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Posted on 11/02/2005 8:54:41 PM PST by Paleo Conservative
Air Canada is reviving a $6-billion (U.S.) order for new Boeing aircraft after an arbitrator upheld a tentative labour contract previously rejected by the airline's pilots.
The Montreal-based carrier said yesterday that a binding decision by arbitrator Martin Teplitsky clears the way for new talks to reorder up to 32 new jets from Boeing Co.
Chicago-based Boeing has already scrubbed three delivery slots in 2006 that had been booked by Air Canada, but the two companies now plan to devise a new schedule, aiming for first delivery in 2007, an industry source said.
Air Canada announced its original Boeing order in April, saying that the purchase of 18 Boeing 777s and 14 Boeing 787 Dreamliners would give passengers the added comfort of new aircraft with roomier seats and aisles wider than older long-range models. The new planes are crucial to the international expansion plans of Air Canada, which emerged from bankruptcy protection 13 months ago, analysts say.
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In June, Air Canada cancelled its aircraft order after members of the Air Canada Pilots Association narrowly rejected a labour contract to fly the new, fuel-efficient planes.
Union leaders recommended acceptance of the pact. But analysts say that angry pilots belonging to the so-called Original Air Canada group turned down the proposal, "hijacking" the vote to protest a seniority list that they claim favours colleagues who formerly worked for Canadian Airlines International Ltd. Air Canada acquired cash-strapped Canadian in 2000.
The contract for flying new Boeing jets spells out everything from wages to sleeping bunks to priority washroom usage. On the wage front, captains would earn up to $238.93 an hour for flying 777s and $213.02 an hour for 787s. Pilots typically fly 80 hours a month.
Union leaders sought various contract changes in recent weeks, but the arbitrator upheld terms of the agreement reached in June.
"With the successful resolution of this matter, we can now re-engage Boeing to conclude an agreement on the acquisition of new wide-body aircraft and move forward with plans for the airline's future," Air Canada president Montie Brewer said in a statement.
Mr. Teplitsky wrote that "there simply is no compelling reason" to quash the June labour deal because it was reached in "good faith" talks between management and the union's master executive council.
"It is always regrettable when tentative agreements made in good faith by experienced negotiators are not ratified," he said in his seven-page decision. "Non-ratification impairs trust and confidence, both of which are essential to successful collective bargaining."
He said it would be difficult for anyone to "fashion a better solution than the parties have," given the complex issues on the table.
An Air Canada lawyer disagreed with union attempts to reopen talks, arguing that if anything, pilots' wages for flying the new aircraft could be reduced because of high oil prices and planned pay cuts at Delta Air Lines Inc. and Northwest Airlines Corp.
The first Boeing 777 aircraft had been slated to arrive next spring and the first Dreamliner in 2010.
"We are pleased with Mr. Teplitsky's decision, which provides us with the certainty required on pilot costs relating to the acquisition of new Boeing wide-body aircraft," Mr. Brewer said.
Mr. Teplitsky is the mediator in the long-standing dispute over seniority lists -- a broader issue that remains unresolved.
Boeing spokesman Nicolaas Groeneveld-Meijer said he's pleased with the "positive outcome" after arbitration. "We remain convinced our 777s and 787s provide the best solution for Air Canada's future growth," he said.
Union lawyer Steve Waller said his clients anticipate that delivery of the first three Boeing 777s will be delayed until 2007.
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AC is still a mess, I had the fotune to fly on Canadian a few times on some very long flights before the merge.
But, Air Canada has a stake in the new USAirways, and they are profiting from that, so I wish them well.
This is typical when you try to mesh corporate cultures and it's especially difficult to achieve peace in the cockpit after a merger.
http://seattletimes.nwsource.com/html/businesstechnology/2002559865_speea14.html
The SPEEA contract could be a big development in the very near future, considering the professional union went on strike for the first time ever in 2000.
I presume every measurement will be done in metric system unless it deals with speed and altitude (which is measured universally in knots and feet).
Interestingly here in New Zealand almost no one under the age of 35 has any concept of how long an inch is or what a gallon is measured. (People between 35 and 55 may use these united, but almost no one bothers with them). Over in Australia things are even mroe abosolute: an Australian will likely ask "How many litres are in a gallon?" or "How many kilometres are in a mile?" when they go to the US.
Yet, interestingly, if you ask someone from Australia how tall they are, they will tell you in feet and inches.
The unions don't care. There is soo much socialism up in Canada, its like one big nanny state. Their MSM are as bad as anything that came out of the Soviet Union. Total 24/7 anti-america, anti-capitalism propaganda.
I remember the closing of the wal-mart up there last year. Most of the employees didn't want to create a union, but a few socialist thugs bullied them and made threats, enough that wal-mart closed the whole store down. A few union thugs ended up destroying hundreds of lives.
I hope Air Canada gets it house in order and gets the unions to STFU before the company completely crash and burns.
Interesting, because all the Australian friends I know gave me their height in metres when asked.
and another huge blow to Airbus who was desperately persuing Air Canada to buy Airbus planes.
In fact, Air Canada hasn't bought Boeing for more than a decade now. It basically had bought Airbus after Airbus after 1989, discounting three 763 in the mid 1990s, and then a few second hand 763s after taking over Canadian Airlines.
Their 762s are slated to be replaced by A321s, and many assume AC would go all Airbus as it already operates A333s and 763s are in the same market as the very similar A332s. It is a very big surprise out of the blue for Air Canada to start buying Boeing again.
213 x 80 x 12 = $204,480
that's what the pilots of the 787 will get....for some reason the 777 pays more?
anyway, even in Canadian dollars, that's a lot of money for a 1/2 time job....
Somehow, that picture reminded me of a "Fly United" poster..
All I can say is "Hmm."
Why buy inferior A330's and A350's when the 787 has both lower acquisition costs and operating costs? Leahy says the A350 is 90% new parts, but it really is just an A330/A340 fuselage with new allows hence new part numbers. The A350 keeps the same old A300/A310/A330/A340 external fuselage width but has a thinner liner to marginally increase the interior cabin width. Why doesn't Airbus come out with a new clean sheet design. Why should any airline want to buy planes that have a 25-30 lifespan when they are already inferior to the competition.
When the initial deal was annouced earlier this year before the pilots union got its panties in a bunch:
Robert Milton, chairman and CEO of ACE Aviation Holdings, the Montreal-based parent company of Air Canada, said the new fleet would save the company hundreds of millions of dollars by lowering its fuel costs and eliminating the need to upgrade its current wide-bodies, which are more than 20 years old, on average.
"I am confident no one has ever done better on a deal," said Milton, who intends to dedicate the aircraft primarily to flights between Canada and various destinations in Asia, including Beijing, Shanghai and New Delhi.
Milton said the company also plans to boost its international cargo service, eliminating costly stopovers in Alaska.
The plan for expanding in Asian and European markets is estimated to bring in an additional US$300 million of improved annual profitability by 2010.
He praised the sleek design and fuel efficiency of the two-engine Boeing models.
and this is a big one as well, because if the business plan for the Air Canada international routes does start working, more orders could be coming in for Boeing.
"Air Canada said in April when the Boeing deal was announced that the airline has also taken out options for another 36 Boeing 777s and 60 Boeing 787s, which could push the deal up to $15.9 billion US."
A good follow on to the older 767s in that fleet.
It is an interesting situation. Air Canada currently already has A333s in its fleet and A321s were chosen to be replace 762s a few years ago, and many aviation enthusiasts had not expected they would dump the Airbus widebodies (they only took deliveries of A345s last year!). But it has chosen to replace them (and the old Boeings) with Boeings.
That's why shocks were so great back in April - the unthinkable (according to conventional wisdom, and common-sense based perceptions) has happened. But I agree it is a good move - anyone who tried A343s will know how bumpy the plane is in a turbulence, its seats incredibly narrow, and most importantly, its cabin temperature control mechanism is set at an insane level - blizzardly cold when you got onboard, then making you sweating like in tropics during most of the flight (this is the way things have been ever from the earliest A300B4s right up to the latest A343s).
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