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Delta CFO: "Airline Is Tapped Out"  
User currently offlineUA777222 From United States of America, joined Dec 2003, 3348 posts, RR: 11
Posted (8 years 4 months 2 weeks 3 days 3 hours ago) and read 14109 times:

Delta Air Lines Inc. is "tapped out" and can't borrow any more money to cover its mounting losses, making deep pay and benefit cuts it is seeking from its pilots essential to its survival, the company's chief financial officer told an arbitration panel Tuesday.

CFO Edward Bastian testified before the three-member panel as part of Delta's effort to void its contract with its 6,000 pilots so it can impose up to $325 million in long-term cuts.

The pilots union has said repeatedly it will strike if its contract is rejected. A walkout would put the nation's third-largest carrier out of business, Delta has said.

"We are clearly in the worst shape and are the most fragile of anyone in the industry," Bastian told the panel.

Bastian also told the panel that what the company is asking of its pilots could be worse.

"One of the things that keeps me up at night is whether we're being aggressive enough," Bastian said. "I'm not suggesting we do, but that's the thing I worry about."

He said in an interview outside the hearing that Delta has no current plans to seek more cuts from its pilots after this request, but he added there can be no guarantee.

Lee Moak, chairman of the union's executive committee, said Bastian's comments raise concerns for pilots.

"I'd like to believe they're trying to do it once, but historically that has not been the case," Moak said in an interview.

Atlanta-based Delta, which is operating under bankruptcy protection, has lost roughly $12.6 billion since January 2001, the year the industry downturn started amid the terrorist attacks.

The panel, on the second day of two weeks of hearings at a Washington hotel, must decide by April 15 whether to grant Delta's request to reject its pilot contract. The pilots, meanwhile, will wrap up their strike authorization vote on April 4. Typically, if such a vote is approved, union leaders could set a date for a strike.

Delta has said a strike by its pilots would be illegal, and it would likely seek a court injunction if its pilots walk off the job.

Bastian told the panel that Delta expects fuel prices to remain high and ticket prices to remain low because of competition and too many seats available in the industry. Therefore, he said, Delta needs to keep cutting costs to survive long-term. He noted the pilot cuts the airline is seeking are only about 10 percent of the $3 billion in overall annual cost cuts Delta is seeking.

"We have both a revenue problem and a cost problem, and we're tackling both," Bastian said.

He said the $3 billion cost-cut figure is not final.

"We're hoping to do better than $3 billion in other ways," Bastian told the panel. He didn't elaborate.

The pilots have acknowledged that the company is in trouble and they have offered to help. But the pilots argue that they previously gave Delta $1 billion in annual concessions in a five-year deal in 2004, and they believe the amount of further concessions the company is seeking is too much. They also argue that since the company has admitted it will likely terminate the pilots' defined benefit pension plan, they should receive some credit for the savings they say the company will reap.

Delta has said it hopes to emerge from bankruptcy in the summer of 2007.

The airline had asked the New York bankruptcy court in November to void the pilot contract, but shortly before a judge was set to issue a decision, the company and its pilots reached a deal on interim pay cuts.

That deal, equal to a little less than half of what the company is seeking on an annual basis, would be replaced by the long-term deal the two sides have been negotiating since December. They missed a March 1 deadline to settle on their own, sending the matter to arbitration.

In the latest negotiating proposals, the company has agreed to reduce its request to $305 million in cuts annually, while the union said it is offering $140 million annually.

According to the company, the average earnings of pilots last year who worked the full year was more than $157,000.


All together this is one bad bad situation. Management vs. employees. It's never going to be alright for either of them. Sadly, the CFO and other managment personel have stated that "Bastian also told the panel that what the company is asking of its pilots could be worse."..."He said in an interview outside the hearing that Delta has no current plans to seek more cuts from its pilots after this request, but he added there can be no guarantee."


Matt


"It wasn't raining when Noah built the ark."
160 replies: All unread, showing first 25:
 
User currently offlineLightsaber From United States of America, joined Jan 2005, 12892 posts, RR: 100
Reply 1, posted (8 years 4 months 2 weeks 3 days 2 hours ago) and read 13927 times:
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I didn't think DL would run out of leveragable assets quite this early. Don't get me wrong, I wasn't under the allusion they had much left. But "tapped out" in a hearing is a scary phrase even if stated during pilot negotiations.

I agree DL is fragile. They are down to < $2.0 billion in free cash. How can they get more dough? GE? Maybe... but why? US had an amazing exposure to GE, thus GE's incentive to finance the merger with HP. Will Wells Fargo come to DL's rescue?

Related (due to this quote coming from arbitration with pilots):

Quote:
And more than the Atlanta arm of ALPA may be involved: Last Thursday, a statement on the union's Web site announced that the SkyTeam Pilots Association (SPA) had inked an "unprecedented International Mutual Assistance Agreement" backing pilots at Delta and at Northwest Airlines--both of which filed for Chapter 11 protection on Sept. 14.

The SPA comprises pilots from nine global SkyTeam member carriers, which maintain international codeshare agreements. The carriers are Delta, Northwest, AeroMexico, Alitalia, CSA Czech Airlines, KLM and Air France (under one corporate roof, Air France KLM (nyse: AKH - news - people )), Korean Air and Continental Airlines (nyse: CAL - news - people ).

The statement didn't specify what actions, if any, the SPA would take if the U.S. pilots' contracts were voided. But union Master Executive Council Chairman Capt. Lee Moak said the agreement "sends a strong message to senior executives that pilots around the globe stand united with their...colleagues."

from:
http://www.forbes.com/2006/03/14/del...tofacescan09.html?partner=yahootix

Yikes! A full skyteam full press.  devil  oh boy...

Lightsaber



Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
User currently offlineNkops From United States of America, joined Jun 2005, 2660 posts, RR: 6
Reply 2, posted (8 years 4 months 2 weeks 3 days 2 hours ago) and read 13870 times:

Quoting UA777222 (Thread starter):
Delta has said a strike by its pilots would be illegal, and it would likely seek a court injunction if its pilots walk off the job.

Now how would this be illegal... with a voided contract, the Railroad Act would not apply since technically the pilots would not fall under a contract agreement, is that correct???

I didn't realize it was that bad at DL

Quoting UA777222 (Thread starter):
In the latest negotiating proposals, the company has agreed to reduce its request to $305 million in cuts annually, while the union said it is offering $140 million annually.

Those numbers aren't even close



I have no association with Spirit Airlines
User currently offlineWorldTraveler From , joined Dec 1969, posts, RR:
Reply 3, posted (8 years 4 months 2 weeks 3 days 2 hours ago) and read 13870 times:

What kind of language do you expect a company that is resorting to a process that has almost never been used to extract concessions from its pilots? DL has used doom and gloom talk for years in order to get what it wants which is a big reason why so many people are convinced they are doomed. As soon as they get the cost cuts they need (which includes an answer on pension reform), the news will get much cheerier. ALPA can see through that.

User currently offlineUA777222 From United States of America, joined Dec 2003, 3348 posts, RR: 11
Reply 4, posted (8 years 4 months 2 weeks 3 days 1 hour ago) and read 13710 times:

Quoting WorldTraveler (Reply 3):
What kind of language do you expect a company that is resorting to a process that has almost never been used to extract concessions from its pilots? DL has used doom and gloom talk for years in order to get what it wants which is a big reason why so many people are convinced they are doomed. As soon as they get the cost cuts they need (which includes an answer on pension reform), the news will get much cheerier. ALPA can see through that.

At the same time, is pissing off management the right way to go about turning a company around? In my opinion, if they don't find their funds here it'll be somewhere else and that the longer this entire process proceeds the longer until a profitable company rises. At the same time, it's like a ticking time bomb. Both pilots and management are running towards a cliff, they can bitch and moan back and forth at eachother but without eachother they're both screwed.

Matt



"It wasn't raining when Noah built the ark."
User currently offlineBeefstew25 From United States of America, joined Sep 2005, 675 posts, RR: 0
Reply 5, posted (8 years 4 months 2 weeks 3 days 1 hour ago) and read 13644 times:

Yet another example of how unions hold the idea of a free market hostage.


MLB: Where you are always number one for takeoff.....
User currently offlineFlyDeltaJets From United States of America, joined Feb 2006, 1854 posts, RR: 2
Reply 6, posted (8 years 4 months 2 weeks 3 days 1 hour ago) and read 13644 times:
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DL most likely is not is such a dire condition that they are proclaiming. It is most likey that they are trying to sell how bad a shape they are in to win the arbitrators sympathy


The only valid opinions are those based in facts
User currently onlineF9Animal From United States of America, joined Dec 2004, 4996 posts, RR: 28
Reply 7, posted (8 years 4 months 2 weeks 3 days 1 hour ago) and read 13553 times:

Quoting FlyDeltaJets (Reply 6):
DL most likely is not is such a dire condition that they are proclaiming. It is most likey that they are trying to sell how bad a shape they are in to win the arbitrators sympathy

Certainly could be a ploy. I would doubt they would publicly announce such a harsh position if it was not true. Delta may be in a very dire position, and it really sounds like they are following the path that Eastern went down.

I seriously doubt they are trying to arm wrestle the pilots at this point, as the losses are black and white in my eyes. They are bleeding very badly, and at this point could be considered to be on life support. It is really sad to see Delta in this position.

I hope they pull out of this. Remember, Independence Air was not afraid to announce their troubles months before shutdown.

Could Delta perhaps restructure itself as far as its flying is concerned? Perhaps they could start relieving some aircraft and routes?



I Am A Different Animal!!
User currently onlineF9Animal From United States of America, joined Dec 2004, 4996 posts, RR: 28
Reply 8, posted (8 years 4 months 2 weeks 3 days 1 hour ago) and read 13512 times:

A few other things to consider:

A. They are in Bankruptcy.

B. They are losing money like crazy.

C. They are publicly announcing they are tapped out.

D. Things are looking really bad right now in this industry.

E. Fuel prices are skyrocketing.

F. The pilots are supposedly the only savior for the airline.

Equals= Bad outlook at this point.

Plus the bankruptcy judge really holds the plug at this point. Amazing how quickly this industry has been shaking out lately.

BTW- I am in no way bashing DL. I really hope they pull out of this. I could not imagine not seeing Delta anymore.



I Am A Different Animal!!
User currently offlinePanamair From United States of America, joined Oct 2001, 4875 posts, RR: 25
Reply 9, posted (8 years 4 months 2 weeks 3 days ago) and read 13415 times:
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Quoting Lightsaber (Reply 1):
They are down to < $2.0 billion in free cash

No, unrestricted cash has remained at around $2.1 billion for the past few months (check out the January 06 and December 05 monthly operating reports) while total cash (including restricted) has been around $2.8 - $3.0 billion.


User currently offlineLightsaber From United States of America, joined Jan 2005, 12892 posts, RR: 100
Reply 10, posted (8 years 4 months 2 weeks 3 days ago) and read 13384 times:
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Quoting F9Animal (Reply 8):

B. They are losing money like crazy.

C. They are publicly announcing they are tapped out.

Just for clarity: DL is losing *cash* right now at an amazing rate. Paper loses are one thing and are what are usually written off in BK. But... DL is losing cash every day. Take that $2.0 billion and subtract every new loss from that reserve.

I'm not DL bashing, but DL is in really poor shape. I too cannot image not seeing Delta anymore. Yes, part of DL's issues is the shutdown of the Colonial and Plantation oil/fuel pipelines. But that is done, that cash is gone.

Can anyone provide a link to the legality or illegality of a DL pilot strike? I am not a lawyer but it would be intresting to know more. Under the RR labor act, they are under binding arbitration; thus technically as I read it the pilots would be subject to said arbitration. On the other hand, is this technically throwing out the voted on contract and thus allowing them to strike? Notice I'm asking as I'm afraid the DL pilots might strike.  Sad

Quoting F9Animal (Reply 7):
I seriously doubt they are trying to arm wrestle the pilots at this point, as the losses are black and white in my eyes. They are bleeding very badly, and at this point could be considered to be on life support. It is really sad to see Delta in this position.

I hope they pull out of this. Remember, Independence Air was not afraid to announce their troubles months before shutdown.

 checkmark  The best thing for the pilots to do is make salary concessions contingent upon profit sharing. Mind you, profit sharing pre-executive bonuses. Perhaps force DL to account for all bonuses and profit sharing on a pre-negotiated formula? This will get interesting...

Lightsaber



Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
User currently offlineLowrider From United States of America, joined Jun 2004, 3220 posts, RR: 10
Reply 11, posted (8 years 4 months 2 weeks 3 days ago) and read 13346 times:

If Delta is truly tapped out, then pilot pay concessions seem a bit like re-arranging the deck chairs on the Titanic. If they are truly losing that much money, then the pilots could work for free and it would only delay the inevitable. If Delta managment is telling the truth, then it sounds as if they may not be able to afford to be in business. If it is simply rhetoric, then the lie will eventually come to light and and it will further errode the relationship between management and ALPA. Either way, I need to go work on my resume...


Proud OOTSK member
User currently offlineFCYTravis From United States of America, joined Sep 2005, 1191 posts, RR: 6
Reply 12, posted (8 years 4 months 2 weeks 3 days ago) and read 13297 times:

Quoting Beefstew25 (Reply 5):
Yet another example of how unions hold the idea of a free market hostage.

Um, excuse me? How do you defend this tripe?

The pilots are free to walk off the job if their contract is voided. Delta is free to hire non-union pilots to staff its planes. That's the free market.



USAir A321 service now departing for SFO with fuel stops in CAK, COS and RNO. Enjoy your flight.
User currently offlineJFKLGANYC From United States of America, joined Jan 2004, 3382 posts, RR: 5
Reply 13, posted (8 years 4 months 2 weeks 3 days ago) and read 13241 times:

Enough already!

We heard this with UA. Then we heard it with US. Then NW. Even ATA. Now DL.

Is someone going to die?? Probably not. Hasn't happened yet. Frankly, cut the crap already. If you're really losing millions a day (like UA was, like US was, like DL is) you can't stay in business. . . that's a free market!

The United States won't turn upside down if a major airline goes under. It's happened before . . . and we are at the point where it should happen again.

So enough with the courts, enough with the fake strike threats, enough with the CFO proclaiming the death rattle. If this was reality TV, we would have all tuned out a while ago.

There's an old saying, "Sh*t or get off the pot."

We have all been watching an industry in turmoil for 5 years now. It's like watching a sick person suffer for way too long.

Stick a fork in one of these guys cause this scene is getting really, really old and its end is very, very near.

PJ


User currently offlineAirCanada014 From Canada, joined Oct 2005, 1513 posts, RR: 0
Reply 14, posted (8 years 4 months 2 weeks 3 days ago) and read 13241 times:

I guess with all the international expansion i think they need to cut most of the non profit route before they expand. DL needs to think about cutting not adding routes. Hmm maybe no more DL in the sky  Smile or make them low cost carrier  Smile.

User currently offlinePanamair From United States of America, joined Oct 2001, 4875 posts, RR: 25
Reply 15, posted (8 years 4 months 2 weeks 3 days ago) and read 13193 times:
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Quoting AirCanada014 (Reply 14):
i think they need to cut most of the non profit route before they expand. DL needs to think about cutting not adding routes

Where have you been? What do you call cutting CVG by 25%? What do you call cutting JFK-STL/JAX/CLT? What do you call substituting 763/764/762s on all LGA flights with 757/M88/738s? What do you call dropping most widebodies from ATL-Florida routes?


User currently offlinePhuebner From United States of America, joined Feb 2006, 244 posts, RR: 5
Reply 16, posted (8 years 4 months 2 weeks 2 days 23 hours ago) and read 13155 times:

Bring on the Delta and NW merge!!!!!!!


Remember this, Your Body is a temple Not a pull toy!
User currently offlineAlitalia744 From United States of America, joined Mar 2000, 4742 posts, RR: 45
Reply 17, posted (8 years 4 months 2 weeks 2 days 23 hours ago) and read 13155 times:

Quoting AirCanada014 (Reply 14):
Hmm maybe no more DL in the sky

And why exactly is that a smiley character comment to you?



Some see lines, others see between the lines.
User currently offlineCory6188 From United States of America, joined Feb 2004, 2686 posts, RR: 6
Reply 18, posted (8 years 4 months 2 weeks 2 days 23 hours ago) and read 13113 times:

Quoting JFKLGANYC (Reply 13):
Enough already!

I have to agree. I've heard these dramatic, awful, death-proclaiming reports so many times from all of the carriers that you mentioned that I am completely convinced that regardless of what these airlines might claim, nothing is actually ever going to happen. It doesn't matter how awful they claim that things are, the legacies just don't die.


User currently offlineRamerinianAir From United States of America, joined Nov 2003, 1486 posts, RR: 0
Reply 19, posted (8 years 4 months 2 weeks 2 days 23 hours ago) and read 13077 times:

DL is "right sizing" their markets right now.
It is re-aligning it's self almost.
They are expanding internationally and thus:
Some 764s are being pulled from the domestic market and
The remaining 763ERs that were on Domestic duty are no longer there
So, the widebodies that are going international or to hawaii expansion are no longer in the domestic system. 757, MD80s and 738 will replace those routes and some shorter routes will be filled with RJs.
A lot of what we percieve as "cuts" are only due to the movement of A/C. On many routes, DL would rather keep 7 daily flights - a few with RJs, than cut the flight to 4 or 5 dailies with larger jets.
SR



W N = my Worst Nightmare!!!!!
User currently offlinePhuebner From United States of America, joined Feb 2006, 244 posts, RR: 5
Reply 20, posted (8 years 4 months 2 weeks 2 days 23 hours ago) and read 12998 times:

Quoting RamerinianAir (Reply 19):
DL is "right sizing" their markets right now.

What a great way to say, "We're fixin stuff!"



Remember this, Your Body is a temple Not a pull toy!
User currently offlineCa2ohHP From United States of America, joined Sep 2005, 953 posts, RR: 1
Reply 21, posted (8 years 4 months 2 weeks 2 days 22 hours ago) and read 12536 times:

Quoting UA777222 (Thread starter):
"One of the things that keeps me up at night is whether we're being aggressive enough," Bastian said.

And the fact that thousands of people's jobs are depending on these clowns to turn that sinking mess around.


User currently offlineLightsaber From United States of America, joined Jan 2005, 12892 posts, RR: 100
Reply 22, posted (8 years 4 months 2 weeks 2 days 22 hours ago) and read 12408 times:
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Quoting Panamair (Reply 9):
No, unrestricted cash has remained at around $2.1 billion for the past few months (check out the January 06 and December 05 monthly operating reports) while total cash (including restricted) has been around $2.8 - $3.0 billion.

Did you include the $300 million injection by Merril Lynch that occurred between those two reports? Going through that much a month is... painful. It sounds like Merril Lynch got the last of DL's leveragable assets. Date of transaction January 26th:

http://news.delta.com/article_display.cfm?article_id=10052

On paper DL is losing $10million/day. In cash... its still high, by my math, close to $200million/month. $2.1 Billion won't last long at that rate. Yes, I know summer is better, but DL *must* reduce cash burn to survive the winter of 2006/2007.

Quoting Phuebner (Reply 20):
What a great way to say, "We're fixin stuff!"

DL is fixing stuff. I'm most exited about their trans-Atlantic expansion. While one could wish for a trans-pacific expansion... alas, another day when new planes can be purchased.

Curious that DL is trying to cut interest rates on their DIP financing:
http://biz.yahoo.com/pz/060314/95671.html
from above link:

Quote:
In particular, the proposed amendment to the DIP Credit Agreement will permit Delta to grant additional liens to GE with respect to the unrelated financing arrangements and with respect to Delta's current and future lease obligations to GE under certain leases of regional jets.

Whisky tango foxtrot? Granting additional liens means there is more equity to leverage! ?!? I'm officially confused now.  confused 


Lightsaber



Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
User currently offlineChiGB1973 From United States of America, joined Mar 2004, 1613 posts, RR: 1
Reply 23, posted (8 years 4 months 2 weeks 2 days 22 hours ago) and read 12378 times:

Quoting JFKLGANYC (Reply 13):
Enough already!

We heard this with UA. Then we heard it with US. Then NW. Even ATA. Now DL.

Is someone going to die?? Probably not. Hasn't happened yet. Frankly, cut the crap already. If you're really losing millions a day (like UA was, like US was, like DL is) you can't stay in business. . . that's a free market!

The United States won't turn upside down if a major airline goes under. It's happened before . . . and we are at the point where it should happen again.

So enough with the courts, enough with the fake strike threats, enough with the CFO proclaiming the death rattle. If this was reality TV, we would have all tuned out a while ago.

There's an old saying, "Sh*t or get off the pot."

We have all been watching an industry in turmoil for 5 years now. It's like watching a sick person suffer for way too long.

Stick a fork in one of these guys cause this scene is getting really, really old and its end is very, very near.

PJ

All that was said before too, about UA, US, NW. You didn't come up with anything new either.

You say stick a fork in one? FL, WN are all adding seats to this "saturated" market. It's not saturated. Virgin America has applied for certification. These all point to mismanagement. I would include B6 in adding seats, which they are, but also losing money and trying to pick up the pieces. So, you can pretty much add B6 in the mismanagement category.

DL flying 767s all over the U.S., got a huge reprieve from AmEx and whomever else gave them $1 billion + over the last year or two and still royally screwed this deal up. Too little, too slowly. They will probably pull out of this, just as UA, US, NW (will), TZ, AQ, CO, HA all did. Plus, there are not really that many airlines that went out this way. PanAm and Braniff, the others were, generally, small, especially compared to DL.

M


User currently offline1MillionFlyer From , joined Dec 1969, posts, RR:
Reply 24, posted (8 years 4 months 2 weeks 2 days 22 hours ago) and read 12347 times:

Quoting Lightsaber (Reply 22):
Whisky tango foxtrot? Granting additional liens means there is more equity to leverage! ?!? I'm officially confused now.

You can file First position liens (which is the usual lien you would think about), but this sounds like DL is getting a lender to give them a loan on a second position lien. A second positioin lien is like a second mortgage on your house. If anything happens and they need to sell the assets, the first lender would recover fees and equity first and the second lender would get any possible remaining equity should a liquidation of assets occur.

When a lender loans money on an asset they do not loan 100% of the fair market value, instead they use usually 60-80% of the "Forced liquidation value".
This means technically after fees and etc if a second lienholder had a lien then they might be able to recover some actual miniscule amout of cash.

This might allow DL to borrow maybe an additional 10-20% of the forced liquidation value on assets, but without seeing the filing there is no way to know for sure what they are allowing DL to borrow.

[Edited 2006-03-15 01:14:23]

[Edited 2006-03-15 01:14:51]

25 Ckfred : If DL pilots, or any pilots from a bankrupt carrier, walk off the job after a bankruptcy court voids a collective bargaining agreement, that would be
26 Post contains images Piercey : Airlines in the US and around the world have made profits, sometimes huge profits (wasn't it last year or the year before Qantas posted a $1 BILLION
27 Post contains images Lightsaber : Thanks for the update. But I thought that with DL's Debt > equity situation that this wasn't likely, but shows you why I do engineering. How much in
28 Post contains images Ptharris : Other domestic carriers would thrive like we haven't seen them thrive before. I'm sure they would somehow retain the market they hold. I think, while
29 Ncflyer : I find delta's bk strategy mind boggling. It is expensive to add new routes-- they take months or years to take hold and build traffic. There's the co
30 777fan : I dare the DL pilots to strike - there's not much love for an airline pilot at the moment, given every airline's desire to slim down. They know bette
31 Post contains images 767Lover : They will be fine...someone will come in and pick up the slack. What worries me is the impact to the Southeast's largest city. The number of people i
32 Skibum9 : You are incorrect. The arbitration panel only decides if the current contract can be terminated, not which proposal to take. If they decide to termin
33 Tu154 : If "good goes around," then "what goes around comes around".........Delta delt the death blow to Pan Am.....ran off with the crown jewels and left Pan
34 Post contains images Nycfly75 :       COuldnt have said it better myself. Its somewhat about market forces now and survival of the fittest. If DL (and even NW) is destined to hi
35 ChiGB1973 : Come on fellows. I'd give them a quarter or two of losses, after all, it is a tough industry, but predictions for the entire year from the head man.
36 Jfr : With both DL and NW in bankruptcy, it seems like a funny time for Malaysia Airlines to be considering joining Sky Team.
37 Nycfly75 : Why? You still have airlines like CO, AF and KL in Skyteam...I think if DL goes CO will step up to lead SKyteam with AF. Vin
38 Ckfred : Skibum9: I stand corrected. You're also right about the gray area of the RLA. Lawyers will be reading the Congressional Record to look into hearings a
39 AvConsultant : I disagree, during J7 days, Delta was matching every move by J7. DL placed mainlined aircraft with double or triple mileage on competing routes and f
40 Airlinespotter : Did I hear the fat lady sing?
41 Tu154m : Does anyone realistically see DL still being here by say 2008???? Seriously...........they have got to go down as one of the worst managed companies e
42 Nycfly75 : Not yet, The Atlanta Philharmonic is warming up first.
43 Post contains images Phuebner : Sure, how about a DL NW and UA merge?
44 Post contains images Nycfly75 : Well at least UA understands the value of a premium TransCon Product.
45 Skibum9 : How can you say that the actions of one (Leo Mullin) management team means the company is the worst managed "ever?" DL has a 75 year history of succe
46 Post contains images Phuebner : UHHHHHH, hahahahahaha...I don't get it.
47 Eyeonthesky17 : I COULD NOT AGREE MORE!!! I resent all this crying and whining by a management team that ran this great carrier into the ground. The DL bankruptcy is
48 Tu154 : Now given your earlier comments about DL and Pan Am, shouldn't you also being "wishing" bad karma on UA as well? Pan Am sold UA it's pacific division,
49 UA777222 : Awarded? More like took over or bought.... Matt
50 Tu154 : UA was the succsessful bidder in the route auction after PA shut down.
51 777fan : Blasphemy! I wouldn't dare wish that upon my beloved UA! The only thing worse than an old UA 733/5 would be a NW DC-9, DC-10 or DL MD-8X! Seriously,
52 N160LH : What the hell did you think DL was going to come out and say... Everything is okay but we still want money from our pilots... PLEASE..! Everyone knows
53 COERJ145 : What about a AA and DL merger????
54 Post contains images Jacobin777 : you should sent an email to Lou Dobbs about this, I'm sure you'll get flamed for it....... doesn' that make them a hypocrite? you call an airline whi
55 Post contains images B777-700 : Ridiculous? The same strategy worked for CO. Fly into cities that can only support one US carrier. Make it work and it's yours. This was a GREAT move
56 Phuebner : AA can't handle a merger right now. They are still trying to work out the rough edges of a TWA merger. That one beat them down pretty good, in additi
57 Ikramerica : DL just may be the airline that goes CH7. While people can call this a ploy, when an airline publicly states it is running out of cash and has nobody
58 Tu154 : I can remember years ago Delta was the airline most said was in the best financial position......just goes to show how fast this industry changes!
59 Vegasplanes : In the case of FL and WN I would say quite the opposite, they have both been making money overall for the last 5 years, WN for the last 33. They make
60 DC10GUY : I remember back in 1981 when I got my A&P my only dream was to work for Delta at DTW. I was working at Zantop then and I sent Delta resume after resum
61 Vegasplanes : DL has a serious problem on its hands. If they keep up these losses, at a supposed $ 10 mil cash per day !!!!, DL does not have long. 1) The judge can
62 Jfr : Interesting......possible, but hell could freeze over before all those "ifs" come to pass. If DL goes.... If NW goes.... If CO steps up.... Instead y
63 AvConsultant : Good point. CFO's cannot make comments if it's not true. Amazing what a cyclical economy can do. Very true, don't forget Virgin America initially sta
64 AvConsultant : DL has been been horribly managed since Ron Allen came on aboard almost 20 years go. As for Gerry, hell he was on the BoD during Ron and Leo. He obvi
65 Nycfly75 : That may be how it is right now, but Im sure there is plenty of "What if" talk going on at CO headquarters right now about what would they do. SKytea
66 Post contains images Nwab787techops : What are you talking about? If there where a merger of NW ,UA and DL, you would have a hub in LAX,DTW,MSP,MEM,ORD,ATL,JFK,AMS,*LHR,*FRA,*MIA,CDG,NRT,
67 Goaliemn : Oh yeah.. they filed bankruptcy using false information just to get concessions.. In some states, if its a closed shop, they have no option but to hi
68 Texan : Don't quite agree with you there. It is more an example of how mismanagement has run a formerly great airline into the ground. DL has also taken a ha
69 ChiGB1973 : That was my point. Sorry if I did not make it clear. M
70 Post contains links Bennett123 : http://www.flightglobal.com/jobs/Search.aspx It seems to me that DL are not the only employer's out there. Clearly if you have family commitments, the
71 SparkingWave : Let's also not forget DL's withdrawal from DFW... I agree with the karma part. I think this is all the revenge of Pan Am. Juan Trippe is having a fie
72 JFKLGANYC : "AA is hanging on for dear life" I really wouldn't say that. They've never been through bankruptcy, and have no plans to do it. I think AA is in 'wait
73 ChiGB1973 : I agree. Not to mention that their rival just helped them (and everybody) out tremendously with the $10 raise in fares. AA has done an excellent job,
74 Hiflyer : First off AA is not being quiet...they are on the suicide run at LUV plus DFW and MIA airport officials are now openly soliciting LCC's to come into t
75 WorldTraveler : DL is indeed fully tapped out. That is not a disputable point. But tell me how many airlines – in bankruptcy or not – have unused credit they can
76 Post contains images Bmacleod : Everyone including DL fans must face the facts...the writing is on the wall for DL and unless a financial miracle happens, we all know what the end re
77 Post contains images DeltaGuy767 : Here's something I would have to add about airlines in BK. The political influence that these BK hearings have is quite substancial. Take a look at UA
78 Skymileman : This is how I definitely felt about Northwest. Now, please correct me if I'm wrong, but didn't Delta's Pilots' union also agree to BINDING arbitratio
79 Phuebner : Dude, I was kidding around when I first brought that up. It's okay.
80 DAYflyer : If you honestly believe this, I have some prime beach-front property in Kansas for you... True enough. Perhaps the best long term solution is for FL
81 Nycfly75 : The bigger picture is that something has to give in terms of the US airline industry, there are too many carriers in trouble; it may be healthy for o
82 JFKLGANYC : "What are you talking about? If there where a merger of NW ,UA and DL, you would have a hub in LAX,DTW,MSP,MEM,ORD,ATL,JFK,AMS,*LHR,*FRA,*MIA,CDG,NRT,
83 Post contains images Nycfly75 :
84 Post contains images Panamair : Everyone always points to airlines like EA and PA going down and not being saved by the government but in truth, EA and PA were so small by the time
85 Ikramerica : True, but they were less that 48 hours away from declaring a few years ago. Other airlines aren't bleeding money at the same rate with the same lack
86 Bmacleod : Just look at DL's balance sheet. That debt isn't just going to "disappear" and you can't let creditors hold back indefinitely. For DL passengers I ho
87 Post contains images Phuebner : Dude, don't scare me like that...that's not funny.
88 Lightsaber : Quite possibly B6 will have it tougher. But since everyone but WN has a higher debt/equity... First, very nice post. I like the facts and appreciate
89 Tu154m : I can say that as I have, and am, living in the environment they have created. I have seen DL go from a great place to work, to one of the lousiest.
90 Panamair : I'm not a full-fledged accountant and frankly, I don't know how an LoC is treated under US-GAAP rules (in terms of where it appears on the financial
91 Lightsaber : I too don't know. Thanks for the reply. All I know is $300 million of free cash was freed up by the Merrel Lynch deal (reduced "hold backs" on credit
92 Ikramerica : Where does the $119million in investment moneys come from?
93 Nwab787techops : Why do you think you have airline alliances like Sky team , star, and oneworld? With all those hub, maybe thats where the money is? If you have only
94 WorldTraveler : Good post Panamair, The most important figure to note is that DL did not burn cash from operations in January despite the posts of many people here. D
95 Tu154 : Please look at usernames before including in your post. There is me, tu154 (I do not work for DL), and tu154M.....who may work for DL. (notice the M
96 WorldTraveler : nothing personal. I frequently abbreviate user names in my posts but will make sure I'm careful with that one.
97 Tu154 : no worries.
98 Vegasplanes : Seems to me like this is a "factoring line." A "factoring line" in other businesses is where the Receivables from Customers are "sold" to the Bank, o
99 Ptharris : I'm sorry to backtrack the conversation, but what exactly is the difference between restricted and unrestricted cash? I'm a bit confused.
100 WorldTraveler : Airlines account for transportation sold but not delivered as "air traffic liabilities." DL has already borrowed against its accounts receivables, as
101 FLALEFTY : Excellent points! They need to shrink to survive and possibly selling off their Tech Ops and Comair divisions could raise some much-needed cash. It i
102 Andessmf : But these may be cash cows for them. In other words, it gets very tough for you to sell anything that actually makes you money and then try to surviv
103 Post contains images TCXDegsy : I know I'm probably going to get shot down in flames for this but here goes.... For the greater good of the US Carriers and industry as a whole, would
104 Post contains images Phuebner : Whoosh!!!!!!!!
105 Post contains images Eyeonthesky17 : This is not rocket science . According to the laws of supply and demand, one would assume that if the demand were high that DL would consider either
106 WorldTraveler : fantasies about airlines collapsing are just that - fantasies. The US government decided several years ago that the best way for the legacy airline in
107 TCXDegsy : But at what point does this process become a shelter for an unfit business, and just delay the inevitable? Afterall, should there not be a time limit
108 WorldTraveler : There are time limits to remain in bankruptcy - five years under the old laws (which DL and NW filed under along w/ all previous airline bankruptcies)
109 Post contains images Nycfly75 : I, for one, will not flame your for saying this. Almost every point you made is valid for consideration. Consolidation part of the natural flow of in
110 Post contains images Nycfly75 : Indeed, it just prolongs the inevitable in certain situations; however CO is a good example of how Bankrupcy can help a carrier rebuild. The jury is
111 WorldTraveler : It is hypocritical to say that the plug should be pulled on DL when other carriers have been through the process twice. It is not at all certain that
112 ContnlEliteCMH : It's not hypocritical at all. This sort of reasoning is childish. When accused of something wrong, a child frequently says, "Yeah, well you did it to
113 TL8490 : Should Delta be allowed to collape??? Good Question.... The real question is ...Should UA and/or US been allowed to collape...IF just one of those air
114 Skibum9 : Amen brother....unfortunately there are many on this board that hate Delta and are hoping for its failure. Can you name another airline that has so m
115 Nycfly75 : Im not one of them and I would never gleefully wish a business to go under and all those dedicated workers to go on unemployment, but I will give my
116 Eyeonthesky17 : No shoot down here either. I fully agree with everything you've said although my gut feeling is that the government will come to it's rescue. I disag
117 AvConsultant : DL is screwed. The leadership is soft. DL should have file in '04.
118 Jacobin777 : its not a question of "should they or shouldn't they" or if UA did then DL should also....it all boils down to whether or not the creditors deal a pa
119 AY104 : I suspected for many years now, that those soft old Mama's boys in the south, would run the airline into the ground. I worked for Western Airlines, at
120 Jumbojet : was just wondering if you got this information from your crystal ball or maybe its that your clairvoyant?
121 Bennett123 : IMO the problem here is that jobs will be lost whichever route is followed. If the demand for flights only matches the supply at a price that is not v
122 767Lover : This is part of my point. Delta did not do anything to create a better PRODUCT. I'm from ATL (I remember the OLD terminal!) and I am fond of Delta (a
123 WorldTraveler : I truly amazes me how dense some people are and how easily there are pulled around by media and the mouths that are quoted in it. Delta is not in dang
124 Jacobin777 : who do you think is more credible?
125 Post contains images Ptharris : Since obviously you're the one with ALL the knowledge and can forsee the future of DL, then why don't you tell us just who the hell you are and how y
126 Bennett123 : Looking at World Traveller's profile it seems that a lot of the id's on his RR suggest a DL connection. This could explain why things are getting a bi
127 Post contains images Nycfly75 : Cant agree more! It silly how people on here take everything personal. This is supposed to be a DISCUSSION board. We can discuss every possibility he
128 Nycfly75 : I can respect him for taking a stand for something he whole-heartedly believes in, but he should speak a little more realistically about current prob
129 Post contains images Jacobin777 : ahhhh..how I love the "quote selected text" function...
130 Post contains images Nycfly75 :
131 Panamair : Yes, I agree that any possibility can be discussed here if it's done in a reasonable and rational way, with as many facts as possible. In most of the
132 Nycfly75 : I agree 100% and i'll always be senstive when it comes to other posters' jobs and livlihood while continuing to talk about hypotheticals and possibil
133 TCXDegsy : Steady on WT - EVERY opinion is valid. Whether you agree or not with any opinion, that doesn't excuse rudeness!!!
134 Post contains images Ptharris : DING!! - You are now free to have an opinion. Uh oh.. here comes the WN lawyers...
135 STT757 : Why would voters in NYC be upset by DL going out of business, most of the jobs DL supports in NYC are low paying service industry jobs which there ar
136 WorldTraveler : I have never doubted that anyone else has an opinion and that they are free to share it. But that doesn't mean I am going to stop arguing my point and
137 Alitalia744 : For now.
138 TCXDegsy : Absolutely agree with that - just cut out the rudeness and disrespect of others, and they are more likely to consider your point of view. Continue wi
139 AvConsultant : Good Post DL significant assets have been reduced to leveraged assets. DL recently retired it's only aircraft it owned (or was not leveraged) the oth
140 Bucky707 : Even if the pilots did not take another dime of pay cuts, they have alreay contributed over a billion a year in concessions. Or do you forget that? W
141 Post contains images Lightsaber : Oh, I really want DL to survive, but if you've read skygod, the PanAm employees thought for years that their losses were "just a strategy." (tax evas
142 Post contains images DeltaGuy767 : I do apologize for not doing research as to the demographics of the employees of DL who work in the JFK area. Since it was a hub in which many DL emp
143 Jumbojet : I read just about everything on Delta air lines news via yahoo and didnt come up with any news on that statement other then the fact that Delta CFO S
144 WorldTraveler : No, I do not have a link of the arbitration transcripts but wish I did. DL has said several times publicly that revenue is coming in ahead of plan. Th
145 Bucky707 : I don't disagree. For a long time we were far and away the highest paid. The cuts over a year ago got us in line. The most recent 15% cut put us at o
146 WorldTraveler : perhaps the additional cuts are "interest payments" on the time when you were overpaid. Did you really think you would remain so overpaid for so long
147 Post contains images SBN580 : Delta's situation certainly becoming confusing to the some of us on the outside. Just earlier this week or last week I read that they are planning on
148 Mariner : Delta's CEO Grinstein hated the idea of Chapter 11, he hated doing he and he seems to hate being there. He keep saying that they will be out as soon
149 Surfdog75 : It scares me that management is spending so much time and energy on trying to put one employee group in it's place. It's obviously a vendetta now. Th
150 Jumbojet : just to add my 2 cents, if that is your attitude, then according to statements made by DL CFO, then your going to strike and DL liquidates. CFO says
151 Post contains links Jumbojet : another thing Delta did yesterday was raise most domestic fares by $5 each way. Most other major airlines, including JetBlue matched this fare increas
152 N766UA : Tapped out and fragile yet perfectly able to boost JFK flights by over 40 daily departures, add new regional carriers and aircraft, and introduce doze
153 Mariner : Yes, indeed. Some might argue that there is something wrong with that. They seem to be intent on alienating the pilots while adding routes that, in s
154 Bucky707 : hmm, and what do you expect him to say publically? We want $305 million, but thats just a number and we can go down from there? Just months ago they
155 Jumbojet : NO way Jose. Hey, I'm still booking flights on Delta for travel in May, July, etc. I plan on them being around for a very long time. Just booked LGA
156 WorldTraveler : DL is restructuring its business, not sitting in for last rites. Adding new routes is a perfectly acceptable way of restructuring the business. In fa
157 Jacobin777 : personally, if its legal, I see nothing wrong with it......good business move maneuver if one asks me..
158 Mariner : Who suggested last rites? I have no problem with Delta adding new routes. It is the nature of some of those routes that puzzles me. The other questio
159 WorldTraveler : perhaps you don't see the potential for the new flights. Those JFK flights have been discussed ad nauseum. Quite frankly it's puzzling that some of th
160 Mariner : In some cases, yes I do. But not in all. Get in and do what you have to do. However long it takes. US Airways tried your approach and was back in wit
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