Ual Mec Responds

[WorldTraveler]

Financiers have said they would provide the financing UAL needs to get out of bankruptcy IF the pensions are dumped. Problem is you and others seem to think that UAL will be allowed to dump their pensions on the PBGC and continue as an operating business. The PBGC's actions validate the point I have made - UAL will not be able to dump its pensions on the government and the American taxpayer and then continue as an operating business. Yes, the PBGC should take over those responsibilities if UAL is unable to reorganize but the PBGC never intended to take over pensions when companies decide they can no longer afford them. The fact that DL at least has said they have no intention of dumping their pensions on the PBGC should indicate that terminating pension plans is not necessary for the legacy airlines to turn themselves around. The bankruptcy laws are of no more concern to me than they have ever been; however, I and many others no longer want the government to interfere in the airline industry by either propping it up or by preventing consolidation that has been one of the most effective mechanisms to remove weaker competitors. Like it or not, in the free enterprise the weaker competitors are swallowed up or eliminated by stronger competitors.

I do not advocate consolidation in the industry because a bunch of talking heads say that is what is needed. I advocate it because the airline industry is fiercely competitive and has a history of haivng weaker carriers to fall out; although the industry has experienced the greatest financial difficulties in its history, NOT ONE MAJOR LEGACY CARRIER HAS FAILED since the current downturn began in late 2000 (well before 9/11) except TW which was already well on its way to being eliminated from the industry. I do not rejoice in anyone's failure but I am tired as an American taxpayer and customer of having an airline industry that is in shambles because market forces have not been allowed to work - largely because of government intervention. There are people who recognize that the tax burden on the industry is wrong but Washington sees any aid to the industry as only prolonging the shakeout which everyone believes needs to happen.

It is not contradictory to say that market forces should be allowed to work without government intervention at the same time that capacity is eliminated from the industry. The reason why flights are as full as they are is because airlines are willing to accept just about any passenger that will put as little as a quarter in the fare box as they board the bus. Yes, there are too many legacy carriers and the hubs they operate. As LCCs have picked off and reduced the fares in the top origin and destination markets, there simply is not a need for as many carriers operating hub and spoke services to the other 80-90% of the markets that do not support nonstop service and never will. There are at best the need for 3 nationwide hub and spoke carriers that operate no more than 10 hubs between them. Many of the current hubs should become focus cities but will not as long as each of the current six legacy airlines have to maintain service to the entire country (or at least the parts of the country that each of those carriers has provided service).

Yes, UAL could have a very low cost structure if it is able to emerge from bankruptcy. In order to get out, though, UAL needs to get rid of some major obligations that the government and creditors are not willing to let an ongoing business rid themselves of; in other words, there is a practical limit to how many obligations a company can shed in bankruptcy and expect to emerge as an operating entity.

You and I may disagree at this point about what's next for UAL but I will stand by my position that the airline industry is about to enter a phase where the legacy carriers that are able to do so will actively begin managing their destinies, including acquiring other carriers it that is what is necessary to ensure the survival of the solvent airlines. I believe that UA and US will not be in a position to control their destiny by virtue of their position in bankruptcy while CO is and will be too stretched financially to control their destiny. Restructuring in the industry will be led and controlled by AA, DL, and NW. Now who else has told you that?

 

[aafsc]

I believe that a UA ramper makes about the same as an AA ramper in terms of an hourly rate after the first round of concessions (about $19.65 an hour- topped out full time). But I do believe that the people at UA still have all their holidays and holiday pay and all their vacation (AA people don't). At AA the cut in the hourly rate of pay was 16% and the cuts in vacation, holidays, and holiday pay among other items was about 14%. Also, AA people have to pay more for medical benefits. So that is a reduction in total compensation of 32%. Now at UA, in addition to the 16% reduction in hourly pay after the first round, in the second round they want another paycut, holidays, holiday pay, vacation time and pay more for medical. But wait, also in this second round they want the pensions, retiree medical, more outsourcing, and unlimited part time. In summary, if UA obtains this, they could be working for about $16 an hour at 20 hrs per week which is equivalent to 40 hrs a week at $8 an hour and of course expensive medical, no pensions , etc. And like US Air, they could easily come back for a third round. According to someone at US, the third round will drop his topped out hourly rate to $12 an hour, hardly a liveable wage in LAX, SFO, ORD etc.

 

[WorldTraveler]

and driver,
I am not bitter about UAL or anything in the industry. I am incredibly that UAL lost its position as the world's largest airline and is now in bankruptcy despite having access to the world's best routes and having probably the world's best fleet and some of the world's best people. There was a key misstep made in the 2002 decision to let the cash levels drop while trying to negotiate new pay rates and that single decision and the fallout from it have undone all the good things that UAL did in the 70+ years before.

UAL's routes are so valuable and its hubs are so well positioned that there is little doubt that most of the routes flown by UA will continue to flown by someone else. It's hubs like CVG, MEM, CLT, and CLE that may lose hub status and revert to focus cities for some airline. Although AA is probably concocting a way right now to acquire UAL's Pacific routes, I don't believe they will be successful solely because the Pacific routes and DEN are about the only things that AA could acquire without causing DOJ concerns, and there will be concerns about AA's acquisition even of the Pacific given that they duplicate most of UA's NRT-US routes.

NW will be the carrier to watch in the next couple months. If they decide to go after US' assets, they will push themselves away from DL and may set themselves in a position to become on par networkwise with the top 3 airlines - a move that AA and DL will not allow to go unanswered. Ultimately, I expect AA will prevail in bidding for US assets while will force NW and CO to consummate their long-term relationship leaving DL to acquire UA's assets. If US fails while AA and NW beef up their east coast presence, UA may find DL to be a pretty attractive partner. But then, DL and UA tried to develop a partnership 10 years ago that couldn't get off the ground.

 

[csrgal]

CSR gal, please attach a dollar figure to what the Summer of 2000 cost us vs. Sept 11, the proliferation of low cost carriers, the failed acquisition of US Air, the stock buy back, and the dividend pay out. Also, please attach a dollar value to the public threats of CHAOS the AFA has been making in the media since November. Please feel free to quote public company financials and SEC statements as you make your argument. Maybe you and the other brainless wonder can find your way to the UAL investor relations page to research your mornoic hypothesis instead of parroting "what's popular" and enlighten us all on this topic. I'll be anxiously awaiting, but I won't hold my breath.

You crack me up ---- the summer of hell was not a small bump. I talk to customers everyday --- they still remember. They bring it up if we lose their bags, need to charge them a fee, etc. I know we had very loyal customers walk to other airlines because they needed to continue on with their business. Maybe someone from Mileage Plus or Customer Relations could provide a figure. I know I gave thousands of dollars and tickets to other airlines away everyday because people needed to get weddings, funerals, etc. As you and your fellow pilots walked away from airplanes because something didn't feel right, the American flag was faded, or their was no bible on board, we gave away the house. Now as brainless as you claim I am, I do realize this is not the only reason for our current situation. The fact that you pilots will not admit that you participated in your own version of CHAOS, is hysterical, because every other employee on the property from the top to the brainless level knows the truth. By the way, I would bet thousands you were one of the biggest jerks. The mechanics were able to get rid of FISH maybe the pilots that use their brains, could get you an interview at F9. I'm sure FISH would give you -- a fellow ass - a reference.

 

[North by Northwest]

World :"I am incredibly that UAL lost its position as the world's largest airline and is now in bankruptcy despite having access to the world's best routes and having probably the world's best fleet and some of the world's best people" Where you referring to Pan Am (world's largest international airline w/unparalled route system, owner of Inter-Continental Hotels, some of the most valuable real estate in NYC? Sadly, history has repeated itself. On another note...lets simplify the PBGA vs. Ual/ Pilots.......Ual/pilots takes "King", PBGA=Checkmate. The pension/ bankruptcy issue is new reading for Ual. The PBGA wrote the book.

 

[WorldTraveler]

Pan Am had the corner on international service in its day but it had little presence in the domestic market. UA is unquestionably more significant in its day than Pan Am was in its day by virtue of having extensive domestic and international service.

Yes, history does repeat itself and I am mindful that at one time proud carriers like Eastern and TWA dominated the industry but are now no more. It doesn't take too long to realize that the history of nations and civiliations as well as American businesses is filled with rise and fall.

N by NW,
How do you think NW's position as a leader in the industry will play out?

 

[North by Northwest]

"UA is unquestionably more significant in its day than Pan Am was in its day" Hardly...Pan Am virtually created aviation around the world where there was none. There has been only ONE airline in aviation history to be the FIRST to establish Hubs around the globe, PAA . Ual simply has volume, and as we all know...there is too much of that in the skies these days. Ual has never dominated the globe as did PAA. As far as how NWA might play out. I do know that an additional widebody purchase is on the slow track pending the possible glut of aircraft that may hit the market over the next six months. Additionally, NWA intends to maintain max. cash reserves in order to take advantage of potentional market opportunities that may arise over the next year. Northwest has a very steady, deliberate stratigic plan in place. Potential asset sales will go to the carrier that is in the position to leverage exsisting cash on hand...NWA will definately be one of them.

 

[Walmartgreeter]

I do not rejoice in anyone's failure but I am tired as an American taxpayer and customer of having an airline industry that is in shambles because market forces have not been allowed to work - largely because of government intervention. There are people who recognize that the tax burden on the industry is wrong but Washington sees any aid to the industry as only prolonging the shakeout which everyone believes needs to happen.

This is a good thread (and I am sad to say my own airline is on the losing end of the stick.) You are right, and in a couple of sentences managed to sum it up.....the goverment HAS NOT allowed market forces to work, and now the taxpayers simply want the board leveled for a new game. I will still, till the bitter end, defend the so called handouts given after 911. They have been improperly labeled as free moneys, when in fact MOST of the moneys are only securing loans. U lost its full DCA ops for a long time...and reallly to this day was not compensated. Somehow, the truth of needing a free market in the airlines has been mixed with what happened on 911. Its like saying the shopkeeper in India DESERVED to lose his business in the Tsunami because it was badly run. His government will help him no matter what his books said. And I do understand your point about the moneys delaying the shake out. I may have strayed a little here. Oh well, at least this will be an interesting year! Best to you Traveler. Greeter.

 

[WorldTraveler]

I agree, Greeter, that 9/11 created the need for certain compensation as a result of the government's inability to provide security to the airline industry (such as the government being aware months before 9/11 that US airliners were a target of terrorists but yet apparently failed to tell the airlines. And yes, US was harmed more than other airlines and yet did not receive any special consideration. On the other hand, AA and UA both lost jets and undoubtedly lost some extra customers because of their names and the fear that they might be prime targets for future terrorist activities.

My beef is not w/ the post 9/11 government assistance but with the government's manipulation of the entire industry including blocking mergers and acquisitions and more recently choosing who should fly into slot controlled airports. I'm not sure what other reasons the government might come up with to not let market forces work in the airline industry but I think everyone recognizes it needs to happen. In UA's case, US' failure w/ its first bankruptcy and the reality of the pension crisis in the industry have apparently caused Washington to finally decide to let market forces work (or at least that the problems in the industry are so big that even Washington doesn't want to mess with them). I do have to wonder if your lives and the lives of others at US would be any easier today if US could have been allowed to engage in some of the actions they previously desired such as a merger with United or American. Hard to say but it's also hard to imagine things being much worse for you than it is now.

Thank you also for recognizing that I am not antagonist at specific people in the industry, including you, ualdriver, and/or Fly even though I speak rather harshly against some of the actions of your companies and even specific labor groups. I don't really know any of you and am certainly in no position to wish any of you as individuals ill will despite the actions or positions of your companies or labor groups.

It would be interesting to know what we're talking about a year from now.

 

[Walmartgreeter]

Thank you also for recognizing that I am not antagonist at specific people in the industry, including you, ualdriver, and/or Fly even though I speak rather harshly against some of the actions of your companies and even specific labor groups. I don't really know any of you and am certainly in no position to wish any of you as individuals ill will despite the actions or positions of your companies or labor groups.

It would be interesting to know what we're talking about a year from now.

[post="234630"][/post]​

I wish everyone could post as you do without wishing anyone any ill will. Best. greeter. You are a pleasure to read.

 

[alexander66]

You have a Master's Degree and you post all that crap, including all those older posts we've discussed in the past? Incredible.

Well, I guess you'll have to explain to me how the AFA is fighting to have their "entire contract" elimated, as I only have a bachelor's degree and after having read their first give back and now the second that is on the table, I don't see how they're losing their "entire contract." I see maybe a couple of 10% paycuts and lots of work rules, but then again, I've seen 54% and lots of work rules too. Does that mean my entire contract is gone too?

We weren't "by far" the highest paid pilots in the industry. We were just above the "Delta dot" if you remember correctly. We were the largest airline in the world surfing on billions of dollars of profits. Every employee group on the property should have been the "highest paid" in the industry. We had the unity and the balls to negotiate the deal we deserved. ALPA doesn't negotiate for the other employee groups. If they weren't happy with their deals, they could have taken it up with their respective unions instead of complaining about it on a forum.

Where did you come up with 750M? Doubtful, but would love to see where you get that number from. Please don't tell me you read it in a newspaper, either. I'll gag.

"Yes, you do have a very technical skill and education. But the pilots at AirTran and Jetblue do the same thing you do and are and always have been paid way less....... And that many good employees (not the slackers) are leaving the airlines. Just look at USAir."

Again, more non-sense stuff from a person who is supposedly highly educated. The pilots at MANY other carriers do the same job I do and are paid way less. Or used to be paid way less anyway, now they make more. There's probably people that will do your job for less than what you make as well. What's the point? That I'll probably make more money long term if I start over at another carrier? Well that's a pretty good darn point! And he11, you can find people who would be airline pilots for free! I think someone should start an airline with that premise!

"You pilots are saying how ramp and maintenance can be replaced by oursourcing to the cheapest bidder?"

Who is "you pilots?" Why in his right mind would ANY pilot want his aircraft maintained by some schlep in Mexico who was the "lowest bidder" when we already have great mechanics here? Who exactly are you talking about?
"As I said earlier, non-pilot airline employees have nothing to lose when the airlines decimate their wage scales."

This is my favorite statement. If you're talking about rampers and flight attendants, you're probably right. I guess I should have forgone the college education, flight training, and years of experience buidling so that I too, would have nothing to lose when I lost the job that requires no formal education or vocational training. What was I thinking? Those guys/gals have it made as they'll never have anything to lose as their wages are decimated. Hey AFA and IAM members! AAFSC says you have nothing to lose! Funny.

[post="234363"][/post]​

 

[alexander66]

"Good post. In the summer of 2000, the pilots had UAL, the other employees, and the passengers by the throat....... "

Again, two hypocritical posts. How can a member of the AFA, who is threatening, let me use your buddy's words, "to hold the company and customers hostage" if any contract in the AFA coven is abrogated, complain about the Summer of 2000? Please explain this to me, because I really can't see past the irony. The must exaggerated Summer of 2000 was a speed bump in UAL history's, a successful CHAOS campaign in mid January will likely be the end of UAL as we know it. Hmmm......Any hypocrisy here? Nah.
"Now UAL and the other employees have them by the throat because if UA fails then they will have a difficult time finding another job making what they are making. It will be very interesting to see how low the pilots will go to save UAL and their positions. But the other employees have nothing to lose because they can more easily find a job paying what UA wants to cut them down to."

I'm a person with a very technical skill and education. So are my peers. Unless the world stops flying airplanes, I will always make a very comfortable salary and will have enough in the bank account to survive the industry's ups and downs and a layoff/liquidation here or there, including this one. If my peers were smart with their finances, so would they. Any pleasure you would get from seeing a pilot on the street would be very short lived for most. However, I would imagine starting flight attendant pay at JetBlue or AirTran isn't what you're earning now either? So instead of talking tough on the forum, I expect you to VOLUNTEER for the first CHAOS activity at your airline. I'm ready! Are you? Burn the house down!

CSR gal, please attach a dollar figure to what the Summer of 2000 cost us vs. Sept 11, the proliferation of low cost carriers, the failed acquisition of US Air, the stock buy back, and the dividend pay out. Also, please attach a dollar value to the public threats of CHAOS the AFA has been making in the media since November. Please feel free to quote public company financials and SEC statements as you make your argument. Maybe you and the other brainless wonder can find your way to the UAL investor relations page to research your mornoic hypothesis instead of parroting "what's popular" and enlighten us all on this topic. I'll be anxiously awaiting, but I won't hold my breath.

[post="234348"][/post]​

 

[ualdriver]

Financiers have said they would provide the financing UAL needs to get out of bankruptcy IF the pensions are dumped. Problem is you and others seem to think that UAL will be allowed to dump their pensions on the PBGC and continue as an operating business. The PBGC's actions validate the point I have made - UAL will not be able to dump its pensions on the government and the American taxpayer and then continue as an operating business. Yes, the PBGC should take over those responsibilities if UAL is unable to reorganize but the PBGC never intended to take over pensions when companies decide they can no longer afford them.

Actually, you have no idea whether financiers have said they would provide the financing UAL needs to get out of bankruptcy IF the pensions are dumped. And I bet there's a lot more "if's" in there beside pension cancellations! Very few people at UAL KNOW what the financiers want, including you and I. It's possible (but unlikely) some back room deal could get cut and some groups' get pensions and some don't AND we exit bankruptcy. We'll see. If you're not happy about UAL continuing on as an ongoing entity if some, if not all the pensions are dumped, then contact your congressman. UAL didn't make the laws, they're just following them.

UAL is not dumping its pensions on the government because UAL decided they can't afford them. UAL wants to terminate its pension obligations because under current FEDERAL LAW, they are underfunded to the tune of billions of dollars. UAL tried to save the pensions through an ATSB loan. No dice. One quick bill through Congress (like they did in Canada) could fix every airline's pension problem and save the country billions in potential liability. I won't hold my breath.


You crack me up ---- the summer of hell was not a small bump. I talk to customers everyday --- they still remember........ By the way, I would bet thousands you were one of the biggest jerks. The mechanics were able to get rid of FISH maybe the pilots that use their brains, could get you an interview at F9. I'm sure FISH would give you -- a fellow ass - a reference.

They still remember yet we still have record load factors. Like I said, a small bump in the road. Nope, not one of the biggest jerks. I enjoy coming to work and working with my fellow employees. I won't even have a beef with any particular union (unlike you) if one of them decide to shut the house down over the lack of a TA, because I understand that unions (although I may not agree with the reasons) sometimes have to take a stand. Apparently you do not understand that. And the only time I ever "take the gloves off" is when certain pilot-hating posters, like you, write posts such as this:

"After nearly 5 years, I can finally speak to a pilot without wanting to prepare a ball of spit for their face."

You're an embarassment for posting something like that. And it's an assault if you did it. It's funny that you're upset about something that happened years ago, WAS a small speedbump, was due to difficulties in contract negotiations- but let me take a guess.......I bet it will be OK if your union undertakes a job action next week if you don't come to a tenative agreement with the company, right? It will be OK to inconvience the customer if the IAM decides to take job action, right? If it's not OK, please let us all know. Make sure you stand up in the break room and tell all your peers as well, because I'm sure they'd be interested in knowing your position. So you post that garbage, that you want to spit in a pilot's face, before I said anything to you, and I'm the jerk? Hmmm......There goes that double standard again.

 

[csrgal]

You're an embarassment for posting something like that. And it's an assault if you did it. It's funny that you're upset about something that happened years ago, WAS a small speedbump, was due to difficulties in contract negotiations- but let me take a guess.......I bet it will be OK if your union undertakes a job action next week if you don't come to a tenative agreement with the company, right? It will be OK to inconvience the customer if the IAM decides to take job action, right? If it's not OK, please let us all know. Make sure you stand up in the break room and tell all your peers as well, because I'm sure they'd be interested in knowing your position. So you post that garbage, that you want to spit in a pilot's face, before I said anything to you, and I'm the jerk? Hmmm......There goes that double standard again.

I don't even know what to say. You seem to be in denial. I have never spit in anyones face -- it is said to make a point. I absolutely do not believe any job action by any union is ever justified. It screws the passengers and they do not forget. I am one of the few on this board that think unions should go away. I also would not have a problem telling my peers the way I feel. Most of my peers feel the way I do. You don't deal with the passengers everyday like I do. I would never argue with you on the difference between a 757 and a 737 so please try not to guess what goes on at the ticket counter on a daily basis. We hear from the customer -- how much do you get on the "buh-bye" Insult me all you like driver I have read your posts and responses to your posts -- As far as the double standard goes - "hello pot this is (what did you call me? oh yes) 'brainless' kettle.

 

[ualdriver]

You'll notice that no personal attack was made toward you, csrgal, until after your post#5 on this thread. I have disagreements with MANY people on this thread/forum, yet, as I wrote, the gloves don't come off until some punches are thrown my way. Consider your post#5 the "first punch." I have little respect for ANY employee on the property, pilot, csr, mechanic, or otherwise who is so bitter and angry that they need to post something like that. Get over it.

You don't believe in job actions if it screws over the passenger? That's very altruistic of you. I guess you'll just take whatever the company is about to hand your group next week with a big smile on your face and a "Thank you very much may I have another?" Unions, unfortuately, are a necessary evil in this business and I wouldn't blame any union for having to put their foot down sometimes, whether the customer gets caught in the middle or not. Its unfortunate, as was the Summer of 2000 (or what may start to happen as early as next week), but that's the way it is in the airline biz. It's up to the customer to decide whether they want to fly us again with all our warts and imperfections. So far, they're still coming.