The problem is not our Branded flying, or our Charter flying. In fact, Branded and Charter have been doing very well. We are pulling some routes on the East coast for Branded that have been unprofitable, and bulking up some of the West coast flying. Also, the Delta flying has been going very well for us. We did not offer our services for less to get the Delta contract. 11 of the 21 aircraft in that deal are operated under a "pro-rate" agreement, which means that we share the burden in marketing and ticket sales.
As for the staffing issues, the problem is that the Crew Planning Department has to make educated guesses each month on how many block hours we'll receive from Delta and Continental, as well as a wild guess on how many pilots we'll lose to attrition. In 2007, we were losing a ton of pilots to the majors, since all the majors were hiring. Now, the majors have slowed or stopped hiring altogether due to the Age 65 rule and the current economy. That means very little attrition. In addition to the attrition problems, Continental keeps reducing our block hours. Not because they are transferring to Chautauqua, but simply because Continental is trying to reduce costs due to fuel prices just like we are. Less block hours means the need for less pilots.
This problem was foreseen while our last batch of new-hire FOs was still in training. Rather than let all those pilots go (they would not be furloughed, since they had not technically become employees), the company finished their training and brought them online. So we are "properly staffed" for Captains, but not so for First Officers. At this juncture, rather than dump 50-100 FOs with a furlough, the company is offering COLAs instead.
So yes, I am drinking the Kool-Aid here... When I had questions about this stuff, I simply asked the right people. I even e-mailed the CEO asking about our future plans, and he responded. That to me shows I work for a good company, so I'll back their decisions. They could have fired all those FOs in training, but they did not want to do that. Now, they could force them to go find new jobs, lose pass privledges, lose medical benefits, and so forth, but instead they'll offer a COLA until we can "right size" the company for the flying that is expected over the next few months. By the end of the summer/early fall, I'd even expect to see a new-hire class or two.
A weakening economy, the Age 65 rule, high fuel prices... We are all in for a very long year. Anyone who thinks they are immune better step back into reality. What happens when we enter turbulence? We put on the shoulder harnesses, tighten our belts, settle in and hang on. That's what we're all going to have to do here for the next few years.
I'll be damned if I'll take a pay cut so we can get another major airline contract. I'm just happy we extended our current contract until 2010... The last thing we'd want is to negotiate in this environment.
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