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Chances Of NW & DL Emerging From Bankruptcy?  
User currently offlineSquirrel83 From , joined Dec 1969, posts, RR:
Posted (8 years 7 months 1 week 2 days 6 hours ago) and read 4035 times:

IN Result of the following article, im looking for comments and also what are the chances of NW & DL Emerging from bankruptcy? How long?

http://news.airwise.com/story/view/1126766104.html

39 replies: All unread, showing first 25:
 
User currently offlineSolnabo From Sweden, joined Jan 2008, 847 posts, RR: 2
Reply 1, posted (8 years 7 months 1 week 2 days 6 hours ago) and read 4027 times:

I read that DL to sell 11 of their widebodys to a freighter carrier called ABX air.

source: www.flygtorget.se *in swedish*

Micke//SE



Airbus SAS - Love them both
User currently offlineLTBEWR From United States of America, joined Jan 2004, 12883 posts, RR: 12
Reply 2, posted (8 years 7 months 1 week 2 days 6 hours ago) and read 3997 times:

I would suggest that the chances are good, with conditions. Another 9/11 level event would be the worst possible situation. The general economy of the USA will continue to be affected by oil prices remaining at current high levels for the forseeable future and could get worse. The costs and effects of Hurricane Katrina will hurt the economy for a while at one level, and still lead to long-term economic issues. The war in Iraq continues to be damaging to the USA economy.
As I have stated elsewhere, I still believe there needs to be hearings in the USA's Congressional and Senate committees to try and figure out what to do with our current airline situation. We need to find innovative ways that will keep our airline network working as we need it for our economy to be strong. We need to prevent the race to the bottom as to wages and benefits in the industry. We need some way to pare back excess capacity across the industry including perhaps limiting expansion of LCC's recognizing that we need full network legacies and their subsidies for the economy of the USA and to assure basic air services to many smaller markets.


User currently offlineArniePie From Belgium, joined Aug 2005, 1265 posts, RR: 1
Reply 3, posted (8 years 7 months 1 week 2 days 6 hours ago) and read 3995 times:

I suspect NW whent into bankrupty protection to reform and redeal some things which they otherwise couldn't do.
DAL I'm afraid they are in more severe troubles.

as for the sale of widebody's, don't they still have some MD11 in storage maybe those are the planes together with some 767's.



[edit post]
User currently onlineCOSPN From Northern Mariana Islands, joined Oct 2001, 1602 posts, RR: 0
Reply 4, posted (8 years 7 months 1 week 2 days 5 hours ago) and read 3961 times:

they are 767's to DHL ABX is the US operator for DHL

User currently onlineCOSPN From Northern Mariana Islands, joined Oct 2001, 1602 posts, RR: 0
Reply 5, posted (8 years 7 months 1 week 2 days 5 hours ago) and read 3948 times:

from www.justplanes.com

ABX Air
ABX Air has agreed to buy 11 Boeing 767-200s from Delta Air Lines. The aircraft will be converted from passenger to cargo configuration more than likely by Israerl Aircraft Industries. The agreement calls for delivery of 6 aircraft in 2006, 2 in 2007 and 3 in 2008.


User currently offlineArniePie From Belgium, joined Aug 2005, 1265 posts, RR: 1
Reply 6, posted (8 years 7 months 1 week 2 days 5 hours ago) and read 3921 times:

Quoting COSPN (Reply 5):
ABX Air has agreed to buy 11 Boeing 767-200s from Delta Air Lines

Airplanes that are currently in the desert or planes that will be taken out of active duty and as such also reduce capacity?



[edit post]
User currently offlineLightsaber From United States of America, joined Jan 2005, 12428 posts, RR: 100
Reply 7, posted (8 years 7 months 1 week 2 days 4 hours ago) and read 3879 times:
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NW has some cash and assets to borrow against. DL? They have it tougher due to their level of leveraging. Can they find buyers for the remaining RJ's/RJ divisions? If so, they too have a chance. If not...  Sad

Lightsaber



I've posted how many times?!?
User currently offline727LOVER From United States of America, joined Oct 2001, 5960 posts, RR: 17
Reply 8, posted (8 years 7 months 1 week 1 day 22 hours ago) and read 3601 times:

I tawt I taw a lame-ass remark,....

Quoting LTBEWR (Reply 2):
We need some way to pare back excess capacity across the industry including perhaps limiting expansion of LCC's

I DID! I DID see a lame-ass remark!!!



Yeah bud, keep legacy carriers deregulated, but lets regulate LCCs. Who's your LSD supplier?



Listen Betty, don't start up with your 'White Zone' s*** again.
User currently offlineAirRyan From United States of America, joined Mar 2005, 2532 posts, RR: 5
Reply 9, posted (8 years 7 months 1 week 1 day 22 hours ago) and read 3578 times:

Quoting 727LOVER (Reply 8):
Yeah bud, keep legacy carriers deregulated, but lets regulate LCCs. Who's your LSD supplier?

Probably the US Government!  Silly


User currently offlineNorCal From United States of America, joined Mar 2005, 2459 posts, RR: 5
Reply 10, posted (8 years 7 months 1 week 1 day 22 hours ago) and read 3578 times:

what happens to the stock during Chapter 11?

User currently offlineStarrion From United States of America, joined Jul 2003, 1122 posts, RR: 2
Reply 11, posted (8 years 7 months 1 week 1 day 22 hours ago) and read 3560 times:

During CH11, the stock can be expected to fluctuate wildly. Once the final BK plan is entered the stock will be cancelled. It's sort of like musical chairs except with money. The last one holding the stock when it gets cancelled loses.


Knowledge Replaces Fear
User currently offlineTOLtommy From United States of America, joined Dec 2003, 3277 posts, RR: 4
Reply 12, posted (8 years 7 months 1 week 1 day 22 hours ago) and read 3543 times:

Quoting ArniePie (Reply 6):
Airplanes that are currently in the desert or planes that will be taken out of active duty and as such also reduce capacity?

Delta recently announced that all 767-200's will be withdrawn from service effective with the December schedule. They called it their "least efficient widebody". Don't know if any are currently parked.


User currently offlineKaitak From Ireland, joined Aug 1999, 12325 posts, RR: 35
Reply 13, posted (8 years 7 months 1 week 1 day 21 hours ago) and read 3528 times:

These are the aircraft being sold to ABX. DL needs to standardise and rationale its fleet - although probably not quite as much as NW! However, this is only half the battle. A lot of it will happen at government level. This business of having four airlines in bankruptcy is not good for the industry as a whole and it's unfair on the carriers that are doing "OK" or better - the remaining legacy carriers and the low cost carriers.

Sooner or later, however much we might want to avoid it, a legacy carrier is going to have to go; there simply isn't the market so support so many carriers.


User currently offlineDAYflyer From United States of America, joined Sep 2004, 3807 posts, RR: 3
Reply 14, posted (8 years 7 months 1 week 1 day 21 hours ago) and read 3463 times:

I think the chances of emerging from ch 11 are pretty good, once the horrible debt loads are in order. They are both solid airlines (operationally speaking) and they have excellent reputations and a good customer base(for the most part).

They need to get the revenue to expense ratios way down, and do so quickly.



One Nation Under God
User currently offlineRevelation From United States of America, joined Feb 2005, 11932 posts, RR: 25
Reply 15, posted (8 years 7 months 1 week 1 day 20 hours ago) and read 3403 times:

Quoting Kaitak (Reply 13):
A lot of it will happen at government level. This business of having four airlines in bankruptcy is not good for the industry as a whole and it's unfair on the carriers that are doing "OK" or better - the remaining legacy carriers and the low cost carriers.

I don't think a lot of it will happen at the government level. What the government already does - providing bankruptcy protection - doesn't help. If UA had been allowed to die a natural death, by now there'd be less capacity in the industry, and some one else would be operating whatever UA assets could have been operated successfully.



Inspiration, move me brightly!
User currently offlineRevelation From United States of America, joined Feb 2005, 11932 posts, RR: 25
Reply 16, posted (8 years 7 months 1 week 1 day 20 hours ago) and read 3382 times:

From the AirWise article:

Quote:
"It's recognizing where you make money, and being willing to shrink and move the business very quickly," said Bromley, identifying the key points of a successful reorganization.

I think he got it in one. The task ahead for Delta and NW management is to recognize what they do well, and cut back everything else.



Inspiration, move me brightly!
User currently offlineNYCAAer From United States of America, joined Jul 2004, 691 posts, RR: 4
Reply 17, posted (8 years 7 months 1 week 1 day 18 hours ago) and read 3269 times:

I think both DL and NW each have a 100% chance of exiting Chapter 11 with great success. I don't expect either one to file for Chapter 7. It makes it tougher for the airlines not operating in bankruptcy to compete, so it levels the playing field, whehter it's fair or not.

User currently offlineComorin From United States of America, joined May 2005, 4869 posts, RR: 16
Reply 18, posted (8 years 7 months 1 week 1 day 17 hours ago) and read 3211 times:

The chances of DL and NW emerging from Bankruptcy are not predictable as they depend on a combination of external factors:

1. Oil Price -If this remains equivalent to $100/bl including crack spread, then they would need to write off pensions, radically restructure debt, sell off domestic operations to be viable.

2. Pension Reform: The US tax payer takes over $15B in unfunded liabilities. This may not be enough to compensate for generate operating profits under a hi-oil scenario.

3. Capacity: 50% of US seats are on bankrupt airlines. Unless capacity declines, recovery will be difficult.

Summarizing, the chances are

1. If nothing changes, DL and NW cannot pull out of their nosedive.
2. If Pensions are taken over, Delta still in trouble, but some hope for NW.
3. If Pensions taken over, major debt restructuring, NW success, DL has a chance.
4. If Pension + Debt restructures, and fuel price falls drastically, DL and NW will survive.

The Klingon in me says that Delta heads to the Chop Shop, and a leaner NW gets acquired.

Caveat - All this is just conjecture and opinion ...


User currently offlineNYCAAer From United States of America, joined Jul 2004, 691 posts, RR: 4
Reply 19, posted (8 years 7 months 1 week 1 day 16 hours ago) and read 3189 times:

Some pilots I've been flying with on my trips seem to think the same thing as you, Comorin, that it doesn't look good at all for Delta. Time will tell how all this plays out. The whole thing is a mess. Maybe we should just put all the legacy carriers to death in the United States and start all over again!  Smile

User currently offlineDALMD88 From United States of America, joined Jul 2000, 2506 posts, RR: 14
Reply 20, posted (8 years 7 months 1 week 1 day 15 hours ago) and read 3148 times:

The large problem at DL is debt. Our debt service is what is really killing us. If fuel had stayed low we might have eeked by with a little help on the pension front. In BK the debt service can be greatly reduced and maybe congress will pass the pension reform bill. We have been told DL has a plan and it will be inplace quickly. Upper management is telling us this will be a quick proccess so be ready for the ride.

User currently offlineHPRamper From United States of America, joined May 2005, 3965 posts, RR: 8
Reply 21, posted (8 years 7 months 1 week 1 day 12 hours ago) and read 3025 times:

Quoting TOLtommy (Reply 12):
Delta recently announced that all 767-200's will be withdrawn from service effective with the December schedule

How many of these does DL operate? And how many models of the 767 are there? I see DL and HA 767s every day and the HA plane is noticeably longer, maybe larger than DL's. Also looks newer.


User currently offlineIncitatus From Brazil, joined Feb 2005, 3964 posts, RR: 13
Reply 22, posted (8 years 7 months 1 week 1 day 12 hours ago) and read 3004 times:

NW will be absorbed into another airline. They are not a viable carrier:
- Hub in MEM has no local traffic.
- Hub in MSP does not have enough local traffic.
- Hub in NRT is losing value by the day as airlines such as AA and CO keep adding beyond Japan nonstops.
- Their transatlantic presence is small in spite of a super alliance with KLM.
- Their Latin American presence is nil.

So.... The only viable hub is DTW. MSP can get St.Louis'd.

They can't survive on their own.


User currently offlineAirRyan From United States of America, joined Mar 2005, 2532 posts, RR: 5
Reply 23, posted (8 years 7 months 1 week 1 day 11 hours ago) and read 2987 times:

Quoting Incitatus (Reply 22):
NW will be absorbed into another airline. They are not a viable carrier:
- Hub in MEM has no local traffic.
- Hub in MSP does not have enough local traffic.
- Hub in NRT is losing value by the day as airlines such as AA and CO keep adding beyond Japan nonstops.
- Their transatlantic presence is small in spite of a super alliance with KLM.
- Their Latin American presence is nil.

So.... The only viable hub is DTW. MSP can get St.Louis'd.

They can't survive on their own.

With all due respect your full of it. NW will not only emerge from Ch11 sooner than DL but they will do so with a business plan that will allow them to become stronger than any other US carrier that actually flies overseas. NW's prescense in Asia is strong and I don't know what you refer to by "local traffic" but NW has been doing fine in MSP since they started back in 1926.

I don't know what you penchant against NW but don't let it cloud your judgement - NW will be turning a profit and out of Ch11 before August of 2008 when they take delivery of their first 787.


User currently offlineIncitatus From Brazil, joined Feb 2005, 3964 posts, RR: 13
Reply 24, posted (8 years 7 months 1 week 1 day 11 hours ago) and read 2949 times:

Quoting AirRyan (Reply 23):
With all due respect your full of it.

That statement and everything else that follows has no vestige of rationality.
I have nothing against Northwest, but here is the recipe to counter any of my arguments:
- Please show that MEM is a large air travel market when compared to other hubs or non-hubs of medium sized cities, eg, New Orleans, Tampa, Nashville, Raleigh.
- Please show that MSP is well located for a hub. Don't forget the US population is slowly drifting Southwest.
- Please show that MSP is not redundant with DTW for most east-west markets that matter.
- Please show that NW is a major transatlantic player that would have more than half a dozen flights in that market were it not for KLM.
- Please show that hubbing in NRT is a winning strategy in the long run.
- Please show NW's plans to go into Latin America.

NW has interesting assets to be absorbed by another airline. Not to survive as an independent carrier.


25 AirRyan : Better yet - why don't you show me the numbers because you already appear to have them. I work for NW and let's just say we don't share your "optimis
26 Post contains links Incitatus : I made several points. You made none except saying I'm "full of it". MEM is the smallest market in the US that is still a hub. The geographic center
27 Cubsrule : Why (besides the fact that you are Brazillian) is there a need to expand in L.A. to be successful?
28 Blackearth : Of course, compared to Memphis, New Orleans and Tampa are in another league (tourism). Regarding Nashville and Raleigh, I doubt if either city had an
29 Coa764 : That is the reason for the code share agreement with COA, all the benefits of being able to sell seats on a complimenting network without the associa
30 Burnsie28 : Other then New Orleans and Tampa, MEM isnt much different then Nashville and Raleigh. What does that matter, think people from Wisconsin, North Dakto
31 Incitatus : I didn't say "need". It's part of being successful. CO and DL grasped it, NW didn't. If everything else was right for NW and they didn't expand in La
32 Viscount : Can you imagine how much NW would have saved in fuel and maintenance costs if they'd replaced their ageing DC9s and DC10s a while back?
33 AirRyan : It's a hub first and foremost because of FedEx - they operate more flights from MEM than anyone. New Orleans? I think the future markets of New Orlea
34 Cubsrule : DL is in b/k... CO isn't. Where's the correlation? Heck, UA has dismantled much of the Latin American operation they got from PA (ex-MIA)... is that
35 Incitatus : If you need correlation, try AA and CO are #1 and #2 in the US-LATAM market and are the only two network carriers outside of Bk. UA trashed the netwo
36 Blackearth : Both Nashville and Raleigh have boomed business-wise since AA pulled out. I'm not saying at all that the pullout caused that boom. What I am saying i
37 Blackearth : I'm probably missing something here, but what does the fact of Memphis being a FedEx hub have to do with it being a passenger hub for NWA? MEM was a
38 Burnsie28 : Actually they would have loss more money, as leasing a new airplane and its minor maintnance was found to cost more then what it would to fuel and ma
39 HPRamper : MSP is a smaller local market #16 among US metro areas as opposed to Detroit's #9, but I thought I read a report that it has a greater percentage of O
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