by Captain Duane Woerth, ALPA president
Throughout its 67-year history, our union has survived and remained effective because of its ability to recognize -- or even anticipate -- the major evolutionary changes that have reshaped the airline industry and the piloting profession. In many ways, our union's primary function is to determine which adaptations are required to advance professional pilots' interests in the face of such change, and to ensure that those adaptations take place.The globalization of the air-transportation marketplace is a pivotal event in this evolutionary process. ALPA began formal preparations for this trend in 1992, the year our Board of Directors approved the first rendition of ALPA's Global Pilot Strategy document. Since then, we've re-crafted the document for each biennial meeting of the BOD, refining ALPA's goals and strategies to conform to the twists and turns in the unfolding process of globalization in the airline industry.
Today, our adaptations to globalization are no longer anticipatory. The numerous global alliances and partnerships among US and foreign airlines are evidence of the trend's rapid evolution.
ALPA has been actively pursuing its members' interests throughout the process. In the middle of this decade, we worked with then Secretary of Transportation Federico Peņa to incorporate our concerns into the US's broad definition of "open skies" principles.
Since then, we've supported some international open-skies proposals involving the US, and opposed others. We've always based our opinion on certain criteria: Does the proposal provide comparable value to the airlines of both countries? Does it give US airlines new access to potentially profitable international markets? In light of the prevalence of government-sponsored airlines abroad, is the competitive playing field level?
Likewise, we have weighed in on proposed international code-share alliances and partnerships suggested by our members' respective carriers. In most cases, we recognized potential economic benefits for our employers and, accordingly, supported these international alliances.
Now that these alliances have had a few years to mature, we are obligated to assess their effect on US pilots' relative position: are we at an advantage or a disadvantage in the global marketplace?
I explored this question as a participant in a discussion panel at this year's "Forum on Air and Space Law," conducted by the American Bar Association in Washington, DC on Friday, January 22. The panel discussion, "International Aviation Policy: Toward Further Liberalization," included a senior official with the US Department of Transportation, a senior executive from a major US international airline, and two senior executives from major European international airlines.
The panel's title, and the remarks of the other panelists, suggest that airlines and governments will seek to open US and foreign markets even wider in the months and years ahead. This premise adds more urgency to our investigation of how our pilots, and their respective airlines, are faring in the open-skies environment.
Before investigating who's getting what share of the growth in the international aviation marketplace, I first looked at the cost position of our US carriers relative to their European partners and competitors. Figure 1 clearly shows that US carriers have an advantage, measured by unit cost, over their European counterparts. We know that an airline's two largest cost factors are fuel and labor. Since fuel costs are relatively constant worldwide, we can assume that lower labor costs -- including pilot labor -- account for much of this advantage.
Despite their cost advantage, US operators are losing ground to European operators in the international market. Figure 2 shows that, while US operators' growth in the trans-Atlantic market has remained relatively flat since 1993, operations marketed with a US carrier's code but performed by a European carrier have grown dramatically.
This conclusion is supported by Figures 3 and 4. They show a much sharper growth trend as measured in available seat miles (ASMs) -- and, therefore, in pilot jobs -- among German and Canadian carriers as compared to US carriers.
Certainly, the burgeoning growth in international air traffic over the past few years has ensured that no one is a loser. Both foreign and domestic carriers have experienced growth. The code-share alliances have helped carriers on both sides of the Atlantic improve the viability of certain international operations by feeding them with each other's passengers.
However, the disproportionate sharing of the international growth is cause for concern. Our US pilots, who provide a lower-cost pilot "product" to their respective employers, are losing jobs to the pilots of alliance partners, even though those pilots are more expensive. If this trend exists during an economic boom for international airlines, what will happen when the industry's performance levels off or regresses?
No one at the Forum challenged these observations. No one suggested any answers. And no one else will. It is our job, ALPA's job, to dig more deeply into this issue and determine whether US pilots' job security is being compromised as the globalization trend reaches maturity.
Many variables may account for the apparent disparity. I'm working with ALPA's Economic and Financial Analysis Department, Representation Department, and Legal Department to attempt to isolate those variables and determine which, if any, we can influence to improve our pilots' prospects. The task may be formidable, but it is all part of being the kind of union that adapts to varying demands and upholds its members' best interests in the face of change.