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CX Director Flight Ops: "Young pilots don't want pensions or medical care"

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CX Director Flight Ops: "Young pilots don't want pensions or medical care"

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Old 7th Feb 2007, 03:40
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CX Director Flight Ops: "Young pilots don't want pensions or medical care"

Pilots turning scarce as demand takes wing
After years of layoffs and pay cuts, expansion of air travel creates shortage of qualified crews

By Julie Johnsson
Tribune staff reporter
Published February 4, 2007

For the first time since the Sept. 11, 2001, attacks, all major U.S. airlines are hiring pilots or recalling those laid off during the industry's five-year downturn.

But the airlines are discovering that many of the 10,000 pilots who lost their jobs during those bleak years aren't interested in returning to their old lives.

Many pilots, faced with salary cuts of 35 percent or more, moved to overseas carriers, such as Emirates Airline and Cathay Pacific Airways Ltd. Others took higher-paying jobs with overnight carriers such as FedEx Corp. and United Parcel Service Inc.

Joe Marquardt, 50, left a 17-year career at Northwest Airlines last year for Emirates, as the Minnesota-based carrier phased out the DC-9 jets he flew.

He already had lost one-third of his salary in pay cuts, Marquardt said, and he faced a demotion to a smaller plane, which would mean another pay reduction.

"It got to the point where we couldn't keep the house," Marquardt said.

Now, Marquardt enjoys a life of golf and beachcombing in Dubai, as well as the free housing provided by Emirates, which employs him as a Boeing 777 captain.

"It's hard to match that back home," Marquardt said.

After slashing pilot jobs and pay to survive the last downturn, old-line carriers may find it tougher to hire pilots to keep pace with the industry's rebound, experts say. In fact, they appear to be facing a shortage in the decade ahead.

The trend is a byproduct of the loss of financial security and prestige suffered by the airlines that have long dominated U.S. travel, increased recruiting of American pilots by foreign carriers and the global boom in commercial aviation and airliner sales.

"It is a wild and crazy time, and it's really just begun," said Kit Darby, an expert on pilot hiring trends and pay. He is president of Atlanta's Air Inc.

About one-third of the world's airline pilots work in the United States, the largest market for air travel. But U.S. pilots are becoming hot commodities for overseas carriers, which need large numbers of experienced pilots to fly the fleets of wide-body aircraft they have on order from Chicago's Boeing Co. and Europe's Airbus SAS.

Boeing predicts that the total number of planes used by airlines around the world will more than double by 2025, to 35,970. To keep pace, Darby estimates airlines will need to hire more than 210,000 pilots globally, more than double the number currently working.

Moving the mandatory retirement for pilots to age 65 from age 60, as proposed by the Federal Aviation Administration last week, will help a little. Darby estimates that relaxing retirement rules will reduce U.S. airlines' hiring by about 3,800 jobs during the next five years.

"That's only a drop in the bucket compared to the need," he said. "There are many, many airplanes coming, and with them large increases in air service."



Demand from light jets

That's not including the competition for pilots that airlines will face from air taxi operators flying a new breed of jets that carry between three and five passengers.

Merrill Lynch estimates that 925 of these aircraft, known as very light jets, will be delivered by 2010. That's up from the 21 jets that rolled out of factories in 2006. And all of these planes will need certified jet pilots in their cockpits.

Don Osmundson, vice president for flight operations at Florida-based DayJet Corp., said his company plans to hire about five pilots for each of the 239 Eclipse 500 jets it has on order.

Once it passes regulatory hurdles, DayJet plans to fly business travelers to destinations of their choosing in Florida and, eventually, other states in the Southeast. DayJet doesn't plan to fly on weekends, and its pilots will return to their home bases every evening.

Osmundson hopes that will be a draw for airline pilots, sick of a vagabond lifestyle that involves days away from home. He says DayJet has received 1,700 applications, many of them from airline pilots who either opted for early retirement or were forced from their jobs at age 60.

"The fact is that even at the major carriers, the job is not what it used to be," said Osmundson, who's a former vice president at Continental Airlines.

Many pilots still aspire to fly large aircraft for major carriers such as Elk Grove Township-based United Airlines, which has about 6,500 pilots, down from more than 10,000 in 2001. Captains at these carriers still earn six figures and have jobs that let them see the world.

But such jobs are no longer considered aviation's plum posts: Pilots' hours are longer, and their pay is lower.

United Airlines has offered jobs to all of the 2,172 pilots it furloughed, industry parlance for "laid off," during the downturn. About 1,000 of them have returned to the airline, while others passed on the initial job offers.

Now, United is moving through its list of furloughed pilots, whittled down to about 800, for a second and final time as it plans to add 300 pilots this year.

"Guys have to make a decision whether they're coming back to United or not," said Steven Derebey, a Boeing 737 captain at United and spokesman for its pilots union. "When they reach the end of that[list], they will have to start looking to the outside for new pilots."

FedEx and UPS, whose pilots were once derided as "cargo dogs," have long since displaced United Airlines, US Airways and Delta Air Lines at the top of the pay scale in the United States. The most senior pilots at the freight carriers earn about $40,000 more annually than their counterparts at the old-line carriers.

Foreign flag carriers, who would not have contemplated luring pilots from the major U.S. airlines during the 1990s, are holding recruiting drives here.

Cathay Pacific hired about 55 American pilots last year to fly its Boeing 747 cargo planes, said Nick Rhodes, director of flight operations for the Hong Kong-based airline.

Cathay, which has a cargo base in Chicago, plans to add 65 U.S. pilots this year and close to 100 in 2008, said Rhodes. About 10 percent of the carrier's 2,100 pilots are Americans, most of whom joined the airline during the past three to four years.

The six major U.S. airlines are adding pilots to replace those lost to retirement and attrition, and to keep operations moving smoothly as they keep their airplanes in the air for longer stretches of time.

So far, Continental Airlines and Delta Air Lines are the only two who are seeking new pilots. Continental Airlines plans to hire 336 pilots in 2007, after adding 491 in 2006. Delta Air Lines, which saw a large number of pilots take early retirement, plans to hire 200 pilots during 2007.

American Airlines, meanwhile, began recalling the first of its furloughed pilots in January. The nation's largest airline plans to rehire 70 pilots through April, then add about 30 pilots per month after that.

US Airways plans to recall 284 pilots this year, while Northwest Airlines says it will rehire 150 pilots in the first six months of 2007.

The carriers will need to step up hiring as they replenish their aircraft fleets, something Boeing executives predict will happen during the next two years. And that's when the real hiring crunch will begin, Darby predicted.



Training adds to cost

Airlines will face large training costs to bring on the new cadres of pilots, an expense most haven't encountered since 2001. And any shortages could give pilots unions additional leverage to seek higher wages from the carriers.

"It's a huge need, and they're going to be working hard to solve it," Darby said.

Others are more optimistic.

"It's possible you'll see some spot shortages, but I really don't think you'll see long-term shortages," said economist Daniel Kasper, managing director and head of the transportation practice at LECG Group, a Boston-based consulting group.

"To the extent that airlines are having trouble finding pilots, salaries will go up, and that will draw military pilots."

Even so, old-line carriers no longer can claim a monopoly on hiring the best and the brightest pilots.

The best recruiters, the overseas airliners are discovering, are the pilots themselves. Marquardt, for one, has started a blog for pilots pondering following in his footsteps.

Cathay Pacific is drawing pilots in their mid-30s from the likes of United Airlines, who are impatient to fly the new Boeing 777 and 747 aircraft. They would have to wait a decade for such jets at American carriers, which reserve their biggest aircraft for pilots with the most seniority.

"Young pilots don't think about [pensions] or medical care. They just want to strap themselves into a new 777," Rhodes said.


http://www.chicagotribune.com/busine...i-business-hed
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Old 7th Feb 2007, 12:24
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you know whats coming...

the next contract for all of cx pilots, old and young, no pension or medical care..BRILLIANT!!! wait, on second thought, we already don't have a pension to speak of..so next COS will be with no medical..thats more like it...i'm sure it will save the company millions...

hmmm.......wonder if a part time job at Walmart would provide medical care...

better watch that housing allowance...(i wonder why those north america bases are becoming so senior in the left seat...)

Last edited by elgringo; 7th Feb 2007 at 15:56. Reason: correction...
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Old 7th Feb 2007, 12:53
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RE: Paying your Dues (and I don't mean ALPA)

Ok your 23 with a new ATP with no children maybe a wife that works, but just think what are you going to do when you have a wife who stays at home or can't work due to older age or illness and two(2) kids in college at....let's see $50,000 a year per child by the time your kids are old enough to go to college.
Sure you stepped into a job flying a "Commuter Jet" right after flight training. You never flight instructed for $5.00 an hour, hauled freight (single pilot) for $20,000 a year. Yea I know the cost of things were not as much as things are now. But are you going to work until you "DIE" just to live. When you get to strap on a Boeing 777 think......I will fly it for less....I will have to work until I "DIE" just to live.... Like this smiliey face your running into a brick wall.
You need to listen to age....as the old joke a old bull and young bull see cows in the field and the young bull says lets RUN down there and get one...the old bull says let's WALK down and get them all.....(get all the benefits, money, and retirement.)
I just got a Captain bid after 20 1/2 years...I've paid my dues more than once...but I will still have to work until I die just to feed my family...
THINK ABOUT IT !!!
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Old 7th Feb 2007, 15:00
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"Young pilots don't think about [pensions] or medical care. They just want to strap themselves into a new 777," Rhodes said.
It's the new catch phrase to replace "there is no money in freight".
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Old 8th Feb 2007, 01:21
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Nick Rhodes is just confirming the sorry state of our industry.
Here are some comments I found on PPRuNe.



"Money is not too much of an issue, I am not flying to become rich, but what is the roster like?"


"On flightglobal.com Sigmar is offering a self-sponsored typerating program giving rating, line training and a contract to nov-07. Now, I have no idea how much this costs or what the terms are, but it looks like a good way to "get in" and get your first job..."


"What you can expect is to pay for your own type rating if you haven't got one..and i heard that it could cost as much as 280 thousand "Swedish Krona"(37000 USD) so.. that's why some people here will think you are "nuts" .. but unfortunatlly we have to start some where by some how."


Gentlemen, we are our own worst enemy, not the employer. It wont get any better until this ends.
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Old 8th Feb 2007, 02:04
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Just goes to show how much Rhodes thinks of his staff.......what an out of touch idiot he really is. Work for food, absolutely Nick just as long as I can fly a 777!!!. Get real loser.
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Old 8th Feb 2007, 02:55
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The one thing Cathay is always good at is figuring out how to reduce an officer's worth.

Sadly we have agreed with them everytime!!
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Old 8th Feb 2007, 03:32
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Well, it is all about supply & demand. It always has been. It is easy to lure the young pilot onto a B777 or B747 and you can't blame them. It is normal.

Many years ago, I was one of those pilots too. After flying the 747-400 for a few years and with family growing (kids and more kids), my priorities have started to shift towards livestyle and family.

Today, I still enjoy flying the 744 and probably prefer long haul flying to 4 sectors/day, but my perspective has definitely changed. Flying a 747 is no longer on top of my priority list. The fact alone, that I'm fairly experienced on type and -at least currently- considered a "hot" commodity and therefore employable and relatively well paid -which enables me to provide for my loved ones- is what keeps me in the game.

The complications, when it comes to work/life balance is just a quite high price to pay - sometimes anyway.

Of course, the other alternative is, that one does not want to have any long lasting relationships in which case all bets are off. Perversely, being on the 2nd and 3rd wife seems to be a generally accepted norm for pilots, even seen as a virtue. I have yet to understand the logic of that.

Anyway, I guess it is up to the older generation of pilots to fight for the T&C's and let the young ones grow up first, until they are able to take over the helm. (Probably too idealistic, but sounds good anyway)

Keep the blue side up !!
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Old 8th Feb 2007, 03:44
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Note this is from a US paper. For young US pilots - this makes sense.

Start off in commuter to get PIC time, not as career, when you have enough hours then...

Join CX to get heavy time, not as career, when you have enough hours then...

Join UPS/ Fedex until retirement

So CX is a means to an end.

Given number of US crew leaving CX for UPS/FDX after just a short time in CX, any wonder that they aren't that concerned by the pension/ medical, just the take home pay?
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Old 8th Feb 2007, 08:24
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The title of this thread is misleading. The quote was:

'Young pilots don't THINK about [pensions] or medical care'

The point being made is that most of us are more concerned with climbing the ladder than considering what happens when we get there. He makes a very valid point.
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Old 8th Feb 2007, 09:27
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christn

I have to agree with you. Just because a young guy or girl may not “think” about pensions or medical cover when they are trying to get into CX or any carrier for that matter doesn’t mean they don’t “want” it. I think some are reading too much into what our DFO is saying and putting words in his mouth to suit their own agenda.
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Old 8th Feb 2007, 10:10
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I "think" you are kidding yourself 404 if you "think" that any airline would not want to get rid of medical, rental, schooling and other benefits tomorrow. I "think" it comes down to what they would like to do and what they can get away with. Who in their right mind does not "think" about the full benefits package when they join a company. It is rather insulting to say that because a pilot is 23 (or younger) that they are not mature enough to see the benefit of a medical plan!
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Old 8th Feb 2007, 10:42
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Start off in commuter to get PIC time, not as career, when you have enough hours then...

Join CX to get heavy time, not as career, when you have enough hours then...

Join UPS/ Fedex until retirement

So CX is a means to an end.

Given number of US crew leaving CX for UPS/FDX after just a short time in CX, any wonder that they aren't that concerned by the pension/ medical, just the take home pay?
Perhaps, in a rather perverse way, rodent man is correct?

Whether or not it comes back to bite him on the arse may not be the point...especially if he has moved on...
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Old 8th Feb 2007, 10:59
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Tryhard

You are correct in saying that an airline (or indeed any employer) would like to reduce staff benefits. However..... that is NOT what NR is saying. We cannot just change the wording/meaning of a comment to suit ourselves - that just makes us look foolish. His comment is absolutely correct; he confirms that we are our own worst enemies!
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Old 8th Feb 2007, 11:51
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tryhard

Now you’re putting words in my mouth that I didn’t say.
How long ago did you join CX? Did you have an intimate knowledge of CX’s pension scheme and medical benefits before you came here? Be honest with yourself now. I bet you didn’t. I certainly didn’t but don’t get me wrong, that doesn’t mean I don’t want it. I would have to be mad to say that. The information just wasn’t available. I did though have good information on salary and housing and the cost of living in Hong Kong.
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Old 8th Feb 2007, 15:00
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Tryhard,

"...It is rather insulting to say that because a pilot is 23 (or younger) that they are not mature enough to see the benefit of a medical plan!"


It may be insulting, but tell me one young gun out of flight school, who honestly gives a $hit about anything other than SJS (shiny jet syndrome).

That's why there are regional airlines; no, better, that's why regional airlines CAN exist.

When I was that young, I was chasing the dream too. I'd be lying if I made my job selections based on who had the best retirement scheme!

But one thing I didn't do, is step on anyones feet, or bypass anyone with pay for training, or any immoral crap like that.

Now that I'm wiser (a lot less hair on top, must mean I'm wiser!) my priorities have changed.

And so, if Cathay offer me a job based on me paying my way through their training, I will not take it.

I quit paying for flight training when I got my ATP ride.

But I agree with Titan, don't read too much into that article. Unless of course you people want to get yourselves riled up, to have something to biatch about...
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Old 9th Feb 2007, 04:28
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""It is a wild and crazy time, and it's really just begun," said Kit Darby, an expert on pilot hiring trends and pay. He is president of Atlanta's Air Inc."


Ahhhh Kit. The Expert. Always with his finger on the pulse....
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Old 9th Feb 2007, 11:41
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It may be insulting, but tell me one young gun out of flight school, who honestly gives a $hit about anything other than SJS (shiny jet syndrome).
Just one? For me it was crop dusting, but I know plenty of folks who couldn't have cared less about a jet. Not everybody has stars in their eyes.
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Old 9th Feb 2007, 13:33
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Do you think young pilots tell Nick Rhodes what they really think, or what they think their new employer wants to hear........
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Old 9th Feb 2007, 15:52
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Too true Liam.
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