Airline Division News Items
Aloha Air Cargo Group Votes Teamsters In
On April 17, 2009 Aloha Air Cargo Fleet Service Workers voted to join the Teamsters. Jimmie and Justin Muraki were instrumental in organizing this group. The fleet service workers voted to join the Teamsters by more than a 2-1 margin.
Continental Section 6 Negotiations
Ongoing Section 6 negotiations will have the next session on April 28-29 in Las Vegas. The negotiations are moving along smoothly.
Opening of United Mechanics Section 6 Negotiations Moved
The date for the opening session of the Section 6 negotiations between United Airlines and the Teamsters mechanics and related is now scheduled for April 28 in Chicago. This will be the first Teamsters contract for this group, which has been operating under an existing contract.
Teamster Work on Capitol Hill Will Resume After “Spring Break”
The Teamsters will resume their active work on the Hill after Congress returns from break next week. The Airline Division is actively pursuing new outsourcing legislation to bring rules on foreign maintenance outsourcing oversight up to the same level as domestic outsourcing rules. As part of this effort, the Teamsters are seeking a moratorium on new outsourcing until foreign repair stations are in compliance with the new rules.
Southwest Stock Clerks
Stock clerks at Southwest are in Section 6 bargaining this week. Robert Rasch of Local 19 is in charge of the Teamsters negotiating side.
Emergency Trusteeship Imposed on Local 747
Effective April 15, 2009, Teamsters General President Hoffa imposed an emergency trusteeship over Local 747. Members of Local 747 should go to the local’s web site for further information.
Week in Review News Items
Labor Developments
This year's stock payout to American Airlines’ executives may be the smallest this decade, but size didn't matter to several hundred Transport Workers Union members protesting Tuesday outside the airline's headquarters. John Conley, director of TWU's air transport division, said the issue isn't that the payout likely will be relatively minor, but the fact that the executives and other key employees are getting anything at all. At United Airlines the carrier is finding out that bankruptcy cost-reductions don't last forever. The airline emerged from bankruptcy three years ago and is now opening labor talks with its unions, whose contracts become amendable at the end of the year. Unions say the time has come to be compensated for sacrifices they made in bankruptcy.
Airline Financial Results
AMR Corp., parent of American Airlines Inc., said Wednesday that it lost $375 million in the first quarter as the recession dampened demand and reduced the company's revenue by 15 percent. But the question on many analysts' minds during a conference call was whether American and the industry have hit bottom. The answer from top executives Gerard Arpey and Tom Horton: We don't know yet. Standard & Poor's placed Southwest on CreditWatch with negative implications after the carrier reported a first-quarter loss. The placement "is based on the company's weaker-than-expected revenue and earnings outlook," S&P said, in a report late Thursday. Southwest said it lost $91 million, or 12 cents per share, including $71 million due to the falling value of its fuel hedges.
The Good News
In 2008, a bad first quarter was only the opening act of a really rotten year. In 2009, airlines hope that a bad first quarter will be the last act of a truly horrible stretch. With American Airlines kicking off the earnings season Wednesday, U.S.passenger airlines this month are expected to report losses of around $2 billion excluding special items and one-time charges for the three months that ended March 31. However, the consensus of analysts is that the industry will earn at least $1 billion in the second quarter and more than $2 billion for the full year, even with the poor first quarter. Airline passenger traffic has slowed, forcing Boeing to cut production, but the world's second-largest airline is looking past all that. American on Monday rolled out two new Boeing 737-800s, its first new planes in three years and its first new narrow bodies in nearly eight years, at ceremonies in Chicago and Tulsa, Okla.American is scheduled to take 29 aircraft this year, followed by 39 in 2010 and eight in 2011.
Focus on US Airways
In 2005, US Airways was going to be a low-cost carrier. In 2007, it was going to be a global behemoth. Yet, in 2009, it is neither. USAirways is the nation's sixth-biggest airline, not the biggest. It flies a conventional network of routes and has high operating costs contrary to the low-cost-carrier operating model. Instead of remaking itself, the airline today is concentrating on surviving one of the sharpest drop-offs in air travel in history, overcoming concerns about cash liquidity, competition and an unsettled labor dispute, and eking out a profit by the end of this year.
Criticism of Business Trips Inflicts Collateral Damage
Businesses, already struggling to survive the perils of an economic downturn, are starting to push back against a growing public perception that business travel is wasteful and unethical. "The stimulus is aimed at creating jobs, yet many jobs are being eliminated because meetings are being canceled by the hundreds," said Kevin Mitchell, chairman of the Business Travel Coalition, an advocacy group based in Radnor, Pa. "This toxic environment created around meetings has caused hotels, airlines and restaurants to lay people off. That is the perverse irony of the situation."