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AJC: Can Delta Air Lines Weather Current Storm?  
User currently offlineSLCUT2777 From United States of America, joined Dec 2005, 4107 posts, RR: 11
Posted (6 years 7 months 1 week 1 day 8 hours ago) and read 7568 times:

Some people are saying that mergers should have happened months ago if they were even supposed to happen. Others say that the current economic downturn has soured the environment for mergers. Can airlines such as DL, UA or HP+US who have all been through recent bankruptcies deal with this economic pitfall? Jim Tharpe of the Atlanta Journal Constitution points out that the current DL leadership team feels they are now in a better position to get through this latest economic storm unlike the one 7 years ago that lead to so much loss in the industry. Analyst Mike Boyd seams to think so as well:
http://www.ajc.com/business/content/...stories/2008/03/21/Delta_0323.html


DELTA Air Lines; The Only Way To Fly from Salt Lake City; Let the Western Heritage always be with Delta!
34 replies: All unread, showing first 25:
 
User currently offlineN801NW From United States of America, joined Jul 2004, 744 posts, RR: 1
Reply 1, posted (6 years 7 months 1 week 1 day 8 hours ago) and read 7520 times:

Hmm, interesting timing. Here is the latest Star Tribune story about would be partner Northwest.

With merger grounded, Northwest tries Plan B

Quote:
A new era of belt-tightening is beginning for Northwest Airlines, as its executives respond to abnormally high fuel costs and craft a future that in the short run isn't predicated on a merger.



User currently offlineCommavia From United States of America, joined Apr 2005, 11752 posts, RR: 62
Reply 2, posted (6 years 7 months 1 week 1 day 8 hours ago) and read 7460 times:

Can Delta Air Lines Weather Current Storm?

I think the answer to that question is a resounding yes. Delta is being well run by smart, talented people, and I don't think there is much of a risk of them ceasing to exist anytime soon. The next few months/years (hopefully only months) will be tough for Delta just like every other airline, but I think you'd find it difficult to find anyone who doubts Delta's ability to "weather [the] current storm."

Personally, I'd say Northwest has far more to worry about than Delta - since the fundamentals of their business model are far less visionary in their scope, and the company is having to deal with increasingly contentious challenges on the labor front. I don't think Northwest is going anywhere anytime soon, either, but I suspect they'll have a harder go of things in the near-future than their former dance partner Delta.


User currently offlineGosimeon From Ireland, joined Jan 2008, 663 posts, RR: 0
Reply 3, posted (6 years 7 months 1 week 1 day 8 hours ago) and read 7386 times:

DL has certainly learned from their mistakes in the past. They know things are going to get tough for all airlines for a while and have fastened their belt and adopted a conservative, realistic approach to growth for the time being. Here is hoping they do weather the storm, I have every confidence they will do so and are doing so now pretty well.

User currently offlineLAXdude1023 From India, joined Sep 2006, 7693 posts, RR: 25
Reply 4, posted (6 years 7 months 1 week 1 day 7 hours ago) and read 7323 times:

I see no reason why DL cant "weather the storm". DL will be just fine. They just need to make some cuts (which they are doing). They will probably cut ATL down a bit, but thats fine. That airport has so many flights, they wont even notice.


Stewed...Lewd...Crude...Irreverent...Belligerent
User currently offlineWorldTraveler From , joined Dec 1969, posts, RR:
Reply 5, posted (6 years 7 months 1 week 1 day 6 hours ago) and read 7209 times:

very well said, Commavia. If I'd said it, I'd have been accused of being a pom pom toting cheerleader but your opinion clearly validates what I have been saying: NW and its pilots have far more to lose.

I do think that the merger wheel will spin again... it's just a question of when. If a Democratic president takes the helm, it's a given that NW won't be allowed given Oberstar's influence. If McCain becomes Pres., then DL-NW could happen again. And of course, the pilots could get their stuff together and a deal could be quickly moved through the DOJ.

To the main point of the article, DL is perfectly capable of making it on its own. It is cautiously aggressive and is building on a strong network. There won't be huge risks - and probably no commitments to build a new terminal at JFK - but there will be continued growth in key world markets, esp. in Africa, Latin America, and Asia.


User currently offlineStyle From United Kingdom, joined Aug 2006, 263 posts, RR: 0
Reply 6, posted (6 years 7 months 1 week 1 day 6 hours ago) and read 7158 times:



Quoting WorldTraveler (Reply 5):
If I'd said it, I'd have been accused of being a pom pom toting cheerleader

Thats exactly what you are. What happened to your self glorified thread of "Consolidation in 2008 and Delta in the Driver's Seat"??? Fact is, DL is no 'greater' than you make them out to be. They are simply another 'Big Six' Network carrier dealing with a difficult economic environment just like everybody else.

They are not immune nor significantly better positioned that anybody else, you just fail to see that becuase you have a biased position with DL. There's nothing wrong with being biased, its only when you are biased and fail to see it that you stop making any common sense.

As for Commavia's post, I agree, DL will weather this environment for the time being, just like most others will.


User currently offlineSLCUT2777 From United States of America, joined Dec 2005, 4107 posts, RR: 11
Reply 7, posted (6 years 7 months 1 week 1 day 5 hours ago) and read 7066 times:



Quoting WorldTraveler (Reply 5):
I do think that the merger wheel will spin again... it's just a question of when.

 checkmark  Probably before the year is over.

Quoting WorldTraveler (Reply 5):
If a Democratic president takes the helm, it's a given that NW won't be allowed given Oberstar's influence.

Keep in mind that Oberstar's idea of solving the airlines woes is a U.S. nationalized version of "Mapleflot!" Given how cozy this left-wing radical is with the unions.  irked 

Quoting WorldTraveler (Reply 5):
And of course, the pilots could get their stuff together and a deal could be quickly moved through the DOJ.

I would say there is a slightly better than 50/50 chance this will happen, especially if NW starts parking the DC-9s in the Arizona desert faster than McCain secured the Republican nomination!  biggrin 



DELTA Air Lines; The Only Way To Fly from Salt Lake City; Let the Western Heritage always be with Delta!
User currently offlineFlyASAGuy2005 From United States of America, joined Sep 2007, 7004 posts, RR: 11
Reply 8, posted (6 years 7 months 1 week 20 hours ago) and read 6473 times:

I would have to say yes also. Every time I think about that $5.2 billion lose back before bankrupcty I say they can do it. Keep in mind that they are in the black as of now (I think). Interesting to see what the upcoming quarter would look like though.


What gets measured gets done.
User currently offlineDTWAGENT From United States of America, joined Jan 2006, 1283 posts, RR: 0
Reply 9, posted (6 years 7 months 1 week 18 hours ago) and read 6173 times:

I think DL has a better chance at making it through this current storm the NWA. The reason is NWA has taken about as much money from it's employees that it can. And I don't see the employees allow the management team demand more from them. I see a big strike if that happens. What NWA needs to do is hedge more of their fuel. Same with DL. And NWA needs to take their DC-9's out of service. I hate to see them go. But, they can't be saving any type of money with them flying. NWA also, needs to speed up the delivery process of their E-170's and CRJ-900's. And put some of their smaller CRJ's up for sale to purchase more of the other two aircraft that I have mentioned.

I would think if they stopped flying their DC-9's that would save the a large amount of money on fuel. Also, they may want to think about going back to the Dash-8's like CO is doing. The Saab 340's can't be easy on the fuel either. Unlike DL, NWA can't really cut alot of routes from their system because of contract deals with the DOT to fly to smaller cities. And if they do cut those cities they will have to look at the cost savings on doing this. They can also stop flying the DC-9's to cities like AZO, MBS, and others alike. Start using the Airbus for these cities. And cut back on the number of flights out of these cities. I find it hard to believe that AZO, MBS needs that many flights in a day. Use the Airbus aircraft and decrease the number of flights.

This is just my way of thinking about it. I'm sure I will be raked over the coals and called every name in the book by the time this is over with. So have at it everyone....Tear me apart on this. Because I know I don't know everything.... Have fun

Chuck


User currently offlineBobnwa From United States of America, joined Dec 2000, 6496 posts, RR: 9
Reply 10, posted (6 years 7 months 1 week 18 hours ago) and read 6104 times:



Quoting DTWAGENT (Reply 9):
And NWA needs to take their DC-9's out of service. I hate to see them go. But, they can't be saving any type of money with them flying.

Are you sure that the total cost of flying a paid for DC-9 is more than flying a new aircraft that has loan payments due every month?

Quoting DTWAGENT (Reply 9):
Also, they may want to think about going back to the Dash-8's like CO is doing. The Saab 340's can't be easy on the fuel either.

Are you saying that the Saab 340's burn more fuel than the Dash-8's. do you have the figures?

Quoting DTWAGENT (Reply 9):
Unlike DL, NWA can't really cut alot of routes from their system because of contract deals with the DOT to fly to smaller cities.

Do you have a list of cities that both DL and NW fly to that are government contract to be able to make that statement?


User currently offlineCommavia From United States of America, joined Apr 2005, 11752 posts, RR: 62
Reply 11, posted (6 years 7 months 1 week 18 hours ago) and read 6094 times:



Quoting DTWAGENT (Reply 9):
The reason is NWA has taken about as much money from it's employees that it can. And I don't see the employees allow the management team demand more from them.

Not sure if that's a benefit or a curse!

Sure, Delta hasn't taken all it could from its employees, I suppose one could say, but man-oh-man that's going to end the love train down in Atlanta real quick if they go back to their employees for more. Everyone at the "New Delta" is all gung-ho and pumped up now, but that will change real quick if management takes more from the employees.

Quoting DTWAGENT (Reply 9):
What NWA needs to do is hedge more of their fuel. Same with DL.

Well, in all fairness, that is largely out of management control.

Every airline would like to hedge at favorable price levels, but the problem is that fuel hedges are a two-party transaction: a bet, essentially, between the airline and a financial institution (usually a large bank) about where fuel prices will go. This is important because this means that airlines can only hedge fuel if there's another company on the other end of the bet willing to make the bet with the airline. In today's financial and credit environment, there aren't many companies willing to bet with airlines because - given their once-again-deteriorating balance sheets - these financial institutions are not reasonably confident that the airlines will have the money to pay the banks back if they lose the bet.

That is why you see almost all of the legacy carriers having very little fuel hedging. AA and Delta have the most hedged, at about 1/4 each of their 2008 fuel needs, and it goes down from there (20% for Continental, 18% for Northwest, 15% for United). Even Southwest - which has remained profitable over the last few years largely because of the fuel hedges, is now starting to feel the pinch. 1Q07 had almost their entire fuel bill hedged, whereas this year they're only 75% hedged. And their hedged numbers continue to shrink each month.

As Southwest's hedges begin to expire more and more, it will be an enormous boost to the industry overall, since - finally, for the first time in about five years - all of the airlines will be competing on a relatively level playing field in terms of the fuel cost metric. Southwest has kept fares low in thousands of markets because it can afford to due to its low fuel bill, whereas the other airlines have been dying at those fare levels because of their skyrocketing fuel bills.


User currently offlineDTWAGENT From United States of America, joined Jan 2006, 1283 posts, RR: 0
Reply 12, posted (6 years 7 months 1 week 18 hours ago) and read 6012 times:

Ok as for the questions on fuel burn. I don't know. That is why I was just suggesting that it might be something to look at. And as for the money thing. PLEASE don't go to the DL employees for more money give back. What I was trying to say is that NWA can't and should not ask for anymore money from it's employees. Everyone has give as much as possible. But, what about the upper management???

Like I said I don't have figures for every thing I typed in. I was just suggesting that maybe these are the areas that could be looked at. That is all

chuck


User currently offlineTVNWZ From United States of America, joined Feb 2006, 2398 posts, RR: 2
Reply 13, posted (6 years 7 months 1 week 17 hours ago) and read 5829 times:



Quoting Commavia (Reply 2):
Personally, I'd say Northwest has far more to worry about than Delta - since the fundamentals of their business model are far less visionary in their scope,

About that vision thing: DL's vision is to increase flying across the Atlantic. In theory, that should work. But, in the past, an economic downturn in this country hits Europe a little later. That could put a crimp in their plan, or make them adjust it if Europe's economy takes a hit like the USA economy is doing now. DL to Africa is nice, but Africa always takes a major hit when the world economy goes south.

I believe NW's routes to Asia are actually more helpful, and the big reason DL wants to hook up with NW. While Asia will take a hit in a global economic slowdown I don't think it will be as significant as elsewhere. And remember, today, some of our economic ills are because of their economic boom. If NW can exploit Asia significantly then, in my opinion, they are well positioned.


User currently offlineCommavia From United States of America, joined Apr 2005, 11752 posts, RR: 62
Reply 14, posted (6 years 7 months 1 week 17 hours ago) and read 5744 times:



Quoting TVNWZ (Reply 13):
DL's vision is to increase flying across the Atlantic. In theory, that should work. But, in the past, an economic downturn in this country hits Europe a little later. That could put a crimp in their plan, or make them adjust it if Europe's economy takes a hit like the USA economy is doing now.

I agree. Adding flights to Europe isn't exactly visionary, and indeed, you are right, if the E.U. economy slows down, Delta is now more exposed to that slow-down and will feel it disproportionately more than other U.S. carriers with less presence in that market. In addition, another potential pitfall of the Delta "go global" strategy is fuel prices. Holding all other costs constant, and looking just at fuel, it's obvious why a strategy of longhaul flying to buoy the rest of the network may have problems in an unprecedentedly high-cost fuel environment: Delta's longhaul routes gobble up far more fuel than do shorter flights. In addition, the other (some would say) elephant in the room that nobody wants to talk about is terrorism. If (some would say "when") there is another terrorist attack, anywhere in the world, I think it is very safe to assume that international travel will be hit far more than domestic travel, and will also take longer to recover. And if, God forbid, there is another attack, and it takes place somewhere like, lets say, Europe, than traffic to that region is going to fall far more than intra-U.S. domestic traffic. This, too, will obviously have a far greater impact on an airline like Delta that now has a far higher relative exposure to international markets (like Europe) versus domestic.

Delta's strategy of adding international flights, in and of itself, isn't visionary. I concur.

What I was referring to is the general feeling at Delta these days. The company seems energetic, innovative and excited. Things are looking up. And that's really a big thing - you can't put a value on it, but it makes a huge difference in customer service, management leadership, and innovating thinking and creative solutions to challenging problems. We need look no further than some other legacy carriers - Northwest, United, and to a lesser extent, AA - to see what happens when there is no such excited, passionate visionary feeling among the workforce: horrible service, bitter people and stagnant management.

But, alas, all that being said, as you pointed out - and I agreed - the good deal Delta has going could all easily come tumbling down in about 2 seconds if any one of a million different things goes wrong.

Quoting TVNWZ (Reply 13):
DL to Africa is nice, but Africa always takes a major hit when the world economy goes south.

I'd say Africa was actually the smartest of DL's moves, as it really is a market they can dominate. They face next to no competition at all in the U.S.-Africa market, which helps a lot.

Quoting TVNWZ (Reply 13):
I believe NW's routes to Asia are actually more helpful, and the big reason DL wants to hook up with NW. While Asia will take a hit in a global economic slowdown I don't think it will be as significant as elsewhere. And remember, today, some of our economic ills are because of their economic boom. If NW can exploit Asia significantly then, in my opinion, they are well positioned.

I disagree.

I have long been arguing that NW's Asian network is getting less and less valuable, and indeed more and more irrelevant, by the day. As U.S. carriers continue to use new aircraft (the 777) to overfly Tokyo, NW's almost complete reliance on NRT as their hub to Asia is becoming less and less competitive. United's strategy to Asia has been far, far smarter and more far-sighted in the last 10 years: they have slowly reduced their dependence on Tokyo and instead built up nonstop flights from their U.S. hubs (especially ORD and SFO) right to points in Asia like HKG, ICN, PEK, PVG, etc. That is the strategy that will last in the future, not continuing to just shrink the aircraft size and still route all your passengers heading to Asia over NRT, which in many if not most cases will require a double-connection.


User currently offlineFlyguy1 From United States of America, joined Jun 1999, 1740 posts, RR: 4
Reply 15, posted (6 years 7 months 1 week 17 hours ago) and read 5730 times:



Quoting WorldTraveler (Reply 5):
There won't be huge risks - and probably no commitments to build a new terminal at JFK

This is something that will have to be addressed at some time, as this terminal cannot last forever in its current form.



727, L1011, MD80, A300, 777-200, 737-300, 737-700, 747-400, 757-200, 737-800, A320. E190, E135, 767-200, CRJ9
User currently offlineWorldTraveler From , joined Dec 1969, posts, RR:
Reply 16, posted (6 years 7 months 1 week 16 hours ago) and read 5569 times:



Quoting TVNWZ (Reply 13):
DL's vision is to increase flying across the Atlantic. In theory, that should work. But, in the past, an economic downturn in this country hits Europe a little later.

however, this downturn is very US focused as a result of US credit and mortgage problems. The downturn is not as likely to be a global downturn but a US one. The reason the Fed is working so hard to fix the credit problem is because the US will lose a substantial amount to other economies if the US slips into a recession (or is in one) while other economies are not.

Because the Fed is using lower interest rates to stimulate the US economy but the EU is not matching, the stronger Euro makes the US a valuable vacation destination for Europeans. DL has the most EU denominated sales of any US airline and thus benefits more than other carriers from the weak dollar/strong Euro. At the same time, Americans are continuing to travel to Europe; some travel is prepaid and under contract from when the exchange rate was more favorable and some is Euro-Americans returning to visit family and this type of travel is less sensitive to currency swings.

DL's transatlantic RASM growth is outpacing the industry even though DL is adding more capacity across the Atlantic than any other airline. Adding capacity to Europe does make sense now but may not make as much sense if the dollar/Euro relationship returns to what it used to be. Since DL's entire transatlantic operation except for sub-Saharan Africa and India will become part of the AF-DL joint venture within a couple years, DL has the potential to see traffic continue to grow as AF has the incentive to put more passengers on DL planes. Only NW has a comparable arrangement.

On the other hand, NW benefits the most from the weak dollar/strong yen relationship since they are the strongest US carrier to Japan. However, the Japanese economy is not growing as much as the Euro economies and are thus not able to offset the dollar weakness to the same degree.

Quoting Commavia (Reply 14):
another potential pitfall of the Delta "go global" strategy is fuel prices

actually, no. Fuel prices are generally the same around the world. And international flights and fares have fuel surcharges which more adequately reflect the changing cost of fuel. US airlines recover only about 1/3 of the increased cost of fuel on domestic flights but about 2/3 on intl flights.

Quoting Commavia (Reply 14):
Delta's strategy of adding international flights, in and of itself, isn't visionary

and you propose .....?

let me help. a) parking airplanes b) continuing to slug in out in the domestic marketplace using aircraft that are too big and are actually capable of flying international flights or c) allowing other carriers to grow in international markets while DL sits still or d) ......?

The world is growing more global. DL's international growth plan is as visionary as CO's was in the late 90s and early 00s. However, CO focused on far western Europe using 757s and elsewhere largely by flying to destinations which were served by other US airlines.

DL's international growth plan is focusing growth on markets which are not and often have not been served by any US airline. DL is tapping into demand for air travel in markets which provide far more growth potential than in markets served by most other US airlines.

Quoting Commavia (Reply 14):
I have long been arguing that NW's Asian network is getting less and less valuable, and indeed more and more irrelevant, by the day.

and every delay on the 787 is a further blow to NW's attempts to correct its Pacific strategy. CO and DL still are growing as they take 777s which are being built and delivered on time.

Quoting Flyguy1 (Reply 15):
this terminal cannot last forever in its current form

agree.. but DL is not going to sink itself in order to replace it. The fix will be costly. DL will have to do it from a position of strength.


User currently offlineCommavia From United States of America, joined Apr 2005, 11752 posts, RR: 62
Reply 17, posted (6 years 7 months 1 week 16 hours ago) and read 5559 times:



Quoting Flyguy1 (Reply 15):
This is something that will have to be addressed at some time, as this terminal cannot last forever in its current form.

That is probably the largest single capex commitment DL is going to have to make in the next five years.

If DL is serious about success and growth at JFK - which I have no doubt they are - they simply will not be able to ignore this issue much longer.

DL has made some minor cosmetic changes at JFK in the last 12-18 months, giving walls fresh coats of paint, replacing light bulbs, etc., but they still have not addressed the much larger problem that the terminal is decades-old (and looks it) and is far, far too small for the operation Delta is trying to cram through it.

This problem is going to be exacerbated further by the competitive disparity between DL and its two largest competitors at JFK (JetBlue and AA) as AA now has the largest, newest and nicest terminal at the airport, the new T8 complex, and JetBlue is about the open their brand new terminal in a matter of months. This gives both AA and JetBlue not only far nicer, cleaner and more modern terminals and far superior ground service product offerings, but it also gives both companies room to expand and grow should they choose. Delta, by contrast, has 0 room to expand, and indeed, is already operating their terminal at far above its designed capacity: that terminal wasn't built to handle nearly as much traffic as it does today.


User currently offlineDeltaL1011man From United States of America, joined Sep 2005, 9559 posts, RR: 14
Reply 18, posted (6 years 7 months 1 week 15 hours ago) and read 5195 times:



Quoting LAXdude1023 (Reply 4):
They will probably cut ATL down a bit, but thats fine. That airport has so many flights, they wont even notice.

Most flights will be ASA and I think we will see Q-400s or more ATRs in there fleet to fly some shorter routes out of here.

Quoting Flyguy1 (Reply 15):
This is something that will have to be addressed at some time, as this terminal cannot last forever in its current form.

 checkmark   checkmark   checkmark 



yep.
User currently offlineWorldTraveler From , joined Dec 1969, posts, RR:
Reply 19, posted (6 years 7 months 1 week 14 hours ago) and read 5137 times:



Quoting Style (Reply 6):
Fact is, DL is no 'greater' than you make them out to be

I think you just said that DL lives up to the billing I give them. I agree. I speak quite highly - but realistically of DL and then don't disappoint.

Quoting Style (Reply 6):
They are not immune

never said they weren't... but they are very capable of responding to the changing environment and doing so quickly.

Quoting Style (Reply 6):
significantly better positioned that anybody else

I will have to disagree here. Every network US carrier has shown benefit from shifting capacity out of the US market and into international markets. DL has done that more than other carriers and has more capability to do more shifting than any other airline. Add in that DL has best in class costs and is now reporting RASM very close to industry average across their system and I don't think anyone could argue that DL is not very well positioned, perhaps bettr than other carriers.

Quoting DTWAGENT (Reply 9):
I think DL has a better chance at making it through this current storm the NWA

I don't think either DL or NW are at risk of not making it through although success will occur differently. NW will survive. DL will thrive.

Quoting Bobnwa (Reply 10):
Are you sure that the total cost of flying a paid for DC-9 is more than flying a new aircraft that has loan payments due every month?

that infomration is regularly reported in Aviation Daily for each aircraft type and airline based on DOT data.

Data from last fall (the latest quarter reported) showed that NW's costs for operating the DC9 were not comparable with other carriers and fuel has increased quite a bit since then.

Quoting Commavia (Reply 17):
If DL is serious about success and growth at JFK - which I have no doubt they are - they simply will not be able to ignore this issue much longer.

I don't disagree that something needs to be done but people here put way too much focus on terminals at JFk at the exclusion of what exists at other terminals. How about 10 miles away at LGA? DL and US have had far better terminals at LGA while just about everyone else is packed into the central terminal building. AA's facilities at ORD don't hold a candle to UA's. AA's terminal for decades was inferior to DL's at LAX and AA didn't fall off the map there.

DL will fix its JFK terminal situation and I will be one of the first to applaud when they tell us how. But until then, DL will compete aggressively and successfully.


User currently offlineBobnwa From United States of America, joined Dec 2000, 6496 posts, RR: 9
Reply 20, posted (6 years 7 months 1 week 14 hours ago) and read 5114 times:



Quoting WorldTraveler (Reply 19):
Data from last fall (the latest quarter reported) showed that NW's costs for operating the DC9 were not comparable with other carriers and fuel has increased quite a bit since then.

I don't think the aviation daily figures included finance or lease costs in them. Just about all newer jets have one or the other. the DC-9s have neither.


User currently offlineCommavia From United States of America, joined Apr 2005, 11752 posts, RR: 62
Reply 21, posted (6 years 7 months 1 week 14 hours ago) and read 5080 times:



Quoting WorldTraveler (Reply 19):
I don't disagree that something needs to be done but people here put way too much focus on terminals at JFk at the exclusion of what exists at other terminals.

We had a thread about this a few months back.

And back then, there were several who offered their perspectives on this issue: that DL's terminal was such a horrific experience that they would, indeed, avoid DL through JFK and consciously select another carrier just to avoid the hassle. And these people are not alone. There's a big difference between having merely an old, dirty, outdated terminal (fading paint, 80s design, etc.) and having a terminal that is simply miserably chaotic (cramped space, Soviet-era facilities, etc.). Delta's T2/T3 complex at JFK is largely the latter.

That terminal has got to be fixed, and soon, or it will begin to impede DL's ability to expand and profitably operate at JFK.

Quoting WorldTraveler (Reply 19):
AA's terminal for decades was inferior to DL's at LAX and AA didn't fall off the map there.

Interesting that you mention LAX. What else has happened at LAX vis-a-vis DL/AA somewhat simultaneous to AA's renovating its terminal (T4) to become the airport's nicest? In the last ten years, AA has gone from #4 at LAX to #2 (and actually #1 when it comes to mainline ops) while DL has gone from #2 to #4. Food for thought.

Quoting WorldTraveler (Reply 19):
But until then, DL will compete aggressively and successfully.

Good luck. There's nowhere else to go, especially between 1400 and 2200 everyday. The T2/T3 complex is absolutely stretched to the max - and is already far exceeding what it was designed to handle.


User currently offlineDeltaL1011man From United States of America, joined Sep 2005, 9559 posts, RR: 14
Reply 22, posted (6 years 7 months 1 week 14 hours ago) and read 5050 times:



Quoting Bobnwa (Reply 20):
I don't think the aviation daily figures included finance or lease costs in them. Just about all newer jets have one or the other. the DC-9s have neither.

Your point is the same point NW made not to long ago when someone asked about the 9s. They said there paid for which makes its completable to other jets of its size.



yep.
User currently offlineMariner From New Zealand, joined Nov 2001, 25432 posts, RR: 86
Reply 23, posted (6 years 7 months 1 week 14 hours ago) and read 5025 times:
Support Airliners.net - become a First Class Member!

Quoting SLCUT2777 (Thread starter):
Can airlines such as DL, UA or HP+US who have all been through recent bankruptcies deal with this economic pitfall?

It doesn't really matter, does it?

If necessary, they'll just go Chapter 11 again and the cycle will repeat itself.

mariner

[Edited 2008-03-23 11:31:25]


aeternum nauta
User currently offlinePanamair From United States of America, joined Oct 2001, 4927 posts, RR: 25
Reply 24, posted (6 years 7 months 1 week 14 hours ago) and read 4996 times:
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Quoting TVNWZ (Reply 13):
DL's vision is to increase flying across the Atlantic. In theory, that should work. But, in the past, an economic downturn in this country hits Europe a little later. That could put a crimp in their plan, or make them adjust it if Europe's economy takes a hit like the USA economy is doing now.

Actually, DL's increase in transatlantic flying in the next few years is focused on Africa, Middle East, and parts of Asia. If you look at their plan, Europe will become a smaller percentage of their total international operations (not necessarily by cutting Europe, but rather by growing the other areas faster than Europe). If you look at DL's network these days, Europe will soon be hitting a saturation point anyway - there aren't that many more viable new cities to serve.

In terms of European economies taking a hit like the US, while I don't necessarily disagree that Europe and the US are still joined at the hip, the rest of the world is on a path now that is less and less dependent on the US. Assuming the emerging economies continue to grow (and not derail - either by themselves or other conditions), trade ties say between Europe and Asia, or between Europe and South America will continue to increase and some of it will start to replace those that Europe has with the U.S. Hence, it is entirely conceivable that in the upcoming recession that Europe and other global economies would be less affected by the US downturn than they have been in the past.


25 Bobnwa : Thank you, that is the point I am trying to make.. BTW, the word is "they're" not "there".
26 DeltaL1011man : anytime my bad Anyone know what the options are for the JFK terminal? I know DL is still looking at the 2000 plan but its a little small. What are th
27 TwinOtter : Which begs the question you ignore: What are the "fundamentals of their busines model" (Delta) and what are the fundamentals of NWA business model? H
28 Incitatus : The correct historical perspective is that Delta borrowed a book (and a few brains?) out of Continental's visionary strategy. Delta had the hardware,
29 ScottB : To be completely fair, Delta's strategy worked extremely well up through 2000. Delta piled up profits of $3.3 billion between 1998 and 2000; with the
30 EA CO AS : At what price point, though? With oil trading above $100.00/bbl, I don't see much likelihood for hedges anywhere south of the mid 90s for awhile. Tel
31 WorldTraveler : ownership costs are included in those figures. All of the data is culled from DOT reports. The higher cost of fuel on the DC9 more than offsets the o
32 SLCUT2777 : Ever noticed how much more you spend on vehicle maintenance after the car hits 5-7 years typically? Well this is the problem NW has faced for years w
33 STT757 : The problem with investing in JFK is that it is now restricted to 83 flights per hour, which has to be shared by AA, B6, DL and all the other Internat
34 WorldTraveler : But NW does not fly 5-7 year old cars. The DC9/MD80 fleet is very durable and has low maintenance costs compared with other aircraft of similar age.
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