US labour unions are resisting as record profits for many carriers have weakened carriers' arguments for new concessions, while other tangential issues are also playing a part.
At USAir, record second quarter results are seen as the primary reason for the collapse of concession-for-equity talks (see opposite). And management negotiators at American and Delta, both in mediated discussions with their pilot unions, admit that strong profitability is hindering contract negotiations. The position is underlined by Philip Baggaley of rating agency Standard & Poor's, who sees no investment-grade ratings for junk-rated carriers like Delta without signed concessionary agreements. 'The recent strong results will make it harder to do that.'
Tangential concerns around the cost-cutting wave at airlines are also creating management-labour obstacles. At Delta, a realignment of the shorthaul system in early August (see p14) resulted in pilots filing an injunction against the action, claiming the move violates federal labour laws.
American Airlines pilots have expressed dismay over the carrier's 'sweeping codesharing deal with Canadian Airlines International, and [that carrier's] concurrent move to expand Pacific Rim flying,' says a spokesman for the Allied Pilots Association. American will not confirm that it is to give up its long-held ambition to serve Asian points itself. But the union believes Canadian's plan to serve Taipei from Vancouver is the first step in feeding American traffic to the region. AMR pilots will seek expanded scope-clause language to limit such codesharing flying.
Source: Airline Business
