itsjustajob

It's about $100 an hour shy of where Atlas will be, Flynn and Bezos be damned!

Whale Driver

Why do you think this would be a problem? I would love it if they got $400 an hour and a 100 hr. guarantee.

Winston

How much are any of us "supposed" to get paid?

On a related note: PLEASE don't volunteer for the Negotiating Commitee for whatever airline you work for.

Screwed

Its called PATTERN BARGAINING.

"Pattern bargaining is a process in labour relations, where a trade union gains a new and superior entitlement from one employer and then uses that agreement as a precedent to demand the same entitlement or a superior one from other employers."

itsjustajob

K4 isn't comparable in terms of scope and scale of corporate earnings. Love or hate Atlas Management, but the fact is Atlas is ripe to become a player against the likes of FedEx in the not too distant future.

The case is simple, Aligning with Amazon/DHL while retaining full ownership of the fleet and route authorities insures that Atlas cannot be leveraged as was the case with previous "ACMI" carriers. In other words, if DHL walks, Atlas takes the fleet and routes with them, same goes for Amazon.

To be clear, Atlas isn't just "ACMI":

- Scheduled Passenger
- Scheduled "EXPRESS" freight (on routes OWNED by Atlas & Polar)
- ACMI
- CMI
- Express Freight (Asia and Domestic US, expanding further international in the near future).

Anything less than $380 an hour with FedEx/UPS/Delta quality work rules would be a sell out to Atlas management (still a great deal for the crews).

That number as time goes on continues to go higher, check back in a few weeks, its probably going higher yet. Time is not managements friend in the current labor environment.

Atlas remains one of the most if not THE most profitable when accounting for the annual Net earnings for Atlas on a per Pilot basis (regardless of fleet type):
- 6 times higher than FedEx
- 8 times higher than Delta

If IBT 1224 settles on Parity based solely on financial data vs other carriers in the Cargo/Passenger segments, Management can still claim a huge bargain on labor.

$260-$280 hr will be FO pay when the dust settles...Anything less than $380 an hour for a 12 year "Wide Body" captain, is a "NO" Vote.

itsjustajob

Not trolling, the data is computed quarterly and compared to the other carriers.

The Financial health of Atlas not only supports those types of compensation values, but the historical performance virtually guarantees it.

Its great to see K4 get a raise, but the two companies aren't even comparable.

wjcandee

I don't follow this at all. At least on the Amazon side, the flying-the-aircraft contract is reported to be terminable by Amazon at any time without penalty on 180 days' notice. The dry leases of the aircraft to Amazon by Titan (a different subsidiary) are for a fixed period of time. I do not understand how you believe the arrangement "insures" anything about who will fly the aircraft.

It does mean that Titan makes its scheduled profit on the aircraft for the lease period regardless of who (if anyone) is flying them, so AAWW makes that profit, but I don't see how this helps the pilots of the aircraft-flying subsidiary.

itsjustajob

First, stop thinking like a pilot... Lets put our business hats on and take note that every one of those aircraft are owned outright by Atlas Air, Inc.

Atlas Air, Inc. under the umbrella of the corporation shifted control of those assets to Titan Leasing. This accomplished several things from a corporate standpoint, essentially mitigating profit margins for Atlas Air, Inc and bolstering the balance sheet of Titan but effectively creating a "Hybridized ACMI arrangement".

Titan, then leased for a specific term (10 Years) to Amazon, Notice that Amazon did not purchase anything, and is subject to the term of those leases. Realizing that Amazon could in that 10 year period buy an entire new fleet of Boeings or Airbus's (Yes Airbus is being tossed around internally at Atlas as a possible additional airframe - Suggesting an A330F for longer range routes).

Anyway...

Amazon now has control of the airframes for a specified term, and "CMI'd those frames to Atlas (the actual owner of the airframes). This accomplishes several things:
- Allows control of the airframe in the event of labor issues at Atlas
- Allows Titan and AAWW holdings to retain the financial benefits regardless of any future labor or performance issues at Atlas Air, Inc. for a specified term, only.
- What's in it for Atlas Air, Inc.? Ultimately, the agreement pays for the airframes Atlas acquired, effectively adding a new fleet to the balance sheet of Atlas Air, Inc. while engaging in a long term operating arrangement as a hybridized ACMI agreement.

There is no doubt the 180 day window is an issue, however those termination clauses do in fact exist under all the other higher margin ACMI agreements which are specifically 6 month (180 day termination clauses).

The fact of the matter is that AAWW is fully insulated on the terms of the agreement since regardless of the future arrangement with Atlas Air, Inc. the Holdings company is guaranteed that those airframes will be 100% paid for by Amazon, and an eventual return of those assets to Atlas Air, Inc. after the 10 year term is up.

With all that said, lets look at another side to the carrier.

Atlas Purchased outright (cash) (6) Brand new 747-8F's from Boeing. They increased the fleet further thru 50% cash deposits and financed the remaining 50% of the airframes under a 13 year 1.25% term using the first 6 as collateral.

Atlas then entered into a 15 year agreement with DHL whose term effectively pays for those additional 747-8F airframes but also allows for hourly operating costs far below that of any 747-400F in terms of block hour rates due to the actual remaining balances owed on the fleet as a whole.

However, Under the terms of the DHL agreement DHL agreed to a $3 Billion termination clause in effect insuring that the entire fleet of Atlas Air, Inc. is paid for under any potential termination which is provided for in the 15 year agreement.

Even under DHL, Atlas just like Amazon is shifting airframes to Titan only to turn around and operate those same airframes they own under a CMI arrangement for DHL.

It simply amounts to control for the customer, but regardless of the agreement, it insures Atlas Air, Inc. again has a fleet of airframes that are wholly owned and clear of any debt.

Although there is a risk of early termination, we need to look at the current ramp up situation. From the moment the contract was set in motion, it will require approximately 4 years to ramp up from zero airframes to having a fully operational fleet.

That time can be less however given the current market, if for any reason Amazon shifts those assets to another carrier under the terms of the 180 Day provision its a virtual impossibility. Keeping in mind the current labor market, to staff those airframes in anything under a 1-2 year window of time accounting for hiring, training and initial operating experience is again an impossibility even if adding to an existing 767 operator.

The point in all this, Atlas Air (AAWW) has negotiated a pretty good deal with a Hybrid-ACMI customer that benefits all those entities under the AAWW umbrella.

The financial strength is bolstered not only by the low to no debt asset model, but also the fact the short term high margin ACMI operations are matched with long-term debt mitigating terms relative to duration of those contracts.

So what can Atlas Air, Inc. really afford to pay its Pilots (and a management for that matter)?

If you compare the operations of AAWW to DAL or FDX, those other carriers unlike AAWW have to carry the full acquisition burden of their airframes and depreciate those assets over longer terms. The actual cost and risk is born solely by them where AAWW is able to shift that risk to a 3rd party (Not to mention fuel and all other operating cost factors under the CMI terms). This allows for significantly lower operating risk to the Holdings company, but also allows AAWW to acquire additional fleet capacity at far better terms than other carrier can due to the low to no debt model they employ.

The actual net margins are significantly improved over any other carrier since all operating costs are born by a 3rd party rather than the parent or the operator (in this case Atlas Air, Inc.).

A key advantage Atlas has over the likes of K4, is simply that they have access to lower cost financing, the ability to effectively pay cash for all asset acquisitions, and have a scope and scale of operation that permits lower net costs (Crew costs) spread out over other ACMI and CMI contracts.

In summation, AAWW has a cleaner and leaner balance sheet than any other carrier (FDX, DAL, UAL, UPS), This allows far better operating margins per block hour when all factors of the operation are taken into account.

Now back to what AAWW/ Atlas Air, Inc. can afford to operate those airframes!

itsjustajob

The NMB is involved to determine whether or not there exists or there has ever been a process or precedent establishing the cessation of Section 6 with anything other than the ratification by Union membership after the conclusion of the negotiation process.

Given that both Pilot groups having already accomplished thru their specific "Opener" requirements have in fact entered into Section 6. These processes by both Union and Company have and were acknowledged prior to the acquisition announcement by management.

Its the position of the Union and supported by past case history that Section 6 for Both parties must be allowed to continue to its final outcome before entering into a JCBA process.

The current position of the company by virtue of statements by the COO, is that the current situation is solely to delay or as he stated "To Get duration" out of the existing CBA. With that in mind, the current delay is a tactic by management to delay Section 6 for both carriers. Oddly, this is counter to what the company thru its middle management has put out.

Its debatable as to the specific purpose, but with the recent approval of $66.6M in compensation to the board, it appears that a possible change of ownership may be the ultimate reason for the intentional delay by the company in the process.

Despite all that, never mind the specific contracts having language allowing for Mergers, the process of Section 6 having already commenced must first be taken to its ultimate conclusion before proceeding with the merger provisions of the CBA.

The NMB will have to decide the merits of those facts.

HercDriver130

I think you said it pretty well... AND you may have precedent on your side....

What you have working against you is an NMB that probably wont entertain anything but negotiations for at least 2-3 years (even with a mediator). So Atlas takes 2-3 years to get a contract. Southern takes the same. WHO knows what the economic model and the state of the industry will be then. I believe Atlas will get a contract absolutely with rates in excess of K4s.... how long that takes is the million dollar question...and remember boys the NMB and its mediator will drive that agenda to a large extent.

Delay is their game... and they will play it as long as they can... in our case delay while painful probably worked to our benefit... I hope you are as lucky. Economic factors down the road will play a large part in how long this takes for you guys. Good Luck.