More than a year ago the REXPC did some number crunching on the movement of pilots, and the numbers didn't add up. They approached the Chief pilot with what they believed would be a loss of at least half the pilot group over the next 12 months. The Chief pilot was quite dismissive and whilst acknowledgeing the problem (off the record at that stage) believed the loss closer to 20%. So much for the Chief pilot's grasp of the situation.
During subsequent meetings the REXPC proposed to stem the expected flow by what in reality was the only solution. 40% payrise! This would have bestowed a rise for Captains of approx $30K P/A and for F/O's $18K P/A. The costings were passed on to management and were acknowledged as being correct for the amount of money required. Based upon 1.2 million pax per annum at the time, the cost came in at $6.25 per ticket!
Some excuses for not proceeding were,
- We'll lose market share. Yeah right! REX has competitors on only 5 of it's 48 routes. Keep the ticket price the same on those and make the levy $7.00 on the rest. Not exactly rocket science.
- Pilots will leave regardless. Some will, many wont. Even at this early stage the REXPC could see that the loss of experienced Captains and upgradeble F/O's would be the problem. One senior REX manager famously remarked "Experience is overrated". We can only pray that little statement doesn't come back to haunt. It was therefore suggested that rather than diluteing the rise by an increase in fortnightly salary, that it be made as an ongoing yearly retention bonus. Stay the full year, you get the lot. Leave after 364 days, you get nothing. If pilots do leave, then the company keeps the money! Win, Win. Sh!t! this thing sells itself!
- Passengers will not tolerate an increase in fares. They will drive or take the bus! Yes and my Mum still believes in the Tooth Fairy! Rex hedge virtually all the cost of fuel by way of a ticket levy (around $44) and that's per sector! This levy was introduced without fanfare and without hesitation. Guess what, more people are flying with REX than ever before. approx 1.5 Million last year.
The fact that REX are making record profits, and are carrying record numbers appear on the surface to dispell the naysayers. In the latest advice to investors (see apache's first post) they acknowledge that this performance will be in jeapody if pilot attrition does not fall to 20%. Jesus! You think so! What we all know is that the barrel is now empty. If REX are to prevent the inevitable bloodletting next year then they must act now. So what sort of pax levy would do it. I'm afraid the previously suggested 40% may be less effective given that REX Pilot's wages are now an industry joke.
How's this for an idea.
- $10 per sector per pax.
- Bonus to be paid proportionally to REX pilots on the completion of each full years service
- How much will this bestow? Approx $50K for Captains, $30K for F/O's
- Crewing problems solved for life!
Damn! I was having such a nice dream.