American Airlines management seems ready to give its pilots a new contract, though I’m surprised (and impressed) by the way the airline is going about it…
Continue reading: American Airlines CEO Offers Pilots Up To $590K In Pay
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How does a pilot make more money than a doctor? The US is such a weird labor market.
Sidestepping the union to directly negotiate with the pilots isn't a good look.
You have two options to find out.
On your next flight instead of turning right....turn left and ask the pilots directly.
Second option.....fork over a ridiculous amount of money and turn up your sacrifice to 11..... Learn how to fly and become professional pilot. And then you might find out.
Does anyone seriously want a pilot who was hired under the philosophy "cheapest bid gets the job"?
I regularly talk with flight crews. Some are in the union hierarchy, typically low or mid-level. Most express that their union is doing nothing substantive for them. Even those in the union hierarchy. "In what way are our working conditions and compensation better than non-union airlines? They aren't." It's a simple question and a simple answer. Frustrated, some would welcome a direct offer from the employer.
History has shown that airlines who peg their cost structure to the apex of revenue live to regret it within a decade. We are seeing the seeds of the next reset being sown here - the only question is how long until it happens.
I don't think that makes the US unique. That is likely the same in the UK and other areas of the world.
All this proves is how game changing the Delta pilot contract was in putting pressure on the rest of the big 4 to settle their pilot contracts. AS, B6 and NK's new pilot contracts which were settled fairly quickly were to slow the bleeding of pilots to the big 4 but DL's new contract not only increased the value of the contracts substantially but also gave Delta a considerable competitive head start in not losing new candidates to Delta.
As for the comments about AA's financial situation, anyone that actually reads financials knows that AA reported one of its best quarters in a decade in the 4th quarter - in line with Delta and United while Southwest lost money and is expected to do so again this quarter. AA is aggressively paying down debt and spending less on new aircraft than any of the big 4 has for years - they can do that because they have such a young fleet.
AA's interest expenses in 2022 were only about 10% higher than United's and United's debt and interest expense will soar as it takes on far more aircraft in one year than any airline ever has - far above the cash it can generate.
AA is in a far better position to match DL's pilot contract than UA or Southwest.
And, since DL has also raised salaries for most other employees, they have bitten the bullet on pay increases while AA has mostly just its pilots and FAs to settle with - a far better situation than UA or WN.
Isom wants a deal; AA pilot leaders have to decide if they want to play games and drag the process out or get a deal done. No deal is ever 100% what anyone wants but DL's deal is very rich and AA is willing to open its wallet to get a deal done now.
And the last decade shows, airlines goes bankrupt, reneged bad deals, and get bailed out by taxpayers. All with a golden parachute for every CEO.
The big 4 are gaining pilots at the expense of regionals and low cost carriers. the big 4 are not the vulnerable carriers; they are in a better position relative to the rest of the industry than they have been in 45 years of deregulation.
This was the inevitable result of the 1500 hour rule change.
So yes, this is the government creating inflation.
The higher compensation probably will lead to more people wanting to be pilots; at this point it's more than most doctors, lawyers, and tech workers make. I guess it's a net good, if it prevents a long-term pilot shortage and the attending safety consequences that could follow.
"There’s no denying that with such high labor costs, airfare will continue to have to increase over time, to reflect this kind of pay" - Ben Schlappig.
For-profit companies charge whatever the market will bear, regardless of their costs.
Absolutely! That is what happens when I go to the ER. Forgot to mention that the plane pretty much flies itself and most accidents are caused by pilots..... I know its tough being a pilot, being away from your family 12 days a month, I mean they deserve probably even more money so they can start their side businesses faster. Finally, they act like the amount of hours to be a pilot is some absurd high number compared the amount of studying it takes for other professions. Pretty sure the amount of time to being a social worker is about the same.
I would say this is 4D chess by AA to force themselves into bankruptcy so they can dump all their contracts. But we know they aren't that smart.
@Tim Dunn - apex costs are not sustainable. There will be a downturn, and when that downturn happens those apex costs will need to be reset. It's the circle of life. It can be avoided by linking costs to market dynamics, but there is too much mistrust between Management and Union to come up with something like that right now.
You make the classic error here of seeing good pay rates, and calling it a good contact offer. Pay rates are one small section of the contract, and, quite frankly, not the section that needs the most work. We won't know if it's a good contact offer until the company and the negotiating committee of the APA reach actual agreements on quality of life improvements, which is where the AA contact truly lags the competition. There's nothing impressive about negotiating in public, but the public falls for it every time.
@Tim - Completely agree. The Delta contract was not just great for their pilots but for AA, UA and WN pilots. A rising tide lifts all ships.
Never trust a deal negotiated in the press. The details of how they structure his proposal will unlikely look as good as this "Headline" reads. Working conditions can and often have erased what initially sound like good ideas. Unions don't negotiate in the press and any real deal will be hammered out behind closed doors. Flashing these high pay rates in public do nothing to drive respect for the professionalism that exists behind the cockpit door, but instead end up being a failed attempt to screem to the public "but we offered them so much". I don't believe it.
Not sustainable! If you are a current AA employee, non pilot, get ready for a bankruptcy filing! Save your money because the company can only raise prices so far before people can no longer afford to go across the street!
Exactly right. When companies try to make an end run around the unions by offering it directly to the members, it's rarely a good deal. Negotiations in public are never a good idea.
The problem with your comment is that the workers at airlines are AlWAYS the last at the table to enjoy the good times, yet they are the first ones to experience the down times. So the only way is to hit them hard in the good times.
Ha, sure It’s sustainable, the low pilot pay for so long was what was unsustainable. No one is going bankrupt anytime soon…. Finally making up for 2 decades of concessions, regional whipsawing and contractual games….. the airline managers spent that time making the career of being a pilot so unappealing that they dried their own pipeline up, This is them reaping what the sewed
Precisely put, the reason they are in this position is because for twenty years airline management made the career so unappealing by multiple bankruptcy concessionary contracts, the regional outsourcing game…… this is just the market readjusting itself, nothing more.
The minute the US economy cracks and corporate and leisure travelers pull back, airline executives will cry poor.
I suspect APFA will become even more bitter knowing a wide body captain is now a member of the one percent club.
These morons don't have a clue what they are talking about - look up basic airline economics by Freen and get back with me
Really? "Here. Take this shot. It's safe and effective......that'll be $450 please."
The reason pilots are paid more than on doctors is the doctors pay is set by the government through Medicare reimbursement rates. Pilot pay is not set by the government. We just pay it when the bankruptcy, bailout, pension guarantees etc come into play. If bankruptcies required liquidation everyone involved would be more careful with their money rather than expecting to again get our money..so glad we gave them $50B.
PS Anyone up for a relief surgeon if the operation is too long?
Oh you are impressed when Frank Lorenzo goes around the union and attempts to bust the union? You sir, are a douche.
Dude, not only your arrogance but your ignorance is showing, too. You are talking as if medical education doesn’t cost money and sacrifice. A surgery resident still has to be operate on a patient at the end of an 24 hr shift if there is an emergency. Enjoy your ignorance.
All for a job which can literally be done by a computer. Seriosuly , one “pilot” and one security guard is all we need on each plane.
As a former mid-management employee at American Airlines, lower management always got screwed for pay raises. Other Non-Union jobs were treated last for the crumbs let overs well. While I have tremendous respect for pilots, lets face it they always got the lion's share of pay and benefits, and the poor flight attendants were treated as step-children. Forget about the gate agents and reservations agents which get practically nothing.
This is a recipe for failure. Just stating the obvious (to any non-pilot airline employee). The next generation of airline companies will eat the legacy airlines which now includes SouthWest.
Sadly this is a expected outcome due to the super high inflation, product of the fiscal irresponsibility of the left leaning current administration (the left always thinks that money and resources come out of 'thin-air' AKA other ppl pockets). The final customer, us, will be the hardest hit with the inevitable raise in airfare.
Jerry you are obviously not an airline pilot and have no idea what it takes to operate these aircraft …. If you think it is so easy then go and get your pilots ratings and apply …. American Airlines is hiring !!!!
Lot of comments suggesting "the planes fly themselves" and other similar notions suggesting the job is easy, and pilots are overpaid ? Here are a few things to consider:
It takes the average mainline pilot 10-20 years of professional flying to get there. Once "there" , takes another 10-20 years to reach the quoted top of the scale salaries. During this 20-40 year window, most of us flew in the military at great personal risk, and family sacrifice, or many years at very low level pay risky civilian flying jobs. For many of us, a combination of both.
The planes do not fly themselves ! Cockpit automation, autopliot etc .... ensure the precision required to operate in today's crowded and complex airspace. Computers/AI are not anywhere close to replacing pilots. As soon as AI can think/creatively solve complex spatial and time problems, Manage/collaborate with people, see and feel atmospheric and aerodynamic conditions that may threaten the flight etc ... then you might have something ..... the job is a lot more than just flying the plane.
If you think you have what it takes to do it, then maybe it is for you. You could eventually be "there" 20-40 years .... To start you will need a lot of money, or willingness and commitment to take on a lot of debt, or join the military ! ... they are always looking for serious people ... a lot of willingness to study your butt off for years. Absolutely no drug use ! If you are one of those 1 in 100 persons, Congratulations ! You might make it by your 50s and become a 1% er.
These pay raises still don't bring the pilots pay back to pre 9/11 pay rates pre-bankruptcy! So it really isn't fantastic pay, it doesn't even make us whole. And that's not to mention that our pensions were stolen from us...
Spot on Jack!! Although I did make it 1 month shy of my 50th birthday via 28 1/2 years of military service.
First of all American Airlines has NOT offered huge new contract to their pilots, just a hopeful video that their professional pilots will get them through one more Summer. Second, for all the people that say/think that “Pilots shouldn’t be paid the same or greater than doctors”. I have the utmost respect for doctors and believe their compensation has been stolen by big insurance and hospital administrators. That being said pilots have to get it right all the time!! If a doctor gets it wrong one person may suffer ill consequences. If a pilot (or 2 pilots for those who think 1 is enough) gets it wrong hundreds of people suffer the consequences. Pilot pay has been stagnant for decades, that’s why there is a pilot shortage and that’s why the airlines are finally having to pay for their greed…. 100% truth do your research on it
You have no clue as to what it takes to be a senior wide body captain that will be making your click bait pay rates. As one who just retired from that position I can tell you that this offer from Isom falls short in many ways.
Pay, while good, doesn’t match inflation and doesn’t make up for the concessions pilots made after 9/11.
Quality of life issues are not addressed and American pilots will still lag far behind other carriers.
Isom needs to actually come to the table and negotiate with the union. Money (and QOL) talk and bullshite walks. Isom, and Parker’s before him, have never followed through on their promises. This is more of the same.
Your mid level job was in support of front line people like pilots that create revenue for the company. It takes 3 weeks to be a flight attendant. It takes decades to be a 777 captain. Money goes to where the money is created.
These cost increases are minimal compared to the total cost of putting out a flight. And American has always had too many middle management employees that are just drains on the operatiion. Flight Ops alone has way too many office drones that don’t really contribute anything.