Aviation Industry Updates: November 8, 2022

Game Over For Regionals?

• The regionals need pilots with experience to operate but such pilots are suddenly in huge demand by major airlines.

• Almost all of us at the majors who are from a civilian background spent time at the regionals, building the experience necessary to move upward. The regionals were notoriously low-paid, and for a time in the late 80s through mid-1990s, many airlines actually required pilots to pay for their own training. The attitude was generally “you need us more than we need you, and we know you’ll do anything for that dream job.”

• As soon as the post-COVID hiring boom took off, the regionals’ attrition numbers skyrocketed to an unsustainable level. It’s not just that they’re losing captains to the likes of Delta and United; they are also losing first officers (FO) to Spirit and JetBlue and Atlas, sometimes after as little as a year of employment.

• This is doubly threatening to the regionals’ ability to staff their contractual flying, because few of their new hires have the experience requirements to upgrade quickly; they need a few years on the line first.

• The only solution was to increase their pay enough to entice FOs to stick around long enough to upgrade and fly as captain for a few years before moving on.

• The obvious question is where this is all leading. The regionals’ cost structure was never that much lower than the majors; a decade ago, their CASM (cost per available seat-mile) was within 5 to 10 percent of their major partners.

• Now, it must be incredibly high to an unsustainable degree. Add to this the regional carriers’ financial and operational instability and the negative effects on their major partners’ brands, and it becomes hard to see a reason for the regional airline industry to continue to exist.

• I’ve been arguing this day would come ever since I started writing about the pilot shortage in 2014, and now it has happened. The only reason for the current arrangement to persist at this point is industry inertia and C-suite egos. Mind you, those are considerable factors, and the regionals may continue to trudge along for years, slapping very expensive Band-Aids on the problem. Or, a major airline may choose to take a bold step that changes the industry, and the piloting profession.

Flying Mag

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American Pilots' Union Rejects Pay Hike Proposal

KEY POINTS:

• American Airlines pilots' union on Wednesday said its board of directors has rejected a draft agreement that offered a 19% pay hike over two years, as the proposal failed to garner enough votes.

• The Allied Pilots Association (APA) has been pushing for higher wages and improved schedules among other things, at a time when the air travel industry is facing a staff shortage, impacting the company's ability to meet robust air travel demand.

• The APA in a tweet on Wednesday said the proposed agreement received 15 votes, with just five in its favour.

• The company last month offered a 19% pay increase to its pilots over two years in a new contract, after proposing in June to hike the base pay by about 17% through 2024.

Reuters

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

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Delta CEO: ‘No possibility’ Pilots Strike On Holidays, Or ‘Any Time’

KEY POINTS:

• Delta Air Lines CEO Ed Bastian told NBC on Monday that there is “no possibility” of the carrier’s pilots striking during Christmas after its pilot union voted to authorize a strike as it negotiates a new contract.

• “There is no possibility they could strike at Thanksgiving, Christmas or anytime,” Bastian told “Today” anchor Hoda Kotb.

• Delta pilots represented by the Air Line Pilots Association (ALPA) overwhelmingly voted late last month to authorize a strike as the group continued contract discussions that began in April 2019 but were paused for nearly two years during the pandemic.

• Under federal law, pilots cannot go on strike unless the National Mediation Board declares an impasse in negotiations. After a 30-day cooling-off period, the union can go on strike or the carrier can initiate a lockout.

• The board has not yet made such a declaration, meaning that the cooling-off period would prevent a strike until at least next month. But Bastian expressed confidence on Monday that a strike will ultimately not move forward.

• “Not Christmas?” Kotb asked Bastian.

• “No, absolutely not,” Bastian responded. “We are in mediation with the National Mediation Board, and there are many phases and stages you have to go — we are actually a lot closer than people like to think in terms of trying to get this deal done, hopefully soon.”

• “It’s a tactic that all the unions, in fact I should say all the airline unions, pilot unions, have deployed,” he continued. “But the reality is that we have the very best pilots, they already are the very best compensated, we’re going to make sure they stay the best compensated, so there won’t be any issue.”

The Hill

United Pilots Resoundingly Reject Tentative Agreement

KEY POINTS:

• United Airlines pilots have rejected a proposed contract that would raise salaries by almost 15% over the next 18 months.

• Recently, negotiations between unions and airlines have been hectic. It was announced yesterday that Delta Air Lines pilots voted unanimously to authorize a strike if a deal is not reached with the airline.

• According to a statement released by the Air Line Pilots Association (ALPA), a record number of pilots participated in the vote. 94% of the 9,980 United pilots who voted, voted to reject the contract.

• The ALPA statement added that airline management has "taken a wait-and-see approach to negotiations instead of leading the industry forward." According to the union, pilots will start picketing to force United's hand and return to the negotiating table.

Simple Flying

We Just Got A Pilot With 2200 Hours Hired At A Legacy

I don’t know why you haven’t gotten an interview yet… But, if you book a call, we’ve got the resources to figure it out and help you get one ASAP.

Extra Reading

United Goes On Attack…Strategic Or Tacky?

Airlines Reboot as COVID Sparks a Revolution in One-Day Business Trips

Frontier To Open Dallas Base

Hiring Events

Alaska Meet-the-Chiefs | LAS | Nov 10

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