From today's SCMP,

Simon Parry
Feb 08, 2011

Cathay Pacific (SEHK: 0293) is facing another potential showdown with its pilots just weeks after reaching a pay-rise agreement with them. This time the dispute is over the company's plan to change the basis of its leasing of cargo planes to Air Hong Kong, ultimately cutting Cathay Pacific pilots out of the operation.

The pilots' anger is prompted by their fears that the new arrangement may cost jobs and could lead to the airline's entire cargo operation being outsourced.

Cathay Pacific wants to "dry lease" four Boeing 747 freighters - meaning just the aircraft without crew - to Air Hong Kong, replacing an existing arrangement whereby Cathay Pacific pilots fly the Cathay 747s on Air Hong Kong services and use an Air Hong Kong call sign (known as a "wet lease"). Cathay Pacific owns 60 per cent of the airline, which handles DHL express deliveries, while DHL holds the remaining 40 per cent.

Cathay Pacific pilots have been asked to help train Air Hong Kong pilots to fly the Boeing 747s, a situation the Aircrew Officers Association (AOA) warns may lead to tension on the flight deck as pilots train crew who will "take their jobs".

In a circular to members, the AOA says it believes the dry-leasing arrangement is a step that might ultimately lead to Cathay Pacific's entire cargo operation being outsourced to Air Hong Kong, whose pilots are paid less than those at Cathay.

The airline currently has a fleet of 24 Boeing 747 freighters flying to 38 destinations. The circular warns pilots that the dry-leasing deal would have "serious long term effects on your career". Air Hong Kong has a fleet of eight Airbus A300-600 freighters and serves 12 destinations.

In a letter to the airline's Director of Flight Operations Richard Hall, signed by AOA chairman Peter Vinna and his counterparts from offshore Cathay pilot bases in Australia and Canada, the AOA calls for the plan to be scrapped.

The letter says the dry lease would be in breach of a 2003 arrangement for Cathay Pacific pilots to fly the Boeings for Air Hong Kong, and that the union believes management has an "ulterior motivation" for the step.

It says the training of Air Hong Kong pilots by Cathay Pacific crew "raises the distinct possibility that tensions will exist on the flight deck while these duties are being performed since our pilots are being asked to train crews that will take their jobs".

In an apparent reference to possible pilot action, the letter says: "What is most unfortunate about this whole situation is that it has the potential to completely undo any goodwill that we were able to achieve by reaching the current pay deal."

A Cathay Pacific spokeswoman said Air Hong Kong wanted to operate the aircraft itself and lease further planes "to meet the demands of its business".

Cathay currently has 10 new freighter aircraft on order. "All these aircraft will be operated by pilots who currently work for or will be recruited to work for the airline," she said.

"Opportunities for progression and promotion on the rapidly modernising fleet of aircraft have never been better."

JW

A few points if I may.

First of all, the AHK new joiners or wannabes are pretty obvious. Yes, ted and booble, that would be you. Not exactly a beehive you want to poke your carrot into at the moment but thanks for the input.

Next, why can't pilot's (sic) ever figure out how to use an apostrophe? It's pilots. Not pilot's. Sad. (Grammar police have been notified).

The CX "spokeswoman" spewed the standard drivel. Upgrades for all and rapidly expanding yadda yadda blah blah blah. I think I threw up in my mouth a little.

Now, on to the AHK thing. Of course CX is looking for a way to save themselves $$. That's not a shock. Every company in the industry is looking for a regional, a LCC or some other avenue of outsourcing work to save a buck or two. Europe, Oz, USA, take your pick. It's been done before and will continue to do so.

Whether or not AHK takes over CX freight remains to be seen. Who actually knows the percentage of DHL on the wet lease flights to and fro SIN? That would give an idea if there will be a plan to fill the 744 with CX cargo or if it's legitimately DHL business inside.

Hard to say whether the trainers will have a short or long cattle prod during the AHK training. (BTW, when does this training begin?) It would be nice if they could hold personal feelings out of the equation but we all know that human beings have a difficult time doing that. Good luck to the first batch of AHK Boeing recruits.

With 4x744, what will happen to the A300s? (Please note: no apostrophe required here) Will they be spares? New destinations? Take over CX cargo from lightly-loaded destinations? Where will the 744 operate (besides SIN)?

How will the AOA handle this battle? Is it really worth a huge ****storm for 4 horrid, noisy, beat-to-death airframes? Maybe. Why not the stink about the Air China operation? Because it's not on the same ramp? How did Lufthansa pilots fare after their showdown over Jade? I'll have to look that up but it couldn't have gone too well considering they're part of Aero Logic now too.

Time will tell how this plays out. Until a yellow 744 shows up in CLK, it's difficult to get all the panties bunched up.

To all a good night.

Good post Freight, pity about the grammar lesson though. And, by the way, I most certainly am not a potential employee of AHK or an actual one.

A point has been brought up that I also have been wondering. Why the big deal about just AHK? What about Air China as well???? It is the exact same thing. CX is seriously outsourcing flying. I'm ready as usual to stand behind an AOA recommendation. It will be interesting to see what they recommend. Can we 'grieve' this ala US unions, or do we need to literally sue the company to prevent this. Does anyone know the exact documents that are supposed to prevent this scenario? And are the legally binding or just some fluff written between the company and the AOA?

IB

As the 747-8s arrive the BCFs will go. The BCFs were only ever an interim measure and an engineering exercise to help CX sell its ex Pax aircraft when the time comes. Most of the pax aircraft will be converted into freighters and sold on to freight operators with whom we currently compete.

AHK will eventually operate those BCFs on their own AOC. CX is retaining control in the short term in case there are further delays to the -8. For the same reason the departure of BCFs to Air China was delayed longer than planned.

The BCF is less than ideal for the CX operation. It is heavier than a dedicated freighter by about 4 tonnes, it is nearly 7 tonnes light in its landing weight and the ZFW is short by 12 tonnes. It cannot do a cost effective job on CX routes. In 12 months most of them will be gone. If AHK wants to compete with CX on CX routes it will not be able to do so using BCFs. CX operated certain routes on behalf of DHL, but these were never CX freighter routes.

There is nothing to stop AHK, under the terms of its own AOC, buying -8s for itself. What are we to do then? Go head to head with CX management because a rival is expanding?

There is a case to be made for not training another operators crews on CX aircraft. But trying to stop AHK expanding in the long term is a non-starter.

The "big deal" with AHK is that it is Management agreed to limit the operation to narrow body freighter aircraft with the exclusion of the A300F. The 744 breaches that agreement.

There is no issue with Air China Cargo, just the usual grumbles.

jonathon68

Where can I find a copy of that agreement?

BIG MACH

Is this allowed or not?

STP

The agreement had a use by date.(expiration)
X

xdc9er,

The Widebody scope clause is in effect. There is no expiration date.

Forward CofG

BIG MACH states:

If this is the case, does the clause that you refer to apply or not?

STP

Absolutely correct! Especially with the ex CX General running AHK. Its a buisness world my friends! ;)

Agreements, contracts, promises etc are all in paper or verbal, all to be or subjected to negotiation. History repeats! :ok: Go back to the colonial days and remind ourselves.

Lets see what the AOA can do. :ugh:

Good luck!

Happy landings

The AOA can and will do nothing.

They lost the fight with CX management the day after the 49-ers were fired. If the fleet had been grounded that day they would be in a totally different situation today. As it turned out, all flights departed, operations were normal, because the fear-factor entered the equation.

Battle lost, management won. And they will win the war.

To resist the AHK situation is futile. Management will get their way, CX trainers will do as they're told and train AHK new-joiners on the -400.

Why? Because fear is factor for all of us.

Yes
 

Sadly, that is quite correct. Market forces is what will drive the future. Again, sadly, this is no longer a career airline. Why would anyone stay now? Double tax, no more bases, no pension. It's almost as if they want people to leave. The AOA had a real chance here recently and did nothing.

Che, you haven't got your facts right and I question your motives for your post.

The company anticipated much of the fleet to be grounded when the 49ers were fired; they could then tear up contracts due to an 'illegal' strike and rehire on their own (reduced of course), terms; a 'lockout'. CX, or its consultants, may have 'read the manual' after a mass resignation by Australian domestic pilots in 1989 which resulted in a very similar situation which in that case eventually worked in management's favour.

CX was embarrassed when a strike wasn't called, and the boys sat at home on Reserve while our passengers flew in the dodgy chartered aircraft that had been pre-booked.

With the ongoing legal costs, compensations, bad press, ill-will etc CX are still paying the price for this ill-advised action over a decade later. Subsequent legal action by based 49ers led to foreign tax authorities investigating CX's basing structure and costing the shareholders more money.

Further publicity about the infamous 'Star Chamber' hit the press, coincidentally, after the illegal flypast by a management pilot in a CX B 777 with passengers on board on its delivery flight. There's also a book about to come out on the 49ers which will again bring some public attention to the whole disaster. I'm sure that it will sell reasonably well in Hong Kong. Hardly a victory for Cathay Pacific, Che.

The AOA emerged smaller due to 'quitters', but the remaining core financially assisted the 49ers for years and became the basis for a much stronger group with no illusions as to the scruples and competence of who we work for.

And what's more, many CX pilots are tired, pizzed off, are suffering dreadful rosters and disruption due to crew shortage, and there are more and more alternate jobs out there; there have been 12 resignations from Australian FO's alone with, anecdotally, many more to come from North America. Response to CX's rip-off 'fast track cadet' scheme was distinctly, and embarrassingly, underwhelming. They are supposedly attempting damage control, but once your swimming pool has been pooped in, it takes a long time for your friends to come back to it after it has been cleaned; further crew shortage.

Many CX crew feel that there would be nothing to lose with taking a hard line regarding the AHK issue. Prospective AHK joiners should do their research thoroughly as to the real situation and who they will be working for. Rant over.

Dart,

Very well said!!

box

Dart++
 

Dart, best post from anyone, except Toss, for some time!

WHAT UTTER CRAP.......by a membership that was too scared to do anything so they come up with a sorry ass excuse as to why nothing was done. :yuk::yuk::yuk::yuk:. Half the membership were too scared to participate in MSS....and you actualy believe not going on strike was a tactical decision???? Give me a f#@*ng break!!

You do remember how we all got new contracts and were told sign or be fired right?? They don't need us to go on an "illegal strike" to reduce our CoS.

Yup the same members that eventually sold out the 49ers because the extra dues were becoming an inconvenience..

Che's post is spot on!

OK Flap, seeing you know so much about it I've edited the first part of my post to more general terms; it was my opinion, having been involved in the 'lockout' scenario I referred to.

I assume from your language and use of multiple vomiting emoticons, very easy to post on an anonymous forum, that you feel very strongly about events of that time. I take it that you supported the 49ers all the way to the courtroom steps, were or are an AOA committee member or volunteer, and that you harangued the non-members, quitters and MSS non-compliers to their very faces. Funny how I don't recall a motion for a strike ballot from anybody, which would have included yourself; or had you written everybody off even then? And I'm sure that you will be buying the book as your token of ongoing support.

Relevant to the thread, I look forward to hearing from you what YOU are prepared to DO about this AHK situation.