FlyPNS1
Topic Author
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DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 12:24 am

Delta has issued an RFP to potentially replace flying currently done by Comair, Chautauqua, Shuttle America and Freedom (Mesa).

http://biz.yahoo.com/pz/060822/104142.html

This had been rumored for a while. It's likely this RFP will be used to put pressure on the regionals that DL is not happy with. Notably, Comair and its labor problems and Mesa and its reliability problems. There's also been rumor that DL hasn't been thrilled with S5's E170's in terms of fuel burn and cost.

Let the RJ games begin.
 
COERJ145
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 12:41 am

Q300s/Q400s coming to replace the CRJs?  scratchchin 
 
FutureFO
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 1:03 am

The only one that will be replaced is Freedom. DL is extremely happy with the E70's and also the ERJ's. OH tho may get significantly reduced.


Sean
I Don't know where I am anymore
 
FlyPNS1
Topic Author
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 1:08 am

Quoting FutureFO (Reply 2):
The only one that will be replaced is Freedom. DL is extremely happy with the E70's and also the ERJ's. OH tho may get significantly reduced.

You may be right, but none of the regionals in this press release are assured of anything. If DL was so happy with the ERJ/E70, your contract would alread have been affirmed through the BK courts. DL has not done so for a reason. The RP/S5 contracts were signed at a different time when DL wasn't in BK and would accept higher costs. If your costs are too high, you can be replaced.

If you look at the press release, DL specifically targets the E70s by mentioning 43 70-seat RJ's up for rebid (27 CRJ700's from Comair and 16 E70's from S5).
 
S5FA170
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 1:15 am

This doesn't mean that Delta is unhappy with us. We have known as a company that this was coming since the day Delta Air Lines filed for bankruptcy. Delta has always been pleased with the Embraer 170 (despite its early teething problems) and the customer reaction to the aircraft has been incredibly positive, and is something Delta shouldn't overlook.

If anything, this is a big opportunity for us to grow as a Delta Connection carrier. We offer a very competitive cost structure against other regional airlines, and I have total faith and confidence in our management team to prove to Delta Air Lines that we are a valuable asset to their DCI program.

-Tony
Prepare doors for departure and cross-check.
 
worldtraveler
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 1:17 am

Completing the regional flying restructuring is one of the last major things DL needs to do. They will cut their regional jet flying costs and will get the quality that several of their carriers do not currently provide.

And Comair's flight attendants will quickly find that they will be out of work if they don't get with the program.
 
CRJ900
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 1:19 am

The RFP also include 50 x 76-seat aircraft with first class cabins... let the race begin between the E175 and the CRJ900. I'm sure both aircraft manufacturers are gearing up for such a lucrative order.
Come, fly the prevailing winds with me
 
luv2fly
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 1:36 am

Quoting WorldTraveler (Reply 5):
Completing the regional flying restructuring is one of the last major things DL needs to do. They will cut their regional jet flying costs and will get the quality that several of their carriers do not currently provide.

And Comair's flight attendants will quickly find that they will be out of work if they don't get with the program.

You also in the end will get what you pay for - and or do not want to pay for! Mesa being one example of wanting the cheapest.
You can cut the irony with a knife
 
Delta787
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 1:50 am

Quoting CRJ900 (Reply 6):
The RFP also include 50 x 76-seat aircraft with first class cabins... let the race begin between the E175 and the CRJ900. I'm sure both aircraft manufacturers are gearing up for such a lucrative order.

There are already several CR9s that are entering service with Skywest in the fall for Delta Connection.
Fly Delta!
 
FutureFO
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 1:57 am

Right now I believe there are 2 CR9's in service with DL, more of a CR705 than a true CR9. But as far as getting the E175's on for DL, RAH would be the ones to turn to, as S5 is the only current operator of the E-jet family for DL. The ERJ's are more comfortable than the CRJ, so I would hope that they reduce the CRJ flying.



Sean
I Don't know where I am anymore
 
nwa757boy
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 2:17 am

Also heard through the rumor mill that XJT may be picking up some DLX flying.....
 
Alitalia744
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 2:21 am

Quoting NWA757boy (Reply 10):
Also heard through the rumor mill that XJT may be picking up some DLX flying.....

Is this expressJet? (Sorry just don't know). If so, I wouldn't mind, the one thing I'll say about expressJet is their professional and I prefer the ERJ to the CRJ any day of the week.
Some see lines, others see between the lines.
 
nwa757boy
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 2:25 am

yes XJT is expressJet.....yes XJT has some mighty fine service
 
SHUPirate1
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 2:42 am

Quoting FlyPNS1 (Thread starter):
Delta has issued an RFP to potentially replace flying currently done by Comair, Chautauqua, Shuttle America and Freedom (Mesa).

http://biz.yahoo.com/pz/060822/104142.html

This had been rumored for a while. It's likely this RFP will be used to put pressure on the regionals that DL is not happy with. Notably, Comair and its labor problems and Mesa and its reliability problems. There's also been rumor that DL hasn't been thrilled with S5's E170's in terms of fuel burn and cost.

Let the RJ games begin.

Ummmm...doesn't Delta Air Lines still own Comair?
Burma's constitutional referendum options: A. Yes, B. Go to Insein Prison!
 
luv2fly
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 2:47 am

Quoting SHUPirate1 (Reply 13):
Ummmm...doesn't Delta Air Lines still own Comair?

Yes they do. Though I thought they wanted to unload them.
You can cut the irony with a knife
 
okie73
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 2:47 am

Quoting SHUPirate1 (Reply 13):
...doesn't Delta Air Lines still own Comair?

Yes, but both Grinstein and Whitehurst have been quoted as saying it doesn't make sense to own your regionals. CMR will be sold either whole or in parts, but Delta will get rid of them.
 
FlyPNS1
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 2:56 am

Quoting SHUPirate1 (Reply 13):
Ummmm...doesn't Delta Air Lines still own Comair?

DL does own Comair, but they can still make Comair compete for regional flying. If Comair fails to compete, DL can liquidate Comair even in whole or piece by piece. Not a particularly great return on investment (considering what DL paid for Comair), but that's business.
 
luv2fly
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 2:59 am

Quoting FlyPNS1 (Reply 16):
DL does own Comair, but they can still make Comair compete for regional flying. If Comair fails to compete, DL can liquidate Comair even in whole or piece by piece. Not a particularly great return on investment (considering what DL paid for Comair), but that's business.

Did they not take a big loss in getting rid of ASA.
You can cut the irony with a knife
 
toltommy
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 2:59 am

This may also give DL the opportunity to reject a number of leases for the Comair CRJ fleet. If DL dumps Shuttle, there's nobody else to provide E170 flying. They can play CHQ vs COEX to get costs lowered on the ERJ fleet. I'm sure somebody at Mesaba just saw the light go on at the end of the tunnel. Mesaba invested heavily to get the CRJ added to their ticket, only to have NWA pull the rug out on 'em. Mesaba's current costs are likely below Comair's current. If Mesaba is successful in getting any further cost reductions from employees, they could be a thorn in Comair's side.
 
ah414211
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 3:00 am

Quoting FutureFO (Reply 9):
Right now I believe there are 2 CR9's in service with DL, more of a CR705 than a true CR9. But as far as getting the E175's on for DL, RAH would be the ones to turn to, as S5 is the only current operator of the E-jet family for DL. The ERJ's are more comfortable than the CRJ, so I would hope that they reduce the CRJ flying.



Sean

The CR9s are not in service yet--they will start service in 2-3 weeks
 
CRJ900
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 3:45 am

Quoting Ah414211 (Reply 19):
The CR9s are not in service yet--they will start service in 2-3 weeks

SkyWest "only" has 17 of them on order, so what are chances that there will be 33 more ordered, to make the 50 aircraft the article mentions?
Come, fly the prevailing winds with me
 
jetlanta
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 3:50 am

Quoting FlyPNS1 (Reply 3):

You may be right, but none of the regionals in this press release are assured of anything. If DL was so happy with the ERJ/E70, your contract would alread have been affirmed through the BK courts. DL has not done so for a reason. The RP/S5 contracts were signed at a different time when DL wasn't in BK and would accept higher costs. If your costs are too high, you can be replaced.

This is a valid point. Operating costs for the E70 have been far higher than anticipated. It is a more expensive airplane to operate than promised when the contract was signed. CRJ 705 offers more seats, similar performance and superior economics. The E 170 is a great plane, but there is a price to pay for all that comfort. Delta would love to keep them, but the economics need to get better, and part of that may come out of Republic's hide.
 
ATWZW170
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 7:33 am

I think the day of the airlines looking for the lowest bid are just about over. With air travel being up, load factors very high - a poor performing express carrier can in fact hurt your bottom line and turn passengers away. I think Mesa is going to have to clean up their act in a big way. There are many carriers looking for work, ExpressJet, Air Wisconsin, Mesaba - all of which provide a good product and can start service rather quickly. I'd be very nervous if I was Mesa.
Success is getting what you want...happiness is liking what you get
 
B4REAL
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 7:37 am

Quoting Okie73 (Reply 15):
Yes, but both Grinstein and Whitehurst have been quoted as saying it doesn't make sense to own your regionals. CMR will be sold either whole or in parts, but Delta will get rid of them.

Should they say this, I disagree. AMR owns American Eagle, and I think that to be successful.
B4REAL, spelled like it sounds
 
jetlanta
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 7:41 am

Quoting B4real (Reply 23):
Should they say this, I disagree. AMR owns American Eagle, and I think that to be successful.

You make think so, but you'd probably be wrong. Scope clause limits what AA can do today. You can bet they'd love to shop their RJ flying around.
 
luv2fly
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 7:58 am

Quoting ATWZW170 (Reply 22):
I think the day of the airlines looking for the lowest bid are just about over. With air travel being up, load factors very high - a poor performing express carrier can in fact hurt your bottom line and turn passengers away. I think Mesa is going to have to clean up their act in a big way. There are many carriers looking for work, ExpressJet, Air Wisconsin, Mesaba - all of which provide a good product and can start service rather quickly. I'd be very nervous if I was Mesa.

I have to second this statement.
You can cut the irony with a knife
 
wjcandee
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 8:39 am

Quoting S5FA170 (Reply 4):
If anything, this is a big opportunity for us to grow as a Delta Connection carrier. We offer a very competitive cost structure against other regional airlines, and I have total faith and confidence in our management team to prove to Delta Air Lines that we are a valuable asset to their DCI program.

What a refreshing attitude! Congratulations!

Compare this guy's attitude to the thread on the NW f/a's. Old-style thinking versus today's thinking.
 
FlyPNS1
Topic Author
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 8:58 am

Quoting ATWZW170 (Reply 22):
I think the day of the airlines looking for the lowest bid are just about over. With air travel being up, load factors very high - a poor performing express carrier can in fact hurt your bottom line and turn passengers away. I think Mesa is going to have to clean up their act in a big way. There are many carriers looking for work, ExpressJet, Air Wisconsin, Mesaba - all of which provide a good product and can start service rather quickly.

I hope you are right. The bottomline is that there are too many 50 seat RJ operators looking for work and not enough demand for 50 seaters. Someone is going to lose and find many of their planes parked in the desert.

One note, the press release makes no mention of replacing the prop flying done by Mesa. I believe the contract for the Dash-8 flying has already been affirmed in bankruptcy (since the deal was done while DL was in BK). Therefore, DL may be stuck with the Dash-8 flying. However, the Freedom ERJ flying at MCO is fair game.
 
lowrider
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 9:22 am

Quoting Wjcandee (Reply 26):
Compare this guy's attitude to the thread on the NW f/a's. Old-style thinking versus today's thinking

Probably a young, inexperienced one at that, who has not spent the past few years with constant demands for pay cuts, threats of furloughs, bankruptcy and just generally being demoralized. Wait until he gets asked for a significant pay cut in order to get this flying.

The contracted lift RJ game is, and will continue to be, about lowest cost. On time performance, customer satisfaction, and aircraft type are all secondary. If it wasn't, then these aircraft would be operated by the main line carriers. So long as someone will do it cheaper (read Mesa here), what ever flying your carriers currently has is not safe. Once upon a time, quality and performance my have counted, but not any more.
Proud OOTSK member
 
FCYTravis
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 9:29 am

Quoting FlyPNS1 (Reply 27):
However, the Freedom ERJ flying at MCO is fair game.

Freedom is not just at MCO anymore. They've spread throughout the system, including a substantial ATL operation.
USAir A321 service now departing for SFO with fuel stops in CAK, COS and RNO. Enjoy your flight.
 
ksupilot
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 11:38 am

Quoting CRJ900 (Reply 20):
SkyWest "only" has 17 of them on order, so what are chances that there will be 33 more ordered, to make the 50 aircraft the article mentions?

Would they order more CRJ900s when there could be a CRJ900X. Would Sky West be interested in a 100 seat RJ?
 
N839MH
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 1:24 pm

We would love to see S5 leave DFW...ever since they have operated the
LGA-DFW-LGA, service has been deplorable at best. They have bratty little
pilots who don't want to fly if its past their bed time...i.e late ops going back to LGA and are told to fly to JFK...many times Delta has had to cxl flights to NYC (LGA) because the pilots refusal to fly to JFK and their ops didn't want the plane in JFK. S5's attitude is "the hell with the passengers!"

S5 and their service to DFW is a very costly operation based on the number of inconvience passengers we have to rebook on AA. Their flights have been late 46% of the time in/out of DFW since April.

Sure wish Delta would bring back mainline flights!!!!! If not..Delta would be better off not offering service provided by S5.
Solodude!
 
avconsultant
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 2:00 pm

Quoting NWA757boy (Reply 10):
Also heard through the rumor mill that XJT may be picking up some DLX flying.....

They have 60+ aircraft being removed from CO. They're attempting a European partnership, but if there's an opening within DL they will definitely bid along with Air Wisconsin.

Quoting Okie73 (Reply 15):
Yes, but both Grinstein and Whitehurst have been quoted as saying it doesn't make sense to own your regionals. CMR will be sold either whole or in parts, but Delta will get rid of them.



Quoting FlyPNS1 (Reply 16):
DL does own Comair, but they can still make Comair compete for regional flying. If Comair fails to compete, DL can liquidate Comair even in whole or piece by piece. Not a particularly great return on investment (considering what DL paid for Comair), but that's business.

Don't forget the pilots and mechanics pulled their agreements, OH has started over from scratch with contract labor. DL wrote down the valuation of EV & OH in late 2004. Someone posted this is an opportunity to void the leases. Good point.

Quoting N839mh (Reply 31):
We would love to see S5 leave DFW...ever since they have operated the
LGA-DFW-LGA, service has been deplorable at best.

Deplorable, huh? I'm sure the poor ba$tard in SAT last Saturday agrees with you. What was up with that?
 
CRJ900
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 6:56 pm

Quoting KSUpilot (Reply 30):
Would they order more CRJ900s when there could be a CRJ900X. Would Sky West be interested in a 100 seat RJ?

That would be wonderful, but who would they fly them for? 100 seats is "mainline territory", isn't it?
Come, fly the prevailing winds with me
 
DAL767400ER
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 7:19 pm

Quoting CRJ900 (Reply 33):
That would be wonderful, but who would they fly them for? 100 seats is "mainline territory", isn't it?

It is, and the new pilots contract call for any 100-seaters to be operated by mainline pilots, hence Skywest couldn't operate those for DL. Besides, that would also violate UA's scope clauses with Skywest as well.
 
peachair
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 8:46 pm

Quoting ATWZW170 (Reply 22):
I think the day of the airlines looking for the lowest bid are just about over. With air travel being up, load factors very high - a poor performing express carrier can in fact hurt your bottom line and turn passengers away. I think Mesa is going to have to clean up their act in a big way. There are many carriers looking for work, ExpressJet, Air Wisconsin, Mesaba - all of which provide a good product and can start service rather quickly. I'd be very nervous if I was Mesa.

Although you would surmise by looking at the word "RFP" that DL is looking for the low bidder, they do not have to look for the low bidder. Just as with any RFP in any business, the company has to look for the most benefit for bottom line vs cost. That doesnt always mean they pick the low bidder. I am certain that is only one part of the equation.
 
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SLCUT2777
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 8:47 pm

Quoting DAL767400ER (Reply 34):
It is, and the new pilots contract call for any 100-seaters to be operated by mainline pilots, hence Skywest couldn't operate those for DL. Besides, that would also violate UA's scope clauses with Skywest as well.

I believe it is 75-76 for both DL and UA if I recall correctly.
DELTA Air Lines; The Only Way To Fly from Salt Lake City; Let the Western Heritage always be with Delta!
 
DAL767400ER
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 9:11 pm

Quoting SLCUT2777 (Reply 36):
I believe it is 75-76 for both DL and UA if I recall correctly.

Dl definitely is 76 (used to be 70 for years). Not sure about UA, but normally it should be in the same range.
 
lowecur
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 9:36 pm

Quoting FlyPNS1 (Thread starter):
There's also been rumor that DL hasn't been thrilled with S5's E170's in terms of fuel burn and cost.

I had no idea that DL has to pay for the 170 fuel burn and cost. And here I thought DL pays a block cost that is predetermined by contract. Silly me.
 
okie73
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 9:40 pm

Quoting Jetlanta (Reply 24):
Scope clause limits what AA can do today. You can bet they'd love to shop their RJ flying around.

In the case of AA, I believe American Eagle does have scope assuring them the bulk of regional flying.

Quoting SLCUT2777 (Reply 36):
I believe it is 75-76 for both DL and UA if I recall correctly.

76 seats at DL. And a limit of 200 airplanes seating 70-76 seats.


I think UA is still at 70 seats, but no limit on the numbers.
 
jetlanta
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 9:47 pm

Quoting Lowecur (Reply 38):
I had no idea that DL has to pay for the 170 fuel burn and cost. And here I thought DL pays a block cost that is predetermined by contract. Silly me.

Delta pays for fuel as well, hence the issue.
 
FlyPNS1
Topic Author
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 9:55 pm

Quoting Lowecur (Reply 38):
I had no idea that DL has to pay for the 170 fuel burn and cost. And here I thought DL pays a block cost that is predetermined by contract. Silly me.

DL does pay a contractual block cost, however fuel is not part of the block cost. DL pays for fuel separately and has not been thrilled with the E170's fuel consumption. I know some on this board think the E170 is the end-all be-all plane for regionals...but it's not perfect.
 
lowecur
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 10:05 pm

Quoting Jetlanta (Reply 40):
Delta pays for fuel as well, hence the issue.

So does US Air, so what? DL says they want to get their costs in line with other carriers. You think that means that US Air might be paying less for block hours?.....I think so. The statement was made "fuel burn and cost." What other costs are we talking about?
 
lowecur
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 10:19 pm

Quoting FlyPNS1 (Reply 41):
DL does pay a contractual block cost, however fuel is not part of the block cost. DL pays for fuel separately and has not been thrilled with the E170's fuel consumption. I know some on this board think the E170 is the end-all be-all plane for regionals...but it's not perfect.

The E-jets are the end-all-be-all plane for regionals. Adjustments will be made for the block hour rates to coinside with US Airs rates. If DL is still not happy, I'm sure US Air or United would be glad to split the 170s between them, or NWA may jump on them. Perhaps they can bring in some Q400s to really cut fuel costs.
 
toltommy
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Wed Aug 23, 2006 10:33 pm

Quoting AvConsultant (Reply 32):

Don't forget the pilots and mechanics pulled their agreements

Not exactly. The pilot and mechanic agreements were contingent on the FA's also agree to a new contract. There were sunset provisions in the new agreements with those two groups. Since the FA's haven't agreed to concessions, the sunset provisions kicked in. The pilot agreement passed by just a few votes. Now that ALPA has seen that the FA's have a bigger pair, you can expect more resistance to concessions. Just another reason why the Comair flying was put out to bid.

Quoting FlyPNS1 (Reply 41):
DL pays for fuel separately and has not been thrilled with the E170's fuel consumption.

I've read that as well, especially when the planes were new. I've also heard on a pilot forum that the 170s now have a fuel burn rate below projections.
 
jetlanta
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Thu Aug 24, 2006 3:13 am

Quoting Lowecur (Reply 43):
The E-jets are the end-all-be-all plane for regionals. Adjustments will be made for the block hour rates to coincide with US Airs rates. If DL is still not happy, I'm sure US Air or United would be glad to split the 170s between them, or NWA may jump on them. Perhaps they can bring in some Q400s to really cut fuel costs.

My man, you are out of touch with reality here. This is a great airplane, but under no circumstances will it ever be more "cost-effective" than a comparable CRJ-705/900. It is just too damn heavy. Now it can have some revenue upside, but that is hard to define. It will never be the "end-all-be-all" as long as it is significantly more expensive to operate than its competitors. You might like to fly it, but airlines won't like to buy it.

Operators will not gladly take a block-hour rate cut just to be more competitive and make up for the disappointing fuel burn. If only it was that easy. These operators will hold onto every dime they can. US Airways and United are or will experience the same economics as Delta. Perhaps DL has lower-cost CR7/CR9 operators that only magnify the difference with the E70 and lead them down this road earlier. Or, since US and UA aren't in Chapter 11 and can't make a move like this, nobody has any idea how happy they REALLY are with the E70. Regardless, the jury is still out of the economics of the aircraft.

I suspect that the operators will take a little hit on block hour rates, but I also suspect you will not see a whole lot more E70's ordered by U.S. carriers, especially in markets where the CR7/CR9 can operate. Instead, you will see more orders for the larger versions of the E-jets. In fact, take a look at the US Airways order book and you will see that this is already happening.
 
MCOflyer
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Thu Aug 24, 2006 3:27 am

Why would ZW bid? Does ZW have enough planes?

MCOflyer
Never be afraid to stand up for who you are.
 
lowecur
Posts: 512
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Thu Aug 24, 2006 4:42 am

Quoting Jetlanta (Reply 45):



Quoting Jetlanta (Reply 45):
My man, you are out of touch with reality here. This is a great airplane, but under no circumstances will it ever be more "cost-effective" than a comparable CRJ-705/900. It is just too damn heavy. Now it can have some revenue upside, but that is hard to define. It will never be the "end-all-be-all" as long as it is significantly more expensive to operate than its competitors. You might like to fly it, but airlines won't like to buy it.

You lost me there pally. You see the 170 has 144 firm orders and 111 options to date. The propaganda on the Embraer website says: "The cost-effective use of the latest technologies makes the EMBRAER 170 the most efficient aircraft available in the 70-78 seat segment. The best structural efficiency, excellent fuel burn and outstanding aircraft maintainability characteristics provide significant cost advantages to airlines." They may not be the most fuel efficient ala the CRJ-705/900, but when you throw in ergonomics, mx savings of 30%, fleet commonality......airlines will choose the E-jets. Now if I see NWAC turn their nose up when ordering either the 170/175 in favor of the 705/900, then I will jump out the window of my bedroom on the first floor.

Quoting Jetlanta (Reply 45):
Operators will not gladly take a block-hour rate cut just to be more competitive and make up for the disappointing fuel burn. If only it was that easy. These operators will hold onto every dime they can. US Airways and United are or will experience the same economics as Delta. Perhaps DL has lower-cost CR7/CR9 operators that only magnify the difference with the E70 and lead them down this road earlier. Or, since US and UA aren't in Chapter 11 and can't make a move like this, nobody has any idea how happy they REALLY are with the E70. Regardless, the jury is still out of the economics of the aircraft.

You'd better check out Republics profits this Q pally. The money made was not just their small RJs. You should take time to read the press release when making your statements. DL has said they want their block hour leases to be in line with the present market which includes UAL and US Air. Don't forget, they were not on a long term lease with Republic, where UAL and US Air are.

As far as the jury being out on the E70. It sounds like you are the judge, jury, and hangman. The E70 will continue to be part of the future order book for no other reason that carriers that order the 175/190/195 want the commonality when ordering the 70 seat a/c.

Quoting Jetlanta (Reply 45):
I suspect that the operators will take a little hit on block hour rates, but I also suspect you will not see a whole lot more E70's ordered by U.S. carriers, especially in markets where the CR7/CR9 can operate. Instead, you will see more orders for the larger versions of the E-jets. In fact, take a look at the US Airways order book and you will see that this is already happening.

I just saw where Republic turned some of their options to 30 175s as they got a long term agreement with US Air. Could be they like the economics of the 175 better, or maybe they have enough 170s in service for the time being. In either case, all the Ejets will be the straw that stirs the 70-110 seat market in the next 10 years.

[Edited 2006-08-23 21:51:17]
 
FlyPNS1
Topic Author
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RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Thu Aug 24, 2006 5:10 am

Quoting Lowecur (Reply 47):
They may not be the most fuel efficient ala the CRJ-705/900,

Unfortunately, fuel is now the largest cost item for most airlines. So like it or not, fuel burn is important. And what happens if fuel spikes even higher? The economics of the E70 will get worse.

Quoting Lowecur (Reply 47):
ergonomics

This is the one place where the E70 is the big winner.

Quoting Lowecur (Reply 47):
mx savings of 30%

I don't think there's much evidence to support this and if you check the Bombardier website, they make similar claims about mx savings.

Quoting Lowecur (Reply 47):
fleet commonality

I don't see how this is an advantage for the E-Jets. For almost every carrier that orders the plane, it creates a new fleet type. Not to mention the lack of commonality between the E-Jets and the ERJ.

Quoting Lowecur (Reply 47):
You'd better check out Republics profits this Q pally. The money made was not just their small RJs.

True, but what do you think will happen to those profits when DL asks to have its rates cut by 20+%?

Quoting Lowecur (Reply 47):
The E70 will continue to be part of the future order book for no other reason that carriers that order the 175/190/195 want the commonality when ordering the 70 seat a/c.

The only problem with this logic is that the carriers who operate the E70/75 won't be the same carriers that operate the E90/95. The E70/75 will mostly be operated by regional affiliates. The E90/95 will be operated mostly by mainline carriers.

I like the E-Jet family a lot from a customer comfort perspective. But there are cold, hard economic realities that I think will prevent the E70 from having blockbuster sales. It will certainly gain some orders, but I think its sales potential has been overblown a bit.
 
lowecur
Posts: 512
Joined: Wed Jan 26, 2005 1:18 pm

RE: DL Issues New RJ RFP...could Replace OH/RP/S5

Thu Aug 24, 2006 5:21 am

NWA is the next big order. Lets see where it goes.

Let me see the 705/900 order book. If the 170/175 were such a big loser, this should be reflected in runaway sales for the 705/900.

As far as commonality goes, I believe NWA will have flow through on the 70 seat to 100 seat a/c, but I'm not sure.

[Edited 2006-08-23 22:23:15]