Arrrggh,. I hate weeks like this. I’m swamped!

Okay earthlings. This week’s issue of PlaneBusiness Banter is now posted. Or rather the first of our two issues this week is now posted.

Meanwhile yours truly is headed back to the Worldwide Headquarters tomorrow. And just when I was getting used to 107 degrees.

Talk to you later. I have to go send out emails.

PlaneBusiness Banter subscribers have no fear. The next issue of PBB will be posted Monday. It’s a good issue. We have a column about the recent Phoenix International Airline Symposium, where yours truly was hanging out last week, the latest DOT numbers, and a quite good Lounge Lizard interview with US Airways CEO Doug Parker. And yes, we were drinking cold ginger ales while we talked. No beers.

Talk to you guys later!

Thanks to a previous PBB subscriber and a never-ending resource of Braniff history, Mr. RT Simpson of Phoenix, who wrote this trip down memory lane concerning what happened 25 years ago today — on another airline geek list that I belong to.

“It was one helluva storm on May 12th.

As I left a meeting in downtown Dallas and got onto the turnpike to my home in Arlington, I turned on the radio to KRLD for an update on the weather.  The windshield wipers were on their highest setting, yet mother nature was easily winning the battle of reduced visibility.  I knew spring storms in North Central Texas could be quite severe, but nothing prepared me for what I heard on the radio.

KRLD reporters were interviewing Braniff employees who were packing up their personal belongings and told not to return to work.  For the past several months the roller coaster known as Braniff International was one of the most followed news stories in the Metroplex.  Delayed paychecks, route consolidations, 3 for 1 ticket sales, celebrity endorsements to save Braniff, the sale of Latin America routes and the impact of a possible shutdown on the local economy.

But none of that mattered anymore as for the first time ever it became apparent that Braniff had gone bust.  As the thunderstorm pounded DFW International Airport, flights were routinely delay at all airlines.  But only Braniff canceled flights and no one at the airport seemed to know why.  Even Braniff employees weren’t told.

Everyone at Braniff World Headquarters, a sprawling monument to the ambitions and ego of former CEO Harding Lawrence, were tight lipped.  But after 5pm when the employees left the building, then word went out that due to business conditions Braniff was temporarily shutting down and a news conference would be held the next morning.

As the storm lifted and weather returned to normal, Braniff’s fleet returned to DFW where the planes were parked around the semi circular terminal.  As far as the eye could see were brightly colored Braniff 727s..some in the Ultra livery, but a lot in the older two tone combination.  There wasn’t enough money to repaint the entire fleet.  The 747 to London never left the gate.  The 747 to Hawaii was enroute to Honolulu and would return the next morning.  The 747SP was ferried from Miami, where it flew to Latin America destinations.  All the DC-8s went to Braniff’s maintenance facility at Love Field as they would not be needed if the airline was to restart in the future.

At the stroke of midnight a Bankruptcy judge signed the three petitions putting Braniff into Chapter 11.  A news conference in the morning revealed the ugly truth: All but around 100 employees were terminated.  Paychecks issued in the past week were not negotiable.  There would be no resumption of service in the near future.  The debt was too great, the assets too few and the airline industry was in shambles.  Even arch rival American Airlines was losing money.

Gone were Flying Colors.  Gone were glamorous international destinations.  Gone were Halston, Pucci, Girard, Calder and the style that set Braniff apart from all other airlines.  And gone were the dreamers who never thought Braniff International would never end.

It was one helluva storm on May 12!”

As RT signs off on all of his emails, “Braniff International, Flying Colors forever!”

A very energetic and engaging young man showed up this morning with my room service breakfast — and as he made a place for it on my desk here in my room — I commented that he could just put the tray in and amongst the various notes, conference programs, laptop,and other items scattered about.

As he said, “Oh, trust me. I’ve seen much worse.”

To which I said, “I’m sure you have lots of stories. When are you going to write your book?”

To which he replied, “Oh, well…I think most of my stories would come from my previous job. I was a flight attendant for four years.”

Me: “For whom?”

Him: “A small airline — Mesa Airlines.”

Oh boy. Needless to say, after I assured him I was quite familiar with his former employer,  I was treated to a fairly entertaining recap of several of his best stories.

And, in another case of how the airline world is a small one, guess who was speaking at the IABC dinner meeting last night in the room directly adjacent to where the Symposium was holding its closing dinner here at the Biltmore? Southwest Airlines’ SVP of Corporate Communications Ginger Hardage.

IABC is the International Association of Business Communicators — a great organization. I say that, of course, as the ex-President of the New York City chapter a few years ago. Yes, I’m biased.

It was great to see Ginger — who was off to San Francisco today to do some work regarding the airline’s new service there.

Meanwhile, the Symposium is over, and I am now packing up my things and heading over to US Airways, where I am scheduled to interview CEO Doug Parker later this morning.

More tidbits when I get resettled with connectivity later today.

Sorry guys. It’s been a little busy around the Arizona environs this week. Yours truly was honored to participate once again in the Phoenix Sky Harbor International Airline Symposium. So that is where I have been hanging out.

Tonight we have about an hour off and then it’s back to the grind of being social and talking airlines.

Once again the folks at Sky Harbor put on an engaging conference.  And I think the venue this year better fits the conference. Instead of the huge J.W. Marriott in north Scottsdale, this year the symposium went back to its roots to the Arizona Biltmore. Nice place. And more cosy than the Marriott. The Marriott is a great hotel, but it’s more suited to huge 1500 meetings and such.

About the only negative thing I could say about this year’s conference is that the guest list was somewhat impacted by two things. One, the Bear Stearns Transportation Conference was this week in New York. That prevented at least one, if not two airline CEOs from participating today. And then there was JetBlue’s Russ Chew, who was also supposed to be here today.

Yes, well, there was a  bit of news that came out of the JetBlue board meeting — and I’m sure you are aware of it. The board of directors asked David Neeleman to step down, and Dave Barger has replaced David as CEO. David will now assume the role of non-executive chairman. Meanwhile, as most of you also know, Russ Chew was recently hired by the company as its new COO. So alas — Russ had some other things on his plate today to tend to.

My take on the Neeleman news? One thing is for sure. It certainly was a hot topic in the halls of the Symposium today.

But aside from that — it was the right move. I am not surprised. In fact, I had written in PBB more than a year ago that I thought perhaps it was time for David to consider such a move.

But that didn’t happen, and so here we are now.

I think the move came about a year too late, maybe a little more. Then again — at least the good part of the decision is that it would appear there is at least one airline board of directors that has balls.

More than I can say for most of the others.

For PBB subscribers — a reminder. This week’s issue will be posted this weekend.

Next up, the pilots at US Airways and all those furloughed US Airways pilots now working for other airlines.

As most of you know, a crucial part of the merger between what was US Airways (US Airways East) and America West (US Airways West) is a merger of the two airlines’ pilot groups.

While both groups are represented by ALPA, that is where any semblance of unity ends between these two groups.

Not surprisingly, the major issue here, as it has been since the merger was first announced, is the issue of how the two groups would be merged. The US Airways East pilot group has argued that Date of Hire (DOH) should be the way seniority is determined. Not surprising, in that you’d have most US Airways East pilots end up on top of the bulk of the US Airways West pilots. Remember that folks were flying for US Airways before America West even existed.

Friday, an arbitrator ruled on the issue of the merged seniority list.

In this case, I think it would be fair to say there is a little on both sides to make folks happy, and probably more on both sides to make some folks upset. Just depends on the individual pilot’s  situation.

In a nutshell, the very senior US Airways East pilots were placed above all US Airways West pilots, but that does not stay the same as the list moves through the middle and junior levels of the US Airways East pilot group.

In those tiers, both mid-level and lower US Airways East pilots were placed at a disadvantage to the US Airways West pilots.

So, if someone is currently a senior US Airways East pilot — he or she should be pretty happy. If he or she is a senior US Airways West pilot, that is not the case. And so it goes.

But from the top tiers down, it appears that the US Airways West pilots came out on the better end of the stick.

One other fact that we can’t overlook in this decision — the fact that there are hundreds of furloughed US Airways pilots now working at other airlines. Before this decision was made, it is clear that a handful of airlines were sweating the outcome. Why? If the decision had gone further in terms of giving US Airways East pilots higher seniority overall — the fear was that some of the furloughed US Airways East pilots would leave their new environs and go back to US Airways — to take advantage of their better seniority status.

Looking at the details of this decision — I don’t think this is going to be that big of an issue now.

Tickers: (LCC:NYSE)

Man, there are some ugly line breaks in that material I posted from the APA. Let me see if I can clean that stuff up.

Ugh.

Over the end of last week, there were two bits of news concerning large numbers of those folks who fly airplanes.

Yes, the pilots.

Let’s talk about the situation at American Airlines first.

Last week the Allied Pilots Association gave management at the airline a non-variable compensation proposal. APA will provide an additional proposal that addresses variable compensation at some point in the near future.

According to the APA, the proposal, “should not be viewed as a starting point for negotiations. Rather, it is a statement of what is required to return pilot compensation to the minimum level necessary to constitute a reasonable  return on the

investment pilots made in our company in 2003.”

These are the principal components of APA’s non-variable pay proposal.

• Pay Rates: Increase all hourly pay rates 30.5 percent from the 5/1/2008 book rates on the date of signing.

• Annual Pay Raise: Increase all hourly pay rates five percent annually thereafter for the life of a 36-month agreement.

• Extended Pay Rates: Increase all hourly pay rates six percent annually from the amendable date of the contract being negotiated now until the following contract is signed.

• Retroactivity: All pay rate increases are to be retroactive to 5/1/2008 should this agreement not be complete by that date.

• Signing Bonus: Pay a signing bonus of 15 percent of W2 income from 7/21/2006 (the date management opened on APA) to date of signing of this new contract.

There were also some additional components to the proposal as follows:

• New Hire Pay: Increase new hire pay to $4000 per month

• Pay Date: Change pay dates so that 50 percent of pay is paid at the end of the current month with the balance paid by the 15th of the following month.

• Night Differential: Increase Captain night differential to $6.50.

• Premium Pay: Double time (200 percent of hourly rate) for all flying done on major holidays.

• International Override: Increase International Override pay to $10/hour for Captains and $8/hour for First Officers.

• Per Diem: Increase Per Diem to $3/hour International and $2.15 Domestic. Annual increases of $0.25 (international) and $0.10 (domestic) thereafter.

As part of the APA’s presentation to its members, it points out that the senior executives at AMR have recovered approximately seven times what they gave up in 2003.

The chart below illustrates the point.

Or as the APA put it in their proposal outline, “Stated another way, if you were to take the amount of money they gave up, i.e., what they invested in AMR’s recovery, and then computed their return on that investment, it would come out to 98% annual rate of return for the four year period 2003-2007. Over that same period of time, the Dow Industrials produced a 9.6 percent annual rate of return, while the S&P 500 returned 12.2 percent annually. In the final analysis, management has recovered all their compensation sacrifice more than eight times over.”

I look at that chart and wonder what the total numbers were in 2000 and 2001.

I may have to go forage around and find out for myself.

Ticker: (AMR:NYSE)

We heard from three people today who complained about the Barron’s piece this weekend. This was the response they received when they complained about the inaccuracies in the story we talked about this weekend. (And yes it went out in the print version with all the mistakes intact.)

“The use of an automated spellchecker resulted in a number of errors in last week’s feature story about Delta Airlines. The company’s chief executive is Gerald Grinstein, and an analyst cited was Ray Neidl of Calyon Securities. Delta’s ticker symbol is DAL, US Airways’ is LCC. American Airlines’ parent is AMR, with the ticker AMR. A variety of other words also were garbled. A fully corrected version of the story is available for free on Barron’s Online, at www.barrons.com <http://www.barrons.com/>.”

Sorry. But that doesn’t cut it with me. Not only that but their apology does not include all the mistakes in the original piece.

So are we to assume from this response that not one honest-to-god editor looked at this piece before it was posted and then printed?

Pretty lame if you ask me.