eaglefly

A LOT of incorrect assumption here.

The "sale" of Eagle was most likely a spinoff to the shareholders in lieu of a REALLY GOOD DEAL from an outside purchaser. There WERE several VERY interested parties, but the deal breaker in all cases was the the control requirements (and "back out" clauses) AMR wanted as part of any deal which not only scared off the purchasers, but revealed how much AMR wants SOME feeder control, if not outright then in pseudo fashion basically giving them the same benefits.

Control of Eagle gives AMR many financial benefits which have proved useful. Eagle revenue, "profits" and costs can be adjusted depending on whether AMR needs to show a profit, adjust to show nuetral for tax purposes or even a loss. AMR charges Eagle for much of their resources and ground ops and that's just the tip of the iceberg. If Eagle was a straight loss scenario, it would have been dumped a long time ago and the losses written off at strategic times.

It's easy to come to erronous conclusions about Eagle because their existance has always been clouded in murky financial waters..........which is EXACTLY what those in control want.

eaglefly

The environment you claim will produce the sale of Eagle has come and gone several times. That money may indeed "flow downhill" in the future as the conflict with mainline labor (not just the APA) intensifies, but there are dynamics invloved that make the scope of Eagle future existance a lot more difficult to predict in just your few assumpive paragraphs.

ToiletDuck

Money in the bank isn't all that matters. I'll try and find it but around the time oil was hitting $140 there was an in-depth analysis of the airlines. They actually put AMR at the bottom. Reason being wasn't just the cash. It was the debt and price of the fleet replacement. AMR is needing to phase out the MD's which is a gigantic undertaking. For instance CAL might not quite as much cash on hand but the much newer/efficient fleet more than makes up for it. It's like paying off your credit card and having $1k in your checking or having $2k in checking with a $2k credit card bill.

ToiletDuck

I agree 100% with this. What I'm saying is that the value in eagle lies within AMRs ability to move money around. AMR needs to do that now. When AMR is able to start pulling profit expect Eagle to go back on sale. Eagle is not and cannot be as cost effective as other regionals at this current point in time. There's no reason for AMR to keep them once they are no longer needed for the whipsaw either on the pilots or the investors.

ToiletDuck

Point remains. AMR did put eagle for sale. If eagle were the best option they would not be trying to put them on the market.

Mason32

Ok, you really have to explain that. Since operating costs for an EMB-145 are going to be the same at XYZ contractor as they are at AE then where are the differences?

Before you go trying to tackle that, be forwarned that a study was completed around the time they were supposedly selling Eagle that showed it was NOT more expensive than other regionals due to cost savings in other areas. It is almost always cheaper, on this level, to do it yourself then to hire an outside firm to do it. Otherwise you have to pay enough of a fee to cover their facilities, equipment, payroll, taxes, and still have money left in sufficient quantities to make their CEO's happy.

In Eagles case, they are using AMR facilities and equipment. The costs are very similar, the two big differences being... Administration costs, and who keep the profit. There are lessor financial advantages to this, but for the purpose of this forum, and this discussion, the two major ones are adequate.

Even if we assume that the only difference is who keeps the profits, and ignore administration costs and all lessor cost savings... the fact is that when places like TSA CHQ MESA or whomever use flight safety.... flight safety is making a profit on them... that is money that the mainline carrier is paying to the regional, who is then turning it over to an outside service provider. At AMR, that money never leaves home. On paper they can bill Eagle twice as much as FS charges other carriers, and it would still be cheaper when the final dime stops spinning.

Get it yet?


in simplest terms
two vacant shacks in the middle of the field

both have one room
both have one light bulb
both have a desk and chair
both have 1 cleaner that comes by daily

so,
each shack costs the same
each light bulb cost the same to buy and run
each desk costs the same to buy and use
each cleaner is paid the same

where's the difference?

The difference is,
you are paying some landlord
AMR is paying itself

Mason32

Point remains??? Everything AMR owns is for sale. What you are pointing out, is like saying the sky is blue. Holding a press release and saying, hey xyz is for sale, is only credible when asking something that most would consider reasonable.

example

Offering a regular one dollar bill for sale on ebay for the price of $15.00, a 30 day money back guarantee with a five dollar return processing fee would have most people laughing their *** off... but you seem to think the AMR really wanted to sell Eagle.

I take back what I said in the earlier posting. Apparently you have NOT been watching AMR as long as I thought you had.

Jake Wheeler

You should consider why they are putting Eagle up for sale. Do they need to the cash to avoid bankruptcy? Is it for leverage to avoid scope issues?

As a former business owner, I cannot see how selling a wholly owned asset in preference for paying a middle man for the same services is good business. If Eagle was unprofitable, then as the owners, AMR is in a better position to cut costs rather than selling it and buying back the services.

Nevets

Yes, that is me, didn't know it was a secret seeing that my screen name there are my initials. I don't feel that there is any danger of the IBT right now. This is not something that would happen overnight. This is something that is going to take a long time just as it did in Canada. The Canadians were hesitant about it at first also. And they implemented it very slowly to show that it works. Now we can see that it actually does work. This is the same way it will happen here. The Fee for Departure Work Group is methodically working on it as we speak. I hope they are successful and will help in any way I can including getting people informed of the idea and showing that its not just a theory, that it actually works and is working right now up north.

As for non-union carriers, I thought I had addressed that already. We have those kinds of protections in many of our contracts now. XJT just recently had that portion of its contract tested to the fullest extent when Skywest tried to buy us. They were requried to negotiate with us because our contract would require them to integrate all three opeations and pilot groups. So there are already provisions in contracts that keep management from using who ever they want. We have it and major airline pilots like CAL have it in the form of aircraft size.

Just so that we are clear, there are two distinct things this thread has been talking about. The first was a national seniority list. The second, and the one that the Fee for Departure Work Group in working on is just seniority migration within the regional carriers.

I agree and that is what the Fee for Departure Work Group is doing. They are trying to get contract standards and seniority migration language into contracts so that these things are long lasting regardless of managments. I'm just saying that in general, your airline is one management away from having to deal with people that are hostile to their pilots.

Bond

You're getting around the question, what keeps anyone from opening a non-union shop, and what keeps a major from giving them the flying????

Seriously, there is no contract that binds Continental from taking flying from us giving it to anyone when our cpa comes due, or if they go into bankruptcy. And that's the other thing, I perfectly understand how our contract prevented SKW from coming in a raping the company, but what if XJT would have gone into chapter 11 prior to a the sell dump the protections, exited chapter 11 a year later and executed the sale without limitations, what keeps that from happening? And please, "ALPA is working on it" is not an answer, before anyone can buy into this all the issues have to be addressed and all those protections have to be in place. But you know that in chapter 11 any company can do anything, and you also know that there's no contractual obligation for any Major carrier to keep flying at any carrier, look at what's going on with the DCI carriers.

If ALPA can make it bullet proof then I"m in, 'til then, there's nothing to talk about, I'm not willing to make any sacrifices on a gamble. No thanks. Now answered the questions.