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AA to reduce staff by 40K, invol furlough 19,000, 1 Oct 2020

AA to reduce staff by 40K, invol furlough 19,000, 1 Oct 2020

Old Aug 25, 20, 10:03 am
  #1  
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AA to reduce staff by 40K, invol furlough 19,000, 1 Oct 2020

Seems a new thread hasn't been started on this devastating news yet, so might as well jump.

Per JonNYC




My heart hurts for all my dear friends affected by this over at AA. However, there is still hope that the PSP extension will be passed when Congress reconvenes. We will see....
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Old Aug 25, 20, 10:32 am
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This is terrible news that everyone knew was coming. American appears to be downsizing less than United or Delta. I think American is gambling with running at greater capacity than the two main legacy competitors on the assumption that if flying comes back sooner, they will be ready to take on the business. I read somewhere that American determined that after analyzing the opportunity cost of planes sitting parked while lease payments continued would be off-set by whatever flying American chose to do. Unfortunately, most analysts say the high cash burn will catch up with American in the first quarter of 2021. I really hope they are wrong!
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Old Aug 25, 20, 10:37 am
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Wasn't this announced months ago that coming what October 1st? Either way so sorry to hear. I heard WN cutting down their daily flights by 60 at DAL. I don't know what UA or DL has in plan come 10/1.
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Old Aug 25, 20, 10:39 am
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Originally Posted by ksweeney View Post
This is terrible news that everyone knew was coming. American appears to be downsizing less than United or Delta. I think American is gambling with running at greater capacity than the two main legacy competitors on the assumption that if flying comes back sooner, they will be ready to take on the business. I read somewhere that American determined that after analyzing the opportunity cost of planes sitting parked while lease payments continued would be off-set by whatever flying American chose to do. Unfortunately, most analysts say the high cash burn will catch up with American in the first quarter of 2021. I really hope they are wrong!
A total decrease of 14K FAs represents over 50% of the workgroup. Parker has already clarified a plan to only fly a reduced 50% schedule compared to 2019 through the end of the year. As of right now, the other majors I think have still scheduled far more than that percentage wise through the end of the year, but I wouldn't be surprised to see similar cuts announced as more clarity comes around as to whether a PSP extension is likely. But as it stands, it seems to me that AA is actually downsizing more than United or Delta. Am I missing something?

Originally Posted by enviroian View Post
Wasn't this announced months ago that coming what October 1st? Either way so sorry to hear. I heard WN cutting down their daily flights by 60 at DAL. I don't know what UA or DL has in plan come 10/1.
Original announcement months ago was overage of 7k-8k. Now it has ballooned up to 14K (8100 furloughs + early outs and leaves)

Last edited by standbyalldtime; Aug 25, 20 at 10:41 am Reason: add response to enviroian
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Old Aug 25, 20, 11:18 am
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You are probably right. I was going on a report in the morning news on Bloomberg a couple of weeks ago that was decrying Doug Parker for not downsizing fast enough. That report was anticipating what the carriers were going to do when the money ran out on Sept 30th. I hate to see anyone loose their job, especially the great people that have done such a wonderful job of getting me from point a to point b every week for all these years, but it also sounds like this was a tough decision that could not be avoided.
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Old Aug 25, 20, 12:06 pm
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AA Cutting 19,000 Jobs Oct 1st, When Fed Aid Protecting Jobs Expires

American Airlines will cut 19,000 employees in October when federal aid that protected those jobs expires and the coronavirus pandemic continues to devastate travel demand, the carrier said Tuesday.

The Fort Worth, Texas-based airline, which employed more than 140,000 people in March, is prohibited from laying off workers through Sept. 30 under the terms of a $25 billion federal aid package set aside for carriers to weather the worst of the crisis. But demand has only modestly recovered, presenting a dire scenario for airlines. American said its fourth-quarter capacity will be half of the year-ago level and that international long-haul flights will be just 25% of its 2019 schedule.
https://www.cnbc.com/2020/08/25/amer...n-october.html
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Old Aug 25, 20, 12:27 pm
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This really sucks but is something that needs to be done and should have been done sooner. At least they are furloughs for the time being.
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Old Aug 25, 20, 12:32 pm
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Originally Posted by ksweeney View Post
I hate to see anyone loose their job
I'm ok with those FAs who played fast and loose with service standards losing their jobs. Those losers really needed to tighten their job performance rather than loose it.
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Old Aug 25, 20, 12:51 pm
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Originally Posted by Herb687 View Post
I'm ok with those FAs who played fast and loose with service standards losing their jobs. Those losers really needed to tighten their job performance rather than loose it.
It would be great if job performance was the deciding factor in who stays and who goes.
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Old Aug 25, 20, 12:53 pm
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Originally Posted by saltytheseagull View Post
This really sucks but is something that needs to be done and should have been done sooner. At least they are furloughs for the time being.

Exactly, I dont feel any worse then for any other employee in any other biz that has or will be losing their job. If anything I feel worse for alot of others who lost min wage jobs and were not even able to live paycheck to paycheck. Most employees in the airline industry made out extremely well money wise and to an extent way to well

It doesnt make sens for any biz to carry any employee/ that they simply have no work for or forsee work for. A Carrier is a biz and not a charity, that should also include cutting Execs and Exec pay and stock/options
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Old Aug 25, 20, 1:19 pm
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Originally Posted by Herb687 View Post
I'm ok with those FAs who played fast and loose with service standards losing their jobs. Those losers really needed to tighten their job performance rather than loose it.
Not just that, but why do airline employees think they should not be affected by the economic effects of COVID 19?

Tons of other industries are furloughing or laying off employees, but airline employees should somehow be protected?
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Old Aug 25, 20, 1:25 pm
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Originally Posted by Statman View Post
Not just that, but why do airline employees think they should not be affected by the economic effects of COVID 19?

Tons of other industries are furloughing or laying off employees, but airline employees should somehow be protected?
Agreed. It's never great to see people being laid off or furloughed and my best wishes go out to those at AA who are in that situation.

In reality though, millions of people in most other industries did not get to enjoy an additional six months of payroll on behalf of the government and have been experiencing this since March/April.
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Old Aug 25, 20, 1:37 pm
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Originally Posted by cmd320 View Post
Agreed. It's never great to see people being laid off or furloughed and my best wishes go out to those at AA who are in that situation.

In reality though, millions of people in most other industries did not get to enjoy an additional six months of payroll on behalf of the government and have been experiencing this since March/April.
I'm not knowledgeable enough in economics to make have a fact vs emotion based response as to whether the PSP was truly necessary. I tend to agree that paying senior captains' 300K annual salary in full sounds excessive, but one way or another the employees of airlines would have ended up costing the federal government a huge sum of money (whether through PSP or UI payments).

It's also hard to argue that industries that rely on international travel have been disproportionately affected. I struggle to think of any other large company in which 50% of a major workforce is cut (13.9K leaves/early outs/furloughs against 26.5K total FAs at AA).

Perhaps aid can be restructured in a way that helps preserve the basic income of affected employees without funding the extravagant lifestyles of those making 6 figures at taxpayers expense. Then again, adding any thoughtful structure or complexity to a government aid program seems like a surefire way to get it killed/delayed to the point of being ineffectual.

In some ways, I actually applaud AA mgmt for making cuts this deep. It shows a commitment to reduce cash burn and maintain a sustainable business model, and as a (small) shareholder I appreciate their efforts to keep bankruptcy at bay and fulfill their obligations.
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Old Aug 25, 20, 4:25 pm
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Originally Posted by Herb687 View Post
I'm ok with those FAs who played fast and loose with service standards losing their jobs. Those losers really needed to tighten their job performance rather than loose it.
This was generally done by seniority, so those that did an excellent job were swept away with those who didnít.
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Old Aug 26, 20, 6:06 am
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Originally Posted by Herb687 View Post
I'm ok with those FAs who played fast and loose with service standards losing their jobs.
Originally Posted by wrldwide1 View Post
This was generally done by seniority, so those that did an excellent job were swept away with those who didnít.
This furlough, like all such actions in the airline business, is entirely seniority-based. So more junior, more enthusiastic, less burned out employees will be cut, while more senior, probably more cynical and jaded, employees will remain.
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