Union and Atlas Air Meet in Washington, Progress Made but Much Work Remains
Union and management negotiators for Atlas Air Worldwide met in Washington, DC this week. For the first time in a long time, meaningful progress was made, including a tentative agreement on Section 25-Schedule. Additionally, management presented its first Section 3-Compensation counter-proposal to the Union, who responded with a second counter-proposal on Thursday. A significant number of contract Sections remain open, including Insurance Benefits, Retirement, Sick Days and Scope.
If the parties do not reach an agreement on all open issues, the dispute will be submitted to interest arbitration. Considerable work remains to be done if interest arbitration is to be avoided. The first round of arbitration is scheduled to begin in October, with additional dates in November and December.
Negotiations are scheduled to resume August 31 through September 2. No additional bargaining dates have been scheduled. However, the Union told management it is willing to schedule more bargaining dates prior to the arbitration hearing.
Airline Division Applauds Change in Minimum Pilot Standards
The move by Congress last week mandating changes in the minimum number of hours required for pilots to occupy the cockpits of commercial airliners has been hailed as an important step in improving airline safety.
The bill, which requires a pilot to have logged a minimum of 1,500 flight hours before operating as a crewmember of a commercial airliner is an increase from the FAA minimum of 250 flight hours required to hold a basic Commercial pilot’s license, which allows a pilot to carry passengers or freight for compensation. The bill also requires specific pilot training and experience for adverse weather conditions, including icing and high-altitude operations. Additionally, the FAA is required to ensure that the pilots are trained on stall recovery and upset recovery, and that airlines provide remedial training to pilots who need it.
“This is a tremendous victory for the travelling public and our industry,” said Teamsters Airline Division Director David Bourne. “We are tremendously grateful to Senator Schumer who recognized and championed the need for higher standards and did not yield on them. We’re also proud to have led the fight with the Coalition of Airline Pilot Association (CAPA) and their member airline pilot groups as well as our Airline Division carriers and other unions who joined with us, insisting that this higher standard be implemented,” he went on to say.
“Most importantly, we want to thank the families of the Colgan 3407 tragedy for their determination to take their personal tragedy and work for change. I was honored when they came to me and asked for our support. It was a privilege to have met and worked with them. They are the true heroes of this legislation,” Bourne said.
In addressing the new rules, Senate Commerce Chairman Jay Rockefeller (D-W.Va.) called the new requirements "a big step forward in improving the safety of our skies." Remembering the Buffalo crash that killed all on board and one on the ground, Rockefeller said in a statement, "The families of the victims of Flight 3407 have my full support in demanding one level of safety among all air carriers — large and small."
Week In Review News Items
Legislative & Regulatory
Financial troubles forced Mexicana de Aviacion, the first airline established in Mexico and among the oldest in the world, to suddenly cancel on Monday several regular flights to destinations in the United States, including Los Angeles, San Jose and Sacramento…American Airlines and Delta Air Lines said they will remove their codes from AeroMexico and Mexicana flights respectively following the U.S. FAA's downgrading late Friday of Mexico's safety rating from a Category 1 to Category 2. FAA said that Mexico is "not in compliance with international safety standards set by the International Civil Aviation Organization," noting that it reached the conclusion "following an assessment of the country’s civil aviation authority."
Airline Industry Finances & Structure
Regional carriers for merger partners United and Continental Airlines are combining in an all-cash deal valued at $133 million…two large July jet orders and a rosier manufacturer’s forecast this month suggest that carriers are feeling better about the economy and might be ready to start revamping their fleets again. But executives from several carriers made it clear in their second-quarter earnings calls with analysts this month that there is no rush to get new planes just yet…crude oil futures on Tuesday were trading at more than $82 per barrel, hitting the highest level since May and nearing what one airfare analyst called the "danger territory" for airfare surcharges and price hikes."
WestJet Airlines posted a big jump in quarterly profit on Thursday, but said uncertainty in the Canadian economy meant it would focus on boosting capacity to destinations outside of the country. Canada's second-biggest airline said it earned CAD$21 million (USD$20.8 million) in the second quarter, up from CAD$9.2 million in the same period last year…and Air Canada on Thursday reported a second-quarter loss, hurt by higher operating expenses, and said it expects third-quarter cost per available seat mile (CASM), excluding fuel expense, to decline. Canada's largest airline plans to increase its third-quarter system available seat miles capacity by 7 percent to 8 percent. It expects CASM, excluding fuel expense, to drop from 2009 levels by 4.5 percent to 5.5 percent. For the second quarter, net loss was CAD$203 million (USD$199.6 million), compared with net income of CAD$155 million a year ago.
Miscellaneous
Feds store body scans from security checkpoints. Feds store more than 35,000 body scans from visitors of a federal courthouse. The government agency body scans raise privacy concerns over the Feds ability to store images…Spirit Airlines says it is gaining ground in the fight against flight delays with its controversial move to charge for carry-on bags. With the new fees in place for the first time Sunday, Spirit spokeswoman Misty Pinson said the new approach appears to be working…a YouTube video showing two niqab-wearing Muslim women being allowed to board a flight at Montreal airport without being subjected to any security checks has outraged Canadians. The incident violates international standards which require airport check-in staff to see the faces of passengers who board their flights…and Delta is moving ahead with its long-planned facilities upgrade at New York's Kennedy Airport. The upgrade is a maneuver in the continuing battle for supremacy in the world's biggest aviation market.