402Fanatic

I have enjoyed a couple of the last responses. Because I am a firm believer that management isn't always out to screw over the front line people. But with the way the industry is going, pax are expecting fares that are below cost and you have airlines like VX or Skybus who further that stereotype just long enough to make people think they should always get those fares.

If there was less pressure to charge cheapo tickets, there'd be less pressure for management to cut costs to barebone levels. Any manager will tell you that it is not worth getting a huge wage concession if that means lost productivity and extremely unhappy workers. Sure, there will always be a line drawn as to what management thinks they should pay and what a workgroup thinks they should get paid. But if the pressure for making a tiny profit was gone, negotiations wouldn't be so heated and everyone could truly meet in the middle.

I have never been a fan of reverse predatory pricing as I call it. Anyone who says there is no such thing, and a new entrant can charge whatever they want is missing the point that it is rather ridiculous to "plan" for 3-5 years of losses.

Eric Stratton

When has it ever taken management 2-5 years of negotiating to get pay cuts if they want them? Pay increases take years and pay cuts take months.

jonnyjetprop

Industry wide, are more (and deeper) cuts made by negotiating them or going bankrupt and having a judge impose them?

XHooker

Tom, I've only been in the industry for about a dozen years, but in that time I've never seen a concessionary contract at a legacy that was drawn out by the RLA. American and CAL voted for concessions, Alaska had them assigned in binding arbitration, and USAir, UAL, DAL, and NWA had their contracts assigned in Chapter 11. Conversely, the pilots at CAL and American, looking for gains, are past their amendable dates as we speak. I believe that pattern holds mostly true historically. Concessions happen quickly without regard for amendable dates, while gains typically take well past amendable dates.

XHooker

The low barriers to entry are a huge industry problem. It'll never cease to amaze me the amount of money people are willing to bet on a longshot in an industry that has lost money since its inception.

tomgoodman

Actually, it's a combination of the two: First, file BK or make a very credible threat to do so, then negotiate deep cuts from an understandably frightened union. The judge rarely has to impose anything. This is not the fault of the RLA, however, but of management's ability to leave the RLA process for the bankruptcy court, a completely different section of the law. Labor has no such weapon, at least not in the U.S.

XHooker

Maybe this is what Kellner wants.

Blockoutblockin

What he wants is to not have to negotiate. I imagine negotiations are not going as well as they would like right now. They're thinking we should be willing to take a paycut. I'm thinking they can go completely out of business before I take another paycut. Enough is enough!

Daytripper

A lot to say from a CEO who can't keep his own house in order. The blown fuel hedge alone has added millions to his cost side.

757Driver

Bingo !!!

Funny how it always seem to work in favor of management.