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Topic: Detroit Bankruptcy- Bad For DL?
Username: Traviskuhn4
Posted 2013-07-18 20:30:58 and read 12876 times.

With the news of the city of Detroit filing for bankruptcy what are the odds that this will impact DL's operation at DTW?

Any chance they may scale back their operation if O&D traffic drops?

http://www.usatoday.com/story/news/n...-bankruptcy-filing-friday/2552819/

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: KBJCpilot
Posted 2013-07-18 20:35:53 and read 12867 times.

DTW is in the city of Romulus so there shouldn't be much of an impact. As far as city of Detroit employees are concerned I don't think the bankruptcy will affect DL that much as the travel on city business by the employees is not in high demand.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: gigneil
Posted 2013-07-18 20:38:16 and read 12839 times.

Yeah, this will have zero impact on Delta or the rest of that part of Michigan.

NS

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: coronado
Posted 2013-07-18 20:38:19 and read 12838 times.

No impact or may even be positive now that the uncertainty is over. Ann Arbor and the new tech corridor continues to grow.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: luckyone
Posted 2013-07-18 20:41:48 and read 12820 times.

The traffic Delta pulls out of DTW isn't centered on the City of Detroit. And really, with the way the finances of the City of Detroit have been since the turn of the century (and possibly much much longer) is a City of Detroit officially in bankruptcy that much different than a City of Detroit teetering on the edge of bankruptcy for 20 years?

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: usflyer msp
Posted 2013-07-18 20:47:40 and read 12754 times.

This bankruptcy can only be a positive for DL. In the short term, they will increased amounts of creditor bigwigs and consultants flying in and out of town (premium traffic). In the long-term, the financial stability of the city of Detroit will allow the city to begin attracting business and residents again which will positively affect air travel demand.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: slcdeltarumd11
Posted 2013-07-18 20:51:23 and read 12710 times.

I don't see this as an issue at all.

Most of the traffic is suburbanites, Canadians, and corporate travel aka the auto industry. If DTW economy just never recovers then eventually traffic will become an issue, but the city finances iteself i don't think has any effect on the airport. Delta has a great facility and its a large transfer hub as well as a city with a lot of business traffic. They are not going anywhere. Delta has a fantastic setup of hubs now they ain't going anywhere.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: DeltaMD90
Posted 2013-07-18 20:59:20 and read 12628 times.

I think the city's health affects DL to a slight degree (as a city does better there will be more pax) but Detroit has been doing poorly for a while and I don't think Detroit's bankrupcy is making it that much worse. If anything, Detroit will start to do better and bring in more traffic I would think

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: LAXintl
Posted 2013-07-18 21:12:28 and read 12519 times.

Any effect on facility bonds, leases, cross guarantees, or credit rating for the airport?

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: DocLightning
Posted 2013-07-18 21:28:57 and read 12412 times.

DTW serves all of Southeastern Michigan and a good chunk of northern Ohio (If you live in Toledo, it's the closest major airport). I can't imagine that the City of Detroit uses that much DL. Other businesses in the Detroit Metro Area will be unaffected. Most businesses within Detroit will be unaffected. The entire bankruptcy will have little direct effect on anyones' lives. Detroit cannot possibly get that much worse than it is and so the only direction to go is up.

In the mean time, the suburbs are actually starting to come back to life. I was just back there (I grew up there) in November and I was shocked at how alive it is. So many young people out having fun.

DL and DTW will do fine.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: Prost
Posted 2013-07-18 21:47:26 and read 12319 times.

Isn't DTW a Wayne County facility, a completely different entity than the city of Detroit?

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: Surfandsnow
Posted 2013-07-18 22:51:51 and read 12105 times.

Remember, DTW serves much more than the city of Detroit. The airport is not located in nor controlled by Detroit itself, and even officially goes by "Detroit Metropolitan Airport" (many folks shorten this to "Metro Airport"). The Detroit metropolitan area for which the airport is named is home to 5,311,449. That figure includes Flint and Ann Arbor, but does not include Toledo (metro population of 651,429) or Windsor (metro population of 319,246).

While the international urban area of over 6 million is centered around Detroit, the city itself has just 700,000 residents - most of whom can't afford to fly. The city's socioeconomic problems have been around for about as long as DTW itself, yet the airport has thrived anyway. Wealthy suburban areas with extremely low crime rates, excellent schools, lively entertainment districts, strong job markets, etc. are just as close to DTW as the nation's poster child for urban crime/poverty/despair.

As a hub, DTW is centrally located to a massive population base encompassing a diverse array of major population centers throughout the Midwest, Northeast, South, and Eastern Canada. In less than 2 hours, you can fly to Atlanta, Boston, Buffalo, Charlotte, Chicago, Cincinnati, Cleveland, D.C., Indianapolis, Milwaukee, Minneapolis, Montreal, Nashville, New York, Ottawa, Philadelphia, Pittsburgh, St. Louis, Toronto, etc. DTW is well known throughout the country as being the nicest major hub airport, and many people will use it for transit purposes as much as possible.

For all of these reasons, DTW will continue to do well, as it has in spite of its namesake city's declining fortunes for decades. In fact, this bankruptcy filing may very well mark the low point for the city of Detroit. This could be the turning point for Detroit to finally overcome burdensome early 20th century obligations and begin to prosper in the 21st century. DL may very well stand to benefit when it is all said and done!

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: PHX787
Posted 2013-07-19 02:51:05 and read 11635 times.

The only thing i see is a decrease in O&D. About it. Maybe a bit of a scale back to match it, but people from Ohio still need a way to get back and forth from Japan  (of course I am using MSP coming back in September....)

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: MIflyer12
Posted 2013-07-19 04:16:16 and read 11418 times.

Quoting Prost (Reply 10):
Isn't DTW a Wayne County facility, a completely different entity than the city of Detroit?

It is.

Other than 3rd-order reputational effects - more media exposure to the plight of the city and its residents - this will have zero impact on Delta.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: DTW2HYD
Posted 2013-07-19 05:35:08 and read 11126 times.

Premium traffic between Detroit-New York/Detroit-Washington,DC is going to increase by several fold for next 18-24 months. All the $1000/hr attorneys(DC Based) and Wall Street sharks have to travel daily.

Depends on where the judge is, either Detroit-Cincinnati (or) Detroit-Tenesse(City Unknown) traffic will increase.

Until yesterday probably $700 Million/Year out of $1 Billion/Year revenue went to paying debt obligations. Now probably that will be cutdown to $100 Million-$200 Million a year. Lot of surplus cash.

Quoting LAXintl (Reply 8):
Any effect on facility bonds, leases, cross guarantees, or credit rating for the airport?

Once you stiff old creditors, new ones line up with armored trucks to lend. It is against conventional wisdom but very true. Only in US of A.

Once you get past the stigma associated with bankruptcy, financially you are good for next forceable future. Until yesterday City had $18 Billion obligations, now may be $2 Billion.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: a380787
Posted 2013-07-19 06:39:17 and read 10841 times.

somehow the producers and directors of RoboCop could foresee the future back in 1987 where OCP plans to demolish "Old Detroit" and redevelop it as a high-end utopia called "Delta City." [wiki]

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: jetlanta
Posted 2013-07-19 06:45:02 and read 10804 times.

Quoting LAXintl (Reply 8):
Any effect on facility bonds, leases, cross guarantees, or credit rating for the airport?

None.

Quoting PHX787 (Reply 12):
The only thing i see is a decrease in O&D. About it. Maybe a bit of a scale back to match it, but people from Ohio still need a way to get back and forth from Japan  (of course I am using MSP coming back in September....)

OMG. Really? The city of Detroit, home to only 700,000 people (mostly poor), can't pay its bills. That doesn't make the 6-7M people of Southeast Michigan and the DTW catchment area suddenly impoverished and incapable of purchasing air travel. On the contrary, the business environment in the region is in the best condition it has been in a long time. The DTW solidly profitable for Delta. This will have no impact on that.

Quoting DTW2HYD (Reply 14):
Premium traffic between Detroit-New York/Detroit-Washington,DC is going to increase by several fold for next 18-24 months. All the $1000/hr attorneys(DC Based) and Wall Street sharks have to travel daily.

You are right, if anything the net effect will be positive.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: DTWPurserBoy
Posted 2013-07-19 07:05:42 and read 10580 times.

Quoting Prost (Reply 10):
Isn't DTW a Wayne County facility, a completely different entity than the city of Detroit?

It is a Wayne County facility and draws primarily from the very affluent suburbs and not from Detroit itself. This will have virtually no effect on DL's operations. If anything, it could improve them. As another poster has said, the airport's mailing address is Romulus, MI, not Detroit.

Detroit has been abused and bungled by a series of poor administrators and mayors. BK will at least put an end to this and give them a fresh start. The city has incredible potential with some beautiful old homes at incredibly small prices for those with a bit of the pioneering spirit and are not averse to risk-taking. And downtown the area known as Greektown offers incredible dining and an overhead tram system that runs in a big loop. Many of the old classic buildings downtown are being converted to condominiums and lofts with reasonable success.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: FURUREFA
Posted 2013-07-19 07:06:27 and read 10551 times.

Quoting DTW2HYD (Reply 14):
Premium traffic between Detroit-New York/Detroit-Washington,DC is going to increase by several fold for next 18-24 months. All the $1000/hr attorneys(DC Based) and Wall Street sharks have to travel daily.

And BOS - insitutional bond holders.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: ouboy79
Posted 2013-07-19 07:52:21 and read 9932 times.

Quoting jetlanta (Reply 16):
OMG. Really? The city of Detroit, home to only 700,000 people (mostly poor), can't pay its bills. That doesn't make the 6-7M people of Southeast Michigan and the DTW catchment area suddenly impoverished and incapable of purchasing air travel. On the contrary, the business environment in the region is in the best condition it has been in a long time. The DTW solidly profitable for Delta. This will have no impact on that.

This. It is amazing how many ignorant people there are commenting on threads like this that don't understand the dynamics of that region.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: jetlanta
Posted 2013-07-19 08:23:07 and read 9495 times.

Quoting ouboy79 (Reply 19):
This. It is amazing how many ignorant people there are commenting on threads like this that don't understand the dynamics of that region.

Did anyone ask questions like this when Orange County, CA went bankrupt?

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: MasseyBrown
Posted 2013-07-19 08:40:33 and read 9230 times.

Quoting gigneil (Reply 2):
Yeah, this will have zero impact on Delta or the rest of that part of Michigan.

I wouldn't say zero. The Jefferson County bankruptcy has had a negative effect on the Birmingham area, not in terms of explicit layoffs or large corporate decisions; but it has been "chilling" in the short term and a depressing burden as it drags on.

If it's like Birmingham, the Detroit bankruptcy will likely have a negative regional effect on credit availability and cost of money. Pensioners will be taking fewer trips to the sunshine. Construction will probably drop a bit. Real estate prices will stay soft. The result of the bankruptcy won't be concertrated, huge, and pin-pointable, but it will be a real drag on the area's economy.

Depending on the speed of resolution and the way the case is handled, the bankruptcy may ultimately be a good thing. DL can undoubtedly ride it out without any massive local perturbation.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: jetlanta
Posted 2013-07-19 09:02:17 and read 8954 times.

Quoting MasseyBrown (Reply 21):
If it's like Birmingham, the Detroit bankruptcy will likely have a negative regional effect on credit availability and cost of money. Pensioners will be taking fewer trips to the sunshine. Construction will probably drop a bit. Real estate prices will stay soft. The result of the bankruptcy won't be concertrated, huge, and pin-pointable, but it will be a real drag on the area's economy.

All good points. But I think Detroit is sort of unique in that all of the above has been happening for decades. As the Governor and Emergency Manager said today, this has been 60 years in the making. Now is the time to fix it. There are a lot of resources and a lot of really smart people in that state. Curing the cancer that is Detroit's fiscal and political situation could have a tremendous positive impact on the entire region. And that is a big deal for America. While most of America knows Detroit for "ruin porn", the truth is that SE Michigan is still the nation's high-tech manufacturing leader. The incredible advancements and productivity that come out of the region are overshadowed by our fascination with the City of Detroit's decline. This is the first step toward permanently fixing that.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: IADCA
Posted 2013-07-19 09:21:35 and read 8684 times.

Quoting DTW2HYD (Reply 14):

Premium traffic between Detroit-New York/Detroit-Washington,DC is going to increase by several fold for next 18-24 months. All the $1000/hr attorneys(DC Based) and Wall Street sharks have to travel daily.

Depends on where the judge is, either Detroit-Cincinnati (or) Detroit-Tenesse(City Unknown) traffic will increase.

While the general premise of this post is correct, that expensive people in suits will be flying to Detroit, there are two corrections needed here. First, almost all the out of town attorneys will be coming from New York, Chicago, or firm headquarters offices (i.e., Dallas or Houston for the Texas firms). Bankruptcy is a minuscule part of the legal world in DC, almost non-existent except for cases filed in D.C. Second, the petition was filed in E.D. Mich., so the judge will be somewhere within that jurisdiction, most likely Detroit itself.

Edit: Didn't want to sound like quite the jerk I might have with just the first paragraph. I think this post makes a strong point that this development will be positive for DL. I'd add that given the high volume of likely LGA-DTW traffic (with corresponding strong DL presence at both ends) it will be particularly so. It'll also be nice to get some more high yielding traffic in and not get DTW too strongly biased towards connections.

[Edited 2013-07-19 09:39:10]

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: superjeff
Posted 2013-07-19 09:23:55 and read 8665 times.

Quoting DTW2HYD (Reply 14):

Once you stiff old creditors, new ones line up with armored trucks to lend. It is against conventional wisdom but very true. Only in US of A.

Once you get past the stigma associated with bankruptcy, financially you are good for next forceable future. Until yesterday City had $18 Billion obligations, now may be $2 Billion.

That's exactly why. The City's credit rating probably just improved because they haven't got all that debt anymore  

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: DTW2HYD
Posted 2013-07-19 09:53:22 and read 8497 times.

Quoting IADCA (Reply 23):

The reason I picked DC is Kevin Orr, the appointed Emergency Manager has a law firm in DC, famous for handling bankruptcy cases. Legally he is detached from the firm during his tenure as EM for the city, but you can bet his firm will play a major role.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: MIflyer12
Posted 2013-07-19 10:11:29 and read 8254 times.

Quoting MasseyBrown (Reply 21):
The Jefferson County bankruptcy has had a negative effect on the Birmingham area, not in terms of explicit layoffs or large corporate decisions; but it has been "chilling" in the short term and a depressing burden as it drags on.

Other posts have spoken to the issue but I'll address it more specifically:

For the most part, the residents, workers, and pensioners of the city of Detroit aren't driving O&D demand at DTW.

Look at the ratio of Jefferson County to the Birmingham MSA, and of the ratio of Detroit to the Detroit-Warren-Dearborn MSA, in population or income. Detroit represents a far smaller fraction.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: AADC10
Posted 2013-07-19 11:11:35 and read 7664 times.

Any city or municipality in bankruptcy would have a limited impact on the airport because if they received FAA funds, which is nearly all airports in the USA with commercial flights, they are required to be revenue neutral to their owners. A municipality can contribute funds to the airport but it cannot take any money out and Detroit was in no condition to send money to the airport.

The bankruptcy does not have much impact on short term spending. The effect will be years down the road when Detroit cannot float bonds and residents will spend less because their pensions were slashed. As indicated in previous posts, part of the problem in Detroit was white flight to the suburbs. The city center is collapsing but the suburban WASPs are doing reasonably well.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: KarlB737
Posted 2013-07-19 11:36:09 and read 7413 times.

Quoting Traviskuhn4 (Thread starter):
With the news of the city of Detroit filing for bankruptcy what are the odds that this will impact DL's operation at DTW?

None. On the other hand if Detroit City Airport (DET) had any air service as well that could be impacted. Since DET is connected to the City of Detroit there may be some effect to the general aviation there. There had been suggestions by Detroit to spin off that airport in some fashion to cut costs however nothing has transpired.

If I recall there was talk of closing the airport but the FAA may have rejected that. Then there was discussion of selling or hiring some sort of professional management to run it but again nothing actually has changed.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: brilondon
Posted 2013-07-19 12:35:49 and read 6868 times.

Quoting LAXintl (Reply 8):
ny effect on facility bonds, leases, cross guarantees, or credit rating for the airport?

No.

Quoting PHX787 (Reply 12):
The only thing i see is a decrease in O&D. About it. Maybe a bit of a scale back to match it, but people from Ohio still need a way to get back and forth from Japan  (of course I am using MSP coming back in September....)

The O&D market will remain stagnant as it has for the past 5 years, although it may have increased with the newer tech sector in the surrounding communities. Detroit itself should not affect the airport as the airport is in the city of Romulus which has been pointed out several times over many threads when this topic comes up.

Quoting DTW2HYD (Reply 14):
Until yesterday probably $700 Million/Year out of $1 Billion/Year revenue went to paying debt obligations. Now probably that will be cutdown to $100 Million-$200 Million a year. Lot of surplus cash

No, that is why they declared bankruptcy, they don't have "surplus cash". They could not meet the obligations that they were under. Just because they declared bankruptcy does not mean they don't owe the money. They still owe gobs and gobs of money. They are just restructuring that debt so that the payments are not as much. The amount may change after the bankruptcy courts decide how much they will have to pay back and until such time that these decisions are made, they still owe that whole debt.

Quoting superjeff (Reply 24):
That's exactly why. The City's credit rating probably just improved because they haven't got all that debt anymore  

The in effect don't have a credit rating as no one is going to loan then any money while they are in bankruptcy. They still have the debt, they just don't have the obligations to pay it back in the amount of the payments that they were paying. The bankruptcy judge will make that decision and it usually doesn't work out for the unsecured creditors so well, be and the secured creditors will get the bulk of the moneys that are going to paid.

This should also have no effect on DL, if anybody it will hurt the likes of WN and NK the most as they are dependant on the discretionary traveller more than DL.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: DTW2HYD
Posted 2013-07-19 12:48:23 and read 6688 times.

Quoting brilondon (Reply 29):
They still owe gobs and gobs of money. They are just restructuring that debt so that the payments are not as much. The amount may change after the bankruptcy courts decide how much they will have to pay back and until such time that these decisions are made, they still owe that whole debt.

Out of $18 Billion debt $12 Billion is unsecured. Legally they don't need to pay a penny of it. For the secured part they will negotiate. Pensions will probably picked up by PGBC, City will just transfer the funded portion to PGBC. Meanwhile the revenue flow remains the same. Granted Judge has to approve each expense, that is very common by bankruptcy judges, when they can approve bonuses to executives during C11 they can definitely approve to turn on more street lights.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: psa188
Posted 2013-07-19 12:57:11 and read 6616 times.

Quoting KarlB737 (Reply 28):
On the other hand if Detroit City Airport (DET) had any air service as well that could be impacted.

You mean the Coleman A. Young International Airport?
http://www.detroitmi.gov/Departments/Airport/tabid/72/Default.aspx
Ever since the demise of the ProAir international hub it's been hurting for business.

This article http://www.washingtonpost.com/busine...1e2-bed3-b9b6fe264871_story_1.html reports that "[emergency manager] Orr has talked about spinning off city assets, including the Coleman A. Young International Airport and the beloved Belle Isle park, to raise money." I can't imagine who in their right mind would want to buy DET but at the right price someone might.

I agree that DL and DTW will not suffer from Detroit's bankruptcy filing.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: brilondon
Posted 2013-07-19 13:00:01 and read 6578 times.

Quoting DTW2HYD (Reply 30):
C11 they can definitely approve to turn on more street lights

They are not in C11 to my understanding, but in C10 which I don't know much about. I admit I am not very familiar with the US bankruptcy laws and all their connotations. I do know how the bankruptcy laws work when it comes to private business but I really did not know a city could declare bankruptcy until that one in California did.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: DTW2HYD
Posted 2013-07-19 13:09:51 and read 6466 times.

Quoting brilondon (Reply 32):
They are not in C11 to my understanding

I was quoting C11 in terms of a corporate bankruptcy, like AA executives. Municipal bankruptcy is under C9. It is new to everyone i.e., not as popular as Trump claims about C11, it is just a tool in his toolbox. What I heard on news City (representing citizens of the city) has more leeway than a companies board/exec team.

http://en.wikipedia.org/wiki/Chapter_9,_Title_11,_United_States_Code

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: BigGSFO
Posted 2013-07-19 13:18:19 and read 6357 times.

Quoting gigneil (Reply 2):
Yeah, this will have zero impact on Delta or the rest of that part of Michigan.

There will be indeed be an impact, but it won't be anything significant enough for DL to adjust their schedule or treat the operation any less than it is now (IMO). All city contracts can be effected. If there were any between Delta and Detroit, they can renegotiate or abandoned. In addition city related travel can be restricted, etc. However, since the general public sees bankruptcy s a negative, the city might want to work with Delta to re-boost the city's image with some tie-in marketing etc. down the line. As for the rest of the state, I am sure it will be felt. When your largest and most important city files for bankruptcy, the ripple effect can be far reaching.

Quoting AADC10 (Reply 27):
The bankruptcy does not have much impact on short term spending. The effect will be years down the road when Detroit cannot float bonds and residents will spend less because their pensions were slashed. As indicated in previous posts, part of the problem in Detroit was white flight to the suburbs. The city center is collapsing but the suburban WASPs are doing reasonably well.

Agreed.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: luckyone
Posted 2013-07-19 13:21:27 and read 6328 times.

Quoting brilondon (Reply 32):
They are not in C11 to my understanding, but in C10 which I don't know much about.

It's probably a typo, but just for clarification, municipality bankruptcy is Chapter 9. There isn't a chapter 10.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: BigGSFO
Posted 2013-07-19 13:24:55 and read 6297 times.

Quoting DTW2HYD (Reply 14):
Once you stiff old creditors, new ones line up with armored trucks to lend. It is against conventional wisdom but very true. Only in US of A.

HAA HAA yes....all of a sudden cash comes from nowhere. "We will finance you, of course you'll pay a premium interest rate but here you go."

All said and done, this was a good move on Detroit's end. It has been struggling for years (decades?) and it's time to bring one of America's most important cities back around.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: IADCA
Posted 2013-07-19 13:31:13 and read 6241 times.

Quoting DTW2HYD (Reply 25):
The reason I picked DC is Kevin Orr, the appointed Emergency Manager has a law firm in DC, famous for handling bankruptcy cases. Legally he is detached from the firm during his tenure as EM for the city, but you can bet his firm will play a major role.

While Orr was in the DC office, a MUCH larger share of that firm's BK practice is in NY, like most large firms.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: OA412
Posted 2013-07-19 13:35:14 and read 6207 times.

A judge just ruled Detroit's bankruptcy filing unconstitutional, so there's that.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: DTW2HYD
Posted 2013-07-19 13:40:53 and read 6166 times.

Quoting BigGSFO (Reply 36):
HAA HAA yes....all of a sudden cash comes from nowhere. "We will finance you, of course you'll pay a premium interest rate but here you go."

If you haven't noticed, there is still a company called "Old GM" with all the liabilities and old creditors/bond holder still holding bag while "New GM" thriving with good credit rating and brand new creditors.

New creditors think old creditors are losers and City cannot file bankruptcy again in near future, so their credit is safe. Got the logic.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: brilondon
Posted 2013-07-19 15:50:11 and read 5267 times.

Quoting OA412 (Reply 38):

A judge just ruled Detroit's bankruptcy filing unconstitutional, so there's that

Yes, I just heard that too. I don't get it though, the state ruled it unconstitutional yet it was filed in a federal court under federal bankruptcy laws so I don't see that the state has any say in the matter unless they are one of the creditors and then they can fight it out in bankruptcy court.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: lightsaber
Posted 2013-07-19 18:17:22 and read 4400 times.

Quoting OA412 (Reply 38):

A judge just ruled Detroit's bankruptcy filing unconstitutional, so there's that.

It is unconstitutional under state law, but it is a Federal bankruptcy.

And how could it matter. The city cannot pay for basic services much less its debt and pension obligations. If Detroit is not allowed to go through bankruptcy, then things will get even worse.

Detroit is broke. No one will lend them money. They must default on $9Billion+ of their debt if they are to function. This is a case were making a law ensures it just has to be broken.

But as already noted, bankruptcy was in a Federal court.


On thread, I think Detroit failing to go forward with a bankruptcy would hurt DL...

Lightsaber

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: luckyone
Posted 2013-07-19 21:10:07 and read 3492 times.

Quoting lightsaber (Reply 41):

And how could it matter. The city cannot pay for basic services much less its debt and pension obligations. If Detroit is not allowed to go through bankruptcy, then things will get even worse.

Agreed, the hard-line principled will say that Detroit should live up to its word no matter what. Sounds great in theory. But with no money coming in how are they going to meet their obligations? They simply aren't obviously. Some would say then repossess and sell off the assets. Well that's great in theory, but what assets does the city of Detroit have that will add up to $16 billion that if sold would still leave the city capable of obtaining income?

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: PHX787
Posted 2013-07-20 02:38:46 and read 3247 times.

Quoting jetlanta (Reply 16):
OMG. Really? The city of Detroit, home to only 700,000 people (mostly poor), can't pay its bills. That doesn't make the 6-7M people of Southeast Michigan and the DTW catchment area suddenly impoverished and incapable of purchasing air travel. On the contrary, the business environment in the region is in the best condition it has been in a long time. The DTW solidly profitable for Delta. This will have no impact on that.
Quoting ouboy79 (Reply 19):
This. It is amazing how many ignorant people there are commenting on threads like this that don't understand the dynamics of that region.

Ok first of all, don't call me ignorant, ok? If I am ignorant then you guys are the same for saying that PHX is nothing but a desolate wasteland.

Second of all, Isn't the state of Michigan also losing population? And the term "dynamics" seems to be the opposite trend. the only company I've seen beefing up presence in that part of the states seems to be GM. But that's only factories. Since the recession, almost all off the investment groups that I've heard of in that area fled south into different cities, or to the west coast.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: michman
Posted 2013-07-20 06:52:39 and read 3012 times.

Quoting PHX787 (Reply 43):
Ok first of all, don't call me ignorant, ok? If I am ignorant then you guys are the same for saying that PHX is nothing but a desolate wasteland.

Second of all, Isn't the state of Michigan also losing population? And the term "dynamics" seems to be the opposite trend. the only company I've seen beefing up presence in that part of the states seems to be GM. But that's only factories. Since the recession, almost all off the investment groups that I've heard of in that area fled south into different cities, or to the west coast.

Do you ever bother to cite references for your assertions? I've yet to see any. The most recent US Census estimates for last year list Michigan having a small population increase last year. Making judgments based on assumptions, biases, and a lack of any real facts is pretty much my definition of ignorance. In terms of new jobs, it is certainly more than just GM adding jobs.

"Michigan leads the country when it comes to new manufacturing job creation.

According to a report by the National Association of Manufacturers, Michigan posted a net gain of over 88,000 jobs between December 2009 and March of this year. The Great Lakes state outpaced second place Texas by more than 30,000 new workers.

Michigan ranked fourth in the nation in 2012 for major new corporate facilities and expansions.

Read more: http://www.woodradio.com/articles/wo...ing-sector-11436528/#ixzz2Zar8CoMM
"

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: falstaff
Posted 2013-07-20 07:45:31 and read 2916 times.

I don't think Detroit's bankruptcy will have any effect on DTW. I don't think much city business has anything to do with the airport. Detroit has been screwed up[ for a long time so a bankruptcy is just a formality at this point.

Many of Detroit's 700,000 citizens are poor and probably not flying places, but even if they do those people are still going to people able to spend their money.

I don't think the bankruptcy will have any effect on the town I live in (Taylor) or the town I work in (Trenton),

I am on the vestry (board of directors) of my church in Detroit and maybe the bankruptcy will have some positive effect for us. I am hoping it will get rid of some inept city workers. I'll give you two examples of Detroit stupidness:
our custodian (who lives at the church) had to call the police once and they told him that it was an invalid address and they wouldn't come to a vacant lot. The church has been on that site (with the same address) since 1861.

A couple of years before that our priest was charged with a misdemeanor for putting up bleachers in our parking lot so children could watch the Thanksgiving parade. A police officer told him he wasn't allowed to put up bleachers on city property without a permit. He explained that the parking lot is property owned by the church since 1858 (which it is), but the officer and his superior said it wasn't and told him to remove the bleachers. When he didn't comply they arrested him. One of our parishioners is a high profile Detroit attorney who gave our priest some fantastic representation. The city eventually dropped the charge because the property did belong to the church and the police were wrong, however the city prosecutor recharged our priest with another crime; storing construction equipment on private property without a permit. After a through investigation by the attorney's investigation team it was found that there was no such law or ordinance on the books in the city of Detroit so the charge was dropped. Without a high powered legal team most people wouldn't beat this wrap, but what it really crazy is that no laws were broken in the first place. You can't charge people for crimes that are not crimes. This incident really made me wonder how many people are charged with things in the city that aren't even against the law. Most people in this situation wouldn't bother getting a legal team and just pay the fine (for something that isn't illegal).

As someone who lives in the Detroit area I get upset when people make generalizations about the area without actually going there and understanding the place. Many people think of the area and think of GM, Ford, and Chrysler. It is true that they are dominating forces in the area, but the Detroit area is the place to be if you are the automobile business regardless of manufacturer. I have friends who live in the area who work for Toyota, Nissan, and Hino (Toyota heavy trucks). Automotive suppliers from around the globe have operations in the Detroit area. Manufacturing may be going on in other places, but there is plenty of R&D going on in the area. Graduates of university Automotive Technology programs (including me) still flock to the area because that is where the good jobs are. Southeast Michigan is a lot more than just Detroit and it has been for a long time.

You can't forget about the importance of southwest Ontario either. Ontario builds more cars than any other state or province in the world (according to them) and most of them are built in the southwest, inside of the service area of DTW. I see a lot of people with Canadian passports in the security line at DTW. Southeast Michigan and Southwest Ontario are the places to be if you want to work in the car business in North America.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: RayChuang
Posted 2013-07-20 08:30:57 and read 2835 times.

How will it affect DTW? Nada.

Here's the thing: once you get out of the Detroit city limits, you encounter some of the richest suburban towns in the USA, period. Interestingly, many of these prosperous towns have large African-American populations--populations that left Detroit post haste after the 1967 riots and especially during the reign of the late Coleman Young as mayor. These more affluent communities is the reason why DTW is doing well and is a major hub airport.

In fact, Detroit is a "sleeping giant" that could be the center of goods trade between the USA and the Toronto-Montreal corridor. All the city needs is a physically smaller size (divide the rest into smaller, more manageable towns), a from-ground-up business-friendly government, build a second bridge crossing between Detroit and Windsor, ON, and turn Wayne County into a permanent free trade zone to encourage new industries to the area and to do massive infrastructure upgrades.

Indeed, now that Detroit has a chance to do a fresh start to become the big trade port between the USA and Canada it should have been with the decline of the automobile industry in the area, you could see a potentially amazing revival that could even mean DTW could get new upgrades and become one of the best airports in the USA.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: MasseyBrown
Posted 2013-07-20 08:35:22 and read 2816 times.

The length of the bankruptcy will be important. The longer companies are unable to predict an important cost of doing business (taxes), the longer they will resist making new investments in Detroit .

A second unknown: if it is decided that Michigan's constitution protects pensions and other benefits, then Michigan may be on the hook to pay for them. The whole state could be liable, not just the citizens of Detroit. The longer this issue is in question, the worse for Michigan.

Delay, the lawyers' favorite legal tactic, is not good for the future of the city. Again, no immediate impact on Delta, but the unknowns could easily turn into a growth killer if they drag on and on.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: ouboy79
Posted 2013-07-20 08:59:21 and read 2755 times.

Quoting PHX787 (Reply 43):
If I am ignorant then you guys are the same for saying that PHX is nothing but a desolate wasteland.

When have I ever said PHX is nothing but a desolate wasteland? Please provide a link. I think in OKC and I definitely don't throw stones at others because we get plenty thrown at us for no reason. If people spent more time educating themselves on regions they want to make statements on, we would be in a much better place.

Quoting PHX787 (Reply 43):
Second of all, Isn't the state of Michigan also losing population?

Google "Michigan Population" and they have a nice little chart that pops up right away that shows population is increasing slightly. Peak was 10.06 million a few years ago and is now at 9.883 million. I think you are confusing population declines in Detroit with those in the rest of the state. Michigan is much more than Detroit.

Quoting PHX787 (Reply 43):
And the term "dynamics" seems to be the opposite trend. the only company I've seen beefing up presence in that part of the states seems to be GM. But that's only factories.

Dynamics - a pattern or process of change, growth, or activity.

So there are no changes, no growth, or no activity in Michigan and Detroit?

I can understand there is a cultural divide when looking across country and people who don't frequent that area don't understand what all is going on there.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: DTW2HYD
Posted 2013-07-20 09:08:28 and read 2735 times.

What impact South Boston has on BOS.
What impact South Atlanta has on ATL.
What impact South Chicago has on ORD.
What impact South Virginia has on IAD.

Apples and Oranges?

Granted Detroit is media poster child for All Things Bad.
Michigan's GDP is ~370 Billion.
Michigan State and most of Cities are right sized long before lot other states did.
Even City of Detroit has only 10,000 employees. They don't foresee any cuts in City Staff. Once their cash flow gets better, they have to hire more to improve services.
Michigan has 500,000+ technology professionals. Most of the jobs in Metro Detroit are.
Michigan is not nursing on federal government. Impending federal budget cuts has little impact on Michigan.

Regarding City of Detroit crime rate, most of the shootings are between known people. Not trying to justify but unlike other cities, random crime is rare.

Michigan has few Top Safest cities published by FBI.

Here is the dichotomy with in the City of Detroit. There is a 1 year waiting period to buy $1 Million+ Loft in Downtown Detroit, but there are 78,000 abandoned structures.

I accept all this doesn't fit narrative for some folks, but that is the greatness of this country and this forum. Everyone is allowed to express their views.

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: SESGDL
Posted 2013-07-20 09:27:29 and read 2698 times.

Some people on here clearly haven't learned that anyone who says anything even slightly negative about DTW will be accosted by those on here who are clearly from the area that seem to come out of the woodwork whenever DTW is mentioned.   Any city filing bankruptcy has some (albeit) short term effects on the surrounding area, otherwise cities wouldn't be so afraid to do it and it would be more common, since virtually every large US city faces major budget constraints.

The extent that it will affect DTW and DL's operation there? Few and far between. DTW's O&D has been impacted for decades by the financial issues of the area, nothing is changing due to this bankruptcy. DTW's operation is driven by the entire metropolitan area as well as the large corporate base in the city. These aren't going anywhere. DL operates a hub there so, by default, the majority of the operation there is going to be connections anyway. DL's beautiful terminal and recent investments (NW's investments, I should say) also force DL to concentrate on continuing to operate an efficient and streamlined operation there to get a good ROI as well as to exploit the competition's somewhat lackluster facilities (AA at ORD, for example).

But let's face it, those on here trying to again site the area as this enormously wealthy, incredibly affluent area are not living in reality. Yes, the area has immense wealth in many areas (as do most large cities), but it's GDP for a city of its size is lacking. DTW's GDP has declined or been stagnant for over a decade (even still per the latest statistics) and lags behind smaller areas like MSP and SEA.

All in all this bankruptcy (like most other American bankruptcies) will do little to impact the airport or DL's operation there.

Jeremy

Topic: RE: Detroit Bankruptcy- Bad For DL?
Username: lightsaber
Posted 2013-07-20 09:41:25 and read 2673 times.

Quoting RayChuang (Reply 46):
In fact, Detroit is a "sleeping giant" that could be the center of goods trade between the USA and the Toronto-Montreal corridor. All the city needs is a physically smaller size (divide the rest into smaller, more manageable towns), a from-ground-up business-friendly government, build a second bridge crossing between Detroit and Windsor, ON, and turn Wayne County into a permanent free trade zone to encourage new industries to the area and to do massive infrastructure upgrades.

Detroit has HUGE potential. But they must be more flexible. They have far too many rules that take far too long to set up a business. To stimulate hiring, it must become much easier to fire or layoff a worker. My prior employer wanted, for political reasons, to set up in Detroit. But the day to day laws (e.g., who moved what equipment) and the costs of laying off pushed the risk costs up too high.

Detroit needs a far more business friendly government. The void left by the auto industry should have been filed decades ago. The fact it wasn't tells quite a tale. Now that Detroit has lost most of its well to do residents, it will be tougher to attract the business.

For DTW, Detroit is a sideline. About as important as the population along the 14 is to LAX. Some traffic, but not the core market.

Lightsaber


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