even after declining a $770k bonus, CEO Parker collected annual compensation and incentive pay of $2.4 million (salary $550k, incentive pay $1.8 million), plus another $3+ million in restricted stock related to termination of pension plans. He stands to collect another big block of restricted stock once the certificates are merged.

Is he good? probably. some sort of bonus is likely warranted. but $2.4m is along the lines of what an arrogant overconfident DL paid Leo Mullin in 2003.. Is Parker truly amazing? Would it not be prudent to reserve judgment on that until the evidence is fully in? The 400-500% disparity with other current airline CEO's is stunning in its own right, but the "flame bait" it dangles in front of the labor groups is very very dangerous and seems most unwise.

This was posted on usaviation. It does a fairly good job of explaining why his compensation was high this year. I do find it amusing that three years is considered long term. Only in the US's quarterly number-driven economy is three years a long time.


Letter from Doug Parker

April 10, 2006

To: All Employees

US Airways today filed its 2006 proxy statement with the Securities and Exchange Commission (SEC). The proxy statement contains a good bit of information about our company but the section that usually gets the most attention is the disclosure of executive compensation.

I have consistently said two things about my compensation: 1) It will be heavily weighted toward performance. That is, most of my compensation will be in at risk items such as stock options and incentive programs that only pay if the company is successful; and 2) I will always be open and honest with you about how I am compensated. I think it is absolutely your business to understand how I’m paid and you should never be surprised to learn about my compensation by reading about it after the fact.

With that in mind, the following highlights the major components of the executive compensation table that is disclosed in today’s proxy filing:

Base Salary: I was paid a base salary in 2005 of $550,000. This is the same salary I’ve had since I was named CEO of America West in 2001 and it has not been changed with the passage of time or as my responsibilities have grown at our larger, merged company.

Annual Bonus: As you know, I declined my 2005 annual bonus of $770,000 and this is disclosed again in the proxy.

Long Term Incentive Plan (LTIP): I received payments of $1.7 million in 2005 through our LTIP, which was put in place at America West in early 2002 as an added way to focus management on creating long-term shareholder value. It pays based upon the company’s stock performance versus our competitors over a three-year period. The value of America West’s stock (converted to US Airways stock after the merger) increased 558% from 2002 – 2005, far more than any other airline, which resulted in the maximum payment under the plan. The amount is also unusually large because two performance periods ended in 2005 due to the transition to this LTIP.

Restricted Stock Awards: The compensation table lists $3.3 million of restricted stock awards for me in 2005. These are shares of stock that were awarded at the time of the merger. As this is by far the largest dollar value in the table, it is important to understand that this compensation has not yet been earned. The shares are not earned until November 2007 at the earliest, and at that time will only have this much value if US Airways’ stock retains its value.

In addition to the 2005 compensation table, the proxy statement also notes that I have $13.6 million of vested, but unexercised, stock options. All of these options were issued as former America West shares. In my ten years at America West, I have never sold a single share of stock. The value of these shares has fluctuated wildly over time and I, of course, will not recognize any of this value until I actually exercise and sell the shares.

I hope this helps you better understand my compensation. I recognize that it is a significant expense to our company and I fully appreciate the obligation that comes with it. I am committed to meeting that obligation and working with you to transform US Airways into a truly great airline.

This was posted on usaviation. It does a fairly good job of explaining why his compensation was high this year. I do find it amusing that three years is considered long term. Only in the US's quarterly number-driven economy is three years a long time.


Letter from Doug Parker

April 10, 2006

To: All Employees

US Airways today filed its 2006 proxy statement with the Securities and Exchange Commission (SEC). The proxy statement contains a good bit of information about our company but the section that usually gets the most attention is the disclosure of executive compensation.

I have consistently said two things about my compensation: 1) It will be heavily weighted toward performance. That is, most of my compensation will be in at risk items such as stock options and incentive programs that only pay if the company is successful; and 2) I will always be open and honest with you about how I am compensated. I think it is absolutely your business to understand how I’m paid and you should never be surprised to learn about my compensation by reading about it after the fact.

With that in mind, the following highlights the major components of the executive compensation table that is disclosed in today’s proxy filing:

Base Salary: I was paid a base salary in 2005 of $550,000. This is the same salary I’ve had since I was named CEO of America West in 2001 and it has not been changed with the passage of time or as my responsibilities have grown at our larger, merged company.

Annual Bonus: As you know, I declined my 2005 annual bonus of $770,000 and this is disclosed again in the proxy.

Long Term Incentive Plan (LTIP): I received payments of $1.7 million in 2005 through our LTIP, which was put in place at America West in early 2002 as an added way to focus management on creating long-term shareholder value. It pays based upon the company’s stock performance versus our competitors over a three-year period. The value of America West’s stock (converted to US Airways stock after the merger) increased 558% from 2002 – 2005, far more than any other airline, which resulted in the maximum payment under the plan. The amount is also unusually large because two performance periods ended in 2005 due to the transition to this LTIP.

Restricted Stock Awards: The compensation table lists $3.3 million of restricted stock awards for me in 2005. These are shares of stock that were awarded at the time of the merger. As this is by far the largest dollar value in the table, it is important to understand that this compensation has not yet been earned. The shares are not earned until November 2007 at the earliest, and at that time will only have this much value if US Airways’ stock retains its value.

In addition to the 2005 compensation table, the proxy statement also notes that I have $13.6 million of vested, but unexercised, stock options. All of these options were issued as former America West shares. In my ten years at America West, I have never sold a single share of stock. The value of these shares has fluctuated wildly over time and I, of course, will not recognize any of this value until I actually exercise and sell the shares.

I hope this helps you better understand my compensation. I recognize that it is a significant expense to our company and I fully appreciate the obligation that comes with it. I am committed to meeting that obligation and working with you to transform US Airways into a truly great airline.



"Committed to transform US Airways into a truly great airline"? Sure, if that's true, then I'm a Singapore Airlines Airbus A380. I'm not sure how upsetting the majority of frequent flyers, having a terrible fare structure that is certainly not typical of a LCC, and offering one of the weakest domestic First Class products of all time live up to that promise.

"Committed to transform US Airways into a truly great airline"? Sure, if that's true, then I'm a Singapore Airlines Airbus A380. I'm not sure how upsetting the majority of frequent flyers, having a terrible fare structure that is certainly not typical of a LCC, and offering one of the weakest domestic First Class products of all time live up to that promise.

Agreed. It takes less than no G2 to know that those two statements are facts.

Use Travelocity to check fares between any two US/HP cities. You will not find one city pair where US/HP fares are the lowest. Try PHX-MHT for instance. US as a LCC is an outright lie.

The only thing that will prevent US from dying within 24 months is Doug somehow connecting with the passenger experience...and improving it dramatically at reasonable cost.

He is spending a lot of time on employee surveys where many employees are saying, "Let's stop doing whatever we are not going to do well...like first class". Another question he is asking internally is, "Do you have everything you need to do your job", to flight attendants. The feedback he is getting is very heavily skewed toward, "We are embarassed about our company's approach and level of service to customers". The word inside is that nearly all of the best flight service personnel are leaving, and I am seeing that myself.

He and they know what they need to do, but currently refuse to do it. Desintegrating financial results will cause improvement to occur, but most likely not fast enough to save the ship.

It's kind of funny to hear people who actually believe that RASM, load factor and stock price are indicative of airline success.

Airline seats are the highest price point/most frequently purchased consumer product in the USA. RASM, load factor and stock price have no connection to customer satisfaction and willingness to return or willingness to recommend that someone else visit. But, Doug and a few others insist that they are important. It is very funny to watch.

It's kind of funny to hear people who actually believe that RASM, load factor and stock price are indicative of airline success.
Yes, why should we look at the actual numbers when we can take the word of somebody who's posted 5 pseudo-insider made up facts a day in the 10 days he's been here?

Labor disaster is an interesting new threat. Maybe if they said, really big, super dooper, we mean it this time labor disaster than they get more attention. :p The only tool USAirways unions have is hyperbolic hot air.

You know what, I do not always agree with DP... but I do respect Doug.. I think he is a pretty honest guy and does what he thinks is best in light of the business requirement.

I have always said, you need to merge the airline FIRST before you can really improve it... trying to do to much at once is not good. As long as they can keep the loads up while they merge, they will be in good shape. Also, if you keep the expectations lower for a while, when they do a promotion or two, it will exceed your new expectations.

I honestly think US Airways has a great chance to do well. It is what it is.. but it has a good chance of being successful


This was posted on usaviation. It does a fairly good job of explaining why his compensation was high this year. I do find it amusing that three years is considered long term. Only in the US's quarterly number-driven economy is three years a long time.


Letter from Doug Parker

April 10, 2006

To: All Employees

US Airways today filed its 2006 proxy statement with the Securities and Exchange Commission (SEC). The proxy statement contains a good bit of information about our company but the section that usually gets the most attention is the disclosure of executive compensation.

I have consistently said two things about my compensation: 1) It will be heavily weighted toward performance. That is, most of my compensation will be in at risk items such as stock options and incentive programs that only pay if the company is successful; and 2) I will always be open and honest with you about how I am compensated. I think it is absolutely your business to understand how I’m paid and you should never be surprised to learn about my compensation by reading about it after the fact.

With that in mind, the following highlights the major components of the executive compensation table that is disclosed in today’s proxy filing:

Base Salary: I was paid a base salary in 2005 of $550,000. This is the same salary I’ve had since I was named CEO of America West in 2001 and it has not been changed with the passage of time or as my responsibilities have grown at our larger, merged company.

Annual Bonus: As you know, I declined my 2005 annual bonus of $770,000 and this is disclosed again in the proxy.

Long Term Incentive Plan (LTIP): I received payments of $1.7 million in 2005 through our LTIP, which was put in place at America West in early 2002 as an added way to focus management on creating long-term shareholder value. It pays based upon the company’s stock performance versus our competitors over a three-year period. The value of America West’s stock (converted to US Airways stock after the merger) increased 558% from 2002 – 2005, far more than any other airline, which resulted in the maximum payment under the plan. The amount is also unusually large because two performance periods ended in 2005 due to the transition to this LTIP.

Restricted Stock Awards: The compensation table lists $3.3 million of restricted stock awards for me in 2005. These are shares of stock that were awarded at the time of the merger. As this is by far the largest dollar value in the table, it is important to understand that this compensation has not yet been earned. The shares are not earned until November 2007 at the earliest, and at that time will only have this much value if US Airways’ stock retains its value.

In addition to the 2005 compensation table, the proxy statement also notes that I have $13.6 million of vested, but unexercised, stock options. All of these options were issued as former America West shares. In my ten years at America West, I have never sold a single share of stock. The value of these shares has fluctuated wildly over time and I, of course, will not recognize any of this value until I actually exercise and sell the shares.

I hope this helps you better understand my compensation. I recognize that it is a significant expense to our company and I fully appreciate the obligation that comes with it. I am committed to meeting that obligation and working with you to transform US Airways into a truly great airline.

This was posted on usaviation. It does a fairly good job of explaining why his compensation was high this year. [/indent][/i]

Parker's rationalizations are scant comfort to anyone.

The $2.4m goes directly into the compensation expense the company incurs for him this year, whether or not part of it is labeled "long term incentive", with "two incentive periods" coinciding in 2005. And the other $3m in restricted stock will just pile up on top of whatever salary he's paying himself in 2007, should US/HP live to see that day...

For crying out loud, his regular base salary is already 22% higher than the CEO's of AA and DL, but the the company hasn't made a dime over the last four years. AWA had net earnings of minus 397 million (2005, not including US), minus 85 million (2004), plus 61 million (2003), minus 388 million (2002). even counting only operating profits, it's minus 120m (2005), minus 20m (2004), plus 33m (2003), minus 160m (2002).

You know what, I do not always agree with DP... but I do respect Doug.. I think he is a pretty honest guy and does what he thinks is best in light of the business requirement.

I have always said, you need to merge the airline FIRST before you can really improve it... trying to do to much at once is not good. As long as they can keep the loads up while they merge, they will be in good shape. Also, if you keep the expectations lower for a while, when they do a promotion or two, it will exceed your new expectations.

I honestly think US Airways has a great chance to do well. It is what it is.. but it has a good chance of being successful

A promotion or two? It certainly will not bring back all the premium customers and frequent flyers the airline has already lost. We all know US Airways is NOT a profitable leisure airline like Air Transat or LTU, thus their new model will not be profitable in the long-run, for the type of customers they are attracting are the ones that will easily abandon US Airways to fly Southwest if the latter offers a cheaper fare.

In the past, US Airways managed to deceive many frequent flyers. But now, so many of them know that other airlines offer significantly nicer amenities in F that there is no point of paying for F on US Airways. By the way, what's F on US Airways these days? No real food except mediocre 2-course meals on transcon, dirty planes, and very soon, limited leg room...

As the CEO of his company, my uncle used to spend over $200,000 in transatlantic premium class travel with US Airways. His last flights were so miserable that he basically told one of his travel consultants: "book me on them again, and expect a pink slip in less than 24 hours." I thought it was pretty funny. Then again, US Airways should not be charging more than $1,500 USD round-trip for any Envoy or as I like to call it, Super Premium Economy Class tickets.

Yes, why should we look at the actual numbers when we can take the word of somebody who's posted 5 pseudo-insider made up facts a day in the 10 days he's been here?

Excellent point -- such posts read more like those of a disgruntled former employee than a US CP. For one thing, there'd be more whinning about gate upgrades and pen marks on the seatbacks.

Excellent point -- such posts read more like those of a disgruntled former employee than a US CP. For one thing, there'd be more whinning about gate upgrades and pen marks on the seatbacks.

Not a problem. I don't take it personally. Just sharing actual data, and will continue to do so. Please keep an eye on what the near term future holds, and then you can reach your on conclusion based on that aged data.

Excellent point -- such posts read more like those of a disgruntled former employee than a US CP. For one thing, there'd be more whinning about gate upgrades and pen marks on the seatbacks.

Exactly. And let's not forget that operating numbers like RASM, yield, load translate directly to paying butts in the seats. It sounds like someone doesn't quite get the air travel as commodity idea. No matter how badly you tick a few people off, there's always a few more to take their place in the seats. God forbid we should use numbers indicative of actual performance over anecdotal "insider info". For example "all these elites" have been "leaving" for a couple quarters now with no appreciable impact on the bottom line.

Yes, why should we look at the actual numbers when we can take the word of somebody who's posted 5 pseudo-insider made up facts a day in the 10 days he's been here?

No offense intended but you might be, like many, confusing load factor and RASM with airline survival. When you look at the data surrounding the failures of Eastern, National, Vanguard, Pan Am, Branniff, and 4 others you will note that load factor never decreased prior to their liquidation. In nearly all cases, neither did their stock price or RASM, in comparison to other airlines at the time.

But, thats cool if you think those numbers are important to customers and airline survival. Many people disagree, however.

Yes, why should we look at the actual numbers when we can take the word of somebody who's posted 5 pseudo-insider made up facts a day in the 10 days he's been here?

Agreed -- great point. I'm not sure where that pos(t)er even finds the time to gather these "insider facts" since he seems to be jetting off with US/HP quite a bit, despite his obvious dislike of the airline. I don't know about you, but I doubt I'd spend "$53,600 year to date" (http://www.flyertalk.com/forum/showthread.php?p=5600205#post5600205) with a carrier I was so determined to badmouth.

But, thats cool if you think those numbers are important to customers and airline survival. Many people disagree, however.

If you sell something that costs $1 for 75 cents, you will go out of business. You will not make up the loss on volume.

That's why RASM/yield are only part of the equation. The other half is cost. When those airlines went out of business they weren't profitable. The stated goal of Mr Parker is to make US profitable, and they aim to do that this year (or is it next year?). Fact of life: profitable airlines don't go out of business.

Frankly, you sound like a disgruntled employee drinking union kool aid than someone who flies as much as you claim. Dubious claims such as the YTD spend you posted only further damage your credibility. For example, you claimed on the 99th day of the year (4/10) to have spent 53,600 and been on the road 79% of the time. For ease of math, that's 80 days on the road - $670/ travel day. Even at all BloFares, all the time that's pretty tough to do. And as for your even more dubious claims about last year (92,400 on 55% travel) is $1,680/travel day. That's a one way, full C-fare trip PHX-Europe every two travel days all year long. Nice try, kid. Please run back to airliners.net where you belong. :rolleyes:

If you sell something that costs $1 for 75 cents, you will go out of business. You will not make up the loss on volume.

That's why RASM/yield are only part of the equation. The other half is cost. When those airlines went out of business they weren't profitable. The stated goal of Mr Parker is to make US profitable, and they aim to do that this year (or is it next year?). Fact of life: profitable airlines don't go out of business.

Frankly, you sound like a disgruntled employee drinking union kool aid than someone who flies as much as you claim. Dubious claims such as the YTD spend you posted only further damage your credibility. For example, you claimed on the 99th day of the year (4/10) to have spent 53,600 and been on the road 79% of the time. For ease of math, that's 80 days on the road - $670/ travel day. Even at all BloFares, all the time that's pretty tough to do. And as for your even more dubious claims about last year (92,400 on 55% travel) is $1,680/travel day. That's a one way, full C-fare trip PHX-Europe every two travel days all year long. Nice try, kid. Please run back to airliners.net where you belong. :rolleyes:

If you sell something that costs $1 for 75 cents, you will go out of business. You will not make up the loss on volume.

That's why RASM/yield are only part of the equation. The other half is cost. When those airlines went out of business they weren't profitable. The stated goal of Mr Parker is to make US profitable, and they aim to do that this year (or is it next year?). Fact of life: profitable airlines don't go out of business.

Frankly, you sound like a disgruntled employee drinking union kool aid than someone who flies as much as you claim. Dubious claims such as the YTD spend you posted only further damage your credibility. For example, you claimed on the 99th day of the year (4/10) to have spent 53,600 and been on the road 79% of the time. For ease of math, that's 80 days on the road - $670/ travel day. Even at all BloFares, all the time that's pretty tough to do. And as for your even more dubious claims about last year (92,400 on 55% travel) is $1,680/travel day. That's a one way, full C-fare trip PHX-Europe every two travel days all year long. Nice try, kid. Please run back to airliners.net where you belong. :rolleyes:


I just wish you knew accurately what I do for a living. And, that you were better at math and how flying works. But, that's cool. Just watch how the future unfolds. Don't worry...we are still friends.

I just wish you knew accurately what I do for a living. And, that you were better at math and how flying works.
The stage is set and now's your chance. McFlyPHL has two advantages in his corner, our common sense and a calculator. You can either prove the numbers, or take a seat in the rear lav next to King.

The stage is set and now's your chance. McFlyPHL has two advantages in his corner, our common sense and a calculator. You can either prove the numbers, or take a seat in the rear lav next to King.

Thanks, fish! I always thought I was pretty good at math that didn't require multivariate diff eqs, but hey - I've been wrong before :D

Of course, since our friend has no idea what I do, how much I travel, or what I know about airline pricing, costing, and economics I just have to chuckle softly. In the meantime, I'll stand by my prediction that selling $1 for 75 cents is generally bad business while selling it for $1+ is good business.

To review again:
CASM/Costs down
Yields/Load/RASM up
---------------------
Good business.

Speaking of, my calculator suggests our friend is off on another of his twice-weekly Y fare excursions. Happy trails! :p

Thanks, fish! I always thought I was pretty good at math that didn't require multivariate diff eqs, but hey - I've been wrong before :D

Of course, since our friend has no idea what I do, how much I travel, or what I know about airline pricing, costing, and economics I just have to chuckle softly. In the meantime, I'll stand by my prediction that selling $1 for 75 cents is generally bad business while selling it for $1+ is good business.

To review again:
CASM/Costs down
Yields/Load/RASM up
---------------------
Good business.

Speaking of, my calculator suggests our friend is off on another of his twice-weekly Y fare excursions. Happy trails! :p

Neither the common sense nor the calculator is working. These are some math and common sense lessons:

1.) First class and business class are a lot more expensive than coach. They are not, in the US and HP instances higher value as I have discovered with increasing frequency during the last 4 months. That is why my spending is way down with HP/US.

2.) Some tickets are bought in advance, sometimes substantially in advance. They were last year as well, for comparison purposes.

3.) Some people who fly also occasionally buy tickets for other business flyers, for business purposes.


So, I encourage you...only if you wish to...to discuss on this board issues with fact support instead of mere opinional delusions.

I am finished with this silly subject so have much fun talking with yourself and while perhaps breathing US Jet-A fumes.

:-)

1.) First class and business class are a lot more expensive than coach. They are not, in the US and HP instances higher value as I have discovered with increasing frequency during the last 4 months. That is why my spending is way down with HP/US.


With this, you're falling into the same trap as many others on this board who kicked and screamed about "leaving" and how could the airline survive without them. It doesn't matter what YOU as an individual spend, nor what value you perceive if the airline can replace your revenue. A butt in a seat = revenue. Revenue greater than cost = profit. It makes ZERO difference who is attached to that butt that is paying higher fares.


2.) Some tickets are bought in advance, sometimes substantially in advance. They were last year as well, for comparison purposes.

3.) Some people who fly also occasionally buy tickets for other business flyers, for business purposes.


So, by definition, you did not accurately state YOUR spend for year to date travels. Even taking your above statements and figuring you've booked out the next 100 days at a similar pattern and always take a companion, your numbers don't add up.

Since you're done responding with conjecture and factless attacks on my math skills (which are very much in demand because chicks dig them :D) and common sense, this might be a good time to wish you safe travels back to a.net.

this might be a good time to wish you safe travels back to a.net.
Or...like I said, a seat next to someone else from this board. The bs factor on this board lately.... Gonna need new boots if this keeps up.

mere opinional delusions.


The phrase of the day!

The phrase of the day!

Finally.. something worth "borrowing" from FT useful for everyday life! :D