Nevets

Who said anything about not playing nice. Both sides can be professional with each other understanding the reason why each have disagreements. Its not personal, its business.

But the whole reason that we think SKW is even capable of this is exactly why we should do everything we can to get one list.

As for my personal situation, I rather go down fighting then to be a part of this while just rolling over. But I don't need this career for me to be happy or successful.

ERJFO

I never said you have not been around. I did say that you have not talked to ASA ALPA because they fully support a single list concept.

When you sat across the table from SkyWest management and called their "bluff" were you trying to uphold clear, legal, and court-enforceable language in a contract? That is what XJT ALPA will be doing.

Also, it sounds like you don't want this to happen for some reason. Is that true? If so, why?

Finally, have you read Section 1 and Letter 1 in the current XJT CBA? If you have, how/why do you think SkyWest management will get around the clear language contained in those parts? Why do you think SkyWest management asked for these parts to be stricken from the CBA during the last proposed XJT buyout? This would be more helpful than making the general blanket statement: "You will fail."

Thanks.

Slaphappy

It's pretty clear to me and many pilots that skywest found a way around the scope. It will be years before any of that gets resloved but tony is right. JA doesn't do anything without a plan and i'm sure skywest had its legal team plan out any issues that would come up. They have had months to figure it all out and I doubt that alpa and their community college lawyers will be able to one up the months of work and planning by the skywest legal team. I echo tonys warning of "you will fail" if you try and fight a losing battle. ASA learned that the hard way, and once they started playing nice and started acting like adults they grew and become better than anyone could have dreamed. I can tell you ASA pilots are very happy with how everything turned out.

BassFishr

I agree that he does everything with a plan. But WOW you make some bold statements about XJETs CBA and ASA pilots, your "opinion" is wrong.

ERJFO

I would like you to answer the same questions that I've asked Captain Tony in the above posts (#244 & #232).

No one is disagreeing that SkyWest management has discussed the XJT CBA and associated letters. However, to assume that SkyWest would have a fail safe way of circumventing a clear and legally binding agreement would be foolish.

Having a disagreement with SkyWest, Inc. doesn't mean that XJT ALPA will go to "war" with the company. It also doesn't mean that anyone is acting childish.

I'd also like to encourage you to make your posts less insulting ("community college lawyers", etc.).

Nevets

There is nothing to lose by trying to uphold our contract from those who are obviously trying to get around the clear intent of it. It doesn't mean people are not playing nice. JA made his move, now its XJT ALPA's move. Its business, not personal and I'm sure both sides will be professional about it. Lets just hope that JA & Co. themselves decides to play nice instead of blatantly treating his new employees without dignity and with disrespect.

Kramerica

Maybe, assuming worst case scenario, JA is buying some time before all three would be required to merge...

Golden Bear

Aviation, Defense and Space News, Jobs, Conferences by AVIATION WEEK

SkyWest Sees Fleet Synergies With Merger

Aug 6, 2010

By Madhu Unnikrishnan, Jennifer Michels

SkyWest Inc. expects its proposed acquisition of ExpressJet Holdings will close by the fourth quarter, and the company is basing plans on an aggressive 12-18 month timetable for earning a single operating certificate (SOC) merging its wholly owned subsidiary Atlantic Southeast Airlines and ExpressJet.

SkyWest is offering $6.75 per share for ExpressJet. The $133 million acquisition, already approved by both carriers' boards, was expected to be filed yesterday and is pending shareholder and regulatory review. Continental and United, ExpressJet’s mainline partners, have already approved the plans, SkyWest CFO Bradford Rich told analysts Aug. 4. The merged entity will operate from an Atlanta headquarters, but will have significant operations at Houston.

Integrating the two fleets is not an issue, Rich noted. ExpressJet’s Embraer fleet and Atlantic Southeast’s Bombardier fleet will combine to make SkyWest both Bombardier’s and Embraer’s largest customer. This will give the company leverage with the OEMs, he said. “There is value in having the largest pool of regional aircraft in the world,” Rich said.

SkyWest has the capital to re-fleet ExpressJet “over the next several years,” Rich said. “We’re well positioned to re-fleet, grow the fleet and move into new aircraft types as warranted.”

SkyWest has reached a 10-year deal with Continental, ExpressJet’s biggest regional partner, to operate 206 aircraft. Continental is either the head-lessee or the owner of these aircraft, and the deal allows Continental to drop aircraft as their leases expire. But SkyWest has retained replacement rights for those aircraft, Rich said. It is uncertain what would happen to the 32 aircraft ExpressJet operates for United should a United/Continental merger be consummated.

ASA operates from its hubs in Atlanta, Cincinnati, Detroit, Memphis and Washington Dulles, and has 3,703 active employees. The bulk of its fleet, about 112 aircraft, are the 50-seat CRJ200.

ExpressJet said it anticipates the combined airline will maintain a “significant operational presence” in each of the hubs it serves, including Continental’s Houston, Newark and Cleveland hubs, as well as Chicago O’Hare and Washington Dulles for United. It operates 22 aircraft as United Express, and another 16 in its charter division. The carrier operates the ERJ-145 and ERJ-145XR.

The ExpressJet deal could generate between 45 and 50 cents in additional earnings per share or between $35 million and $40 million of annual cash flow, Rich said.

Both airlines said a majority of front-line employees will not be affected. Neither carrier has commented yet on executive positions.

The International Association of Machinists and Aerospace Workers issued a statement yesterday saying “it is not a surprise that the merger mania roiling the major airlines is spreading to regional carriers. The lack of any appreciable regulation in the airline industry ensures that carriers large and small will continue to tear each other down and exacerbate their failure to serve passengers, employees and communities.” The IAM represents ExpressJet flight attendants. The union said it is meeting next week with advisers to discuss “the proposed merger and the strategy to protect” the workers.

The company probably will not pursue further merger opportunities for ASA, but is leaving the door open for acquisitions by SkyWest, Rich said.

To that end, SkyWest already invested $7 million in a 30% stake of startup Vietnamese carrier Air Mekong. SkyWest has personnel on site to provide technical expertise and is sub-leasing four aircraft to the new carrier, said Rich.

SkyWest yesterday reported second-quarter operating revenues of $649.8 million, down from $698.8 million for the same quarter in 2009. The company reported net income of $18.7 million, down from $26.2 million. It incurred $16.4 million in engine maintenance costs in the quarter that were not passed through. “This was a little higher than we wanted,” Rich said. Fuel expenses declined from $129 million to $85 million. “It is one of the strongest balance sheets in the industry,” he said.

According to Oliver Wyman data prepared for The DAILY, ExpressJet had one of the lowest unit costs in the first quarter among regional carriers at 7.27 cents, while ASA was at 9.88 cents, both below the 11.80-cent average. ExpressJet also saw its traffic pick up greatly throughout 2009, starting out with a 32% drop in traffic in the first quarter and ending the fourth quarter with a 13.8% increase to 3.4 million revenue passenger miles. ASA ended the fourth quarter with 3.2 million RPMs.

Captain Tony

I have! And you were not bought by SkyWest, Inc, the holding company, you were bought by Atlantic Southeast Airlines! If they had made ASA the holding company and proposed to operate you as a subsidiary of it, that would have been a violation, but the way they did this complies with the letter of your scope. And fighting this battle to tie it to Inc just because that's where *its rumored* ASA got the money to buy you is a legal stretch. How are you gong to prove where the money came from? ASA is a very profitable company, and if SKW INC kept separate accounts, it wouldn't have taken long for ASA to bank the $130 million. Notice SKW INC has always been very careful to never break down the individual profits of ASA and SkyWest divisions. We have no idea what ASA's actual financial situation is, but I'm betting ASA bought XJT free and clear. SKW would have to have been stupid not to do it that way, and they're not stupid.

SKW asked for these sections to be dropped before, because they preferred to operate you as a third competing subsidiary. Now that they realized that's not possible, they took the second best option. The fact that they backed off last time, but not this time, is proof that they've done their homework. As slaphappy said, ALPA's quack lawyers will be no match for 2 years worth of research by Ford & Harrison's finest (as usual). All you're going to do is drag this out, and exhaust resources we could be using for the contract negotiations.

And have you considered the law of unintended consequences? What happens if you do prevail and force a merger, then ALPA gets voted off the property? The SkyWest pilots voted overwhelmingly (or didn't vote, the same as a no vote) against ALPA last time. Add that to the hundreds of ALPA haters at ASA, and those I'm sure you have, and you never know what might happen. Maybe it's best to just let sleeping dogs lie, and work together to hammer out a great contract with the limited resources we have?

surreal1221

Non-votes no longer count as No Votes Tony. This time they actually have to pick up the phone and vote No, or remain as passive as they have been in the past. But I'm sure you knew that.