JetStar to pay for ratings
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Illusion,
I totally agree with your entire post.
As J* costs go up, aligning more closely with mainline the less likely they are to get the new jets anyway!
So no problem with parking jets, there's another entity available to crew them.
I believe the 1st 15 * B787 are still going to Jetstar (at present).
But execs are awaiting the numbers on the mainline / subsidiary cost/yield analysis.
Dont expect to hear any announcements till after mainline EBA8 goes thru
I totally agree with your entire post.
As J* costs go up, aligning more closely with mainline the less likely they are to get the new jets anyway!
So no problem with parking jets, there's another entity available to crew them.
I believe the 1st 15 * B787 are still going to Jetstar (at present).
But execs are awaiting the numbers on the mainline / subsidiary cost/yield analysis.
Dont expect to hear any announcements till after mainline EBA8 goes thru
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Master Caution has of course just outlined the real AIPA strategy.....to push up JQ costs to the point where there's no reason for it to exist and they get all the 787s.
From their point of view, very clear, very logical. From the shareholders point of view, a disaster. From the point of view of pilots wanting growth and commands.....not good news. For those who've already got good super, a big jet and a command....no problem at all.
Any actuary could tell you exactly how long to bond for and for how much, to offset training costs. (And remember that the actual endorsement is not even a mjaority of the real cost of the first year of a new pilots life). A pilot would do the same number crunching if faced with paying for own endorsement or accepting a training freeze. The bond is probably a good strategy to get the right guys without putting costs up.
Just remember the pilot pays for every endorsement. Up front in cash, by years working for a dodgy carrier to get the endorsement somewhere else, by a training freeze, by a bond , by training pay, or by the low growth rates (read: time to command) that come with a huge legacy airline training pipeline thru multiple types. Or more than one of the above.
From their point of view, very clear, very logical. From the shareholders point of view, a disaster. From the point of view of pilots wanting growth and commands.....not good news. For those who've already got good super, a big jet and a command....no problem at all.
Any actuary could tell you exactly how long to bond for and for how much, to offset training costs. (And remember that the actual endorsement is not even a mjaority of the real cost of the first year of a new pilots life). A pilot would do the same number crunching if faced with paying for own endorsement or accepting a training freeze. The bond is probably a good strategy to get the right guys without putting costs up.
Just remember the pilot pays for every endorsement. Up front in cash, by years working for a dodgy carrier to get the endorsement somewhere else, by a training freeze, by a bond , by training pay, or by the low growth rates (read: time to command) that come with a huge legacy airline training pipeline thru multiple types. Or more than one of the above.
Last edited by genex; 14th Mar 2008 at 22:36.
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Interesting how people ignore the evidence right in front of them. Obviously an actuary trying to live with the harsh realities of the airline business there genex?
There are many of us that have not paid for an endorsement and are making more money than the new Jetstar EBA!
Australia is a rich country with great distances and a good mining/tourism and interstate commerce. There is no reason to treat pilots like paupers. The pilots will not be treated this way anymore either, which is why your aircraft are becoming very expensive airport ornaments.
There are many of us that have not paid for an endorsement and are making more money than the new Jetstar EBA!
Australia is a rich country with great distances and a good mining/tourism and interstate commerce. There is no reason to treat pilots like paupers. The pilots will not be treated this way anymore either, which is why your aircraft are becoming very expensive airport ornaments.
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Don't get too personal too quickly boys. I have no vested interest in this at all and you should focus on the issues not knee-jerk reactions. I sincerely hope you are more logical in the cockpit. Emotion is no asset to a professional pilot.
Read what I said...that like the "free steak knives" that you can get with TV buying, someone somewhere is always paying. If the method of paying is that airline management accept lower profits from the part of the business that gives you a "free" endorsement in an airline with a huge, multi-type training pipeline, then you should expect less resources devoted to that part of the business, and lower growth. Which is what you have at Qantas.
When I first joined a major Australian airline decades back I signed a bond for my first endorsement. Also signed that they could send me anywhere on any type for the first 2 years as I recall. When I got my 777 rating years back I paid for it and also signed a bond that I'd stay for 3 years to cover the cost of ground and line training. No big deal at all and I have never regretted it.
I could of course have stayed with that major Australian airline and waited for my "free" 777 rating. Still be waiting wouldn't I? Or I could have joined the other major Australian domestic airline and waited...and I'd be unemployed because they couldn't manage their way out of a paper bag and were swamped by massive pilot salary and training bills.
When pilot training finally comes under a comprehensive HECS umbrella, and when any endorsement costs become tax deductible to the pilot then we'll get somewhere. But I fail to see how a bond is such a big deal to people who have already...under AIPs benign oversight...accepted training freezes and low growth promotion rates. You do truly get what you pay for.
For those reading this who are on big shiny old jets, waiting year after year for the next promotion....enjoy your life. The world outside is moving on.
Read what I said...that like the "free steak knives" that you can get with TV buying, someone somewhere is always paying. If the method of paying is that airline management accept lower profits from the part of the business that gives you a "free" endorsement in an airline with a huge, multi-type training pipeline, then you should expect less resources devoted to that part of the business, and lower growth. Which is what you have at Qantas.
When I first joined a major Australian airline decades back I signed a bond for my first endorsement. Also signed that they could send me anywhere on any type for the first 2 years as I recall. When I got my 777 rating years back I paid for it and also signed a bond that I'd stay for 3 years to cover the cost of ground and line training. No big deal at all and I have never regretted it.
I could of course have stayed with that major Australian airline and waited for my "free" 777 rating. Still be waiting wouldn't I? Or I could have joined the other major Australian domestic airline and waited...and I'd be unemployed because they couldn't manage their way out of a paper bag and were swamped by massive pilot salary and training bills.
When pilot training finally comes under a comprehensive HECS umbrella, and when any endorsement costs become tax deductible to the pilot then we'll get somewhere. But I fail to see how a bond is such a big deal to people who have already...under AIPs benign oversight...accepted training freezes and low growth promotion rates. You do truly get what you pay for.
For those reading this who are on big shiny old jets, waiting year after year for the next promotion....enjoy your life. The world outside is moving on.
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Well, I guess that the above post by Genex does go to prove that he is talking out of his backside. Mainline provides higher yields and how could Ansett's pilot salaries be responsible for it falling over? Maybe if you had have joined Qantas you could be flying your nice new A330 or soon an A380.
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Genex enjoyed the pay and condition, for many years, hard won by strong unions, and, in fact, was a union heavy himself. His attitude today perplexes me.
Did he hear the voice of Geoff on his road to his Damascus.
Did he hear the voice of Geoff on his road to his Damascus.
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Never met Geoff...never heard his voice...never was a union "heavy"., don't want to fly a 330 or even worse, a 380. I have done my flying and have no regrets, except for those who will take years and years to command because of short-sightedness. But I did enjoy the conditions hard fought for by a union (singular) before the Qantas pilots set upon their own destruction by leaving and watched, smiling in 1989 while the industry tore itself apart.
So you have beaten me...I just give up trying to explain about the real world. I recommend you stay away from it because it might bite. In return for me ceasing to annoy you with posts about the thread topic...BONDS, or indeed any other....could you last few AIPA spokespersons/posters who take all this so personally and are so filled with venom...please PM me regularly with your monthly schedule so that on those flights I might take in my retirement, I can avoid cockpits where passion and blinkers get in the way of real judgement.
Good luck with your careers and, in the decades to come, your commands.
So you have beaten me...I just give up trying to explain about the real world. I recommend you stay away from it because it might bite. In return for me ceasing to annoy you with posts about the thread topic...BONDS, or indeed any other....could you last few AIPA spokespersons/posters who take all this so personally and are so filled with venom...please PM me regularly with your monthly schedule so that on those flights I might take in my retirement, I can avoid cockpits where passion and blinkers get in the way of real judgement.
Good luck with your careers and, in the decades to come, your commands.
Mstr Caution,
I am not making comparisions with J* / mainline- I belong to NEITHER of the two.
I am simply stating that the fight between the LCC's eg Tiger, Jetstar, Lionair etc may largely be determined by their ability to attract and retain experienced crew to uphold the integrity of their operation, allow expansion and to gain competitive advantage in the areas of schedule reliabilty, on-time departures and staying out of the 9 O'clock news.
I am not making comparisions with J* / mainline- I belong to NEITHER of the two.
I am simply stating that the fight between the LCC's eg Tiger, Jetstar, Lionair etc may largely be determined by their ability to attract and retain experienced crew to uphold the integrity of their operation, allow expansion and to gain competitive advantage in the areas of schedule reliabilty, on-time departures and staying out of the 9 O'clock news.
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Genex...
Are you really trying to suggest that pilot salary had anything to do with the collapse? I believe it had more to do with corporate greed and incompetence.
Training bills? Don't you have the biggest bills with the highest staff attrition leaving you with the lowest experience?
that major Australian airline ... swamped by massive pilot salary and training bills.
Training bills? Don't you have the biggest bills with the highest staff attrition leaving you with the lowest experience?
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Genex.
I haven't outlines AIPA strategy, purely my own opinion. So any inference that it is AIPA's strategy is your opinion only. Unless you know something about AIPA strategy I dont.
Just like Jetstars employees strategy is to improve there own lot in life which in turn achieves the same result !!
Not necessarily a disaster for the shareholders either Genex, all is dependant upon where the best yield is achieved.
You also failed to mentioned the hundreds of pilot in Qantas mainline whom dont hold commands but have however been patiently waiting for there time to command. They have been employed within the group long before the birth of Jetstar. Do they not want growth & commands too, or is that limted to J* only?
Lower growth at Qantas mainline? QF mainline is about to embark on the largest training & protional expansion in it's history.
The Ansett collapse had nothing to do with pilot salaries. But managers negotiating EBA's will have you believe that.
I do however agree with your statement "you get what you pay for" & as those managing airlines will eventually reap what they sow.
Illusion, Agree with you there again. but in the case of J* as I mentioned. No aircraft will ever be parked cause mainline will be there to pick up the pieces.
I haven't outlines AIPA strategy, purely my own opinion. So any inference that it is AIPA's strategy is your opinion only. Unless you know something about AIPA strategy I dont.
Just like Jetstars employees strategy is to improve there own lot in life which in turn achieves the same result !!
Not necessarily a disaster for the shareholders either Genex, all is dependant upon where the best yield is achieved.
You also failed to mentioned the hundreds of pilot in Qantas mainline whom dont hold commands but have however been patiently waiting for there time to command. They have been employed within the group long before the birth of Jetstar. Do they not want growth & commands too, or is that limted to J* only?
Lower growth at Qantas mainline? QF mainline is about to embark on the largest training & protional expansion in it's history.
The Ansett collapse had nothing to do with pilot salaries. But managers negotiating EBA's will have you believe that.
I do however agree with your statement "you get what you pay for" & as those managing airlines will eventually reap what they sow.
Illusion, Agree with you there again. but in the case of J* as I mentioned. No aircraft will ever be parked cause mainline will be there to pick up the pieces.
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Master Caution,
“As J* costs go up, aligning more closely with mainline the less likely they are to get the new jets anyway!”
Are you privy to detailed information about Jetstar costs v Qantas costs. Do you think Jetstar's cost savings only come from pilot salaries or do you suspect it may be a bit more complex than that?
More importantly, the implication of this comment by master caution is that Qantas pilots will watch Jetstar pay and conditions increase until they have lost the comparative advantage over Qantas thus guaranteeing Qantas pilots the 787 gig. Or put another way, “we will forgo pay rises (that will widen the Qantas/Jetstar gap) in order to place ourselves in a competitive position within the labor market”.
Has the penny finally dropped?
And this little gem from Kangaroo court,
“Australia is a rich country with great distances and a good mining/tourism and interstate commerce. There is no reason to treat pilots like paupers. . . . “
Except, last time I checked, the Australian economy is still based upon the capitalist principles of market forces. Salary is not based on generosity.
“As J* costs go up, aligning more closely with mainline the less likely they are to get the new jets anyway!”
Are you privy to detailed information about Jetstar costs v Qantas costs. Do you think Jetstar's cost savings only come from pilot salaries or do you suspect it may be a bit more complex than that?
More importantly, the implication of this comment by master caution is that Qantas pilots will watch Jetstar pay and conditions increase until they have lost the comparative advantage over Qantas thus guaranteeing Qantas pilots the 787 gig. Or put another way, “we will forgo pay rises (that will widen the Qantas/Jetstar gap) in order to place ourselves in a competitive position within the labor market”.
Has the penny finally dropped?
And this little gem from Kangaroo court,
“Australia is a rich country with great distances and a good mining/tourism and interstate commerce. There is no reason to treat pilots like paupers. . . . “
Except, last time I checked, the Australian economy is still based upon the capitalist principles of market forces. Salary is not based on generosity.
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The professor,
Of course the cost analysis is more complex then pure pilot salaries.
However as the remuneration differential decreases then remuneration is taken from the equation.
As oil prices increase then other costs also play (to a lesser extent) less importance.
My observation of the scenario regarding a loss of the jetstar competitive advantage is nothing new. Have a look at my previous posts!
Months prior to the EBA4 vote, I stated to the effect that Jetstar pilots should caution wage growth for risk of loosing competitive advantage over mainline.
I have stated on numerous occasions in the past that as Jetstar pilot's wages increase, then their competitive advantage over mainline is diminished.
If paying for endorsements is over for jetstar, then there's another loss of competitive advantage.
What AIPA choses to do, whether maintain the differential or tighten such by mainline wage constraint is up to them.
I don't run AIPA, but if I was I know what I would do.
I also expect alot more is happening behing the scenes within EBA8 negotiations to secure B787 flying. To think otherwise would be naive.
When The JPC locked themselves away with management to secure the A330 flying, in effect shutting out AIPA. Did they not expect that when push came to shove AIPA would not use all available resources and economy of scale to protect their members?
Again, my opinion only. But GOAL will never happen.
Jetstar & QF mainline are two seperate companies. Qantas mainline will never be told who they have to employ, ask any senior QFLink pilot about that.
(not that i think this is fair or just, but it's the way it is)
I really dont think that any mainline pilot has anything to gain from GOAL.
The best outcome for Jetstar pilots would be a deal similar to those in QFlink with more than 2 years of service.
I expect that AIPA will negotiate a deal with EBA8 to secure all the B787 flying, once the company renegs on GOAL.
For any junior mainline pilot to vote yes for EBA8 without such deal needs their head read.
Remember economies of scale, there are more QF second Officers than Jetstar pilots.
I agree with market forces, cause economy of scale & market forces will dictate who flies what & in what colour scheme.
Oh yeah, speaking to those that would know. Who have made no secret about it. Yes, the first 15 B787's are going to J* (at present & subject to change. The remaining 100 * B787's are up for grabs depending on best yield.
Of course the cost analysis is more complex then pure pilot salaries.
However as the remuneration differential decreases then remuneration is taken from the equation.
As oil prices increase then other costs also play (to a lesser extent) less importance.
My observation of the scenario regarding a loss of the jetstar competitive advantage is nothing new. Have a look at my previous posts!
Months prior to the EBA4 vote, I stated to the effect that Jetstar pilots should caution wage growth for risk of loosing competitive advantage over mainline.
I have stated on numerous occasions in the past that as Jetstar pilot's wages increase, then their competitive advantage over mainline is diminished.
If paying for endorsements is over for jetstar, then there's another loss of competitive advantage.
What AIPA choses to do, whether maintain the differential or tighten such by mainline wage constraint is up to them.
I don't run AIPA, but if I was I know what I would do.
I also expect alot more is happening behing the scenes within EBA8 negotiations to secure B787 flying. To think otherwise would be naive.
When The JPC locked themselves away with management to secure the A330 flying, in effect shutting out AIPA. Did they not expect that when push came to shove AIPA would not use all available resources and economy of scale to protect their members?
Again, my opinion only. But GOAL will never happen.
Jetstar & QF mainline are two seperate companies. Qantas mainline will never be told who they have to employ, ask any senior QFLink pilot about that.
(not that i think this is fair or just, but it's the way it is)
I really dont think that any mainline pilot has anything to gain from GOAL.
The best outcome for Jetstar pilots would be a deal similar to those in QFlink with more than 2 years of service.
I expect that AIPA will negotiate a deal with EBA8 to secure all the B787 flying, once the company renegs on GOAL.
For any junior mainline pilot to vote yes for EBA8 without such deal needs their head read.
Remember economies of scale, there are more QF second Officers than Jetstar pilots.
I agree with market forces, cause economy of scale & market forces will dictate who flies what & in what colour scheme.
Oh yeah, speaking to those that would know. Who have made no secret about it. Yes, the first 15 B787's are going to J* (at present & subject to change. The remaining 100 * B787's are up for grabs depending on best yield.
Mstr Caution,
you state"I have stated on numerous occasions in the past that as Jetstar pilot's wages increase, then their competitive advantage over mainline is diminished".
It is not about a J* vs mainline. They are a different product targetting different segments of the marketplace. If /when J* do drop this requirement their ability to attract experienced jet crew with the possibility of a quick command due lack of suitable applicants within will be considerable and the company will create advantage iover the LCC competitors.
you state"I have stated on numerous occasions in the past that as Jetstar pilot's wages increase, then their competitive advantage over mainline is diminished".
It is not about a J* vs mainline. They are a different product targetting different segments of the marketplace. If /when J* do drop this requirement their ability to attract experienced jet crew with the possibility of a quick command due lack of suitable applicants within will be considerable and the company will create advantage iover the LCC competitors.
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It is not about a J* vs mainline
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Actually it is way more difficult than just focussing on yield. For example, for years USAir trumpeted that their higher costs were OK because their yields were high too.
But since the dawn of civil aviation yields have been falling...long run average of 4% I think. Over the life of the 787 in Qantas service, yields will fall significantly. Thats why airline managers look not just at yield (Revenue per Passenger Kilometre) but at Cost (Cost per Available Seat Kilometre) and Passenger Load Factor. That's just for starters. Then there's cargo revenue, fuel price volatilty, competitive positioning, competitor's strategies, cost of capital, accounting and tax policy etc etc etc. Cost by itself is a giant subject. Then there's the yield mix, by seat, by day, by hour, by season. Utilization and scheduling too are biggies.
Yield worshippers need to look hard at the two biggest (daily passengers emplanements) airlines in the world....Southwest and Ryanair. They have shown that there is no defensible yield strategy other than to work out how to make money at the "free market" rate.
The Qantas CitiFlyer service is great. I use it often and it is a wonderful tool for the businessman and for all those on lower price seats who fill up the gaps. Its yields are higher than "free market" which is why Qantas does not use Jetstar to directly compete with CityFlyer. But in the longer term the yields are still falling, taking planeload vs planeload, year upon year.
Still, if the AIPA strategy is to get the 100 B787s at any cost, then good luck to them. They might just find out the deep truths about that proverb..."Be careful what you wish for"...because there will be myriad bitter pills AIPA will have to swallow over the next 20 years so that QF mainline can ever make money from the 787. If you doubt me, find some USAir pilots and ask them about reliance on high yields to cover high costs and the price they had to pay, as highly paid union members for believing in fairies.
Anyhow, I am old and this is all beyond me....maybe AIPA does actually know it all. Think I'll sell my QF shares though, just in case.
But since the dawn of civil aviation yields have been falling...long run average of 4% I think. Over the life of the 787 in Qantas service, yields will fall significantly. Thats why airline managers look not just at yield (Revenue per Passenger Kilometre) but at Cost (Cost per Available Seat Kilometre) and Passenger Load Factor. That's just for starters. Then there's cargo revenue, fuel price volatilty, competitive positioning, competitor's strategies, cost of capital, accounting and tax policy etc etc etc. Cost by itself is a giant subject. Then there's the yield mix, by seat, by day, by hour, by season. Utilization and scheduling too are biggies.
Yield worshippers need to look hard at the two biggest (daily passengers emplanements) airlines in the world....Southwest and Ryanair. They have shown that there is no defensible yield strategy other than to work out how to make money at the "free market" rate.
The Qantas CitiFlyer service is great. I use it often and it is a wonderful tool for the businessman and for all those on lower price seats who fill up the gaps. Its yields are higher than "free market" which is why Qantas does not use Jetstar to directly compete with CityFlyer. But in the longer term the yields are still falling, taking planeload vs planeload, year upon year.
Still, if the AIPA strategy is to get the 100 B787s at any cost, then good luck to them. They might just find out the deep truths about that proverb..."Be careful what you wish for"...because there will be myriad bitter pills AIPA will have to swallow over the next 20 years so that QF mainline can ever make money from the 787. If you doubt me, find some USAir pilots and ask them about reliance on high yields to cover high costs and the price they had to pay, as highly paid union members for believing in fairies.
Anyhow, I am old and this is all beyond me....maybe AIPA does actually know it all. Think I'll sell my QF shares though, just in case.
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Capt Sherm it would've been far more convincing if you didn't make it obvious that you don't know what yield is. With your lack of knowledge I think you have just outed yourself as management. 