Pan Am clipper, Vol. 4, No. 6, June 1978

              June ’78
Pan Am’s plans outlined at stockholder meeting
Pan Am is responding to the U.S. government’s shift to a more permissive air transportation policy with a “new game plan” that calls for expanding domestic routes and introducing new economic low fares, Chairman Seawell told shareholders at the company’s 50th annual meeting last month.
Seawell described as a “whole new ball game” the current U.S. air transportation policy of more competition, lower fares, easier entry into new markets and fewer restrictions.
“The initial impact of this new policy has been to intensify scheduled competition across the Atlantic,” Seawell told the 250 stockholders who gathered at the Eisenhower Theater of the John F. Kennedy Center in Washington. Last year, he noted, three new domestic airlines —Northwest, Delta and Braniff—were granted authority to serve the North Atlantic.
Another source of additional competition is the expanded authority of the supplemental carriers resulting from agreements with Great Britain, Belgium and the Netherlands, which also gives more U.S. markets to foreign airlines, Seawell said.
Pan Am is responding to this new environment by introducing new low fares, such as the standby and Budget Fares now in use in numerous markets throughout the world, and by applying for new domestic routes, on which Pan Am also has proposed major fare reductions.
“While Pan Am feels much of the new international air transportation policy is good,” Seawell said, “there are certain parts of it we do not agree with. We particularly do not like that aspect of it which would result in an unnecessary trading away of U.S. routes to foreign governments and foreign airlines. We feel such concessions will put U.S. carriers at a competitive disadvantage with foreign carriers, will result in the loss of U.S. jobs and will be detrimental to the overall interests of the U.S.”
“Organized labor feels strongly about this,” Seawell pointed out, “and the AFL-CIO’s Air Line Coordinating Committee has said it is “the surest way to assure the supremacy of foreign flag carriers.”
“I do not want to give the impression that Pan Am is not used to competition or is afraid of it. We are prepared to take on this new challenge. However, we want to be assured we will be permitted to compete freely and fairly,” he said.
On the plus side, Seawell noted the addition of Houston to Pan Am’s transatlantic route structure, authorization to serve Miami-Madrid nonstop, and the renewal of nonstop service between Los Angeles and London—all “good news” for Pan Am, he said.
Reviewing the highlights of a year in which the company reported net income of $45 million, an improvement of more than $58 million over 1976 (excluding that year’s extraordinary gain from a debenture exchange), Seawell said:
— Yield per scheduled passenger was up 7.9 percent over 1976.
—Operating revenues increased 14.8 percent while operating expenses went up 11.5 percent.
—Employee productivity increased, with Pan Am one of the top two major airlines in the entire industry in number of revenue ton miles produced per employee. —Pan Am’s 747 and 747SP
Chairman Seawell paid special tribute to employees at several points during his report to the company’s shareholders.
“This report would not be complete without specifically recognizing the contributions they (the employees) have made, both on the job and off the job,” Seawell said.
“Pan Am continues to receive support from our employees and their labor organizations—ALP A, FE1A, IBT, 1UFA, and TWU-on the many matters of common interest and concern to us. In addi-
utilization was up, with the aircraft averaging more than 12 flying hours a day, compared with 11 hours and 8 minutes the year before.
—Passenger seat factor for the entire fleet was 54.3 percent, up almost 2 percentage points.
—First class revenues increased 18.3 percent, while the industry in
tion, Aware—Pan Am’s volunteer employee group—continues to be active and effective in helping produce a better product, selling more of it, and in matters of legislative and regulatory concern.”
At another point in his presentation, Seawell noted that the company was encouraged when the Senate approved the regulatory reform bill, which would extend fillup rights and permit some degree of automatic entry of carriers into new routes. “The company and its employees worked very actively and effectively for the passage of the bill,” Seawell said.D
general showed a reduction in first class travel.
“Total cargo revenues increased more than 10 percent over 1976. —Pan Am’s principal subsidiary,
Dan A. Colussy was elected President of Pan Am by the Board of Directors at the annual meeting last month. Colussy, formerly Executive Vice President-Marketing and Services, will be succeeded in that post by William Waltrip, formerly Executive Vice President-Operations.
The Board also elected the following corporate officers:
—James Montgomery, formerly Senior Vice President-Marketing, as Senior Vice President-Assistant to the President.
—Captain Albert A. Frink, formerly Staff Vice President-Flight Standards, as Vice President-Flight Standards.
—Jesse B. Houston, formerly Staff Vice President-Materiel and Logistics, as Vice President-Materiel and Logistics.
—Donald W. Hunt, formerly Staff Vice President-Labor Relations, as Vice President-Labor Relations.
—Ronald Marasco, formerly Director-Aircraft Maintenance, as Vice President-Maintenance Production.
—Klein Mitchell, formerly Staff Vice President-Maintenance
Intercontinental Hotels Corporation, doubled its 1976 profits to $11.4 million.
—Contract Services reported continued on page 2
Operations, as Vice President-Maintenance Operations.
—Robert Pablo, formerly Staff Vice President-Property and Facilities, as Vice President-Property and Facilities.
—Michael S. Maino, formerly Director-Passenger Revenue Accounting, as Assistant Controller.
The title of staff vice president, held by 19 executives, has been eliminated.
Colussy joined Pan Am in 1970, first as Vice President-Marketing Development, then as Senior Vice President-Marketing and Services, the position he held until being elected Executive Vice President and member of the Board of Directors in 1976.
Prior to joining Pan Am, Colussy held positions with Wells, Rich and Green; Northeast Airlines; American Airlines; and General Electric.
He holds a Bachelor of Science degree from the U.S. Coast Guard Academy and a Master of Business Administration from Harvard Business School. He served three years in the Coast Guard and is a licensed commercial pilot. □
Aware elected new members of its Executive Committee for the upcoming year at a meeting in Seattle last month. From left to right are Mike Lyon, New York-based first officer, elected political coordinator; Felicia Fairchild, New York-based flight attendant, reelected chairperson; Al Williams, reservations agent-Washington, elected EPIC coordinator; Jody Thompson, Los Angeles-based flight attendant, communications coordinator; Tom Koyles, JFK mechanic, marketing coordinator; Jeannette Keaton, reservations agent-Guam, member at large; and Ted Horikawa, Tokyo passenger service, fundraising coordinator.
Route expansion underway
Colussy elected president; other changes announced
In this issue. . .
London Budget, standby fares bring new traffic......................page 2
Pam Am’s Rockleigh facility is growing...............................page 3
Employee’s “other life” is that of a tiddly winks champion...........page 8
In case you haven’t noticed, the Pan Am route map has stopped shrinking and started growing again.
By year-end, the company expects to have inaugurated, expanded or resumed service on more than a dozen routes through-
out the system — including Vienna and Paris, which are already back on line. (Paris awaits the outcome of intergovernmental discussions.)
There will be deliveries of three additional passenger aircraft by the end of next month, including the continued on page 8
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