Key words here are "could", "might", "may". Last time AA laid off nearly 2, 000 took leaves and retired. Stay tuned. Hopefully, leaves, job sharing and retirements will take care of the overage*
*Editor

AP
American COULD cut 900 flight attendant jobs

Wednesday July 2, 6:22 pm ET
By David Koenig, AP Business Writer

American Airlines indicates plans to cut 900 flight attendant jobs as soon as Aug. 31

DALLAS (AP) -- American Airlines says it could cut 900 flight attendant jobs as it reduces flights to cope with record high fuel costs. The Fort Worth-based airline expects to reduce jobs for pilots and mechanics too, but it hasn't released numbers yet.

American, the nation's largest carrier, said Wednesday that job cuts were necessary "to overcome near-term challenges and secure our company's long-term future."

American parent AMR Corp. said in a regulatory filing Wednesday it will take a charge of $70 million to cover severance costs for reducing its work force of 82,000, including the flight attendant jobs.

Further, AMR said, reduced flying and other cutbacks will lead the company to take a non-cash accounting charge of about $1.1 billion to $1.2 billion for the just-concluded second quarter. That charge covers the reduced value of the company's MD-80 and Embraer RJ-135 aircraft fleets.
Analysts were already expecting AMR to post a loss of about $330 million in the second quarter, according to a survey by Thomson Financial. Those forecasts typically don't include one-time charges.

In May, American announced it would cut domestic capacity 11 percent to 12 percent later this year, retire some planes and cut an unspecified number of jobs.

Federal law requires employers to give 60 days notice of major layoffs, and officials of the flight attendants' union said they received a notice Wednesday of job reductions that could start Aug. 31.

Airlines and union officials said they would try to reduce layoffs through attrition or by employees voluntarily taking leaves of absence or sharing jobs.

American has about 18,000 active flight attendants, so 900 jobs represents 5 percent of the ranks.

"We've all been sitting on the edge of our seats waiting for a number," said Frank Bastien, a spokesman for the Association of Professional Flight Attendants. "Most of us were pretty pleased it wasn't higher." (but it includes all former TWA flight attendants who have been recalled for less than a year, ed.)

Flight attendants had feared more job losses after the company said last week it would reduce management and support staff jobs by 8 percent.

American said it reached agreement with the union to offer voluntary measures such as leaves of absence to U.S.-based flight attendants 50 and older with at least 15 years of service. The airline said it struck a similar deal with the Transport Workers Union, which represents mechanics and bag handlers.

"These are difficult, but necessary changes given the unprecedented challenges we face with overcapacity in the industry, skyrocketing fuel prices, and a worsening U.S. economy," said American spokesman Tim Wagner.

American and sister airline American Eagle expect to spend more than $10 billion on jet fuel this year, up from $6.7 billion last year.

American is the latest airline to put a number on possible job cuts and reduced flying due to rising fuel costs and widening losses.

Continental Airlines Inc. is cutting 3,000 jobs and grounding 67 jets, and offered voluntary-departure packages -- but no cash -- to employees with at least 10 years experience.

UAL Corp.'s United Airlines, the nation's second-largest carrier, plans to eliminate 950 pilot jobs and 1,600 salaried positions. Delta Air Lines Inc. is shedding 4,000 jobs -- spokeswoman Betsy Talton said more than that number took incentives to leave, avoiding layoffs -- and US Airways Group Inc. is cutting 1,700.

Airlines are also raising fares and imposing new and higher fees for checking luggage, hauling a pet or sitting in a choice aisle seat.

Still, the industry's trade group, the Air Transport Association, predicts that U.S. airlines could lose $13 billion this year.

Shares of AMR fell 23 cents or 4.7 percent, to $4.62, as oil prices rose past $144 per barrel. The shares are trading at their lowest mark since early 2003, when the company was threatening to file for bankruptcy.

American Airlines Fleet Reduction Update

Three new Boeing 737-800's with the 12 additional seats are ready for delivery for AMR and will be put into the fleet as soon as they are checked out.

This is wonderful news as now AA must begin staffing 737's with FOUR F/A's as who will know what A/C is where once they start flying around the system. Conversion of the remaining 737 will begin shortly. Acceleration of the 737's on order will also take place. Boeing cranks out 31 737's a month. Service flows will be adjusted to reflect additional F/A.

Appears the biggest hit for reduction of flying is Eagle and the mainline cutbacks are not as severe as planned to to UAL grounding approx 100, 737's and the 4-6 747's and other carriers dropping service and routes. UAL will have about 100 more A/C's than TWA when they are done cutting service and routes. Put that into perspective.

Loads for the Holiday solid. Planes being held in service to accommodate them. In NO way does In-Flight want or wish to have a repeat of Christmas past when they ran short of crews and supervisors filled in for a good part of December.

Extended leaves and retirements should offset mainline furloughs...cross our fingers. There is a 400 pilot shortage and a projected F/A shortage for 2009 and we all know what that means...more recalls...let's hope this all comes to pass.

The DAL and NWA deal...just like TWA and AA. They all say no employee cutbacks but we shall wait and see on that one. Never say never again. You know darn well they will chop excess headcounts.

Here is a snapshot the AMR's fleet.

Airbus A300-600 33 in service 267 (16/251)Domestic/Latin American short-medium haulMost fly out of JFK, MIA, SJU, and MCO. SJU cutbacks require moving aircraft to other marketsTo be phased out by 2012 or sooner. Exit from service: 13 in 2008

Boeing 737-800 77 in service (29 orders) (29 options) 142 (16/126) config148 (16/132) config. North American short-medium haul. Most fly out of MIA, DFW, and LAX. Three ready for delivery, 16/160. More coming late 2008, early 2009

Boeing 757 124 in service 188 (22/166) Short-medium-long haul. Most fly out of hub/focus citiesTo be fitted with winglets. To be fitted with new interiors.

Boeing 767-200ER 16 in service 165 (9/30/126)167 (9/30/128) JFK-BermudaLos Angeles, Miami, San Francisco. To be fitted with winglets. To be fitted with new interiors.

Boeing 767-300ER 58 in service 219 (30/189)223 (30/193)225 (30/195)Domestic/International medium-long haulTo be fitted with winglets. Fitted with New Business Class

Boeing 777-200ER 47 in service (7 on order)245 (16/35/194)247 (18/35/194)DomesticMiami-ChicagoDallas-ChicagoInternationalMoscowBeijing (begins March 25, 2009), Buenos Aires, Paris, London, Frankfurt,Delhi, Rio de Janeiro, Shanghai,São Paulo, TokyoFitted with Flagship Suites. Being fitted with New Business Class. Being refitted with AVOD in all classes (internet)

McDonnell Douglas MD-82 35 in service (some former TWA)136 (16/120)140 (16/124)North American short-medium haul. Most fly out of ORD, DFW, STL, LGA

McDonnell Douglas MD-8 393 in service (some former TWA)136 (16/120)140 (16/124)North American short-medium haul. Most fly out of ORD, DFW, STL, LGA

Happy employees are more productive employees...

Small workplace-enhancing changes can reap big rewards
(ARA) - It's not surprising that employees cite compensation as the number one factor that makes them professionally satisfied these days.
What is surprising is that the comfort and aesthetic appearance of their physical workplace virtually ties with benefits for second place.

With an increasing number of people spending more time in their offices, the physical comfort, visual appeal and accessibility of their work environment become increasingly important. So pivotal, in fact, that the American Society of Interior Designers commissioned a 1999 nationwide study, "Recruiting and Retaining Qualified Employees - By Design" that revealed:

- Employees who were pleased with their physical workplaces were 31 percent more likely to say they were satisfied with their jobs,
- The physical workplace would impact 41 percent of employees and job seekers to accept a position, and
- The quality of their physical workplace would influence 51 percent to leave a company.

Even more eye-opening is that an astonishing 73 percent were not satisfied with the physical workplaces at their current jobs.

Certainly these statistics give one pause, particularly given the high costs, headaches and loss of productivity associated with staff member turnover. Wouldn't it make far better sense to keep valuable employees by making small, yet meaningful, cosmetic adjustments to their work environments?

"In this competitive marketplace, it is increasingly more important to focus on the appearance of the workplace," explains Todd Imholte, president of Environmental Graphics, the leading producer of wall murals for home or office in the United States. "Studies have shown that employers who care about their employees and their work environment, have noticed more motivated and productive employees."

Denise Ones, Ph.D., the Heller Vic Professor of Industrial and Organizational Psychology at the University of Minnesota says, "We know that there is a strong relationship between motivation and productivity in the workplace. Employees who are motivated will be more conscientious, dependable and ultimately more productive." Sage Publishing will release a book authored by Dr. Ones entitled, "The Handbook of Industrial, Work and Organizational Psychology" in September of 2001.

The Toyota manufacturing facility in Georgetown, Ky., for example, recently installed 44 of Environmental Graphics' WallMurals throughout their production facility, labs and conference rooms. According to safety manager, Karen Wells, "The murals help bring the outdoors in, making the work environment a more positive and motivating place for the employees.

When people look up at the wall, they see pleasant scenery instead of a plain, boring wall. We even let the employees pick them out!"

Murals can have a tremendous impact on morale and productivity and most companies have walls that accommodate murals. Murals are a cost effective way to make a big improvement on the workplace environment. Murals, like the ones from Environmental Graphics, cost around $100.

A novel concept: charging your product cost. Problem is if you raise ticket prices, you fall to the bottom of web ticket searches. What do you do?

Freeways in California are still clogged...you just cut out the flipflops and shorts crowd!

Charge the cost...it is that simple. It is simple economics...really! People will still travel! Stop shaking out the passengers with endless fees. Freeways in California are still clogged...you just cut out the flipflops and shorts crowd! ...Charge the cost...it is that simple.

Soon, no free drinks if you fly US Airways
Water, coffee, juice, sodas due on pay list for $2.00 each
Are they going to charge for oxygen when the masks fall?
By Laura McCandlish
June 13, 2008

Talk about taking the fizz out of air travel. US Airways will become the first major U.S. airline in August to charge domestic coach passengers for soft drinks, juices, coffee and bottled water as part of a shift to what it calls a "pay-for-what-you-use" business model. The $2-a-pop beverage charge is the latest in a raft of new charges airlines have been imposing to help pay for record fuel costs. Free nonalcoholic beverages have been one of the last freebies handed out by domestic airlines, which already charge for alcoholic beverages and - except for Continental - for meals and even snacks on domestic flights.

Among other new or higher charges US Airways is imposing :
•A $2 increase in the cost of alcoholic beverages, to $7.
•$15 for a first checked bag, making it the third major U.S. airline to start charging for a single piece of stowed luggage. It already charges $25 for a second checked bag.
•Fees of $25 to $50 for booking frequent-flier award tickets after Aug. 6.
•A $25 service fee for domestic tickets and a $35 service fee for international tickets purchased by phone, up from $15.

At Baltimore-Washington International Thurgood Marshall Airport, US Airways also is shuttering its exclusive club for elite travelers, in addition to its one in Raleigh, N.C., due to "insufficient demand." Five employees currently work at the BWI club, US Airways spokesman Morgan Durant said. Once the dominant carrier at BWI, US Airways now accounts for slightly more than 6 percent of the market share there."Our operation at BWI is a fraction of what it was in the '90s," Durant said. "Unfortunately it was one portion of our club network that was identified as an area where we could save some costs."

The Tempe, Ariz.-based carrier also is cutting flights, shrinking its fleet and slashing 1,700 jobs."We must write a new playbook for running a profitable airline in this new and challenging environment," US Airways Chairman and Chief Executive Officer William D. Parker said in a statement.US Airways created the new cuts and fees to help pay for soaring fuel bills this year. Jet fuel has jumped to almost $4 per gallon from $2.72 at the end of 2007, and US Airways' fuel costs are up almost $2 billion this year.

Parker said the airline now needs to make about $650 to $700 per round-trip passenger just to break even. Independent airline consultant Robert Mann said it's unlikely that the charges and fees announced yesterday will bring in that much revenue. "They're just grasping at straws," Mann said. "The industry has to fundamentally reprice its services." Mann said the industry needs to cut the number of available seats by 20 percent before airlines will have the power to boost fares and keep up with the price of fuel.

US Airways said free drinks would continue to be served to unaccompanied minors and passengers in first class on US Airways Shuttle and on trans-Atlantic flights. Passengers who suffer from dehydration or other medical issues will be served complimentary bottled water at the flight attendant's discretion, US Airways spokesman Durant said.

When weather delays hold a plane on the tarmac for hours, passengers also will be given free beverages, he said.Kate Hanni, who heads a grass-roots group called the Coalition for an Airline Passengers' Bill of Rights, said the new US Airways fees went too far and could even jeopardize the health of its passengers. "All of the airlines are unbundling to the point where it's unsafe," Hanni said. "Are they going to charge for oxygen when the masks fall?"

laura.mccandlish@baltsun.com
The Associated Press contributed to this article.

BREAKING NEWSNBC News and MSNBC

NBC's Tim Russert dead at 58
He was the Washington bureau chief and moderator of ‘Meet the Press’

Virginia Sherwood / © NBC Universal, Inc.

BREAKING NEWS
NBC News and MSNBC

WASHINGTON - Tim Russert, NBC News’ Washington bureau chief and the moderator of “Meet the Press,” died Friday after a sudden heart attack at the bureau, NBC News said Friday. He was 58.

Russert was recording voiceovers for Sunday’s “Meet the Press” program when he collapsed, the network said. No details were immediately available.

Russert, the recipient of 48 honorary doctorates, took over the helm of “Meet the Press” in December 1991. Now in its 60th year, “Meet the Press” is the longest-running program in the history of television.

In 2008, Time Magazine named him one of the 100 most influential people in the world.
Timothy John Russert Jr. was born in Buffalo, N.Y., on May 7, 1950. He was a graduate of Canisius High School, John Carroll University and the Cleveland-Marshall College of Law. He was a member of the bar in New York and the District of Columbia.

Senate staffer before entering journalismAfter graduating from law school, Russert went into politics as a staff operative. In 1976, he worked on the Senate campaign of Daniel Patrick Moynihan, D-N.Y., and in 1982, he worked on Mario Cuomo’s campaign for governor of New York.

Russert joined NBC News in 1984. In April 1985, he supervised the live broadcasts of NBC's TODAY show from Rome, negotiating and arranging an appearance by Pope John Paul II, a first for American television. In 1986 and 1987, Russert led NBC News’ weeklong broadcasts from South America, Australia and China.

Of his background as a Democratic political operative, Russert said, “My views are not important.” “Lawrence Spivak, who founded ‘Meet the Press,’ told me before he died that the job of the host is to learn as much as you can about your guest’s positions and take the other side,” he said in a 2007 interview with Time magazine. “And to do that in a persistent and civil way. And that’s what I try to do every Sunday.”

Cuomo, Russert’s onetime boss, wrote of Russert: “Most candidates are not eager to present themselves for Tim’s incisive scrutiny, which is fed by his prodigious study and preparation. But they have little choice: appearing on ‘Meet the Press’ is today as vital to a serious candidate as being properly registered to vote.”

Russert wrote two books — “Big Russ and Me” in 2004 and “Wisdom of Our Fathers” in 2006 — both of which were New York Times best-sellers.

Emmy for Reagan funeral coverageIn 2005, Russert was awarded an Emmy for his role in the coverage of the funeral of President Ronald Reagan. His “Meet the Press” interviews with George W. Bush and Al Gore in 2000 won the Radio and Television Correspondents’ highest honor, the Joan S. Barone Award, and the Annenberg Center’s Walter Cronkite Award.

Russert’s March 2000 interview of Sen. John McCain shared the 2001 Edward R. Murrow Award for Overall Excellence in Television Journalism. He was also the recipient of the John Peter Zenger Award, the American Legion Journalism Award, the Veterans of Foreign Wars News Media Award, the Congressional Medal of Honor Society Journalism Award, the Allen H. Neuharth Award for Excellence in Journalism, the David Brinkley Award for Excellence in Communication and the Catholic Academy for Communication’s Gabriel Award. He was a member of the Broadcasting & Cable Hall of Fame.

Russert was a trustee of the Freedom Forum’s Newseum and a member of the board of directors of the Greater Washington Boys and Girls Club, and America’s Promise — Alliance for Youth.

In 1995, the National Father’s Day Committee named him “Father of the Year,” Parents magazine honored him as “Dream Dad” in 1998, and in 2001 the National Fatherhood Initiative also recognized him as Father of the Year.

Irish America magazine named him one of the top 100 Irish Americans in the country, and he was selected as a Fellow of the Commission of European Communities.
Russert is survived by his wife, Maureen Orth, a writer for Vanity Fair magazine, and a son, Luke.

Check back soon for more on this breaking story.
© 2008 MSNBC Interactive

Blog Editor comment...6/8/2008

This is Icahn at the top of his game...corporate blackmail, extortion, nothing less at what he does best! Icahn complains about corporate governance...exactly the SAME things HE DID did while running TWA into the ground, sucking every last time from the company and its employees. Bottom line...a quick buck to add to his war chest. Icahn knows NOTHING about running a company. The proof is in his actions!


Icahn tells Yahoo to sell for $49.5B, or $34.375 a share
Updated
By Jon Swartz, USA TODAY

SAN FRANCISCO — Billionaire activist investor Carl Icahn's latest salvo in his escalating war against Yahoo's (YHOO) board put a price tag on the embattled company and intensified pressure on Yahoo as it approaches its annual shareholders meeting.

In a scathing letter to Yahoo Chairman Roy Bostock on Friday, Icahn said he wants Yahoo to tell Microsoft (MSFT) it's willing to be sold for $49.5 billion, about $2 billion above Microsoft's last offer for the Internet pioneer.

"Why don't you stop dancing around the subject and publicly offer to sell the company to Microsoft for $34.375 per share and promise to cooperate completely?" Icahn said in the strongly worded letter.

Yahoo said declaring an acceptable sales price for the company would be "ill-advised."
Microsoft declined comment. It withdrew an oral offer of $47.5 billion, or $33 a share, last month after Yahoo CEO Jerry Yang asked for $37 a share.

Icahn's letter was just the latest volley in an increasingly nasty campaign to force Yahoo's sale.
In a letter on Wednesday, Icahn made it clear he wants Yahoo's board replaced and Yang fired unless the company works out a deal with Microsoft before Yahoo's shareholders meeting Aug. 1.
Icahn, who carved a reputation as a ruthless corporate raider in the 1980s and reinvented himself as a shareholder activist in recent years, was particularly miffed by what he claimed was a provision by Yahoo that would add more than $2 billion to the cost of a takeover.
In his letter Wednesday, Icahn accused Yahoo's management and board of putting themselves ahead of their shareholders.

Some tech analysts say Icahn is merely softening up Yahoo in the weeks leading up to its shareholders meeting in San Jose. If Yahoo staves off Icahn, it faces a torrent of lawsuits from disgruntled shareholders, says Jonathan Yarmis, an analyst at AMR Research.
"I'll bet after the shareholders meeting — if there's no deal done — you'd have a hard time booking a hotel room in Wilmington, Del., as plaintiffs' lawyers line up to file their lawsuits," Yarmis says.

Ultimately, Icahn's end game is simple, Yarmis and others say.
"It's quick money. Nothing more, nothing less," Yarmis says. "(Icahn) has to make Yahoo think that the path of least risk is doing something large with, or selling to, Microsoft. I still don't think a deal for the whole enchilada is out of the question."

Yahoo shares inched up 8 cents to $26.44 in trading Friday. Microsoft shares slipped 81 cents to $27.49.

As Airlines Cut Back, Who Gets Grounded?
THE MIDDLE SEAT
By SCOTT MCCARTNEY

June 6, 2008
What do all these announcements of massive airline cutbacks mean for consumers? Higher fares.

By grounding planes and removing flights from schedules, airlines hope to limit the supply of seats in the skies and force people to pay more to fly. Planes are full now largely because airlines have to discount prices a lot in order to fill seats, especially in a weak economy. Airlines have been like automakers offering big discounts on SUVs and other vehicles piled up on dealership lots. At some point you have to stop making so many trucks if you can't sell them at a profit, and so airlines are shutting down their ``factories'' some – grounding airplanes and reducing the number of flights they offer for sale.


Despite more than a dozen ``fare increases,'' the fares that people actually are paying haven't yet gone up enough to come close to covering higher fuel costs for most airlines. In April, the most recent month reported, the average price people paid to fly one mile domestically was up only 4.3% over last year, according to the Air Transport Association. Fares likely were 7% to 8% higher in May than a year ago, according to some preliminary reports from airlines, but that's a far cry from paying for the 66% increase in the cost of fuel, which now amounts to about 40% of an airline's total costs.

Why? Because raising airfares isn't like raising the price of milk at the grocery store. Consumers have almost perfect information for price comparisons – the Internet can hunt the cheapest fare worldwide in seconds. If one carrier has some empty seats to fill, it will have to cut the price because getting something for that seat is better than flying it empty. And there's lots of competition in the industry – some airlines have lower cost structures than others, or better fuel hedges, and can absorb more of the higher costs than others.

Cutting the number of seats to sell is the only way to significantly raise prices. Not only can airlines raise ticket prices, but also they can sell fewer seats at discounted prices, and leave more seats in higher-priced fare ``buckets.'' Demand for seats will drop since there won't be as many cheap seats out there, but the planes that actually fly should generate more revenue. That's the only way for the industry to get back to profitability.

Continental Cuts Jobs, FleetSo which flights will get cut? Most of the cutting will come after the busy summer. Weak international routes are first to go, in general. The longer the trip the more fuel affects the profitability of the flight. AMR Corp.'s American Airlines already said it would end its daily service between New York and London's Stansted Airport, for example. AMR launched that flight in response to start-up business-class carriers using secondary London airports like Standsted. But high fuel costs and limited credit for airlines have already killed the London trans-Atlantic start-ups like Eos and Silverjet.

UAL Corp.'s United Airlines has erased its Los Angeles-Hong Kong flight from its schedule – San Francisco-Hong Kong flights do much better, and United can carry Los Angeles traffic over to San Francisco. Continental Airlines Inc. has been aggressively expanding internationally, and some routes have done better than others. Expect the weak ones to get suspended.

Domestically, airlines likely will thin schedules rather than abandon cities completely. Instead of five or six flights a day, they may cut back to four. Fewer seats will enable them to charge more.

But there's a cost to all this for airlines, too. Shrinking can raise the cost to operate each flight, on average, because lower-paid employees are the ones to get laid off and planes that sit often still need to be paid for, unless there's a bankruptcy filing or a way to sell them or turn them back to leasing companies. The aircraft market worldwide is strong, so many planes that U.S. airlines are grounding may well find new homes overseas.

In addition, all the cuts create opportunity for discount airlines that are still growing. Southwest Airlines Co. has historically been very opportunistic, filling in when bigger carriers cut. Southwest is expanding aggressively in Denver, for example. Frontier Airlines is already operating inside bankruptcy court protection, and United has said it will kill its ``Ted'' lower-cost airline-within-and-airline, which is based in Denver. Expect Southwest to continue its Rocky Mountain assault. That should provide travelers with different options, and even some lower-priced options.

In the end, airlines that can fly people at lower costs will gain in this financially challenging environment, and higher-cost carriers will continue to shrink. The staggering cost of oil may eventually bury a big carrier—they are very much in survival mode.

Former Continental CEO Gordon Bethune used to illustrate the challenges of running an airline with a joke: A bear is chasing two men, and one stops to put on running shoes. ``What are you doing? The shoes won't help you outrun the bear,'' the other man says.

``I don't have to outrun the bear,'' his friend responds. ``I just have to outrun you.''

The faster runners among airlines will continue to provide lots of service for consumers. It will just be at higher fares.

Write to Scott McCartney at middleseat@wsj.com

JOHN DVORAK'S SECOND OPINION
Carl Icahn will destroy Yahoo
Commentary: Investor's all-stars will first try to deal with Microsoft
By John C. Dvorak
Last update: 6:35 p.m. EDT May 16, 2008

BERKELEY, Calif. (MarketWatch) -- Shareholders of Yahoo Inc. are now being confronted by Carl Icahn and the slate of directors he has to replace the current board. The thinking is that the company's directors screwed up an opportunity to sell to Microsoft Corp.

I've looked over the current directors of Yahoo and Icahn's proposed replacements. Here's what I think of them, keeping in mind that to be on this board it might be useful if you knew something (anything) about computers and the Internet. In some cases, I seriously doubt that the person named even knows how to turn on a computer.

Let's look at them:
Jerry Yang, founder. He should not be the chief executive but should be the chairman of the board. Why isn't he?

Roy Bostock, chairman of the board here and at Northwest Airlines. He's also a director at Morgan Stanley. Sounds like a professional board guy. What's this have to do with the Internet?

Ron Burkle, finance guy and Bill Clinton pal. Burkle's an expert in supermarkets and other things, as well as board member of Occidental Petroleum Corp. What does he bring to the party, knowledge about coal reserves? I doubt he can even use email.

Eric Hippeau. The second of the board members besides Yang who actually knows the business. Negative: He's been on the board the longest and signed off on too many dumb deals.
Vyomesh Joshi, a VP at Hewlett-Packard Co. Are you kidding me? He's from the printing division. What's Yahoo got to do with that?

Arthur Kern. Known as a nice guy. He's been on the board forever and is the new-media guy. Also must have signed off on a lot of dumb deals.

Robert Kotick, chairman and chief executive of Activision Inc. OK, he's in the business. Finally!

Ed Kozel. I could be wrong, but Kozel seems like the real sleeper on the board, with a background in technology as well as finance. He's probably underappreciated.

Maggie Wilderotter. Seems like another lightweight to me; apparently her connection to Microsoft as a former VP is her real allure. She's another professional director who's on various other big-name boards. Must be good at networking.

Gary Wilson, another board member from Northwest Airlines. Yeah, that makes sense. I smell a drinking club!

So this board stinks overall.

That said, at least this group is familiar with the company. Icahn wants to drag in a bunch of out-and-out finance/law guys, along with Dallas Mavericks owner Mark Cuban.

Cuban made his fortune by selling Broadcast.com to Yahoo back in the late 1990s for more than $5 billion. After that it disappeared from view. Another $5 billion down the drain.

Let's look this new group over:
Lucian Bebchuk. Famous corporate lawyer who's an expert in corporate governance. Will serve as the procedural bully on the board.

Frank Biondi Jr. The former Viacom Inc. executive sits on a lot of boards, including Seagate Technology's. He might have a clue but that won't be his job. His job will be to say "yes" to Icahn.

John Chapple. Too many accomplishments to be a real person. Another impressive seat-filler with little or no hook into Yahoo's sort of business.

Mark Cuban. My guess is he's being brought in to be the next chief executive after basketball season is over. Projected tenure? Six months.

Adam Dell. Another VC and finance guy with a law degree.

Keith Meister. He's Icahn's personal economic hit man.

Edward Meyer. Might be OK; at least he knows advertising.

Brian Posner. Another guy with too many items on the "what I did over the weekend" list (see Chapple, above). Do these guys actually sleep, ever, or is this a giant bragfest?

Robert Shaye. Another lawyer-MBA type who also is a Hollywood mogul. Cripes.

Of course, there's Icahn himself as coach/chairman of this all-star team.

Here's the deal: If these guys get on the board, they will first try to package a deal for Microsoft and walk away with more money. If they cannot do that, they will be unable to manage Yahoo since they are all professional place-sitters on everything but Internet companies.

So they will immediately parcel out and sell off the company piece by piece until Yahoo is dead. Looking at the bios of these guys tells you this is something they can do.

And they'll do it fast.
You really don't understand capitalism. Looking objectively, Icahn hopes to turn around UNDER-functioning companies and make better use of their capital (including people). In the end, the intention is that the capital will be used more efficiently?

Lack of foresight and oil prices going through the ceiling cause layoffs at AA !

Lack of planning for the future by buying fuel efficient aircraft to replace gas guzzling Super-80's and management a bonus program for rewarding this behavior have caused AA to slash thousands of jobs across many job classifications.

Will flight attendant leaves absorb the layoffs?
Will higher prices promote a profit for the airlines?
How about a new business plan with fares reflecting the actual cost of flying a person or freight from point A to point B?

How about some foresight and planning to run an airline with efficiency? How about it?

With two oilmen in the White House...did we NOT expect this?

Editorial Comment:
May 20, 2008
Senator Ted Kennedy diagnosed with a glioblastoma

Our hearts go out to the Senator and his family during this grim news about the glioblastoma found in the Senators brain. Always fatal, this is the worst diagnosis and at the very least, an uncomfortable and very sad end a storied career in the United States Senate.

A friend of labor, the airlines and the middle class, Senator Kennedy has always fought for working families, as an advocate for doing the right thing at the right time.

Senator Kennedy rose above the Kennedy dynasty and became a very strong voice for the people, in nearly 40 years in the Senate. Intense personal pressure to succeed from his famous father and a legacy unheard of in common times, gives Senator Kennedy his own place in history equal to his famous brothers, as he stood firmly for what he always believed was good for the average person...a fighting chance to achieve the American Dream.

Dear Delta Flight Attendants,
(from a concerned group of former Ozark, TWA, and current AA flight attendants)

As former members of the Association of Flight Attendants, we strongly encourage you to vote and elect AFA as your collective bargaining agent. The Association of Flight Attendants can and has consistently provided protections that other other unions or non-union groups cannot.

Many years ago, AFA represented the interests of our colleagues at Ozark Airlines. At that time, we were caught up in a merger with TWA led by notorious corporate raider Carl Icahn. We knew the expected challenges we would be facing and we knew the challenges our union brothers and sisters at TWA were facing as they were out on strike and continued to walk the picket line as the purchase agreement was being consummated.

AFA’s representation was absolutely crucial to our welfare during the TWA/Ozark merger process. The Ozark flight attendants virtually walked away from that merger unscathed with seniority intact and date of hire received.

However, it is a far different story for our TWA family.

When American Airlines purchased TWA in 2001, every single one of our colleagues (Ozark & TWA) was stripped of seniority and stapled to the bottom of the seniority list, our domiciles and satellites closed and the entire TWA Flight Attendant workforce was corralled behind a fence in STL. After 9/11, every single TWA attendant (some with as many as 40 years) was furloughed, many without furlough/severance pay for nearly five years. Others were not as fortunate; they were terminated as their five year recall rights expired.

As time went on, the writing was on the wall for those awaiting recall. Now finding ourselves at the forefront of battle and a grassroots campaign to extend the recall rights of our colleagues, we knew what had to be done. Ultimately, we landed on the door steps of many politicians, media venues and labor organizations, including that of AFA for support and for that we are ever so grateful.

Many of these middle-aged flight attendants lost a lifetime of building their career, seniority, pay and benefits; a travesty that could have been averted with AFA’s representation.

AFA was not our collective bargaining agent during the AA/TWA merger, as they were during the “fair and equitable” TWA/OZARK merger. AFA was the first of many labor organizations that gave us support and encouragement when we so desperately needed to extend our recall rights to preserve our careers. AFA exemplifies the spirit of “true unionism”.

Today, thanks to the assistance of many Senators, several labor unions and AFA, our ex-TWA colleagues now have a two year extension and some have even been recalled.

Just as in those days, airline consolidation is again on the horizon. Don’t allow yourselves to be sitting ducks for corporate America, OPEC, or terrorism. The ability to preserve and protect our career, seniority and benefits is with a strong, solid and experienced union with a winning track record. AFA continues to prove its strength and integrity when it counts most. Take it from an ex-TWA Flight Attendant, we know, we have been on the losing end.

Steenland: Fuel costs may shrink merged Delta/Northwest
Memphis Business Journal

Northwest Airlines Corp. will keep a "vibrant" hub and a substantial number of jobs in Minneapolis-St. Paul after the airline's merger with Delta, Northwest CEO Doug Steenland told business leaders Monday.

But he warned that soaring fuel costs may ultimately mean a smaller company.
BLOGGER COMMENT: (which is basically B.S., meaning)
THERE WILL BE MASSIVE LAYOFFS AND DOWNSIZING, AND THOUSANDS OF JOBS LOST, WHICH WILL BE A SMOKE AND MIRRORS GAME...A DISGUISE FOR MAKING A PROFIT BY THE LAYOFFS, NOT AN OPERATIONAL PROFIT)
Speaking at a meeting of the St. Paul Area Chamber of Commerce, Steenland said the combined carrier will keep its reservation offices, data center and flight-training facility open following the close of the deal.

Overall, he likened the deal's impact on the Twin Cities to the 1998 merger between Minneapolis-based Northwest Corp. and San Francisco-based Wells Fargo & Co. Then, Minneapolis lost Northwest's corporate headquarters but ultimately gained jobs as Wells Fargo kept a big division here.

But with the price of oil soaring, Steenland said it's hard to predict how many workers the carrier will employ in the future.

"This can only go on so long," he said of airlines absorbing high energy prices. "Fuel costs will have to be passed on to consumers. That will mean higher fares, so we'll see demand come down, and the airline will have to shrink."

Northwest (NYSE: NWA) and Delta Air Lines (NYSE: DAL) last week began crafting a plan for integrating the carriers, Steenland said. The companies expect the merger to close by the end of the year. Northwest may operate as a standalone airline for a full year after the deal wraps up, he said.

While the combined airline's headquarters will be based in Atlanta, the merged company will continue to have a big presence in the Twin Cities. "What won't be different is that Minneapolis-St. Paul will continue to be a vibrant, robust hub," Steenland said.

The airline also will continue to support Twin Cities cultural institutions and non-profits, he said.
Based in Eagan, Minn., Northwest operates one of its three U.S. hubs at Memphis International Airport.
Minneapolis / St. Paul Business Journal

Delta/Northwest deal's dangerous model
The ambitious plan to create the world's largest airline increases costs but may not improve revenues.
By Barney Gimbel

Delta CEO Richard Anderson says the merger is 'a combination about addition not subtraction.'

NEW YORK (Fortune) -- With his slicked back hair and rimless glasses, Delta CEO Richard Anderson looked like an older Clark Kent when he strode to the podium at the Barclay Hotel in New York Tuesday morning. And perhaps underneath that dark suit was, in fact, a superman costume. That's because in less than a year at the helm of Delta, he pulled off what was thought to be an impossible task - a $17.7 billion merger with Northwest to create the world's largest airline.

But can Anderson's superhuman strength wring a stronger company out of a combined Delta (DAL, Fortune 500) and Northwest (NWA, Fortune 500)? And will the copycat mergers that are expected to follow strengthen the industry? It's certainly no slam-dunk, as the new Delta will raise its costs in the near term without offering a concrete way to substantially increase revenues.

Investors panned the deal, with both Delta and Northwest stock down sharply by midday Tuesday.

Ever since the days of Juan Trippe's Pan Am, there has been a persistent fantasy among aviation CEOs that he who has the most planes (and flies the most routes) wins. In today's parlance, you might call that the Delta Model. Anderson believes that the best way to survive $110-a-barrel oil is by growing into a carrier with potential revenues of $30 billion.

But in doing so, he plans to defy the conventional wisdom of airline mergers and create what some believe would be a dangerous model for the industry's long-term sustainability. There are two strategies management traditionally deploys in airline mergers - cutting overlapping flights to slash costs or expanding globally to increase revenue. Trimming routes was the approach touted by US Airways in its unsuccessful bid for Delta last year. At the time, US Airways (LCC, Fortune 500) suggested it could save nearly $1 billion by combining the two carriers and lopping 10% off the flight schedule.

At Tuesday's press conference, Anderson made it clear he was not cutting routes or hubs. The plan rests on combining two complementary networks of routes. That makes sense in theory: Northwest has a large Asian network, and Delta has a large European and Latin American one. So why not combine the two while making better use of the company's airplanes?

Use Northwest's large Boeing 747s through high-traffic Atlanta instead of Minneapolis, for example. These proposed efficiencies will create more than $1 billion in revenue synergies, Anderson said. "It's a combination about addition not subtraction," he added at the press conference. "In a network business, scale and scope are important."

In practice, analysts say, increasing revenues through increased efficiencies will be hard to come by. One plus one rarely equals three. "The appeal of consolidation is redundancy - the network overlap - that can be eliminated," JP Morgan analyst Jamie Baker wrote in a recent report. "The value creation comes in the form of shedding duplication."

Then there are the pilots. The original plan for the merger when it was first touted earlier this year included a seniority integration agreement so the airline could instantly combine the workforce. But after Northwest and Delta pilots couldn't agree, Delta's management made a lucrative deal with its own pilots that guarantees them a 5% pay raise next year and a 4% raise for the next three years. Even better for the pilots, it guarantees them no layoffs for the first two years after the merger closes. That means Delta can't reduce the number of planes or routes it flies.

But management failed to come to any agreement with Northwest's pilots, who generally outrank Delta's pilots in seniority, and are far from happy with the deal. "One can only conclude that the Delta pilot leadership and Delta management have made an arrangement to try to disadvantage the Northwest pilots economically and with respect to our seniority," wrote Dave Stevens, the head of Northwest's pilots union, in a letter to his colleagues. "No pilot group is going to put up with this. No amount of money can sustain a carrier which creates this level of discord. This is a recipe for failure."

Until Northwest pilots are on board with the deal, Delta can't combine operations. It seems inevitable that the new Delta will eventually have to offer a similarly generous deal to Northwest pilots -- pushing labor costs even higher.

None of this bodes well for the airline industry. After a Northwest-Delta deal, expect to see the remaining large carriers - American (AMR, Fortune 500), Continental (CAL, Fortune 500), United (UAL) and US Airways - attempt similar mergers with similar terms. And then what do you have? Bigger companies flying the same routes with the same airplanes - only now with higher labor costs. For some reason, in the airline business, people always forget that bigger doesn't mean better.

Delta and Northwest: a mistake from the start.

Why Airline Mergers Don't Work
by Victor Cook

Ever wonder why over the last 30 years Southwest Airlines managers (LUV) spent only $0.03 on mergers and acquisitions for every $1.00 of shareholder value they created? By comparison, Delta management (DAL) spent $2.35 for every $1.00 of value they created. And Northwest (NWA) spent $1.61 on M&A for every value dollar they created. In Louisiana we have a name for this kind of strategy. It's called jumping over a dollar to get to a nickel.

Does Herb Kelleher, former CEO of Southwest Airlines, know something about creating shareholder value that other CEOs don’t know? Perhaps he understands that in the domestic airline market earnings don’t necessarily increase with market share. Or in economics speak, changes in earnings with respect to a changes in market share may be very inelastic. Because the demand for air travel is very price elastic.

BELIEVE IT OR NOT

Believe it or not, elasticity is one of the most powerful metrics in business. In a single number, elasticity pins to the wall the relationship between percent changes in price and quantity. In theory, if the percent change in quantity purchased by customers is greater than the percent change in price paid, demand is elastic. Alternatively, if the percent change in quantity is less than the percent change in price, demand is inelastic.

Then why does one rarely see price elasticity numbers used in industry analyses? In the real world, price and quantity data are notoriously ill behaved. That’s why your Econ 101 professor couldn’t use real numbers in his or her hand-drawn demand schedules.

It is, however, possible to get at the relationship between price and quantity in the real world if you have access to a large base of precise data, an in-depth knowledge of econometric methods and lots of time on your hands. About the only people I know with these resources are doctoral students in economics. Therefore, I was not surprised to find exactly what I was looking for in Jong-Ho Kim’s 2006 dissertation on “Price Dispersion in the Airline Industry: The Effect of Industry Elasticity on Cross-Price Elasticity.”

Dr. Kim based his research on data from the Department of Transportation’s Origin and Destination Survey from the 1st quarter 1989 through the 4th quarter 1997. This is a 10% random sample of all tickets issued in the U.S. In his dissertation Dr. Kim hypothesized that:
Southwest’s entry provides a natural setting for investigating how travelers respond to the changes in air fares.

More specifically, we can make full use of variations in relative prices among airlines and the revenue shares of airlines by focusing on Southwest entry routes. Consequently, we can focus on coach class travel in those markets where Southwest entered and has been serving since then. … [R]ival airlines adjust their average fares upon Southwest’s entry and remain relatively constant in ensuing quartersIn that study, when Southwest entered a new market (city-pair), estimated price elasticity ranged from a high of -2.6 (with only one other competitor), to -1.63 (with four other competitors), to a low of -1.1 (with 7 other competitors). All of these estimates were statistically significant.

WHAT HERB KNOWS

I think Herb Kelleher understands – as no sitting airline CEOs seems to – a fundamental principle about competition.
Given:
a capital intensive industry,
with few meaningful scale efficiencies,
delivering a highly perishable product,
within a partly regulated infrastructure,
operated by talented professionals,
in a very price sensitive market, with
free entry and court protected exit,

shareholder value can best be created organically. How? By maximizing the satisfaction of employees, passengers, suppliers, partners, and shareholders. Here is the corollary to that fundamental principle:

In airlines, building market share through mergers short circuits the creation of satisfied stakeholders.

The purpose of this article is to examine why mergers don’t work today in domestic airlines, using the DAL/NWA merger as an example.

EARNINGS ELASTICITY

Elasticity can be expressed for any pair of variables. Take earnings elasticity for example. It’s the percent change in earnings divided by the percent change in market share. Here’s what happens. Cutting price leads to an increase in market share. But it also leads to a decrease in earnings. Theoretically, in a price elastic market with few scale efficiencies and a perishable product, earnings and market share are not happy partners.

Suppose the management of a hypothetical airline with 20% of all domestic revenues decides it would be good for earnings if they increased share of revenues to 30%. The quickest way to do that is to merge with a company that has 10% of the market. In a matter of months its market share increases by 50%. Bingo!

But in a highly price sensitive market for a perishable product, earnings may increase only a little, say about 6%. The ratio of the percent change in earnings to the percent change in market share (0.06/0.50) is just 0.12. In this hypothetical case, earnings are highly inelastic with respect to market share. Is this is a bad thing? Yes. It’s a classic case of jumping over a dollar to get to a nickel.

MAXIMUM EARNINGS MARKET SHARE

To test the hypothesis that the DAL/NWA merger won’t be good for shareholders I ran a maximum earnings market share analysis on the combined companies in a strategic group with seven other domestic airlines for the calendar year 2007.

In a nutshell, maximum earnings occur when EBITDA generated by the last share point exactly equals the cost of acquiring it. I worked out the details of how to calculate maximum earnings share in my book Competing for Customers and Capital. I applied the results to eight domestic airlines in the 1st quarter of 2003 when only two of them weren’t losing money. If you want to get an overview of that analysis see my audio slide show The Rule of Maximum Earnings. It’s short and no walk in the park.

Table 1 sets the stage for this analysis with each carrier’s share of the combined $114.7 billion revenues in calendar 2007. American Airlines (AMR) captured 20.0% of total revenue. UAL Corp (UAUA) walked away with 17.6%; Delta and NWA got 16.7% and 10.9% respectively.
Continental (CAL) generated 12.4%; US Airways (LCC) had 10.2%; followed by Southwest with 8.6%; Jet Blue (JBLU) at 2.5%; and Frontier (FRNT) with 1.2% of group revenues.
Combined, DAL and NWA actually captured 27.6% of total revenues. Since both carriers were financially cleansed by bankruptcy court, what is your guess about their potential to maximize earnings?

Combining DAL & NWA revenue and costs as they appeared on their individual income statements produced an actual 2007 market share of 27.6% of group revenues. The vertical axis on this chart is the marginal cost as well as marginal earnings per share point.

Marginal costs continuously increase reflecting the underlying reality of competition. The marginal earnings schedule is constant, reflecting the assumption that there would be no major changes in the scale of combined operations. Under this assumption, maximum earnings market share is 26.7% of group revenues. If synergies were to be found after merging, the effect would be to push actual and maximum earnings market share even closer together. In either event, the combined companies come within no more than 90 basis points of realizing maximum earnings. That’s the good news.

TOTAL EARNINGS ALMOST AS FLAT

The bad news is the total earnings schedule is almost as flat at the marginal earnings schedule.

Market share appears on the horizontal axis ranging from 20% through 35% of group revenue. In this chart, total earnings appear on the vertical axis ranging from zero to $8 billion. There is just a $10 million difference between actual and maximum earnings.

A DOUBLE WHAMMY

I began this article by pointing to the painful price elasticity that exists in this capital intensive market for perishable products. For carriers competing with Southwest in the same city-pair, reported price elasticities range from -1.1 upwards to -2.6 depending on the number of competitors in the market. If you’re the only other carrier in a market with a 10% price premium in a city-pair boarding 1,000 passengers a day, 260 of them likely will switch to Southwest.

So you have to match LUV’s price. If you’re competing for 10,000 passengers a day in a market with four other carriers, including Southwest, and you don’t match LUV’s price, 1,630 of them likely will switch to Southwest. So, you’ve still got to match its price.

But, just as bad, you’re likely to be facing a highly inelastic earnings/share schedule. In the DAL/NWA example presented in this analysis, there is just a $30 million difference between total earnings at a 20% share of revenues ($3.56 billion) and a 35% share of revenues ($3.59 billion). That represents just a 0.8% increase in EBITDA across a spread from 20 to 32.5 revenue share points, a 63% increase. Without extraordinary synergies, a merged DAL/NWA might be facing an earnings/share elasticity of just a little over 0.01. Looks just like a double whammy.

What’s an airline CEO to do in this situation? Reconfigure the business model. Is there a road-map on how to do that? Yes, it’s called The Momentum Effect by Professor J.C. Larreche of INSEAD. It’s going to be published in hard copy by Wharton next month.
.

Northwest willing to merge without pilot deal, selling out pilot group!
Executives recommend the airlines move ahead with the combination, despite pilot disagreements.

MINNEAPOLIS (AP) -- Northwest Airlines Corp. has proposed to Delta that the airlines move ahead with their combination without a prearranged deal with pilots, a person with direct knowledge of the situation said on Friday.

The person, who asked not to be named because of the sensitivity of the situation, said Delta Air Lines Inc hasn't rejected the idea.

Neither airline would comment on the development, but Delta said in a statement that it supports "industry consolidation as a vehicle to ensure Delta remains an industry leader." It said it is continuing to look at strategic alternatives.

The usual approach in airline combinations has been to have pilots work out a joint union contract afterward. Delta and Northwest took a different approach in their merger talks, figuring that if they could obtain full pilot agreements in advance they would reap the benefit of a combined airline much sooner.

With that in mind, pilots were in line to get raises. But the two groups couldn't agree on seniority, which determines who flies more desirable aircraft and routes.

Now, the rising cost of oil has put all airlines under intense financial pressure. Since the talks began, Delta and Northwest have announced plans to reduce capacity this year, and Atlanta-based Delta has announced plans to eliminate 2,000 jobs.

The person who spoke about the talks said the absence of a seniority agreement means there won't be as much money for pilot raises.

Northwest's move could be intended to spur pilots to renew efforts to make a deal on seniority. Northwest pilots have said they'd be willing to let an arbitrator decide seniority. Delta pilots have rejected the idea.

Dave Stevens, chairman of the Northwest branch of the Air Line Pilots Association, issued a statement saying a successful merger will need the agreement of the pilots of both airlines.
"We will reserve our judgment and support until the economic and contractual elements of an agreement have been negotiated," he said. "Any merger must be in the best interests of our customers and the employees, not just the shareholders."
A spokeswoman for Delta's pilots had no comment.

Those shareholders have seen the value of Delta and Northwest investments shrivel. Both have lost about half their value since mid-February, suffering from rising oil prices and fading hope that they would combine. Both recovered from lows on Friday after the reports that Northwest was pressing the issue of combining. Northwest rose 30 cents, or 3.5% to close at $8.76. Delta rose 26 cents, or 3.1%, to close at $8.61.

AP
American Airlines Attendants Vote
Wednesday February 27, 12:44 am ET By David Koenig, AP Business Writer

American Airlines Flight Attendants Elect New Leader As They Head Into Tough Negotiations

FORT WORTH, Texas (AP) -- American Airlines flight attendants on Tuesday night elected a leader of their 1993 strike as the new president of their union, joining pilots in picking a more aggressive leader as they head into difficult contract negotiations.

Laura Glading, based in New York, defeated former president John Ward to lead the Association of Professional Flight Attendants, according to both candidates' Web sites.

Ward was president in 2003 when the union narrowly approved $340 million in annual wage and benefit concessions to keep American, the nation's largest airline, out of bankruptcy.
Glading said she will demand that flight attendants get those concessions back this year "with interest." That could set the union on a collision course with management, which says American is already at a labor cost disadvantage with other airlines.

"It's been five years since we made those significant concessions, and the cost of living has gone up," Glading said. "We can recover all those things and make significant gains."
The flight attendants' union is expected to begin negotiations on a new contract in the next few weeks. In the airline industry, such talks often drag on for years, and federal law makes it difficult for workers to go on strike.

Glading said it was too soon to talk about a strike, but said the flight attendants "are willing to do whatever needs to be done." Glading served on the union's board during a 1993 strike. She also served on the committee that negotiated a 2001 contract that was then seen as the highest in the industry. She will be sworn in as president April 1.

The current president, Tommie Hutto-Blake, did not run for re-election. She ousted Ward in a disputed election in 2004 that at one point Ward appeared to win. This time, Ward carried his home base of Dallas and a smaller outpost in Boston. Glading won in most other bases, including New York, Miami, Los Angeles and San Francisco. Glading and Ward finished ahead of two others in an election last month, but Glading didn't get a majority, requiring the runoff that ended Tuesday.

It appeared that union members also elected members of Glading's slate of nominees to become vice president, secretary and treasurer. Ward did not return a message seeking comment.
Last year, American's pilots ousted their president and replaced him with a more confrontational leader, Lloyd Hill, who proposed a 53 percent pay raise for pilots -- quickly rejected by the airline -- and called executive bonuses "blood money."

American's mechanics and bag handlers are represented by the Transport Workers Union. The three unions combined agreed to $1.6 billion in wage and benefit concessions in 2003. Fort Worth-based American is a unit of AMR Corp.

Exclusive

Breaking News

OUSTED BY THE DEPARTMENT OF LABOR
EX-UNION LEADER SEEKS RE-ELECTION

Monday February 12, 2008
By Roger Graham


St. Louis, MO – While elections loom across the nation, only one is more important to the flight attendants of American Airlines. They have begun casting their ballots for the president of the nation’s largest independent flight attendant union the Association of Professional Flight Attendants (APFA).

Former APFA president John Ward has thrown his hat in the ring for the coveted seat. As the incumbent in the 2004 National Officer election, he was declared president in the heated run-off election with his opponent Tommie Hutto-Blake amid false fire alarms during the ballot count; ultimately beating out Hutto-Blake by as little as five votes.

Later that year, Tommie Hutto-Blake was installed president on August 25, 2004, by unanimous resolution of the APFA Board of Directors following the close review of an August 17, 2004 letter to Ward from John H. Heaney, Chief of the Employment Standards Administration Department of Labor, Division of Enforcement. The Department of Labor had stepped in following formal DOL election complaints in March 2004. District Director of the Office of Labor-Management Standards, DOL, Kermit Perkins and Investigator Ann Woodward, validated, opened, counted and certified 16 ballots of APFA members who had been denied the right to vote on August 12, 2004. These additional counted votes brought the previously recorded tally which had been certified on March 12, 2004, to be recertified on August 27, 2004 with Hutto-Blake declared the true winner by seven (7) votes.

In a letter dated August 17, 2004 to the union, John H. Heaney, Chief, Division of Enforcement, U.S Department of Labor had stated “it is the OLMS position that APFA should immediately install candidate Tommie Hutto-Blake to the position of APFA president”. In doing so, Chief Heaney’s letter further states it would remedy the violations that occurred during the runoff elections giving APFA an August 26, 2004 deadline.

Other issues have surrounded the ex-union leader and candidate in the past. In 2004, Mr. Ward was also brought up on charges of improperly terminating an APFA staff employee without the knowledge and approval of the Executive Committee; a violation of the union constitution and policy upheld by arbitrator Francis Quinn. “The actions surrounding the termination of (said staff member) have all the appearances of arbitrary and capricious political retaliations”. Mr. Quinn further stated “The claim that he (Mr. Ward) did not act intentionally or that there was ignorance of the contractual mandate is without merit”.

“It’s time we unite, bring about change and restore our credibility as a union”, stated Toni Delia. Delia a furloughed flight attendant recently assisted in spearheading a grassroots effort to extend the recall rights of those currently laid off. “I am casting my vote for Laura Glading”, she stated.

Mr. Ward’s opponent is long time trade unionist Laura Glading who joined him in the run-off after last month’s primary. The successor to the current president will undoubtedly have their hands full as union members are demanding pay increases and better working conditions. American’s flight attendants suffered huge pay cuts, furloughs and reduction in benefits in 2003 through a restructuring agreement signed by Mr. Ward and the airline which is now in Federal court over the voting approval process of that agreement.

Nearly 19,000 flight attendants will be waiting in the wings to see who their next union leader will be as ballots are counted on February 26, 2008.

copyright 2007 Roger Graham

Senator Claire McCaskill
For Immediate Release December 21, 2007

McCaskill Brokers Deal to Save 1,200 Jobs at American Airlines

WASHINGTON, D.C. – U.S Senator Claire McCaskill today brought some holiday cheer to the families of over 1,200 laid-off flight attendants for American Airlines who were about to face expiration of their recall rights. In a press conference today, McCaskill announced that American Airlines and the Association of Professional Flight Attendants (APFA) have successfully concluded a new labor agreement for these workers.

The agreement was reached after Senator McCaskill initiated a ten-month series of negotiations in her Senate office on behalf of the men and women facing expiration of their recall rights after years of quality service to the company. American Airlines will extend for two years the option of laid-off flight attendants to get their jobs back at American Airlines. The airline has made a series of substantial hires in recent months, and Senator McCaskill has been assured that these 1,200 laid-off employees will be given a chance to return to the skies.

“American Airlines should be commended for doing what’s right – and I have no doubt that these returning workers will bring an exemplary level of service in the skies over Missouri,” said Sen. McCaskill. “This was an issue of fundamental fairness, and I am simply delighted that we were able to reach a successful resolution in the holiday season.”

"Not only has Sen. McCaskill saved and preserved jobs in Missouri with her actions, but also all across the nation. This workforce looks forward to returning to our jobs with American Airlines and serving the traveling public,” said Roger Graham, a former flight attendant affected by this announcement.

These employees were furloughed following the 9/11 attacks that devastated the airline industry. They were guaranteed a five-year right to reclaim their jobs from American if new hires were made, but the growth in the airline sector was slow and many furloughed employees were facing expiration of their recall rights, and loss of benefits.

Statement from Roger Graham

Of all the promises made to the former TWA Flight Attendants, all were broken but one. That promise was made by Senator Claire McCaskill, who promised to assist this workgroup to return to their jobs after the devastating events of 9/11.

With Senator McCaskill’s relentless negotiations with the respective parties, many former TWA flight attendants now have the opportunity to return to their career, leaving behind the destructive path of a merger and the events of 9/11. Senator McCaskill has successfully taken on some very serious challenges as she fills Harry Truman's Senate shoes with honor and dignity.

In less than one year in office, Senator McCaskill saved countless jobs in Missouri and all across the nation. In addition, Senator McCaskill successfully sponsored legislation protecting hundreds of thousands of employees that may one day face a merger within the airline industry. The economy of Missouri will prosper from her actions, and the results of mergers and acquisitions within the aviation industry, will soon be remarkably different.

This workforce looks forward to returning to our jobs with AA, and serving the traveling public. We owe a debt of gratitude and appreciation to many labor leaders, legislators and individuals including the TWA Flight Attendant "My Family". Special thanks to Senator Kit Bond (R-MO), Senator Dick Durbin (D-IL), Senator Ted Kennnedy (D-MA), their entire staff including those of Senator Claire McCaskill, representing the great state of Missouri.

Posted on Fri, Dec. 21, 2007 10:15 PM
TWA flight attendants should be flying again soon
By JIM SALTER The Associated Press

Sen. Claire McCaskill brokered a deal between American Airlines and the TWA flight attendants who lost their jobs after Sept. 11.

ST. LOUIS They took jobs as grocery workers, house painters, whatever they could to get by. But in the months to come, about 1,400 former Trans World Airline flight attendants who have been laid off for several years should be back to the skies.

Sen. Claire McCaskill of Missouri announced that she had brokered a deal between American Airlines and the Association of Professional Flight Attendants to extend the recall rights for the former TWA attendants for an additional two years.

At a news conference Friday, McCaskill said that with the upturn in the airline industry, the deal almost certainly means all of the attendants who want their jobs back will get them.

“In this line of work you have some dark days and then you have days like this,” McCaskill said, wiping a tear from her eye.

American bought TWA in 2001, just months before the airline industry was hit hard by the Sept. 11 terrorist attacks. As part of the merger, the former TWA employees went to the bottom of the seniority list. After the attacks, they were the first to go and the last to be recalled. All told, about 2,500 former TWA attendants were laid off.

Several hundred have since been recalled, but the recall rights for the rest were scheduled to end in November. McCaskill was able to get a brief extension and even threatened legislative action.

Eventually, American agreed to the extended recall rights. As part of the deal, the union withdrew grievances related to the handling of the layoffs. McCaskill lauded both sides, noting that the TWA attendants averaged 20 years of experience and would earn roughly 50 percent more than American would have had to pay beginners.

American spokeswoman Susan Gordon said, “I think we’re pleased to have been able to work through the issue and reach a mutually beneficial solution.”
Many TWA flight attendants were trained at the airline’s Breech Academy, which was at Lamar and Shawnee Mission Parkway in Overland Park. TWA’s headquarters also was in Kansas City, at 1735 Baltimore Ave., before it moved to New York in 1958 and then to St. Louis.

At Friday’s news conference, McCaskill jokingly told former attendant Roger Graham that he could stop calling her now. It was Graham who spearheaded the effort to extend the recall rights. “With Senator McCaskill’s help, many of the former TWA flight attendants will now have the opportunity to return to their career, leaving behind the destructive path of a merger and 9/11,” Graham said.

One of the attendants, John Linneman, said he took a job working on television towers before his recent recall. Others, he said, made do with low-paying jobs and financial insecurity as they tried to get by. "We all did what we could do, but we stayed together as a group," he said. McCaskill said many struggled to stay afloat. "There has been depression, financial ruin," McCaskill said. "There have been families torn apart, divorces. "Still, Graham said, there are no hard feelings toward the company. "We're a forgiving group," he said. "The only bitter feelings that remain are for 9-11."

Former TWA flight attendants get extended recall rights
Dec 20, 2007

WASHINGTON American Airlines has agreed to give about 1,200 former TWA flight attendants more time to get their jobs back. The ex-flight attendants were among more than 2,500 laid off in 2001, shortly after the two airlines merged.

Several hundred of the former TWA employees have been recalled in the past year, but the remaining 1,200 were close to losing their five-year recall rights.
Sen. Claire McCaskill, D-Mo., brokered the deal between the Association of Professional Flight Attendants and Fort Worth, Texas-based American to extend the recall rights for two more years.

"At the rate American Airlines is hiring employees, we expect that all employees on the recall list will have an opportunity to get their jobs back if they so desire," said Sean Kennedy, McCaskill's chief of staff. Kennedy said the deal was finalized on Thursday. "Sen. McCaskill is thrilled that she was able to bring closure to a dispute that's been simmering for five years now," Kennedy said.
McCaskill, who has been working on the deal for months, plans to announce details Friday at a 10:30 a.m. CST news conference at the Robert A. Young federal building in St. Louis.

The layoffs that began in 2001 were linked to the widespread problems the aviation industry faced after the Sept. 11 terrorist attacks. The TWA employees were laid off in waves starting in 2001, and the last group to lose their jobs would have seen their five-year recall rights expire in July.

Copyright 2007 The Associated Press. All rights reserved.

American Airlines to recall 247 furloughed flight attendants. Recallees are former TWA flight attendants. 460 recalled in August 2007. Many still falling off recall lists!
Thu Dec 13, 2007 4:40pm EST

CHICAGO, Dec 13 - AMR Corp's American Airlines said on Thursday it is sending recall notices to 247 furloughed flight attendants to address anticipated staffing needs and projected attrition for 2008.

The world's largest airline said it has recalled more than 900 flight attendants this year, including 900 former TWA and American Airlines flight attendants.

Although this represents good news for some furloughees, it still leaves little hope, beyond congressional intervention, to save the jobs of those flight attendants who have fallen or will soon fall off American's recall list.