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September 04, 2014

American says it will transfer Envoy's CRJ-700s to PSA

NEW_master_american_crj700American Airlines is shrinking Envoy Air's fleet, transferring larger regional jets that Envoy operates to its other regional subsidiary, PSA Airlines.

The transfer of 47 Bombardier CRJ-700 aircraft from Envoy to PSA will begin in mid-2015 and be completed by the end of 2016, Envoy Air chief executive Pedro Fabregas told employees in a letter on Thursday.

"While it is too early to determine the exact impact that this change will have on Envoy and our people, we know that we will need to adjust staffing," Fabregas said. "For most groups, we believe that normal attrition will address much of these staffing changes. In some cases, there may be displacements from one location to another."

With the CRJ-700s leaving Envoy's fleet, the regional carrier will only operate 44- and 50-seat aircraft.

Since the beginning of the year, American has been in contract talks with Envoy Air's pilots. In March, Envoy pilots rejected a 10-year contract that would have frozen pay scales in exchange for providing larger regional aircraft to Envoy.

Air Line Pilots Association master executive council chairman Bill Sprague said the pilots union was outraged by American's announcement.

"This action obviously and significantly punishes Envoy pilots for refusing to accept the additional concessions demanded by the company in exchange for larger aircraft," Sprague said. "The company’s recent commitment to keep 200 aircraft on the property for the foreseeable future is no more credible than their promise to re-fleet Envoy as part of the bankruptcy contract."

The union had previously told pilots that American said it planned to park Envoy's 59 Embraer 140s and transfer the CRJ-700s. If that happened, Envoy would need 47 percent fewer pilots than the 2,500 pilots currently on staff.

Talks between the two parties broke down again in August and American announced it would place its new larger 76-seat Embraer E175 regional jets with another carrier. To date, American has given 20 E175s to Compass Airlines to be flown under the American Eagle livery.

Ten other regional carriers, including its wholly owned subsidiaries Envoy, PSA and Piedmont Airlines, fly under the American Eagle brand.

"This is a proud moment for our great regional airline as we continue to grow our operations for American," PSA president Dion Flannery told workers in a message. "This transition is a rational and prudent move that underscores American’s pursuit of merger synergies and PSA's track record as a reliable and effective Bombardier CRJ operator."

Keep reading for the full letters from Envoy and PSA to its employees.

-Andrea Ahles

Envoy letter

Dear Envoy Team:

As our partner airline, American Airlines, continues on its path of integration with US Airways, it will continue to make business decisions that optimize its operations and enhance its global network.

To that end, American has informed us that it plans to transfer 47 of its Bombardier CRJ-700 aircraft from Envoy to PSA, beginning mid- 2015. While the exact dates and the rate at which these aircraft will transfer have not been determined, they anticipate that the transition of aircraft from Envoy will be completed by the end of 2016.

The removal of aircraft from our operation will allow Envoy and PSA to more efficiently focus operations on a single aircraft type – Embraer aircraft at Envoy and Bombardier aircraft at PSA. This change will simplify Envoy’s operation considerably and lower AAG’s overall costs, therefore enhancing profitability.

While it is too early to determine the exact impact that this change will have on Envoy and our people, we know that we will need to adjust staffing. For most groups, we believe that normal attrition will address much of these staffing changes. In some cases, there may be displacements from one location to another.

As I have said before, there is never a shortage of change in our industry. Envoy remains a very important partner to American, as we are the largest of its regional partners. But we will need to be efficient to remain its largest partner. I ask each of you to stay focused and continue to do what we do best – run a safe, reliable airline and provide outstanding service to all of our customers.

Thank you for all you do – for our customers and each other.

Pedro Fábregas
President & CEO

PSA Letter

Dear PSA Team Members:

We have some exciting news to share today as American Airlines Group plans to transfer 47 of its Bombardier CRJ-700 aircraft to PSA from Envoy. This is a proud moment for our great regional airline as we continue to grow our operations for American.

The move will allow each airline to more efficiently focus their operations on a single aircraft type - Embraer aircraft at Envoy and Bombardier aircraft at PSA, which streamlines operations and will greatly cut costs of feeding American’s mainline system. This transition is a rational and prudent move that underscores American’s pursuit of merger synergies and PSA's track record as a reliable and effective Bombardier CRJ operator.

American plans to begin transferring these aircraft to PSA beginning mid-2015, and while the exact timeline and rate at which the aircraft will shift from Envoy isn’t finalized, they anticipate that the transition will be completed by the end of 2016.

Rest assured that the management teams at PSA and American recognize the challenge this opportunity represents for our airline, particularly on the heels of the 30 Bombardier CRJ-900 aircraft growth phase which is only 20 percent complete today. While it is too early to determine the full scope of staffing needs to support this decision, we will identify and retain the appropriate people and technical resources to safely and reliably execute the transition.

We are grateful for the opportunity to take on these aircraft for American. We’ve no doubt seen a lot of change in our airline in the recent months, and this award will necessitate that we continue to evolve and grow our company. I look forward to working with all of the PSA team to make this initiative a success for PSA and American. Thank you for your hard work and dedication and let’s remain focused on running a safe, reliable airline and providing outstanding service to all of our customers.

Dion Flannery

ALPA MEC Letter

Fellow Envoy Pilots,

The MEC is outraged by today’s announcement by AAG that all 47 of our CRJ-700 aircraft will be transferred to PSA. This action obviously and significantly punishes Envoy pilots for refusing to accept the additional concessions demanded by the company in exchange for larger aircraft. We are not aware of any plans to bring additional aircraft to Envoy. Therefore the company’s recent commitment to keep 200 aircraft on the property for the foreseeable future is no more credible than their promise to re-fleet Envoy as part of the bankruptcy contract.

We are evaluating the details related to the transfer of these aircraft to PSA. This action will eliminate the highest levels of compensation available under our contract.

Once again, we find ourselves wondering what the future holds for our carrier. The company has already announced their intention to park the remaining Embraer 140’s. Barring any additional aircraft, we will only be operating a fleet of 118 Embraer 145’s. This would require roughly 48% fewer pilots than are active on our seniority list today. We will provide you the company’s draw down schedule when they provide it to us.

The company has indicated that moving these aircraft to PSA is necessary to more efficiently focus operations on a single aircraft type. In reality, management’s decision clearly exploits the lower costs afforded by the 10 year agreement ratified last fall by our colleagues at PSA.

We understand this is a very stressful time for all of us. Many of you have inquired about the status of our previously advertised career progression resources. The MEC will receive a briefing next Tuesday, the 9th, from ALPA National regarding the rollout of these resources, and details will be communicated as we get them.

Bill Sprague
MEC Chairman

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Comments

AAG Employee


Tell me in all honestly, is anyone really surprised at anything Doug Parker does? The truth is that the all of the labor unions at old AMR sold their souls to the devil to get rid of the old management AMR team just to get CEO and management team that will be worse than could ever imagine. let us not forget that for years after America West and U S Air merged the 2 pilot groups could not work together and Parker encouraged this. Parker enjoys creating the conflict (as he is now between Envoy and the other wholly-owned regionals) because he believes that there is both a financial gain for the company and most of all, an ego boost for him.

Parker has had his ego severely bruised by the Envoy pilot's group turning down his "dictatorial" pay and benefit reduction contract. So now to assuage Doug Parker's wounded pride he has to wreak vengeance upon the employees of Envoy to make himself feel better instead of sitting down and really working with the group to hammer out a compromise solution, No, he would rather destroy thousands lives and families to get what he wants.

If Doug Parker really wanted to save AAG money he would have merged all of the wholly-owned regionals together thus eliminating the huge overhead cost of operating 3 different headquarters/operations center buildings, 3 separate maintenance systems, 3 different spare parts stockpiles, consolidated the operating costs of staffing the operations, maintenance, flight/inflight, training, scheduling, and financial departments of 3 separate airlines, now there would be some real savings. But Parker will not do that because of his need for the internal conflict to rule what he sees as his new empire. Divide and conquer is good for his ego and too bad for corporate employees that have to labor under him. If this continues, Doug Parker’s name will be right up there alongside Frank Lorenzo on the list of infamous airline leadership.

I can only hope that the APA, APFA and TWU take an objective look of what is going on here and support their corporate “brothers and sisters in labor” because I have news for them… they’re next on the altar of sacrifice of Parker’s ego.

whitey

face it. American is a piece of crap airline and will always be.

BOHCA

Why is this a surprise to the membership or leadership. Look at Icahn and Lorenzo.

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