If I could write a letter to MGMT industry wide...

[JDean3204]

Greetings,

I'll start this off by saying I truly have no idea how hard it is to do your job, I'm unfamiliar with the struggles that you have gone through to climb up the ladder of your respective careers. So I'm writing this in the most respectful way possible while trying to inform you of the way your decisions look from the outside in and from those that are working beneath you in this industry.

For years, a certain kind of human being has been in awe of the science and possibilities that aviation brings upon our world. Whether that human knew it from the first time they spotted a plane, or if it grew on them with years of exposure to the beauty of aviation. Most pilots will tell you that they weren't made a pilot, they were born one. Pilots in the military, pilots in the civilian community and even those that wish they could be certified pilots but lack the funds necessary share a love and passion that is very extraordinary. This passion has been taken advantage of for years now, all in the name of making a dollar. As of today, almost 50% of the departures in this nation that are flown are outsourced by companies that pay less, have worse work rules and quite frankly treat their employees much worse as they put their certificates on the line every day in order line your pockets. In the last few years, the profits made by the major carriers are astronomical, so why is there still such outsourcing going on? Why are you okay with a pilot flying a plane that says "Brand A" on the side getting paid significantly less than their counterparts? Why are you okay with "expanding your network" but only with those that do the job much cheaper? Why are you still okay with shifting flying to the bottom bidder and causing thousands of lives to be greatly impacted? I'm willing to bet it is to chase that all mighty dollar. The few carriers that don't practice this unique business are still doing well, if not better due to their ability to hire and retain hard working employees. So the argument that you have deemed valid about outsourcing keeps costs low and you could not survive without it is kind of moot.

Lately, as I'm sure you've noted, the bottom rungs have had to either increase their pay or flounder without hiring or retaining pilots. As a pilot I know the pay raises have not come about out of the goodness of your hearts while making money hand over fist. The pay raises are very minimal in terms of hard pay, instead lined with bonuses that keep pilots on property for a longer period to continue to work for less. I know these bonuses can disappear just as fast as they appeared as well. The pay is still abysmal for the job description and location you require employees to be. This new predicament has surfaced in many avenues of the media. However, the problem has been stated that there is a pilot shortage due to new regulations that impede new pilots careers. This I want to tell you is absolutely false. The 1500 hour rule is not the reason you cannot find pilots to fly your 50 seat airplanes. The issue is the contracts you have kept with these outsourced companies to represent your brand at a discounted rate. The retirement wave hasn't even begun yet but many regionals are tripping over each other to scrounge for new pilots. This situation will not get any better in the long term, as more than 35,000 pilots are set to retire by 2032. If you check the data, you will find that you are already behind in replenishing these ranks and it's only getting worse. So why keep kicking this can down the road? It is time to bring the flying back in house, to actually take care of ALL the employees that fly the planes displaying your wonderful brand you are so proud of. The days of taking advantage of willing participants are almost gone, as the dirty laundry has been aired. Pretty soon, the chase for that all mighty dollar will come to a halt because you did not take the time to realize what you have created. Cities are already losing service, flying is already shifting from outsourced companies that are bleeding heavily to those that are just starting to bleed. If you continue to walk down this path, you and all of your investors will have very trying times ahead. The decisions you've made in the last twenty plus years has led to this, not all of it being your fault. 9/11 and the recession were trying times for everyone in this country, times that did call for significant sacrifices in order to stay in business. But those days are no longer here, the airports are now brimming and air travel has never been in such high demand. It is time to make aviation a great career once again for those that have the passion. Every day you are losing potential candidates to other industries because the risk is less and the reward is greater elsewhere.

It is no secret and even public knowledge how much money some of you make annually, I'm not arguing that you don't deserve it because you do. You have earned that money through many years of hard work, but it has to be known that many in this industry at the outsourced carriers make a fraction of what you would consider a penny. A topped out Captain at a regional makes less than most second or third year FO's at their major counterpart. Does that seem fair? If the argument is "Well they should just move on" then you are missing the point, for some they cant move on because they have built lives for themselves during the many stagnant years this industry has endured. Some are now check pilots and love what they do, and do their jobs very well. Plus, if everyone moved on that would make your situation that much worse filling their seats, right?

I now work for one of those outsourced but wholly owned carriers, the people I work with on a daily basis are excellent ambassadors to aviation. They are professional, hard working, caring and love what they do. Many have been working here since before I was born, with years of exceptional service to this outsourced carrier. They are no less than those that fly the bigger metal displaying the exact same brand flying into most of the same places in order to meet your "streamlined experience". I am willing to bet this is true about all regionals as well. I hope this information is processed in a way that does not seem disrespectful, as I have respect for those that are in charge of making decisions in order to keep the doors open for business. I just know there has to be a better solution that those with your education and experience can formulate in order to keep your brand successful while treating all that fly within somewhat equal.

Best Regards,
A Regional Pilot

 

[Zapphod Beblebrox]

Dear Regional Pilot,

First of all, thank you for your respectful and thoughtful letter. I understand how it must be difficult to understand, from a line pilots perspective, how our current state of affairs in the airline Industry has come to be. The bulk of your letter seems to be critical of the current "fee for departure" segment of the industry or the "regional airline" that carries the trademark and logo of its mainline parent.

A little history might help clear things up. The concept of a "branded regional" airline started, quite possibly before you were born in 1967. "Allegheny began to forge links with small commuter operators creating the first code-shares. The commuters used Allegheny's reservations network and guaranteed a level of service to points within Allegheny's system whilst receiving monthly payments from Allegheny. The first airline to be signed up was Henson Aviation of Hagerstown, Maryland in August 1967. They were followed by Pocono Airlines of Mount Pocono in 1968, Vercoa Air Services (later Britt Airways) of Danville in 1968, Galion Commuter Services (later Fischer Bros) of Galion in 1969, Crown Air of Du Bois, Air East of Johnstown and Ransome Airlines of Philadelphia by 1970. Not only did the commuters operate for Allegheny but they also took up an Allegheny Commuter branding." https://www.yesterdaysairlines.com/...he-us-pt2-allegheny-commuter-to-usair-express

This concept of Code-Share flying was done during the regulated time of the industry when Allegheny was upgrading it's fleet from Props to jets and found that in enabling jet service to larger communities, also had the effect of making service to smaller communities unprofitable. The decision to "farm out" the smaller communities to a branded partner was made and has been successful ever since. Please note: This decision was made over 50 years ago, when I was in grade school. It became an established business model in the industry and, despite your criticism, which as a pilot is understandable, has enabled the industry to employ more people, serve more customers and continue to exist.

I say continue to exist because, as you may well be aware, after deregulation, the United States airline industry has lost over 42 Billion Dollars.
http://www.iata.org/whatwedo/Documents/economics/airline_profitability_us_rest.pdf

As recently as 2012, a United States DOT / FAA report placed the annual losses at nearly 65 billion, which is far more than the industry has ever made in its existence. https://www.oig.dot.gov/sites/default/files/Aviation Industry Performance^9-24-12.pdf.

Every single major carrier and even those created after deregulation, with the exception of Jet Blue and Southwest, have filed for reorganization. Employees often look at a chapter 11 filing as scheme to defraud them of the rightful share of the airlines economic gains. However you must consider what happens to airline investors, the owners of the company; they are wiped out. Many unsecured creditors receive pennies on the dollar of their debts and even secured creditors have problems with financial recovery. When almost an entire industry goes bankrupt, there are structural problems in that industry that must be addressed, if that industry is to continue in any viable form.

Going back to the "fee for departure" model, it was an evolution, organized over 50 years ago that has morphed into the regional airline industry of today. I say evolution because at the time no one would have predicted the scope of today's airline industry. This situation simply is what it is and the current arrangement is necessary to allow carriers to serve smaller communities and do so profitably. It must seem unfair from the position of the regional employee, to wear the same uniform, and essentially do the same job, but to earn significantly less. That is however the reality. Fairness in economics is a non sequitur. As John Karass, a well know negotiator says, "You don't get what you deserve, you get what you negotiate." Positive economics, as opposed to normative economics, deals with the "here and now" of the actual world vs, what people think "ought to be". These two economic concepts are described here. http://marketbusinessnews.com/financial-glossary/positive-economics-definition-meaning/

As a business leader and manager for my company I must make decisions that protect the interest of my shareholders, creditors, and yes employees. I live in the "positive economics" world of here and now. The entire business world does the same, and that is how our success is measured. Make no mistake, my shareholders own this company, and I work for them. I did not invent the current structure of this industry, it evolved into what it is and I must take it as it is and do my best to see that this company is profitable so that the shareholders make an adequate return, the creditors are paid and employee's have meaningful employment. The current employment situation in the industry, which may seem unfair to you, is necessary to ensure the continuation of airline service to communities that would otherwise be unprofitable. Perhaps, at some time in the future, the industry will change and the concept of "wholly owned" and mainline will not exist. Maybe there will only be one company and an single seniority list. For now however, the industry is what is, and that's all there is to it.

As you may also be aware, our company has offered a "flow-thru" arrangement with the pilots of our regional wholly-owned carriers and we have upped the percentage to 50%. In this matter, I cannot speak for the rest of the industry, but here at "Really Big Airlines", we are doing our bit to offer mainline employment to our regional pilots.

By the way, I hear a phone ringing in the background, is that "crew-sked" trying to get a hold of you??


Thanks for your time

Doogie Perker, CEO, "Really Big Airline"

 

[Dexter]

TLDR

 

[AAPalmTree]

FUPM also works

 

[JDean3204]

Dear Regional Pilot,

First of all, thank you for your respectful and thoughtful letter. I understand how it must be difficult to understand, from a line pilots perspective, how our current state of affairs in the airline Industry has come to be. The bulk of your letter seems to be critical of the current "fee for departure" segment of the industry or the "regional airline" that carries the trademark and logo of its mainline parent.

A little history might help clear things up. The concept of a "branded regional" airline started, quite possibly before you were born in 1967. "Allegheny began to forge links with small commuter operators creating the first code-shares. The commuters used Allegheny's reservations network and guaranteed a level of service to points within Allegheny's system whilst receiving monthly payments from Allegheny. The first airline to be signed up was Henson Aviation of Hagerstown, Maryland in August 1967. They were followed by Pocono Airlines of Mount Pocono in 1968, Vercoa Air Services (later Britt Airways) of Danville in 1968, Galion Commuter Services (later Fischer Bros) of Galion in 1969, Crown Air of Du Bois, Air East of Johnstown and Ransome Airlines of Philadelphia by 1970. Not only did the commuters operate for Allegheny but they also took up an Allegheny Commuter branding." https://www.yesterdaysairlines.com/...he-us-pt2-allegheny-commuter-to-usair-express

This concept of Code-Share flying was done during the regulated time of the industry when Allegheny was upgrading it's fleet from Props to jets and found that in enabling jet service to larger communities, also had the effect of making service to smaller communities unprofitable. The decision to "farm out" the smaller communities to a branded partner was made and has been successful ever since. Please note: This decision was made over 50 years ago, when I was in grade school. It became an established business model in the industry and, despite your criticism, which as a pilot is understandable, has enabled the industry to employ more people, serve more customers and continue to exist.

I say continue to exist because, as you may well be aware, after deregulation, the United States airline industry has lost over 42 Billion Dollars.
http://www.iata.org/whatwedo/Documents/economics/airline_profitability_us_rest.pdf

As recently as 2012, a United States DOT / FAA report placed the annual losses at nearly 65 billion, which is far more than the industry has ever made in its existence. https://www.oig.dot.gov/sites/default/files/Aviation Industry Performance^9-24-12.pdf.

Every single major carrier and even those created after deregulation, with the exception of Jet Blue and Southwest, have filed for reorganization. Employees often look at a chapter 11 filing as scheme to defraud them of the rightful share of the airlines economic gains. However you must consider what happens to airline investors, the owners of the company; they are wiped out. Many unsecured creditors receive pennies on the dollar of their debts and even secured creditors have problems with financial recovery. When almost an entire industry goes bankrupt, there are structural problems in that industry that must be addressed, if that industry is to continue in any viable form.

Going back to the "fee for departure" model, it was an evolution, organized over 50 years ago that has morphed into the regional airline industry of today. I say evolution because at the time no one would have predicted the scope of today's airline industry. This situation simply is what it is and the current arrangement is necessary to allow carriers to serve smaller communities and do so profitably. It must seem unfair from the position of the regional employee, to wear the same uniform, and essentially do the same job, but to earn significantly less. That is however the reality. Fairness in economics is a non sequitur. As John Karass, a well know negotiator says, "You don't get what you deserve, you get what you negotiate." Positive economics, as opposed to normative economics, deals with the "here and now" of the actual world vs, what people think "ought to be". These two economic concepts are described here. http://marketbusinessnews.com/financial-glossary/positive-economics-definition-meaning/

As a business leader and manager for my company I must make decisions that protect the interest of my shareholders, creditors, and yes employees. I live in the "positive economics" world of here and now. The entire business world does the same, and that is how our success is measured. Make no mistake, my shareholders own this company, and I work for them. I did not invent the current structure of this industry, it evolved into what it is and I must take it as it is and do my best to see that this company is profitable so that the shareholders make an adequate return, the creditors are paid and employee's have meaningful employment. The current employment situation in the industry, which may seem unfair to you, is necessary to ensure the continuation of airline service to communities that would otherwise be unprofitable. Perhaps, at some time in the future, the industry will change and the concept of "wholly owned" and mainline will not exist. Maybe there will only be one company and an single seniority list. For now however, the industry is what is, and that's all there is to it.

As you may also be aware, our company has offered a "flow-thru" arrangement with the pilots of our regional wholly-owned carriers and we have upped the percentage to 50%. In this matter, I cannot speak for the rest of the industry, but here at "Really Big Airlines", we are doing our bit to offer mainline employment to our regional pilots.

By the way, I hear a phone ringing in the background, is that "crew-sked" trying to get a hold of you??


Thanks for your time

Doogie Perker, CEO, "Really Big Airline"

A nice long winded post to rebut my long winded thread... Good info for defending management I guess but it’s funny you should name Southwest and JetBlue as the airlines that havn’t declared bankruptcy. What regional airlines fly for them again?? Oh yeah... that’s right.

 

[Cessnaflyer]

I think time would've been better made at self-betterment then writing a long post.

 

[JDean3204]

I think time would've been better made at self-betterment then writing a long post.

Thanks for that, but the “self-betterment” happens every day in multiple ways. Didn’t waste much of my time, but I apologize if it wasted some of yours.

 

[Cessnaflyer]

Thanks for that, but the “self-betterment” happens every day in multiple ways. Didn’t waste much of my time, but I apologize if it wasted some of yours.

Some rambling points reading through your letter;

The thing that perturbs me is when employees see all this money a business is making and they feel entitled to it. There is a myriad of reasons why it is being stockpiled and some of it eventually does get to the employees.

And yes a business purpose is to make money.

Did the job description of pilot vastly change over the many decades to warrant raises higher than historical average? I understand many are still trying to catch up to historical average though. I would be interested to see how far we are from it with inflation.

The pilot shortage might be well timed to the retirement of pilots and another economic downturn negating the need to hire a ton of pilots. This coming downturn again is another reason to stockpile money. We have several economic indicators this is coming in the near term.

 

[JDean3204]

Some rambling points reading through your letter;

The thing that perturbs me is when employees see all this money a business is making and they feel entitled to it. There is a myriad of reasons why it is being stockpiled and some of it eventually does get to the employees.

And yes a business purpose is to make money.

Did the job description of pilot vastly change over the many decades to warrant raises higher than historical average? I understand many are still trying to catch up to historical average though. I would be interested to see how far we are from it with inflation.

The pilot shortage might be well timed to the retirement of pilots and another economic downturn negating the need to hire a ton of pilots. This coming downturn again is another reason to stockpile money. We have several economic indicators this is coming in the near term.

All valid points. That’s why I post these things, to spark input and get other people’s perspective. Not trying to whine or complain but shed light on what I think is an issue in the industry. If the bandaid falls of and the fix is just to put another bandaid on well at the end of the day it’s still just a bandaid not a real solution.

I do agree that we are getting close to another economic downturn, which may mitigate the 30,000 plus retirements but not to the point business as usual will be conducted without any adaptation. Again, I’m no business major...yet... it’s in the works lol. Also my degree is all self paced online so I’m sure the quality of my education will be lacking but my wallet is happier with the price tag

 

[flyingbum]

The one thing I'd like to point out is the fact that people have been indoctrinated to believe that economic downturns (collapses) are normal. Well....they're not. They are a result of our failed society. Carry on, and may every airline CEO's wishes come true, may their balance sheets always be black, may cheap labor be plentiful, may your political leaders become irrelevant. Long live the Oligarch!

 

[jtrain609]

The one thing I'd like to point out is the fact that people have been indoctrinated to believe that economic downturns (collapses) are normal. Well....they're not. They are a result of our failed society. Carry on, and may every airline CEO's wishes come true, may their balance sheets always be black, may cheap labor be plentiful, may your political leaders become irrelevant. Long live the Oligarch!

Let me pick your brain about this for a second; has society been failed since 1854? Because we have data going back that far regarding economic cycles, and while economic downturns aren't always as predictable as we'd like, they're certainly common to the point of humans not being able to figure out how to prevent them.

Or is this more a commentary on us living in a fallen world?

 

[jweldon]

Let me pick your brain about this for a second; has society been failed since 1854? Because we have data going back that far regarding economic cycles, and while economic downturns aren't always as predictable as we'd like, they're certainly common to the point of humans not being able to figure out how to prevent them.

Or is this more a commentary on us living in a fallen world?

I think it's more along the lines of "Capitalism is evil..."
That's what I got from "may cheap labor be plentiful"

 

[Autothrust Blue]

I have received two responses to this correspondence.

(One)
Dear regional pilot:

Thank you for writing. We wanted to let you know that we literally can't be arsed right now, and are counting our billions.

Move the (expletive) jet.

Sincerely,

The Mainline Partner Propping Your Employer Up

(Two)
Dear regional pilot:

Come on over, the water's fine for well-qualified applicants.

Sincerely,

ULCC/LCC Management.

 

[flyingbum]

Let me pick your brain about this for a second; has society been failed since 1854

Negative ghostrider, don't overthink it. Just some generalized ramblings from my observations. I wasn't trying to drift the thread.

while economic downturns aren't always as predictable as we'd like, they're certainly common to the point of humans not being able to figure out how to prevent them.

There is a reason for this, I'd rather chew on a used sock before wasting time debating it on the interwebs though.
Good day Sir, May you profit well from your endeavors.

I think it's more along the lines of "Capitalism is evil..."
That's what I got from "may cheap labor be plentiful"

Is it? I was taught otherwise. Weren't you? Know whata mean Verne?

 

[Autothrust Blue]

 

[Dphoenix]

The one most important concept management at my regional needs to understand.

 

[ASpilot2be]

Glad I am not the only one that thought of the band MGMT.

 

[MikeD]

but it’s funny you should name Southwest and JetBlue as the airlines that havn’t declared bankruptcy. What regional airlines fly for them again?? Oh yeah... that’s right.

AirTran flew for SWA.....





:stir:

 

[SlumTodd_Millionaire]

AirTran flew for SWA.....





:stir:

I will cut you.

 

[Cherokee_Cruiser]

We have guys writing letters to our management (CEO and COO). They don't care and I doubt it makes any difference.

It's a seniority job and they know that. If you're at a regional they expect you'll move on. If you're at a Major/LCC, they want to get you to work as cheaply as possible and know that those in their 20s and 30s will probably try to leave, those 40+ are probably golden handcuffed with age and seniority. If you're at a legacy, they expect you'll ride out your career with them.

As much as I hate to say it, regional pilots have it good today. Try 10 years ago. Today you have 5-digit sign on bonuses, first year pay hitting 40-50k (or more), and AA regionals have a guaranteed flow program that is working very well today. Others have a partnership for a guaranteed interview and/or guaranteed number (slots) of pilots from their regional counterparts. Today you can pretty much upgrade right at FAR mins and company mins. It's crazy how much quick movement the regionals have today.