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DL Bankruptcy Exit  
User currently offlineDeltadude From United States of America, joined Sep 2004, 132 posts, RR: 0
Posted (7 years 11 months 3 weeks 2 days 11 hours ago) and read 5492 times:

I've heard rumors that the pending pilot pension bailout makes the beginning of BK exit. What are you all's comments? Do you think we will see a DL operating in the black by next March or April?

Also, do you think they'll purchase new aircraft?

[Edited 2006-09-10 03:15:46]

54 replies: All unread, showing first 25:
 
User currently offlineBucky707 From United States of America, joined Aug 2000, 1028 posts, RR: 3
Reply 1, posted (7 years 11 months 3 weeks 2 days 11 hours ago) and read 5481 times:

Yes, I think Delta will be operating in the black. Our current management team has done a good job turning the airline around. I think they are making the right moves with the routes. I have noticed the mood of the employees is very upbeat now. People are once again taking pride in working for Delta. I know I am.

User currently offlineDelta787 From United States of America, joined May 2006, 321 posts, RR: 0
Reply 2, posted (7 years 11 months 3 weeks 2 days 11 hours ago) and read 5461 times:

Quoting Deltadude (Thread starter):
I've heard rumors that the pending pilot pension bailout makes the beginning of BK exit. What are you all's comments? Do you think we will see a DL operating in the black by next March or April?

Delta has already been posting operating profits for several months now. Comparing this year to this time last year, Delta has really done a remarkable job turning itself around in just a year.



Fly Delta!
User currently offlineWorldTraveler From , joined Dec 1969, posts, RR:
Reply 3, posted (7 years 11 months 3 weeks 2 days 11 hours ago) and read 5408 times:

DL has posted operating profits since April - just 6 months after filing for BK. They reported a 10% operating profit in June and July which should put them near the top of the industry.

They continue to say they plan to emerge by the 2nd quarter of 2007, probably in April or May.

Terminating the pilot pension plan is a major step in finaling their post-BK finances but DL also needs to rework its regional carrier contracts. They are on the final stretch but not their yet. Everything is going their way. They will begin the process of developing a plan of reorganization in the next few weeks.

Several news outlets (both industry and non-industry) have said they will feature DL's dramatic turnaround in coming months.


User currently offlineJumbojet From United States of America, joined Dec 2003, 1159 posts, RR: 0
Reply 4, posted (7 years 11 months 3 weeks 2 days 10 hours ago) and read 5319 times:

also, from what I've read, 2007 shall introduce new international flights much like 2006 had. It will be interesting to see what new destinations unfold. I'm not a betting man but if I was, I would say for sure there has to be at least two or three European flights in the mix.

User currently offlineDTWAGENT From United States of America, joined Jan 2006, 1283 posts, RR: 0
Reply 5, posted (7 years 11 months 3 weeks 2 days 9 hours ago) and read 5261 times:

Way to go DL. I need to hear some good new tonight. Keep it up folks.

Chuck


User currently offlineDeputydawghere From United States of America, joined Nov 2005, 205 posts, RR: 1
Reply 6, posted (7 years 11 months 3 weeks 2 days 9 hours ago) and read 5249 times:

Without a doubt, Delta will definitely come out stronger than ever and continue to be a strong player in the global market. I believe the 787 will fit nicely into Delta's infrastructure.

[Edited 2006-09-10 04:51:28]


N/A
User currently offlineSLCUT2777 From United States of America, joined Dec 2005, 4050 posts, RR: 11
Reply 7, posted (7 years 11 months 3 weeks 2 days 9 hours ago) and read 5249 times:

I've even heard some Delta insiders point to even a possible December or January BK exit. Delta did a tremendous amount of restructuring once Jerry Grinstien had his people in place, namely Jim Whitehurst and Ed Bastian, and once they had a plan in place they went into action. Had fuel prices not been so volatile starting in 2004, it is a fairly safe assumption DL could have avoided going up the courthouse steps a year ago. As for the pilots pension, it is clearly an industry trend to go towards defined contribution plans over defined benefit plans since they are so much cheaper to fund. The U.S. Federal government started that trend back in 1984 when all federal employees hired after 12/31/1983 were hired on the FERS system rather than the old CSRS benefit program. The pilots will get a stake in the post BK company as well as a generous retirement contribution in place of the old plan.
I do believe that next year Delta will announce the direction their long-haul fleet will be going, namely placing any more 777 orders they think they wil need and they probably are already firming up plans with Boeing to get the additional 777s they want including some 200LR models they are going to need to fly to South Africa and India from ATL and JFK. With the number of people they carry between ATL/JFK and the primary European ports of entry (mainly LGW, CDG and FRA) I wouldn't be the least bit surprised to see them order a few 773ERs and place an initial order for some 787s. Finally i think they will start looking at phasing out their fleet of MD-88/90s with either some EMB-190/195s or wait for Boeing to come up with a smaller 737 successor.
As for new International routes next year, perhaps the big jaw-droppers will be one or perhaps two routes from Salt Lake City/SLC to Paris/CDG and to London/LGW. This will truly be going into uncharted waters for them or any other carrier. I think you could say the Widget is back!



DELTA Air Lines; The Only Way To Fly from Salt Lake City; Let the Western Heritage always be with Delta!
User currently offlineAlitalia744 From United States of America, joined Mar 2000, 4748 posts, RR: 45
Reply 8, posted (7 years 11 months 3 weeks 2 days 9 hours ago) and read 5213 times:

Quoting WorldTraveler (Reply 3):
They will begin the process of developing a plan of reorganization in the next few weeks.

The process has begun.



Some see lines, others see between the lines.
User currently offlinePositiverate From United States of America, joined May 2005, 1590 posts, RR: 8
Reply 9, posted (7 years 11 months 3 weeks 2 days 9 hours ago) and read 5159 times:

Quoting Deltadude (Thread starter):
I've heard rumors that the pending pilot pension bailout makes the beginning of BK exit.

Keep in mind, there's been no "bailout" of the pilot plan. The pilot plan was terminated by the company and given to the PBGC.

Quoting Deltadude (Thread starter):
Also, do you think they'll purchase new aircraft?

Like everyone else has said, I'm confident they'll be a 787 order (maybe even on the day they exit bankruptcy). I also think you'll see an order for 18 777LR's announced around that time as well  Wink. The thing I always wonder about is the follow on for the 757 and MD-88. I could see them ordering the EMB-195's, but the lack of fleet commonality with the all Boeing fleet makes me think they won't go that way. Maybe some 737-900', and -700's?


User currently offlineFreedom747 From , joined Dec 1969, posts, RR:
Reply 10, posted (7 years 11 months 3 weeks 2 days 9 hours ago) and read 5116 times:

There are plenty of good airlines in this world. But, none quite like DELTA AIR LINES, INC.

[Edited 2006-09-10 05:38:44]

User currently offlineDeltaSFO From United States of America, joined Nov 2000, 2488 posts, RR: 22
Reply 11, posted (7 years 11 months 3 weeks 2 days 8 hours ago) and read 5062 times:

There is still a great deal of work and restructuring left to do. I would be very surprised if Delta emerged from bankruptcy any time before May 2007. Delta executives have been playing down speculation about an early bankruptcy exit. In fact, I wouldn't be surprised if it happened sometime closer to July or August 2007.

The progress has been remarkable, but it is still too early to celebrate. DL is still, believe it or not, in the early stages of its restructuring and transformation. The Delta of 2008 will be very different from the Delta of today and yet very much like the Delta of 1984--in all the right ways.

[Edited 2006-09-10 06:15:50]


It's a new day. Every moment matters. Now, more than ever.
User currently offlineJacobin777 From United States of America, joined Sep 2004, 14968 posts, RR: 60
Reply 12, posted (7 years 11 months 3 weeks 2 days 7 hours ago) and read 5018 times:

Even though I don't fly on DL, I'm happy for you DL guys..keep up the good work thumbsup ....DL is a world-class carrier....

lots of work and challenges in front you guys/gals as well as the fact the economy is slowing down( and so will travel)..so there will be some bumps on the road..that being said, oil is down to $66.30/barrel...if it goes down another $10-$12..the profits will be quite sustainable...

Cheers...



"Up the Irons!"
User currently offlineDAL767400ER From , joined Dec 1969, posts, RR:
Reply 13, posted (7 years 11 months 3 weeks 2 days 1 hour ago) and read 4871 times:

Quoting Positiverate (Reply 9):
The thing I always wonder about is the follow on for the 757 and MD-88. I could see them ordering the EMB-195's, but the lack of fleet commonality with the all Boeing fleet makes me think they won't go that way. Maybe some 737-900', and -700's?

Just my opinion, but I could imagine that DL might forego ordering any new 737NGs besides the ones they already have on order, and instead keep their 757s and MD-88s in as good a condition as possible, and try to be a launch customer. They will be behind others on the 787, but they might try to be one of the first for the 737RS.

I also doubt that DL would leave CH11 earlier than originally planned. I imagine they could perhaps actually do it, but better stay in longer and get absolutely everything work out, than going out early and perhaps overlook something.


User currently offlineAA1818 From Trinidad and Tobago, joined Feb 2006, 3433 posts, RR: 4
Reply 14, posted (7 years 11 months 3 weeks 2 days 1 hour ago) and read 4786 times:

Which US carriers still have their Pilot Pension funds in tact???? AA, CO, anyone else?????

Also what sort of debt levels do the legacies have. I've heard of AA having about 20bn, CO 8bn? Are those figures outdated?

Great news that the US aviation industry is regaining momentum and a speedy recovery to a healthy state is well underway.

AA1818



“The moment you doubt whether you can fly, you cease for ever to be able to do it.” J.M. Barrie (Peter Pan)
User currently offlineCOERJ145 From United States of America, joined Jun 2005, 1421 posts, RR: 1
Reply 15, posted (7 years 11 months 3 weeks 1 day 23 hours ago) and read 4386 times:

Quoting AA1818 (Reply 14):
Which US carriers still have their Pilot Pension funds in tact???? AA, CO, anyone else?????

AA, CO and NW all have theirs. US, UA and soon DL Dumped theirs. Anyone know whether US will restore theirs due to the merger by HP(still has pension)?

[Edited 2006-09-10 15:21:57]

[Edited 2006-09-10 15:22:14]

User currently offlineBucky707 From United States of America, joined Aug 2000, 1028 posts, RR: 3
Reply 16, posted (7 years 11 months 3 weeks 1 day 22 hours ago) and read 4287 times:

Quoting COERJ145 (Reply 15):
AA, CO and NW all have theirs. US, UA and soon DL Dumped theirs. Anyone know whether US will restore theirs due to the merger by HP(still has pension)?

NW still has their pension, but I would bet against them leaving BK with it intact. HP never had a pension, at least not a defined benefit pension.


User currently offlineJano From Slovakia, joined Jan 2004, 827 posts, RR: 4
Reply 17, posted (7 years 11 months 3 weeks 1 day 22 hours ago) and read 4217 times:

Quoting Bucky707 (Reply 16):
NW still has their pension, but I would bet against them leaving BK with it intact.

I believe that NWA's pilots do not have defined benefits plan anymore, rather they are on defined contribution plans now.

See http://wcco.com/business/local_story_031132603.html

The carrier, which filed for bankruptcy protection in September, and its pilots union, the Air Line Pilots Association (ALPA), agreed to the freeze of the defined benefit plan. The creditors committee also came out in support of the freeze, effective on Feb. 1, in court.

The pilots will now get a defined contribution plan, the details of which are still being hashed out between ALPA and Northwest.



The Widget Air Line :)
User currently offlineBucky707 From United States of America, joined Aug 2000, 1028 posts, RR: 3
Reply 18, posted (7 years 11 months 3 weeks 1 day 22 hours ago) and read 4094 times:

Quoting Jano (Reply 17):
The carrier, which filed for bankruptcy protection in September, and its pilots union, the Air Line Pilots Association (ALPA), agreed to the freeze of the defined benefit plan. The creditors committee also came out in support of the freeze, effective on Feb. 1, in court.

The pilots will now get a defined contribution plan,

As this says, the defined benefit was frozen. So someone who had accrued, say 7 years toward the pension, would get 7/25s of the full pension. But no further accrual. Going forward, you get a defined contribution plan. There are many pilots at NW with more than 25 years, so they will get the full defined benefit pension. As of now, the defined benefit plan has not been terminated.


User currently offlineScaledesigns From United States of America, joined Aug 2006, 211 posts, RR: 0
Reply 19, posted (7 years 11 months 3 weeks 1 day 21 hours ago) and read 3928 times:

Great for Delta if its true..Chapter 11 is probably better for most airlines
at this point in time to lower employment costs and return a/c and equipement the company cant afford.Not very good for the Creditors or Employees though!Wall Street and the Banks hate it.

I wonder what airline is next to enter chapter 11??



F1 Tommy
User currently offlineWoosie From United States of America, joined May 2006, 115 posts, RR: 2
Reply 20, posted (7 years 11 months 3 weeks 1 day 21 hours ago) and read 3863 times:

At the expense of sounding dumb... what's the basic intent behind a "defined benefit plan" and a "defined contribution plan"? I realize the defined contribution plan costs less, as [I guess] the employee partially funds his retirement and [probably] contributions paid by the employer are a percentage of the total based on employee contributions. Anything else??

User currently offlineHunUtazo From United States of America, joined Jul 2005, 235 posts, RR: 1
Reply 21, posted (7 years 11 months 3 weeks 1 day 21 hours ago) and read 3838 times:

Dal will be unalterably changed forever more as a result of the consolidation that will ensue relatively soon. The stage has been set, dals future is inextricably tide to the dominoing lemming like combinations that have been planned and will take place in the not too distant future...

AMR nwac

CAL ual

LCC dal frag

LUV dal frag



dude
User currently offlinePositiverate From United States of America, joined May 2005, 1590 posts, RR: 8
Reply 22, posted (7 years 11 months 3 weeks 1 day 21 hours ago) and read 3826 times:

Quoting Bucky707 (Reply 16):
NW still has their pension, but I would bet against them leaving BK with it intact. HP never had a pension, at least not a defined benefit pension.

In orer for them to take advantage of the pension relief recently passed by Congress, they have to do one of two things:

1) If they soft freeze their pension, they are able to take advantage of the 10 year amortization period at a higher interest rate. Unfortunately for NWA, this option doesn't sufficiently address their underfunding.

2) The other option is to totally freeze accruals, and use the 17 year/7.75% amortization period. This addresses their underfunding issues sufficiently.

So you're right, they will not exit bankruptcy with their current pension plans in place.

Quoting Bucky707 (Reply 18):
As of now, the defined benefit plan has not been terminated.

See above. It will be.


User currently offlineLuv2fly From United States of America, joined May 2003, 12090 posts, RR: 49
Reply 23, posted (7 years 11 months 3 weeks 1 day 21 hours ago) and read 3799 times:

IMHO - I would really be surprised if DL comes out of bankruptcy prior to the 4th quarter of 2007. I do not see them rushing it like US did the first time.


You can cut the irony with a knife
User currently offlineDutchjet From Netherlands, joined Oct 2000, 7864 posts, RR: 57
Reply 24, posted (7 years 11 months 3 weeks 1 day 21 hours ago) and read 3779 times:

Quoting DeltaSFO (Reply 11):
There is still a great deal of work and restructuring left to do. I would be very surprised if Delta emerged from bankruptcy any time before May 2007. Delta executives have been playing down speculation about an early bankruptcy exit. In fact, I wouldn't be surprised if it happened sometime closer to July or August 2007.

The progress has been remarkable, but it is still too early to celebrate. DL is still, believe it or not, in the early stages of its restructuring and transformation. The Delta of 2008 will be very different from the Delta of today and yet very much like the Delta of 1984--in all the right ways.

[Edited 2006-09-10 06:15:50]

Interesting and well thought out post......I agree with you 100%. The progress at DL has been remarkable, but I dont think that DL is going to rush out of bankruptcy until each and every financial issue is resolved and until managment is certain that they have a business plan that will work very well...even in these difficult times with security and fuel issues affecting airline traffic and operating costs. Why should DL rush? DL certainly does not want to find itself in a situation where they would be forced to re-file a couple of years down the road ( think US) or emerge with nagging problems unresolved ( think UA).

Quoting DAL767400ER (Reply 13):
Just my opinion, but I could imagine that DL might forego ordering any new 737NGs besides the ones they already have on order, and instead keep their 757s and MD-88s in as good a condition as possible, and try to be a launch customer. They will be behind others on the 787, but they might try to be one of the first for the 737RS

Its a wild card......a lot depends upon how much flexibility Boeing will continue to offer Delta. Dont forget that DL has a lot of orders on Boeing's books that somehow must be resolved; Boeing will certainly accommodate Delta but at some point, Boeing will want to Delta to start accepting some of the new airplanes that are on order. My guess: some of the 737NG orders on the books will be converted to 777 orders with Boeing's blessing (whether its ERs or LRs remains to be seen, I am not convinced that DL needs the very expensive LR variant) as Delta desperately needs additional longhaul capacity, a reasonable number of 738s (say about 20) will be firmed up at Boeing's insistance and the balance of DL's current commitments will be re-allocated to the 787 and 737RS.

Quoting Positiverate (Reply 9):
Like everyone else has said, I'm confident they'll be a 787 order (maybe even on the day they exit bankruptcy). I also think you'll see an order for 18 777LR's announced around that time as well . The thing I always wonder about is the follow on for the 757 and MD-88. I could see them ordering the EMB-195's, but the lack of fleet commonality with the all Boeing fleet makes me think they won't go that way. Maybe some 737-900', and -700's

Eighteen 772LRs in one order, I think, is a bit optimistic.....you are talking about some very expensive airplanes!!! I do think that there will be a 772 order (ER or LR.....I an going with additional ERs) just as soon as DL can arrange for financing......and the exact number will depend upon how willing the institutions are willing to lend to the ""NEW"" Delta.....if I had to guess, I would say between 6 and 12 772s will be ordered by DL. As mentioned above, DL will take some 738s due to issues with Boeing......but I dont expect a large narrowbody order in the nearterm future from Delta, the 752s and MD80/90s plus the 738s are serving the airline just fine.


25 Bucky707 : I agree. I was simply pointing out it has not been terminated yet.
26 Positiverate : "Have been planned"? And you're basing this post on what information?
27 Jumbojet : What DL needs to accomplish is a stronger alliance network that allows for travel to more far east countries and Australia, something that is impossib
28 Post contains images F9Animal : And I remember reading the doom and gloom of DL. I have to admit though, I was kind of worried. DL is a fine airline, and I look forward to seeing it
29 SLCUT2777 : While I likewise don't expect a new narrow-body order for at least 2 perhaps three years, I do see DL putting the MD-88/90 group on the chopping bloc
30 Alitalia744 : Positiverate - He posts this in every thread where DL is concerned. I wouldn't put much stock into his posts.
31 Floridaflyboy : Delta's doing a heck of a lot better than United did. Don't get me wrong. I understand that United was going through bankruptcy in much worse times,
32 Post contains images DAL767400ER : Especially considering that most of the time this BS will be deleted anyway .
33 Post contains images FXramper : It's disgusting what DL and the US Government have done to employee pensions just so they can survive. If they can't pay out and survive, let them die
34 Panamair : Use your head a little before posting next time...if DL were to be liquidated, there wouldn't be enough to fully fund all of the underfunded pension
35 DZ09 : What does cancelling the pilots pension plan exactly mean? Are the pilots getting screwed in the process? is the airline surviving at the expense of t
36 Otter79 : I agree it's outrageous and disgusting... but don't blame only Delta. It started with USAir and United. FYI, Delta's CEO said publicly (pre-bancruptc
37 Dl1011 : Bucky707 wrote "I have noticed the mood of the employees is very upbeat now. People are once again taking pride in working for Delta. I know I am." I'
38 Panamair : FYI, both UA and US dumped ALL of their employee pension plans. Not saying that dumping even one plan is a good thing but DL and NW lobbied hard on C
39 DeltaSFO : I'm pretty sure you're aware of this, Panamair, but I just wanted to clarify. Defined benefit plans for non-contract employees were frozen as of the
40 Panamair : Thanks for the clarification. Yes, I was aware of it- in fact, I thought that quite a few FAs told me that their switch to the defined contribution p
41 Otter79 : I was referring to the pilot's pension plan although I didn't indicate that in my post. Grinstein made that statement at a pilot meeting in the fall
42 Post contains images Positiverate : You're right. It's absolutely outrageous that DL and NW joined with their employees and worked so hard on Capitol Hill to pass legislation to preserv
43 DeltaSFO : I don't remember the specifics, but when DL went from the defined benefit plan to the cash balance plan, I think any employee with more than 10 years
44 DeltaSFO : Yes, and I agree that this is a great thing.
45 Burnsie28 : According to NW the new pension plan passed by congress, NW announced with the passing that it would allow them to keep the pension plans intact.
46 Jacobin777 : which is not competitive (nor fair really) to other carriers such as AA which hasn't filed for bankruptcy
47 Positiverate : Which is why the Congress passed the provisions included in the pension bill to allow airlines that still have DB plans such as CO, AA, DL, or NW to
48 WorldTraveler : only airlines in bankruptcy only had the 17 year option. that provision was necessary because DL and NW both said they couldn't have retained an pensi
49 Positiverate : Show me where in the legislation it says that? You can't, because that isn't true. In fact, CO is getting the best of both worlds. They are taking th
50 Alitalia744 : I think HunUtazo or whatever his name is believes that GE and AMEX are at the center of consolidation and will only allow AA and CO to survive and ar
51 Jacobin777 : intersting...but UA got away with it before this....
52 WorldTraveler : I believe you are right. Part of the latter changes in the bill was to remove the bankruptcy requirement but a plan freeze was required. There were C
53 Post contains images Syncmaster : I couldn't agree more! Great job Delta! -Charlie
54 Positiverate : At no point in any form of the legislation was there ever a requirement you had to be in bankruptcy to take advantage of the provision. The only requ
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