Aviation Industry Updates: July 25, 2023

American, Delta, United Labor Will Want New Deals

KEY POINTS:

• What started as a necessry contract revision that was years overdue for commercial pilots reflected a shortage in pilot supply. But now that the wallet of the airlines has been opened, it’s no longer about an airline pilot shortage but a reckoning other labor groups may feel they are due.
• This site covered the mechanics labor struggles specifically with American Airlines for years, but baggage handlers, counter staff, reservation agents, and even middle level executives may make their voice heard. North American airlines have little position to turn down these groups as they have shown that they will negotiate nearly any deal to continue to operate air travel. Consequences be damned.
• These me-too deals will have to stop at some point. Should Delta be worried that they need to revise their agreement up too? Flight attendants for American may get their deal, but then United, Delta, and Southwest Airlines will face the same challenges. With such huge increases based initially on demand for pilots, how can carriers in the United States continue to sign these deals and remain in business to pay them?
• Further, yes there is record profit for carriers, but there’s also record demand. When demand drops and these other labor groups add in their deals as well, is it not obvious that carriers will struggle not only to remain profitable but to remain solvent if a pullback is substantial enough?
• What then happens to these deals if the carriers can’t pay for them? Do they not become insolvent and get broken up in bankruptcy court? All of the gains received disappear under reorganization so does it not make more sense to achieve a deal that doesn’t place as much pressure on airlines to perform when this has been a challenge during slow periods in the past?
• Labor groups watching the pilot negotiations have started to speak up about their own contracts. It will only be a matter of time before each labor group is angling for their own “historic” deal but at some point the gravy train has to end. It may be at the negotiation table, or it may be when the travel industry demand slows and airlines are left holding the bag. Some of these increases might be overdue, but airlines largely took heavy losses during COVID, so it seems fair that now that demand has returned, they should recover some profits. Only time will tell what happens in these many labor groups, the only question is whether that will be years… or another seven weeks.

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United CEO Confirms Problem Finding Pilots To Upgrade

KEY POINTS:

• Scott Kirby has acknowledged that the carrier's pilots are shunning promotion to the captain's chair, hurting its flight capacity in the fourth quarter, confirming what Reuters reported earlier this week.
• Multiple pilots at United told Reuters that senior first officers have been avoiding promotion to captain as they do not want the unpredictable schedule that comes with the bigger paycheck, creating headaches for the Chicago-based company.
• "It's the first time that I've ever known it to happen in the airline industry," Kirby said in response to a question on the company's earnings call on Thursday. "It is going to impact capacity in the fourth quarter."
• A first officer helps navigate and operate flights, but a captain is the pilot in command of the plane and is responsible for its safety. Airlines cannot fly their planes without a captain in the cockpit.

Reuters

We Just Got A Pilot With A Gear Up Landing Hired At A Major

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Frontier And Allegiant Sharply Cut Back Midweek Flying

KEY POINTS:

• Two of the three primary U.S. ultralow-cost carriers have sharply reduced their Tuesday and Wednesday flights, responding to the changing habits of U.S. flyers. 
• Frontier Airlines, which in May said it planned to draw down service on Tuesday and Wednesday by approximately 20% during the second half of the year, said it made the move because hybrid work opportunities have altered leisure demand patterns.
• "While overall leisure travel is increasing, the benefit is disproportionately landing on peak days and in peak travel periods," Daniel Shurz, the carrier's senior vice president of commercial, said about the reduction. 
• Allegiant has quietly made even more drastic cuts to its Tuesday and Wednesday flying. The Las Vegas-based discount carrier has historically flexed its schedule up and down according to the time of year and day of week far more aggressively than other U.S. carriers. Even so, its move away from the midweek is noteworthy. 
• In the first week of June 2019, Allegiant flew 7.2% of its operations on Tuesday and 13.6% of its operations on Wednesday, according to an analysis of Milanamos airline industry data by the consulting firm Hospitio. That same week this year, Allegiant flew just 1.9% of its weekly schedule on Tuesday. On Wednesday of that week, Allegiant flew 7.8% of its schedule.

Travel Weekly

UPS Dispatchers And Pilots Would Honor Teamster Picket Lines In ‘Greatest Single Employer Strike Ever’

KEY POINTS:

• If there is to be Teamsters Union strike at United Parcel Service, the company’s flight dispatchers and pilots will honor the picket lines, helping to enable “the greatest single employer strike in the history of this country,” said Transport Workers Union President John Samuelsen.
• UPS Airlines operates a fleet of about 280 aircraft, staffed by 3,300 pilots and 111 dispatchers, primarily out of its Louisville hub. TWU represents the dispatchers while the Independent Pilots Association represents the pilots.
• “This is an exciting moment, one that can reinvigorate the U.S. trade movement,” Samuelsen said Tuesday. “If there is going to be a strike against UPS, the entire labor movement has to be in it, and we are going to relish our role in it. “
• IPA spokesman Brian Gaudet said, “The 3,300 UPS pilots represented by the Independent Pilots Association will honor the Teamster picket lines if the IBT strikes the company. We did the same for them for 16-days during their strike of UPS in 1997.”
• With the strike deadline of August 1 still nearly two weeks away, a UPS spokeswoman said Tuesday that the Teamsters should return to the table to negotiate.

Forbes

We Just Got A Pilot With 1900 Hours Hired At A Legacy

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2023 HIRING EVENTS

OBAP | AUG 9-11 | MSY *onsite interviews & CJOs*

LPA | SEP 14-16 | ISM

RTAG | OCT 7-8 | FTW