everyone-else

Did you listen to the complete story? They are unable to hire mechanics because their wages are not competitive.

Brown says airplane mechanics at her company start earning between $12 and $15 an hour, while veterans who have their FAA Airframe and Powerplant licenses top out at $28 an hour.

Yet AAR can't keep these positions filled. Brown says the company has at least 600 open jobs. "I know Indianapolis needs about 283 [and] we're just shy of needing 200 people. They also need people in our Miami facility; we're a worldwide organization," she says.

<snip>

AAR has learned all too well that sometimes $25 an hour won't cut it. The conflicts in Iraq and Afghanistan have siphoned off thousands of mechanics who make hazard pay servicing aircraft in a war zone.

Even in Oklahoma mechanics can make between $5 and $10 more an hour at Tinker Air Force Base and down the road in Tulsa at American Airlines' maintenance facility.

So why doesn't AAR pay its mechanics more? The company says it simply can't afford to; the competition here and abroad is so cutthroat. Jamroz says you'd be surprised to discover the going rate to repair a Boeing 747 these days.

"You take your car into an automotive place and you're paying $75 to $100 an hour. We sell our labor at $48 to $49 an hour," he says.

 

[Bob Owens]

Did you listen to the complete story? They are unable to hire mechanics because their wages are not competitive.

Yea, they all say they cant pay, the numbers say otherwise.

Profits as of may 2011 =138,000,000
They have 6100 employees.
They could give each employee a $22,000 raise and still break even. They could match that $10 more that the AirForce pays if they wanted to, they are just greedy!

I worked for AAR briefly many years ago, worst job I ever had.

 

[Frank Szabo]

Yea, they all say they cant pay, the numbers say otherwise.

Profits as of may 2011 =138,000,000
They have 6100 employees.
They could give each employee a $22,000 raise and still break even. They could match that $10 more that the AirForce pays if they wanted to, they are just greedy!

I worked for AAR briefly many years ago, worst job I ever had.

Even though the Navy trained me as an ADJ (Jet Engine Mech), that's exactly why I'm happy to do the work I do (diemaker, for those who haven't read my page).

If you think there's a shortage of aircraft mechanics, check out my trade - plan on investing your life to learn it, though.

 

[FWAAA]

Yea, they all say they cant pay, the numbers say otherwise.

Profits as of may 2011 =138,000,000
They have 6100 employees.
They could give each employee a $22,000 raise and still break even. They could match that $10 more that the AirForce pays if they wanted to, they are just greedy!

I worked for AAR briefly many years ago, worst job I ever had.

You overstated AAR's income because you left out interest on debt of $30.7 million, leaving a pre-tax income of $108.5 million. So AAR could, in theory, give all 6,100 employees a payraise of $17,787 if management's goal was break-even. Thing is, AAR is not a commune, it's a for-profit business, and a pre-tax profit of $108 million on almost $1.8 billion of revenue doesn't seem all that "greedy."

The problem is that AAR has to compete with the very low-paid in El Salvador and China and elsewhere, and thus cannot increase its prices to its customers, limiting how much it can pay its employees.

 

[Buck]

You overstated AAR's income because you left out interest on debt of $30.7 million, leaving a pre-tax income of $108.5 million. So AAR could, in theory, give all 6,100 employees a payraise of $17,787 if management's goal was break-even. Thing is, AAR is not a commune, it's a for-profit business, and a pre-tax profit of $108 million on almost $1.8 billion of revenue doesn't seem all that "greedy."

The problem is that AAR has to compete with the very low-paid in El Salvador and China and elsewhere, and thus cannot increase its prices to its customers, limiting how much it can pay its employees.

My question is for those who cotinue to post the third world wages, in what economic market do the employees spend their income? A loaf of bread cost the same for you and me, brother. But in different markets the loaf might be $1.00 and in another $10.00.

Is AAR part of the 1%?

 

[787nightmare]

"The problem is that AAR has to compete with the very low-paid in El Salvador and China and elsewhere, and thus cannot increase its prices to its customers, limiting how much it can pay its employees."

And there in lies the root of the problem in this industry.

 

[Bob Owens]

You overstated AAR's income because you left out interest on debt of $30.7 million, leaving a pre-tax income of $108.5 million. So AAR could, in theory, give all 6,100 employees a payraise of $17,787 if management's goal was break-even. Thing is, AAR is not a commune, it's a for-profit business, and a pre-tax profit of $108 million on almost $1.8 billion of revenue doesn't seem all that "greedy."

The problem is that AAR has to compete with the very low-paid in El Salvador and China and elsewhere, and thus cannot increase its prices to its customers, limiting how much it can pay its employees.

I took the number off the cite. You want to quibble about $2200 go ahead.

maybe they need to cut their executives compensation. How much of that stuff actually gets sent to El Salvador and China anyway? Chinas aviation market is growing faster than ours, they need to take care of their own stuff. Your own numbers indicate that AAR is doing pretty well, $1.8 billion in revenue.
Everyone knows that when a company cites their profits thats only what they could not hide from the tax man. AAR could afford to pay more, they are just greedy.

 

[FWAAA]

I took the number off the cite. You want to quibble about $2200 go ahead.

You were the one who overstated AAR's pre-tax income by 28% (almost $31 million), but that's SOP for you, given your constant exaggeration of the size of your 2003 concessions. Seriously, you really ought to take a course in reading financial statements. After taxes, the company only made $70 million, not really outstanding profits on their $1.8 billion of revenue. Please forgive me, as I forgot that profits are evil. Nobody is entitled to earn profits off the backs of working men and women. All companies must increase wage expenses until they merely break even.

Turns out that AAR's MRO business brought in 22% of their revenue but contributed only 18% of their gross profit. AAR doesn't break down how the overhead is allocated between their business units, so it's impossible to tell how much of the net income is attributable to the MRO operation. On a gross profit basis, it's obvious that it's being carried by the other activities.

maybe they need to cut their executives compensation.

Funny you mention that; their CEO made more base pay than Arpey ($850k v $650k) and had a total compensation package about equal to his. The other top paid execs' pay resembled AMR's top paid execs. Base pay, short term and long term bonus and variable comp programs, plenty of stock and options. At a company with only 7.5% of AMR's revenue. So here's a company with just 7.5% of AMR's revenue that pays its execs more than AMR does and pays its rank and file substantially less than AMR and is thus profitable (not unlike many of AA's competitors).

How much of that stuff actually gets sent to El Salvador and China anyway? Chinas aviation market is growing faster than ours, they need to take care of their own stuff.

AAviator posted a link two days ago to Aeroman's website that announced the addition of three new bays that will be complete in April, bringing their total to 11 737 and A320 lines, just one fewer than UA's old IND facility now used by AAR. Here's that page:

http://www.aeroman.com.sv/en-company.jsp?idCat=6

I'm not certain, but I believe that Aeroman gets jetBlue's A320s and some WN 737s and probably others.

China? With almost five times the population of the USA and an air travel network that's only a small fraction of the size of the USA's air travel system, China will have no trouble training several tens of thousands of people to maintain airplanes. And I suspect that they'll work for even less than Timco or AAR. Maybe the Aeroman wages of $5/hr for AMTs and $2/hr for helpers (and I suspect the ratio of helpers to AMTs is a lot higher than TULE's ratio of OSMs to A&P mechanics).

Your own numbers indicate that AAR is doing pretty well, $1.8 billion in revenue.

Actually, the MRO portion of AAR brought in just $394 million of the $1.8 billion and was the least profitable (on a gross profit basis) of their four business units. Their 10-K makes for some interesting reading.

Everyone knows that when a company cites their profits thats only what they could not hide from the tax man. AAR could afford to pay more, they are just greedy.

You know what? You being on the negotiating committee had to bring a smile to Horton's face.

Yes, Bob, you're right. No company ever reports their earnings accurately. All corporate execs are crooks, all accounting firms that audit their financials are crooked and the entire judicial system is crooked (when it decides cases differently than you would if you were the judge). Yes, the hardworking men and women who belong to the worthless union are certainly in good hands with you at the wheel.

You guys are so screwed.

 

[Hopeful]

Yes, Bob, you're right. No company ever reports their earnings accurately. All corporate execs are crooks, all accounting firms that audit their financials are crooked and the entire judicial system is crooked (when it decides cases differently than you would if you were the judge).

And you're always right about execs and corporations..Enron, Tyco.......Hey, about Corzine and MF GLOBAL....."ER, I DON'T KNOW WHERE THE MONEY WENT."

You're right FWAAA, we are screwed.....As are shareholders and creditors.....

After BK, Horton and his team will get rewarded nicely for "GETTING THROUGH THESE OH SO DIFFICLUT TIMES."

 

[enough already]

You were the one who overstated AAR's pre-tax income by 28% (almost $31 million), but that's SOP for you, given your constant exaggeration of the size of your 2003 concessions. Seriously, you really ought to take a course in reading financial statements.

You guys are so screwed.

I don't think stating that we took a 25% cut is exaggerating. 17% in wages, loss of vacation, loss of 5 holidays. I'm sure there's more, but suffice to say it's not an overstatement.

 

[Hopeful]

You were the one who overstated AAR's pre-tax income by 28% (almost $31 million), but that's SOP for you, given your constant exaggeration of the size of your 2003 concessions. Seriously, you really ought to take a course in reading financial statements. After taxes, the company only made $70 million, not really outstanding profits on their $1.8 billion of revenue. Please forgive me, as I forgot that profits are evil. Nobody is entitled to earn profits off the backs of working men and women. All companies must increase wage expenses until they merely break even.

EXAGGERATION? Just like you and other company defenders like to say that an executive's compensation package includes ALL thise things...salary, bonuses and PUPS,,,,,the same went for our concessions.

We too 17% hard dollar paycut....loss of 5 holidays and holiday rate, loss of one weeks vacation, loss of all double time.....the first 2 days of sick at half pay for each occurence......
Each mechanic lost about $20000 a year with ALL these things.....You know FWAAA, just like the execs.....That's our compensation package...And it comes out to more than 25%...
Maybe it is the imagination of thousands of airline workers who since deregulation lost their jobs, were raped in pay and benefit cuts, maybe all these things just so company's could cut their expenses.
We all made this up about corporate greed and screwing workers....it's all just a pad dream....Youi're right FWAAA..You're always right!

 

[Deleted member 14439]

EXAGGERATION? Just like you and other company defenders like to say that an executive's compensation package includes ALL thise things...salary, bonuses and PUPS,,,,,the same went for our concessions.

We too 17% hard dollar paycut....loss of 5 holidays and holiday rate, loss of one weeks vacation, loss of all double time.....the first 2 days of sick at half pay for each occurence......
Each mechanic lost about $20000 a year with ALL these things.....You know FWAAA, just like the execs.....That's our compensation package...And it comes out to more than 25%...
Maybe it is the imagination of thousands of airline workers who since deregulation lost their jobs, were raped in pay and benefit cuts, maybe all these things just so company's could cut their expenses.
We all made this up about corporate greed and screwing workers....it's all just a pad dream....Youi're right FWAAA..You're always right!

Well said Hopeful,bravozulu!