United Airlines UAL this weekend began the process by which it could eliminate the jobs of more than a third of its 12,250 pilots as soon as Oct. 1.
And the airline’s chief pilot warned that unless travel demand rebounds this summer much stronger than they anticipate, a lot more pilots could be pushed into the unemployment lines, along with corresponding numbers of mechanics, flight attendants, ground workers, administrative staff and managers.
United on Saturday sent its pilots an email announcing a bid for work slots effective June 30 that involves the “displacement” of 4,457 positions. That makes United the first U.S. airline to disclose its staff reduction plans in response to the COVID-19 pandemic and its staggering impact on travel. United, like nearly all U.S. carriers, received large grants and low interest loans from the federal government aimed at keeping their staff employed across the summer and ready for a swift return of travel demand. United’s share of those grants and loans totaled about $5 billion, roughly half of which already has been received with balance to arrive in a few weeks.
Now, a quick rebound in travel appears highly unlikely. Thus, when the restriction on layoffs expires after Sept. 30, huge number of job cuts are expected through the U.S. airline industry and related businesses.
In his note to pilots on Saturday that was shared with this reporter, Bryan Quigley, United’s chief pilot and senior vice president for flight operations, wrote that this step in preparation for layoffs in the fall likely won’t be the last such move.“Even though the volume of this displacement is enormous, and its impact on the lives of many of our pilots significant, none of us should believe it solves all of our problems,” Quigley wrote. “This displacement bid aligns pilot staffing to a schedule reduction of around 30%, yet our schedule in May, and our expected schedule for June, is reduced by 90%. No one knows when travel demand will return, so unfortunately, the results of this displacement are likely to be a baseline from which future displacements are conducted.”
Quigley wrote that the airline currently is carrying fewer than 10,000 passengers a day, meaning it now has more pilots on staff than it has daily passengers.
United CEO Oscar Munoz and President Scott Kirby, who will replace the retiring Munoz later this month, said Friday on a conference call with analysts that they are planning for a worst-case scenario in which demand remains at its current low levels into 2021.
Quigley’s email detailed the number of assignments available to be bid on broken down by aircraft type and airport base, and tallied the number of pilot jobs that will be “displaced.” Under the terms of their contracts, airline pilot layoffs are determined by seniority: the last one hired is the first one laid off, or in industry parlance, furloughed. For pilots at United, that means the 4,500 or so lowest-ranking pilots in terms of seniority will be the ones eventually put on the streets, at least initially. Virtually all of the first officers (co-pilots) who remain at United after Oct. 1 will then fall to the bottom the remaining seniority list and become the next group to be laid off, in the likely event additional staff cuts are necessary.
Additionally, hundreds of lower-seniority captains also are likely to displaced from the left seats of United’s planes and forced to “bid down” into lower-paid first officer (co-pilot or right seat) positions. And all but the most senior captains remaining could be required to “bid down” from large, widebody jets, where the pay is highest, into lower-paid captain positions on smaller widebody jets or even smaller single aisle planes.
For those pilots who remain with United after Sept. 30, all that shifting of flying assignments among them will trigger widespread retraining. For example, a “senior” first officer now flying a widebody plane like the Boeing BA 777 likely will have to “bid down” into a smaller Boeing 737 and be retrained on that smaller aircraft. The same thing could happen to captains of 767s who have to move down into a 737 captain’s seat.
Such retraining is expensive and time consuming. Airlines are loath to trigger lots of training events at once and have been known to carry an excess number of pilots at times when they expect any over-staffing problem to work itself out in a relatively short time. Thus, United’s actions this weekend make it plain that the company does not expect there to be any quick recalls to service of all those cockpit crew members who’ll be cut loose in the fall.
The situation for pilots at United will be further complicated by the pilots’ rights to move from base to base, called domiciles in the industry. Thus, a first officer flying a 767 based in Los Angeles could have the right to take a 737 first officer’s position in Los Angeles, or perhaps remain a 767 first officer by bidding into a position at another United domicile in Houston, Chicago or elsewhere. Similarly, a 767 captain in Los Angeles might have the choice between remaining a captain by taking a 767 captain’s position at a less popular domicile, like Chicago or Newark, vs. bidding down into a 767 first officer’s position in Los Angeles. In such cases pilots will have to weigh lower pay vs. lifestyle concerns, including the extra day each way it could cost them to commute between homes on the West Coast and work domiciles in the East.
In presenting United’s initial pilot displacement plans to its cockpit crew members on Saturday the airlines also revealed that it plans not to fly its Boeing 787s - the second-largest, newest and most popular international widebody planes in its fleet - from its Los Angeles hub for up to a full year.
United’s even larger 777s will be refocused solely on its hubs at San Francisco and Newark, though the airline added that it does expect at some undetermined time to re-open 777 pilot domiciles at its Houston Bush Intercontinental Airport and Washington Dulles Airport hubs.
Further, United’s 767-300s are the only versions of the mid-size international range 767 that United expects to continue flying “for the foreseeable future.” It has 38 767-300 models, but at last count three of those had been parked because of reduced travel demand. Thus, the carrier’s 16 767s-400 models, an extended range version that also has greater cargo-carrying capacity, are candidates to be retired or mothballed.
https://www.forbes.com/sites/daniel...l-carriers-are-likely-to-follow/#376754e92bf5