The way I see it is this.....I don't believe AA should stop advertising or whatever they require to operate a business...But for years now, AA has been demanding a ZERO cost contract.....When they keep preaching about how they cannot afford raises, then guess what????????????? You can't afford anything...INCLUDING advertising!
I may be wrong, but AA's position is that it wants to increase your wages (slightly) but wants to pay for those raises by paying fewer people, resulting in a zero cost (to AA) contract. Of course you don't like that, but given that AA's passengers paid less per mile on average in 2010 than they did 10 years before, I don't see AA's position as all that unreasonable.
AA's mainline yield in 2000 was 14.06 cents and its PRASM was 10.18 cents. Load factor was 72.4% and fuel cost 78 cents/gal.
In 2010, 10 years later, AA's mainline yield was only 13.36 cents and PRASM was 10.94 cents. Load factor was much higher at 81.6%, leading to the higher PRASM than in 2010. Fuel in 2010 cost $2.31/gal, almost triple the price paid in 2000, leading to a fuel bill $3.9 billion higher in 2010 than in 2000, even though passengers paid, on average, 7/10 of a cent less per mile to fly. Yes, your costs have increased. AA's costs have increased. Everyone's costs have increased, except the cost of flying, for which passengers paid less. Yes, you should get a raise - even a large raise. But exactly from where does the money come?
Very simple math leads to the inescapable conclusion that the pie ain't growing, so individual pay raises will either have to be borrowed or will have to come from the paychecks of soon-to-be ex-co-workers. Either passengers have to pay significantly more to fly or your wage increase will cannibalize the wages of fellow employees.
So AA spends a little bit of money in hopes that it increases revenue - sorta like planting some seed in hopes you can harvest a lot more seeds later - isn't there a Bible passage about that?
AA can afford raises - it just can't afford raises for everyone. To pay for raises, some will have to be thrown overboard or not replaced as they quit, die, retire, etc.
When it comes to labor, they can't afford this and they can't afford that....But when it comes to advertising and other little "incidentals" like executive compensation,,,the response is usually...."Oh, the company NEEDS these things to compete, blah blah blah."
Can't have it both ways.
I don't see it a a "having it both ways" situation. I see AA's execs trying to increase revenue. Maybe advertising doesn't work. Maybe it does. I'm not smart enough to know the answer, and I'm guessing that neither you nor Bob Owens nor anyone else fixing airplanes for AA possesses the data required to know the answer (does AA's advertising expenditures work or not?)
Of course, as you and others have mentioned in the past, AA could take the lazy way out and agree to large raises even though there doesn't appear to be any money with which to pay them and then turn around and file for Ch 11 and abrogate the contracts and probably impose even larger concessions. Since your pensions (and most other nonpilots workgroup's pensions) don't exceed the PBGC limits, termination of the pensions wouldn't really hit you all that hard since the PBGC would pay what you have already accrued, just like at the other airlines. The pilots, on the other hand, stand to lose significant amounts and will probably do whatever it takes to prevent termination of the pensions. Delta's pilots gave pre-bankruptcy concessions of more than $1 billion per year and then gave another round of concessions worth another $350 million per year in hopes of preserving their pensions, but it didn't work, and their pensions were terminated anyway. I expect that at least some of the AA pilots paid close attention to that and will do what it takes to prevent the same thing at AA.
