AA flyers may be in for some rough times in 2008
Feb 13th, 2008, 02:37 PM
#1
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AA flyers may be in for some rough times in 2008
AA labor contracts are coming up for renewals. Lots of hurt feelings.
The first signs of a possible rough summer are already here.
About 150 pilots retired en masse just recently in order to get their full pension before the new negotiations start.
AA was forced to cancel about 50 international flight in February and will cancel about another 50 in March.
Most if not all the pilots were wide body certified (767 and 777) thus not easily replaceable. It will take some time.
This is just the beginning. It could be a rough ride for AA flyers for the next few months if not for the entire year and possibly into next year.
The first signs of a possible rough summer are already here.
About 150 pilots retired en masse just recently in order to get their full pension before the new negotiations start.
AA was forced to cancel about 50 international flight in February and will cancel about another 50 in March.
Most if not all the pilots were wide body certified (767 and 777) thus not easily replaceable. It will take some time.
This is just the beginning. It could be a rough ride for AA flyers for the next few months if not for the entire year and possibly into next year.
Feb 14th, 2008, 05:37 AM
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We always use AAFF miles for our Caribbean trip in December-- never any problem. For the very first time for '08, I'm finding it impossible to book the award. No problem going out on 12/10-- but absolutely nothing open for awards for return. AA was the one airline where we've actually been able to use our accrued miles in the past. Frustrating....
Feb 14th, 2008, 06:38 AM
#5
Note that (a) pilots can un-do their retirement notices; (b) it leaves room for more junior right-seaters to move left; (c) AA has something like 2000 pilots on the recall list; and (d) these cancellations represent something like 2% of widebody ops and 0.2% of fleet ops.
It's troubling to be sure, but compared to, say, the fallout of a DL/NW merger, it's peanuts.
It's troubling to be sure, but compared to, say, the fallout of a DL/NW merger, it's peanuts.
Feb 14th, 2008, 11:07 AM
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AFAIK, no rhyme or reason, but most of the international flights effected are to destinations where AA has many other flights available and perhaps it's low season as well. London, Tokyo, etc. South America is very profitable for AA, high fares but more importantly, commercial cargo, so most likely these flights will be the last to be cancelled, but it can happen on any given day depending on the positioning of the cockpit crews.
Feb 14th, 2008, 11:14 AM
#9
It's important to note that passengers won't lose their tickets, but might get re-scheduled. If precise scheduling is critical to you (e.g. connecting to a cruise or some such) then I would definitely think about deviation or trip cancellation insurance.
The reason for the cancellations is fairly complicated, but apparently a large number of senior pilots at AA had the option of basing their retirement cash-outs ("golden parachutes" - not a popular term in the airline biz) on previous AA stock share prices, rather than the current one. AA's stock value has fallen dramatically in the past few months (whose hasn't?) but the pilots' retirement package plan allowed them to use this "look back" provision. If they waited to retire until later in the current year, they'd lose thousands of dollars because the "look-back" only is good for so many months, and if they used more recent stock prices, they'd get hammered.
So they accelerated their retirement announcements to lock in the former stock price.
Because the more senior (hence closer to retirement age) pilots tend to be those that are certified to fly the larger wide-body planes (they make more money doing so) then the retirement surge hits the widebody schedules disproportionately to the narrow-body ones. AA has way, way more narrow-body planes in their fleet, hence the bulk of the cancellations are falling on those long-haul flights.
Hope that's clear enough - rather complicated, as are all such labor/pension issues.
The reason for the cancellations is fairly complicated, but apparently a large number of senior pilots at AA had the option of basing their retirement cash-outs ("golden parachutes" - not a popular term in the airline biz) on previous AA stock share prices, rather than the current one. AA's stock value has fallen dramatically in the past few months (whose hasn't?) but the pilots' retirement package plan allowed them to use this "look back" provision. If they waited to retire until later in the current year, they'd lose thousands of dollars because the "look-back" only is good for so many months, and if they used more recent stock prices, they'd get hammered.
So they accelerated their retirement announcements to lock in the former stock price.
Because the more senior (hence closer to retirement age) pilots tend to be those that are certified to fly the larger wide-body planes (they make more money doing so) then the retirement surge hits the widebody schedules disproportionately to the narrow-body ones. AA has way, way more narrow-body planes in their fleet, hence the bulk of the cancellations are falling on those long-haul flights.
Hope that's clear enough - rather complicated, as are all such labor/pension issues.
Feb 14th, 2008, 02:12 PM
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Our flight is December 11, MIA to St Thomas. No problem getting FF seats going over. No return date has opened after December 15. (We're hoping for 20 or 21.) Never had this problem before. (was always able to book 330 days out)
Good luck to everyone.
Good luck to everyone.
