AABI Town Hall MeetingEmployer Comments on USAAP

Lacey PittmanAssistant Chief Pilot

Horizon Air

February 15, 2012

AAG Pilot Hiring Road Map

Alaska Air Group Objective:

Conduct a joint AAG effort to ensure a sufficient supply of qualified First Officers for Horizon and Alaska through 2018.

1. Forecast Hiring Needs2. Anticipate Supply of Pilots3. Develop a Strategy to Attract and Retain

AAG Pilot Hiring Road MapForecast Hiring Needs

AS Hiring Forecast

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AS Fleet Growth 33 33 99 88 66 66 88 88

AS Attrition 12 24 36 48 29 51 59 57

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Current assumptions through 2018:Forecasted Hires: 877Fleet Growth: 48Current annual attrition: 1.5%Number of pilots turning age 65: 248Utilization: 11 pilots per aircraft

Source: FP&A, Flight Ops Controller. Growth and attrition information is forward thinking and numbers could significantly increase or decrease

AAG Pilot Hiring Road MapForecast Hiring Needs

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QX Fleet Growth 30 30 30

QX Attrition 52 84 234

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Current assumptions through 2013:Forecasted Hires: 460Fleet Growth: 10 Q400 aircraft optionsAnnual attrition: 17.03%Number of pilots turning age 65: 9Utilization: 10 pilots per aircraft

Source: QX Finance &Flight Ops Controller. Growth and attrition information is forward thinking and numbers could significantly increase or decrease

AAG Pilot Hiring Road MapAnticipate Supply of Pilots

UND Projects >10,000 New Pilots per Year

AAG Pilot Hiring Road MapAnticipate Supply of Pilots

UND Projects Pilot Shortfall >2000 Pilots per Year

AAG University Program Develop a Strategy to Attract and Retain

A company with its own program ensures the following:• controls company cost by limiting number of training

students in Initial program• control over who is hired and applicant pool• steady stream of pilots to it’s own company• best graduates do not get hired somewhere else• company can control time commitment to airline

AAG University Program Develop a Strategy to Attract and Retain

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Jumpstart Program Investment vs Savings

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AAG University Program Develop a Strategy to Attract and Retain

AAG Pilot Hiring Road MapUSAAP Pros:

• Affordable for the student• Shared investment for all • National solution to national problem

AAG Pilot Hiring Road MapUSAAP Cons:

• The program does not require time commitments at 121 carriers who invest heavily in Initial students.

• The program almost encourages movement towards a major as quickly as possible. This is negative for regional airlines who need to earn back the initial investment of training.

• There is no bridge from Commercial to 1500 hours. • Eats the seed corn of the universities. Does not encourage the

value of instruction time.• Does not ensure a steady stream of USAAP pilots to a given

regional.• No ownership on part of students• Do not have to identify airline for which to train• Government will dictate the process• Increased government bureaucracy in AAG’s hiring strategy

AAG Pilot Hiring Road MapQuestions for USAAP:

• AAG objective is to attract and retain qualified pilots. What is to retain a USAAP pilot?

• Why would a student stay at a regional?• Regional airlines want to limit the number of Initial training cycles for new

hires. Where is the time commitment piece for staying at a regional?• What is to prevent a candidate from being hired at a participating

regional then leaving after 6 months for a participating major?• Would the student identify a carrier at the beginning of the program they

are targeting?• At what point does the airline get involved in the process? Marketing,

brand recognition, etc.• How will a student bridge the gap from the program’s commercial

certificate (no-ATP) to 1500 hours? Even if a credit is given for AABI institutions?

• Where is the give-back to the universities? Contract to instruct, time commitment, etc.

• How does a participating regional airline ensure a steady stream of USAAP pilots? Especially if the regional has a long upgrade time, no jets, etc.