|Quoting Jumbojet (Reply 4):|
It seems as if Delta is on a spiraling wand of destruction that will only end with its liquidation. Its bad news after bad news. I realize that Ch. 11 isn't a fun place to be nor does it breed much good news, but comparing all the legacies that have been in or or currently in ch. 11, Delta seems to be fairing the worst. Almost as if its to late to stop a liquidation. I sure as heck hope it doesn't happen, and if I could have one wish for Christmas, it would be for Delta to emerge from ch. 11 a better and more strongly oranized airline.
Bear in mind that DL
is currently in a battle to cut pilot costs so it certainly doesn't hurt them to publish numbers like that that give a real sense of urgency. When people don't bother to look into the details, headlines like "Delta loses $1.1 billion in 6 weeks" certainly conveys a sense of doom. I'm not saying that DL
is fudging the numbers but it's the way these numbers are communicated. If you look closely, about $660 million of the total loss are in bankruptcy-related charges. The loss before reorganization items was about $472 million. Yes, the numbers are bad but don't forget this was also the period where the post-Katrina effects hit hardest (where jet fuel was over $3 a gallon; it has since moderated to about $1.70 a gallon). Also, non-pilot cost cuts of $605 million annually also went into effect in November, after this reporting period.
's numbers when they went into Ch.11 were horrific as well. With bankruptcy-related charges, UA
was showing a net loss of over $600 million in October 2005 alone. Extrapolate that to the same six-week period that DL
is reporting, you would get about $900 million net loss for UA
in 6 weeks, not far behind DL
's $1.16 billion. So yes, the net loss number looks horrible but you really need to look at the operational numbers more importantly. Starting with November 2005, DL
will be reporting monthly financial/operating numbers as well...that would be interesting to watch as well.