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How Can Delta Avoid Filing For Bankruptcy?  
User currently offlineFlydl2atl From United States of America, joined Aug 2005, 119 posts, RR: 0
Posted (8 years 7 months 4 weeks 4 hours ago) and read 5551 times:

With masisve amounts of debt to service (I believe over 20 billion), thin yields, and the high price of jet fuel, how can Delta survive without filing for bankruptcy? Jerry Grinstein has said that filing for bankruptcy with most of the assests encumbered would likely eventually result in Delta filing CH 11 and eventually being liquidated. What will it take for Jerry to save Delta?

My guesses are some combination of the following:

1. Jet fuel goes down substantially.
2. Delta receives major financing through GE, Boeing, or Airbus.
3. Flyi goes CH11
4. NWA strike causes a major service disruption.
5. Major give-backs from DALPA.
6. Pension reform from congress.
7. Merger with another airline

80 replies: All unread, showing first 25:
 
User currently offlineMariner From New Zealand, joined Nov 2001, 24638 posts, RR: 86
Reply 1, posted (8 years 7 months 4 weeks 4 hours ago) and read 5534 times:
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Quoting Flydl2atl (Thread starter):
2. Delta receives major financing through GE, Boeing, or Airbus.

Why would they receive one thin dime from Airbus?

They have no Airbus aircraft, they have shown zero interest in ordering Airbus aircraft.

Many on this board would go nutso if they did and scream foul.

cheers

mariner



aeternum nauta
User currently offlineAlitalia744 From United States of America, joined Mar 2000, 4731 posts, RR: 45
Reply 2, posted (8 years 7 months 4 weeks 3 hours ago) and read 5521 times:

Quoting Mariner (Reply 1):
Many on this board would go nutso if they did and scream foul.

just like the euro's would if Iberia ordered a Boeing...

give it up.



Some see lines, others see between the lines.
User currently offlineStevenUhl777 From , joined Dec 1969, posts, RR:
Reply 3, posted (8 years 7 months 4 weeks 3 hours ago) and read 5513 times:

Quoting Flydl2atl (Thread starter):
2. Delta receives major financing through GE, Boeing, or Airbus.

Using what as collateral? What unencumbered assets does DAL have right now? DIP financing will be a challenge for them...

Quoting Flydl2atl (Thread starter):
7. Merger with another airline

Maybe. Who will take on DAL's debt? Any takers?


User currently offlineContnlEliteCMH From United States of America, joined Mar 2005, 1450 posts, RR: 44
Reply 4, posted (8 years 7 months 4 weeks 3 hours ago) and read 5484 times:

Cease operations immediately.

Outside of that, I doubt there's little they can do.



Christianity. Islam. Hinduism. Anthropogenic Global Warming. All are matters of faith!
User currently offlineLowrider From United States of America, joined Jun 2004, 3220 posts, RR: 10
Reply 5, posted (8 years 7 months 4 weeks 3 hours ago) and read 5452 times:

Quoting Flydl2atl (Thread starter):
1. Jet fuel goes down substantially.

I see nothing to indicate that this will happen

Quoting Flydl2atl (Thread starter):
2. Delta receives major financing through GE, Boeing, or Airbus

Financed up to the eyeballs by the first two, I doubt airbus has much interests, especially considering that competitor growth can result in more orders

Quoting Flydl2atl (Thread starter):
3. Flyi goes CH11

If/when this does happen, it won't be enough

Quoting Flydl2atl (Thread starter):
4. NWA strike causes a major service disruption.

It hasn't so far, and since NW codeshares, it could also reflect poorly when some of Delta's service is impacted.

Quoting Flydl2atl (Thread starter):
5. Major give-backs from DALPA.

They already gave up 32%, and all of that has already gone through the fuel tanks. Even if they gave up another 32%, it wouldn't be enough. Wages are not a tool to finanace the operation of a company.

Quoting Flydl2atl (Thread starter):
6. Pension reform from congress.

This is a real possibility. It would be a huge, potentially devestating loss to those who lose thier entire pension, but at the rate DL is burning cash, it would only delay the inevitiable.

Quoting Flydl2atl (Thread starter):
7. Merger with another airline

Probably the best option, but with whom? They need a smart, forward thinking, fast reacting managment team. Any takers...?



Proud OOTSK member
User currently offlineFlydl2atl From United States of America, joined Aug 2005, 119 posts, RR: 0
Reply 6, posted (8 years 7 months 4 weeks 3 hours ago) and read 5439 times:

Quoting Mariner (Reply 2):
Why would they receive one thin dime from Airbus?

Airbus lends them money, they agree to a large future purchase of Airbus planes. For instance, replacing their 767 fleet with A350s. Desperate times call for desperate measures. Just an idea...not saying it will happen.

5 billion of Delta's 20 billion dollars of debt is because of an underfunded pension. If Congress would pass pension-reform, then Delta could generate positive cash flow to reduce their debt and subsequently have better access to the credit markets to get better terms on their existing debt. Think of AA in '03. Airlines generate a lot of cash, thus it doesn't take much to go from losing a lot to making a lot (or vice versa).

[Edited 2005-08-26 02:14:42]

User currently offlineZone1 From United States of America, joined Jan 2005, 1034 posts, RR: 7
Reply 7, posted (8 years 7 months 4 weeks 3 hours ago) and read 5408 times:

Quoting Mariner (Reply 1):
Why would they receive one thin dime from Airbus?
They have no Airbus aircraft

You just answered your own question.



/// U N I T E D
User currently offlineMariner From New Zealand, joined Nov 2001, 24638 posts, RR: 86
Reply 8, posted (8 years 7 months 4 weeks 3 hours ago) and read 5383 times:
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Quoting Alitalia744 (Reply 2):
just like the euro's would if Iberia ordered a Boeing...

Call me crazy, but I've flown on an Iberia 747. Was I mistaken, was it not a 747?

Quoting Alitalia744 (Reply 2):
give it up.

Give what up - stating facts? I guess you weren't around for the howls when Airbus put $250 million into US/HP.

Quoting Flydl2atl (Reply 6):
Airbus lends them money, they agree to a large future purchase of Airbus planes.

I could be wrong, but I can't think it would be particularly interesting to Airbus. As others have noted, Delta has debt up the wazoo, about the last thing they need is more debt to service.

I can't think why GE would do it - they are trying to reduce their exposure to risk, not increase it.

In the case of HP/US, Airbus had a long history with both carriers.

Quoting Zone1 (Reply 7):
You just answered your own question.

Rhetorical question.  Smile

cheers

mariner



aeternum nauta
User currently offlineOPNLguy From , joined Dec 1969, posts, RR:
Reply 9, posted (8 years 7 months 4 weeks 3 hours ago) and read 5380 times:

Quoting Flydl2atl (Thread starter):
With masisve amounts of debt to service (I believe over 20 billion), thin yields, and the high price of jet fuel, how can Delta survive without filing for bankruptcy? Jerry Grinstein has said that filing for bankruptcy with most of the assests encumbered would likely eventually result in Delta filing CH 11 and eventually being liquidated. What will it take for Jerry to save Delta?

Although I personally wish it was not so (as I have friends there), I don't think there's any way that they can now avoid a bankrupty filing (Chapter 11, restructuring, and -not- a Chapter 7 liquidation). There is simply too much debt, fuel cost increases are beyond their control (not hedged), and they can't count on Congress to enact pension funding reform on the prompt schedule that Delta needs.

The icing on the cake here (as far as reasons that I think they'll seek Chapter 11 protection) is that the bankruptcy law changes take effect on October 17th. Given the choice of restructuring under the Chapter 11 Code as it exists today, or doing so after the new Code goes into effect, the former gives them much more flexibility than the latter. United has been in Chapter 11 for almost 3 years now, and under the new Code, a firm would have to be out in 12-18 months.

I don't think it unreasonable to assume that Delta will take the same path as United by filing under the existing Code, and therefore getting the same restructuring flexibility that United has had in the last almost 3 years. Since NWA, AA, and Continental all have similar fuel cost and pension cost exposures (but have differing debt and cashflow), it's hypothetically possible that they could also take refuge under the existing Chapter 11 Code, so they too (along with United, ATA, and US Airways) could be on the same level playing field as far as restructuring flexibility. With that protection, maybe 2006 would see lower fuel prices, and Congress enacting some kind of pension reform.

I hope nobody interprets any of this to mean that I hate Delta (or any of the other airlines mentioned) or wish to see them or anyone in bankruptcy--I don't. Situationally, the obscene cost of fuel, and the other factors have created a scenario and shrinking timeframe where big changes are coming to the industry over and above those that have already transpired....

Best of luck to -everyone- in the industry....


User currently offlineLawnDart From United States of America, joined May 2005, 968 posts, RR: 3
Reply 10, posted (8 years 7 months 4 weeks 2 hours ago) and read 5340 times:

Quoting Lowrider (Reply 5):
They need a smart, forward thinking, fast reacting managment team.

There have been a couple of managerial changes at Delta recently that portend "forward thinking, fast reacting" might be coming soon. The new CFO is, from what's been said, a pretty sharp individual. The fomer Alitalia, former Continental guy now at DL marketing also has a good reputation.

I wouldn't be surprised to see some interesting developments in the near future (one of which could be, admittedly, CH11).

Quoting ContnlEliteCMH (Reply 4):
Cease operations immediately

I hate to be critical, but comments like these, even if in jest, display an ignorance of fact. An airline with the amount of debt that Delta has is still a viable entity, if only to pay off the debt! The franchise is a strong one, and management could focus on those strengths to return the carrier to eventual profitability and pay off the debt.

That's what debtors are counting on...they are owed substantial amounts of money, and the ability to get paid that money exists with an operating carrier, not the presumption that someone wants to buy a fleet of second-hand MD88s during a liquidation sale...

Apart from that, "cease operations immediately" means wrenching hardship for thousands of employees. No one in the airline industry likes to see that kind of pain endured by their brethren...even those at the competition.

Quoting Mariner (Reply 1):
Why would they receive one thin dime from Airbus?

As pointed out in a later reply, because DL agrees to purchase a huge honking fleet of Airbii...

Imagine...DL gets Airbus to agree to take their fleet off DL's hands...the 777s and 738s could be remarketed easily, and the 757s find a home with FedEx (why not?). The MD88s...well...I smell a write-off...or sell a few here, a few there. Remember, Boeing was out hawking A340s a couple of years ago.

In return, DL buys 72 A319s...200 A320s...120 A321s and 130 A350s of various sizes...531 aircraft (about the same as the current fleet). Would Airbus do it? Imagine the ability to trump the 787 alone with an order for 130 A350s.

Oh, and toss in an option for about 200 next-generation A320s...oh, and about 500 Embraer 170 / 190s to replace those CRJs (who has a stake in Embraer?). Oh, and the whole damn fleet is powered by CFM56s...GENx...and CF34s...built by the same company that decides...hmm...maybe investing in DL ain't such a bad thing after all...

Think I'm fantasizing? How's this for fantasy...Air France joins the party and makes an investment in their largest code-share partner, while at the same time committing themselves (including KLM) to the A350 as well.


User currently offlineMariner From New Zealand, joined Nov 2001, 24638 posts, RR: 86
Reply 11, posted (8 years 7 months 4 weeks 2 hours ago) and read 5323 times:
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Quoting LawnDart (Reply 10):
Think I'm fantasizing?

In the case of the Airbus fleet, yes. For several reasons.

(i) I think Airbus might take a risk for a small-ish amount of money, but on an order of that size, I think they would feel very uneasy about getting paid.

A fleet transition of the kind you describe would cost a freakin' fortune - in transition costs, as separate from acquisition costs.

(ii) Given that Delta has had minimal interest in Airbus, I can't think why they would be interested now.

As my mom used to say: always be nice to 'em on the way up, coz you never know when you're going to need 'em on the way down.

(ii) Why would Delta not go to GE - or Boeing - first?

cheers

mariner



aeternum nauta
User currently offlineLawnDart From United States of America, joined May 2005, 968 posts, RR: 3
Reply 12, posted (8 years 7 months 4 weeks 2 hours ago) and read 5290 times:

Quoting Mariner (Reply 11):
i) I think Airbus might take a risk for a small-ish amount of money, but on an order of that size, I think they would feel very uneasy about getting paid.

Airbus needs to sell aircraft...getting someone to finance the purchase is the trick. Once the airplane leaves the factory and Airbus turns over the keys, it's not Airbus' problem anymore.

Can Airbus convince someone to finance? Psst...buddy...finance DL's huge fleet purchase at good rates, and I'll get you more business later as well...nah...don't worry, they're good for it, and if they stiff us, we can resell to someone else...they're great aircraft, everyone wants one.

Quoting Mariner (Reply 11):
A fleet transition of the kind you describe would cost a freakin' fortune - in transition costs, as separate from acquisition costs.

Press Release...dateline Toulouse. EADS subsidiary Airbus today announced the largest single aircraft order in the history of commercial aviation. Troubled U.S. carrier Delta Air Lines today placed on order for 530 jets, with options for another 200 aircraft, including 130 of Airbus' new A350 jetliner, thus vaulting that aircraft into the lead over Boeing's 787.

As part of the deal, Delta pilots will be transitioned to the new fleet at Airbus' training facility in Miami. Also, Airbus has agreed to assist in transition Delta TechOps to the new fleet with an agreement to set up a joint venture that would make Airbus maintenance available to other carriers as well.

Quoting Mariner (Reply 11):
(ii) Given that Delta has had minimal interest in Airbus, I can't think why they would be interested now.

$$$. Money talks. And DL seriously considered the A330 (but eventually went with the ever-popular 767-400).

Quoting Mariner (Reply 11):
(ii) Why would Delta not go to GE - or Boeing - first?

Delta to the Boeing and G.E. salesmen: we've gotten this great offer from Airbus and from Rolls-Royce and IAE. What can you do for me?


User currently offlineContnlEliteCMH From United States of America, joined Mar 2005, 1450 posts, RR: 44
Reply 13, posted (8 years 7 months 4 weeks 2 hours ago) and read 5266 times:

Quoting LawnDart (Reply 10):
I hate to be critical, but comments like these, even if in jest, display an ignorance of fact.

On the contrary. I realize what you are saying -- about debt service, franchise, etc. There are employees, and communities, etc. to be considered as well. However, you are either willfully or otherwise ignoring the opposite path, one with another set of "facts": one way to stop losing money is to stop operations.

The question here is how could Delta survive while avoiding Chapter 11. There is probably *nothing* Delta can do, at this point, to avoid it. Ceasing operations obviously violates the requirement for survival

But ceasing operations *will* avoid Chapter 11. I'm not saying it's realistic. You may not like the side effects, and neither does anybody else, but it would accomplish the goal. To say otherwise is, to me, being ignorant of this obvious and self-explanatory fact.

And before you attack me further, perhaps you should consider the reality of many other businesses, such as the one I own. When we started our consulting company, we openly discussed shuttering the operation as a viable exit strategy. There are *facts* that make this viable: the company's present value to its stakeholders could be in excess of what it may be at some future point. If we believe that the company's position will continue to deterioriate, it is *obviously* in our best interests to cease operations. If you are losing a dime on every dollar you turn, and you don't think you can stop the loss, ceasing operations *is* a viable way to stop further deterioration of the stakeholder's position. This is a plain and obvious FACT even if we have employees, franchise, and physical assets.

EDITED because I misrepresented the original question in the thread.

[Edited 2005-08-26 03:25:56]


Christianity. Islam. Hinduism. Anthropogenic Global Warming. All are matters of faith!
User currently offlineLightsaber From United States of America, joined Jan 2005, 12420 posts, RR: 100
Reply 14, posted (8 years 7 months 4 weeks 2 hours ago) and read 5237 times:
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Quoting Flydl2atl (Thread starter):
Jerry Grinstein has said that filing for bankruptcy with most of the assests encumbered would likely eventually result in Delta filing CH 11 and eventually being liquidated. What will it take for Jerry to save Delta?

DL, unfortunately, has the highest risk of going under. While I hope it isn't so (DL was the first airline I flew on), Bankruptcy is not going to be avoided by them. Its only a question of when.

Quoting Flydl2atl (Reply 6):

Airbus lends them money, they agree to a large future purchase of Airbus planes. For instance, replacing their 767 fleet with A350s. Desperate times call for desperate measures. Just an idea...not saying it will happen.

Can DL turn around quick enough to make this purchase? Maybe it would be the largest fleet order ever; replace the MD-80's, MD-90's, 732's, right away with a 318/319/320 fleet. Get financing with GE to go for the CFM's... This is the best scenario I see...

Quoting LawnDart (Reply 10):

That's what debtors are counting on...they are owed substantial amounts of money, and the ability to get paid that money exists with an operating carrier, not the presumption that someone wants to buy a fleet of second-hand MD88s during a liquidation sale...

The old adage, owe the bank $100,000 the bank owns you, owe the bank $10,000,000,000 and you own the bank. It would rock the world for DL to go under... but when do you stop throwing good money after bad? And if DL does go under, MD-80's will go for a few bucks over their bare metal scrap value! Maybe we could chip in and buy one?  hyper ??  duck 

Airlines do go out of business (Tango Uniform). Braniff, Eastern, Pan Am... and more. I give DL five months to get their act together... But then again, I didn't give DH this long nor US... So hopefully I'm wrong again!  spin 

OPENnlguy, I agree, DL will have to file chapter 7. I'm just not sure how they'll avoid chapter 11 unless GE/Airbus/Boeing come riding in on a white horse. FL is ripping them apart in ATL. Not to mention B6 on NE to Florida and I'm sure DH is hurting their yields...

It seems that at least one USA major is going to liquidate... which one? Since US dodged the bullet... DL seems next in its path...

Lightsaber



I've posted how many times?!?
User currently offlineLawnDart From United States of America, joined May 2005, 968 posts, RR: 3
Reply 15, posted (8 years 7 months 4 weeks 2 hours ago) and read 5227 times:

Quoting ContnlEliteCMH (Reply 13):
If you are losing a dime on every dollar you turn, and you don't think you can stop the loss, ceasing operations *is* a viable way to stop further deterioration of the stakeholder's position. This is a plain and obvious FACT even if we have employees, frachise, and physical assets.

"If you don't think you can stop the loss". Delta management obviously thinks they can. Remember, they posted two years of $1 billion + profit not too long ago.

Quoting ContnlEliteCMH (Reply 13):
The question here was what Delta could do, if anything, to avoid Chapter 11. There is probably *nothing* Delta can do, at this point, to avoid it. Except this. Ceasing operations *will* avoid Chapter 11. I'm not saying it's realistic.

I'm glad you're not saying it's realistic, because it isn't. As you stated, so many entities have a stake in DL's survival...and throwing in the towel is not in the nature of large corporations. Chapter 11 may certainly not be avoidable, but most large corporation at least try to restructure their debt before calling it quits. And if history is any indication, DL will be around a while before ceasing operations.

Quoting ContnlEliteCMH (Reply 13):
And before you attack me further,

I'm sorry, but if you're original post hadn't been more than a two sentence, drive by shooting, I wouldn't have felt the need to criticize. Now, if you had originally stated with what you ended up saying in this reply, it would've made for a good initial response.


User currently offlineMariner From New Zealand, joined Nov 2001, 24638 posts, RR: 86
Reply 16, posted (8 years 7 months 4 weeks 2 hours ago) and read 5212 times:
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Quoting LawnDart (Reply 12):
Airbus needs to sell aircraft...getting someone to finance the purchase is the trick. Once the airplane leaves the factory and Airbus turns over the keys, it's not Airbus' problem anymore.

Seperate issue. I was talking about getting its investment back - "getting paid" for that.

The $250 million that is going into US/HP is, finally, peanuts. But to get Delta back from the brink would cost several billion, and Delta is a money losing business.

I note that United has lined up $3 billion in exit fiancing and is looking for more.

Assuming that Delta would need at least a similar sum, on top of its present debt, I would be deeply nervous about getting my money back if I were an investor.

Airbus and Boeing are aircraft manufacturers not airline financiers (mostly). To have to fall back on their good graces for money suggests that the capital markets are closed to Delta.

In which case, to lend Delta billions would seem to me to be foolhardy.

cheers

mariner



aeternum nauta
User currently offlineSEAPlane10 From United States of America, joined Jun 2005, 86 posts, RR: 0
Reply 17, posted (8 years 7 months 4 weeks 2 hours ago) and read 5210 times:

If Chapter 11 bankruptcy were to occur, what would happen to the frequent flyer miles accrued? Would they still be redeemable?

Regards


User currently offlineOPNLguy From , joined Dec 1969, posts, RR:
Reply 18, posted (8 years 7 months 4 weeks 2 hours ago) and read 5209 times:

Quoting Lightsaber (Reply 14):
OPENnlguy, I agree, DL will have to file chapter 7. I'm just not sure how they'll avoid chapter 11 unless GE/Airbus/Boeing come riding in on a white horse. FL is ripping them apart in ATL. Not to mention B6 on NE to Florida and I'm sure DH is hurting their yields...

I don't know exactly how that's agreeing with me, because I actually said:

Quoting OPNLguy (Reply 9):
I don't think there's any way that they can now avoid a bankrupty filing (Chapter 11, restructuring, and -not- a Chapter 7 liquidation).

I'll say again, 11, *not* 7....  Wink


User currently offlineEvan767 From United States of America, joined Aug 2005, 2957 posts, RR: 2
Reply 19, posted (8 years 7 months 4 weeks 2 hours ago) and read 5204 times:

Well Delta did just sell ASA to SkyWest generating 385 million in cash. Not close to 20 billion but I think it is a good start.


The proper term is "on final" not "on finals" bud...
User currently offlineLightsaber From United States of America, joined Jan 2005, 12420 posts, RR: 100
Reply 20, posted (8 years 7 months 4 weeks 1 hour ago) and read 5201 times:
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Quoting SEAPlane10 (Reply 17):
If Chapter 11 bankruptcy were to occur, what would happen to the frequent flyer miles accrued? Would they still be redeemable?

Another airline might buy out the FF program in an attempt to lure passengers to them, but it would have to be a very large airline (only AA could pull it off in my opinion).

Otherwise, kiss those miles goodbye.

Lightsaber



I've posted how many times?!?
User currently offlineSEAPlane10 From United States of America, joined Jun 2005, 86 posts, RR: 0
Reply 21, posted (8 years 7 months 4 weeks 1 hour ago) and read 5181 times:

Quoting Lightsaber (Reply 20):
Another airline might buy out the FF program in an attempt to lure passengers to them, but it would have to be a very large airline (only AA could pull it off in my opinion).

Otherwise, kiss those miles goodbye.

Not good news, not good news at all! A lot of trips have been planned using the miles...even went out of my way to ensure flying on SkyMiles partners.

What about the partner airlines...namely Air France in this case?

Is Lan Chile also one of their partners?

Regards


User currently offlineContnlEliteCMH From United States of America, joined Mar 2005, 1450 posts, RR: 44
Reply 22, posted (8 years 7 months 4 weeks 1 hour ago) and read 5149 times:

Quoting LawnDart (Reply 15):
I'm sorry, but if you're original post hadn't been more than a two sentence, drive by shooting, I wouldn't have felt the need to criticize. Now, if you had originally stated with what you ended up saying in this reply, it would've made for a good initial response.

I'll stop assuming that some facts are as self-evident as *I* thought they were.



Christianity. Islam. Hinduism. Anthropogenic Global Warming. All are matters of faith!
User currently offlineZone1 From United States of America, joined Jan 2005, 1034 posts, RR: 7
Reply 23, posted (8 years 7 months 4 weeks 1 hour ago) and read 5128 times:

Quoting Lightsaber (Reply 20):
Another airline might buy out the FF program in an attempt to lure passengers to them, but it would have to be a very large airline (only AA could pull it off in my opinion).

Otherwise, kiss those miles goodbye.

Lightsaber

Umm, no. The original post asked what would happen if they filed for Ch 11. Like in the case of United, US, Continental, and all the other airlines that have filed for Ch 11. the airline still runs and your miles are still good. The only time you lose your miles is if they go to Ch 7 and cease to exist. We are still quite a ways from that.



/// U N I T E D
User currently offlineLowrider From United States of America, joined Jun 2004, 3220 posts, RR: 10
Reply 24, posted (8 years 7 months 4 weeks 1 hour ago) and read 5120 times:

Quoting Evan767 (Reply 19):
Well Delta did just sell ASA to SkyWest generating 385 million in cash. Not close to 20 billion but I think it is a good start.

Thats about the same amount they lost last quarter. Its like burning the furniture to stay warm. I think it will take a miricle to avoid bankruptcy at this point. All we can do is get our personal houses in order and hope it is only Chap 11.



Proud OOTSK member
25 Aa777jr : They can't and they won't. It's necessary to cancel the current union agreements. Once cancelled, they'll reorganized, sign a new charter with pilots,
26 LTBEWR : I don't see a realistic scenario for Delta to avoid a Chapter 11 Bankruptcy filing. As others suggested that they will probably do so before the date
27 Positiverate : Let's not give FlyI that much credit... You know, I think this could really help. It would smooth out their pension plan payments, kind of like conve
28 Jetdeltamsy : Except for a sudden and dramatic drop in the price of fuel, none of the scenarios are viable in the long run.
29 Halls120 : My brother is a DL pilot. Every time he calls me from the cockpit, and I ask him what he's doing, his response is "just wondering how long it is befo
30 Post contains images Lightsaber : Oops, my bad, I reversed the two bk numbers! I meant to agree that DL would probably go into BK. Sorry everyone, I'm fighting a cold and I just can't
31 OPNLguy : If he's got some reasonable amount of seniority, I'd expect him to have a job as I don't think that Delta would shrink much. One of the things that o
32 Kanebear : A friend of mine is in an ops capacity at DL and is sending his resume out hither, thither and yon. He's survived cutbacks, etc but he's very ready to
33 Post contains images Lightsaber : Like me tonight! Ok, I'm the son of a retired accountant, so I normally know the difference! Its this darn cold. Lightsaber
34 Positiverate : Call me crazy...but shouldn't he be flying the plane and not making personal calls from the cockpit?
35 Halls120 : I would have thought that on this web site, I wouldn't have had to point out the obvious, that he was calling while the plane was at the gate.
36 GQfluffy : Weak argument...but how about fleet commonality? Question, does this mean Skywest (the DL side) will operate out of ATL now as well as SLC? fluffy
37 Post contains images Kohflot : It seems very little has been said about what's brought Delta to this point. I'll throw in my . IMHO, Delta has wasted the past four years chasing aft
38 Post contains links and images Sebolino : View Large View MediumPhoto © Tobias Rose - Hamburg RettopS View Large View MediumPhoto © Javier F. Bobadilla - Iberian Spotters View Large
39 ILOVEA340 : One way is to not sell people like me $198 flights from San Francisco to Zürich and $135 r/t flights from SFO-BOS. just my 2 cents p.s. I'll take tho
40 CV747 : There are candidates, but outside the US. The US law does not allow a majority ownership from abroad. (Which eventually only cuts of US companies fro
41 Halls120 : I agree completely with #1, #3, #4, and #6.
42 Evan767 : Yes but it still gives time for Delta to figure out what they are going to do to avoid this. From what I have heard, yes. This doesn't make sense tho
43 Gigneil : All or nothing, is it? That worked out well at Eastern... something the DL pilots should all remember vividly. N
44 Panamair : Great. Let DL and the judge throw out their contract entirely, impose another round of 30% cuts across the board, and while we're at it, throw out th
45 GeorgiaAME : Kohflot stated it much more eloquently than I ever could. (He obviously hasn't flown with them recently) Personally, I don't believe they can avoid ba
46 DLPMMM : You are correct that cashflow is very important in Chapter 11. Most all the service companies that DL is dealing with already have DL on a cash in ad
47 OPNLguy : I believe it's the dispatchers, represented by PAFCA, an in-house union...
48 Padcrasher : DALPA just voted out Malone today. He was seen a an obstacle to further cuts. They voted in a guy that talked about being pragmatic....hmmm? Is it po
49 Padcrasher : Anybody know what this "20 Billion" in debt figure translates into CASM for Delta? I'll bet it's a really big number compared to what the industry ave
50 Peachair : Yes, very seldom are the "pundits" correct. It is so easy to be the Monday morning quarterback. All those a.netters that are B6 and FL, remember this
51 DLPMMM : Not a basher, but according to my calculations, the Pension settlements, asset writedowns, restructuring and related items cost for the first 6 month
52 BHXFAOTIPYYC : That's 20 billion - American billion I assume ... 20,000,000,000 . A British billion is 12 zeros, so it's not impossible.... Anyone think that part of
53 FlyPNS1 : On a comparative level, DL's debt load isn't that much worse than AA or CO. However, DL's problem is generating the revenue to pay off the debt.
54 Padcrasher : Delta's debt service CASM is .62 cents versus and industry average of .37 cents. 1/4 of 1 cent difference. Meaningless in the scheme of things. The re
55 Alitalia744 : Peachair, presuming you work for Delta... If so, hats off to you and all the employees of Delta. All of you have my (what little it is) support and s
56 Panamair : Well, I'm on DL every other week and will continue to be, Chp.11 or not. DL front-line staff are some of the nicest and friendliest airline employees
57 B4real : That was the straw the broke the camel's back for me. When DL dropped the 732 CVG-GRR GRR-CVG and took away the ATL-GRR flight on the 732 (I wasn't a
58 LawnDart : From the SEC.gov website: "Federal bankruptcy laws govern how companies go out of business or recover from crippling debt. A bankrupt company, the "d
59 Hslightnin : Agreed 100%, but don't forget they will over sell these flights and give a couple people a few $100 to take another oversold flight to give them even
60 LACA773 : I think it's time for DL to bite the bullet and file ofr bankruptcy at this time. American Express helped them out a great deal this time last year to
61 Post contains images Lightsaber : True true. Very interesting. History has a habit of repeating itself. But what is DL's recovery plan? Hey, UA and US will keep flying, so anything is
62 Paddy78 : Sorry my friend, I have to disagree here. Cash flow is the life blood of any company, airlines included. The statement of cash flows is usually the f
63 Solehibob : DL can pull off avoiding any Chapter filing. It will be expensive to all the stakeholders: employees, management, and the stock and bond holders, howe
64 OttoPylit : Although Delta prefers to restructure outside of BK, if the filing does come, it will be before the Oct. 18 legislation deadline. Plus, DL has been p
65 Padcrasher : I don't see that being a significant reason to file. As analysts and the Delta CFO have stated, only the length of time clause applies to Delta and t
66 LawnDart : I agree...my point needs clarification: My response was to CV747's statement "CH 11 protects the company from creditors. But running in CH11, means t
67 Post contains links Solehibob : Sounds like DL is still fighting to stay out of court. Monday should be interesting indeed: http://www.ajc.com/business/content/...usiness/delta/0805/
68 UALdispatch : Amazing on how people already have Delta with one foot in the grave. The same pessimists also predicted UA would just vanish long ago. Hopefully DAL d
69 Alitalia744 : Nice to see some people within the industry hoping for the best for another airline. Always nice to see comraderie! (Spelling?).
70 Post contains images UALdispatch : I think you spelled it right I think most in the industry would agree that seeing others who share the love of aviation lose their jobs is a sad thin
71 Paddy78 : Yes indeed, very nice to see this. After having been through a nasty bankruptcy and merger myself, I can only wish the best to all the DL folks out t
72 UALdispatch : Paddy78 That has to be one of the better posts I have seen a while. Everything you outlined is very accurate and is nice to see someone with the exper
73 Gigneil : No it isn't meaningless. Its almost twice as high. When you're measuring something in cents, usually in the single digits, it matters. N
74 Lono : And they were 2 years slow in doing this! Typical DL slow off the blocks to compete... WOW DFW...DL rolled the dice here like they were trying to com
75 Solehibob : Excerpts from 5 Reasons Delta Is Facing Bankruptcy NewsStand - Sunday, August 21, 2005 The Atlanta Journal-Constitution RUSSELL GRANTHAM Delta is beli
76 Padcrasher : Oh twice as high Gigniel? Wow! So if the average was .02 cents and Delta had a .01 cent debt service CASM that would be twice as high and that would m
77 Padcrasher : Lono can you source this? I'll hold my breath.
78 Padcrasher : Another Lono "fact". Hey Lono what is CO's and AA's debt service CASM?
79 FlyPNS1 : I guess an extra $500 million in annual interest expense (compared to AA) is nothing.
80 Lono : I'll look around and ask some of my DL friends when he said this but it was said and it is in writing Thought you were going to hold your breath....
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