vega
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US May Increase Offer For DL..news

Mon Dec 18, 2006 4:10 pm

US may increase it's offer IF Delta can prove the stated value of $10-12B (down from an earlier $12B - $14B), which is expected in the Restructuring Plan due for public release on Tuesday.

http://www.marketwatch.com/News/Stor...e=blq%2Fyhoo&dist=yhoo&siteid=yhoo
We are but a moment in this vast Universe and when gone we will never have existed.
 
USAirPlatinum
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RE: US May Increase Offer For DL..news

Mon Dec 18, 2006 4:20 pm

Doug's not going to let this go without taking his best shot first. It's not a surprise -- the Airtran/Midwest and United/Continental moves are putting more pressure on US to drive things forward.
"Hey guys, Delta is OUR Delta right now." -- Unpaid Creditors
 
panamair
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RE: US May Increase Offer For DL..news

Mon Dec 18, 2006 6:46 pm

Quoting USAirPlatinum (Reply 1):
It's not a surprise -- the Airtran/Midwest and United/Continental moves are putting more pressure on US to drive things forward

That's the fallacy - the UA/CO deal won't go anywhere if there is no US-DL deal. Dougie created this upon himself when he started pursuing DL - this business is a "Whose is Bigger" business dating all the way back to Juan Trippe and Howard Hughes. Does he really think that Arpey, Tilton, Kellner, and Steenland would stand by and do nothing? The biggest irony of it all is that in an effort to satisfy his ego and become the BIGGEST, he would in effect be putting the "New Delta" back to #3 and in effect, have a network nowhere near as powerful as the other two.
 
gigneil
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RE: US May Increase Offer For DL..news

Mon Dec 18, 2006 8:14 pm

I think we're projecting the childish tendencies of this board onto a mature executive.

Who says he wants to be the biggest or even cares about that?

N
 
dutchjet
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RE: US May Increase Offer For DL..news

Mon Dec 18, 2006 8:24 pm

Quoting Gigneil (Reply 3):
Who says he wants to be the biggest or even cares about that?

Well size does matter.

Anyway, as the price that US will pay for Delta increases, the more dangerous all of this becomes......there is just so much that the proposed combined airline can handle financially. In any case, this is going to get more interesting before it hopefully (probably) all goes away.

US has one thing in its favor when it pitches its proposal to the creditors, the article states that the US proposal puts more cash into the creditor's pockets......creditors sometimes (I said sometimes, there are no rules here) are attracted to whatever deal puts the most money in their pocket and have little interest in the longer term advantages of taking an equity interest in the reorganized corporation.
 
panamair
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RE: US May Increase Offer For DL..news

Mon Dec 18, 2006 9:24 pm

Quoting Gigneil (Reply 3):
Who says he wants to be the biggest or even cares about that?

Why don't you read the investor presentations and the various comments by US officials in support of the merger? While being #1 is not the only goal, it has been used time and time again as a 'benefit' of the deal. In any case, the potential triggering of subsequent mergers amongst UA, CO, AA, NW cannot be discounted and when they do happen, the "New Delta" will be at a strategic disadvantage due to continued holes in the overall network structure.

Quoting Gigneil (Reply 3):
I think we're projecting the childish tendencies of this board onto a mature executive.

And if you think my comment was 'childish', you haven't been paying too much attention to the junk that has been spewed forth on this board and others for a while now... sarcastic 
 
norcal
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RE: US May Increase Offer For DL..news

Mon Dec 18, 2006 11:39 pm

Quoting Panamair (Reply 2):
That's the fallacy - the UA/CO deal won't go anywhere if there is no US-DL deal. Dougie created this upon himself when he started pursuing DL - this business is a "Whose is Bigger" business dating all the way back to Juan Trippe and Howard Hughes. Does he really think that Arpey, Tilton, Kellner, and Steenland would stand by and do nothing? The biggest irony of it all is that in an effort to satisfy his ego and become the BIGGEST, he would in effect be putting the "New Delta" back to #3 and in effect, have a network nowhere near as powerful as the other two.

 checkmark 
 
william
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RE: US May Increase Offer For DL..news

Mon Dec 18, 2006 11:49 pm

No the fallacy was getting the attention of Congress and the DOJ. Whats on DL side is if the plan is approved the creditors will get SOMETHING a whole lot faster than going US route which will be tied up in hearings on capital hill and court. If DL plays this right they can set themselves up as the sure thing vs US plan.
 
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deltadawg
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RE: US May Increase Offer For DL..news

Mon Dec 18, 2006 11:58 pm

Quoting DeltaGuy (Reply 7):
I love how Parker uses that word, synergies. You mean to say, fuck Delta people out of all they've worked for?

Exactly, couldn't have said it better.

Quoting USAirPlatinum (Reply 1):
Doug's not going to let this go without taking his best shot first. It's not a surprise -- the Airtran/Midwest and United/Continental moves are putting more pressure on US to drive things forward.

If nothing is able to happen on this deal until mid '07 and if DL's strategy of emerging from BK late spring/summer could DL throw this whole thing out the door at that time and continue unabbated?
GO Dawgs, Sic' em, woof woof woof
 
FlyPNS1
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 12:11 am

Quoting Panamair (Reply 2):
The biggest irony of it all is that in an effort to satisfy his ego and become the BIGGEST, he would in effect be putting the "New Delta" back to #3 and in effect, have a network nowhere near as powerful as the other two.

To some extent that will happen no matter who US merges with.

US/CO - still weak to Asia
US/NW - still weak to Central/South America
US/UA - still weak to Central/South America
US/AA - still weak to Asia
US/DL - still weak to Asia

No matter who US merges with, there is going to be weakness in their global network. This is largely because US brings little to anyones international route structure except for a little bit of Europe and the Caribbean/Mexican resorts.
 
panamair
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 12:27 am

Quoting FlyPNS1 (Reply 10):
To some extent that will happen no matter who US merges with.

US/CO - still weak to Asia
US/NW - still weak to Central/South America
US/UA - still weak to Central/South America
US/AA - still weak to Asia
US/DL - still weak to Asia

Actually, UA probably is the best match (though UA doesn't have the CH.11 advantage as NW or DL now where Parker could reject more leases, etc.) if he truly wants to be a global player. Even though UA is not that strong to South America, at least it already has the rights (and some presence) to the two most lucrative (and bilaterally-restrictive) markets in deep South America - Brazil and Argentina. The rest of Central/South America, the combined entity can further build later on. Having a turnkey operation like UA's Asia/Pacific however is key as it would take years to build up a presence and following in that region. And since Tilton and Parker are both so hellbent on playing the merger game, maybe they should be talking to each other.
 
FlyPNS1
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 12:38 am

Quoting Panamair (Reply 11):
Actually, UA probably is the best match (though UA doesn't have the CH.11 advantage as NW or DL now where Parker could reject more leases, etc.) if he truly wants to be a global player.

But therein lies the problem with UA. Not only do you get weak South American coverage, but you don't have the ability to dump leases like you do with DL/NW. Not to mention that UA was not as aggressive with cost-cutting in bankruptcy. This leaves UA with slightly higher costs that won't mesh well with the Parker's vision of a global "Costco".

When you look at all the legacy network carriers, it's not too hard to see why Parker chose DL (despite all the overlap).

CO/AA/UA aren't in BK and still leave some network gaps.
NW is in BK, but has tough unions, plus network gaps.
DL is in BK and has minimal unionization, but still network gaps.
 
USPIT10L
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 1:01 am

Quoting Panamair (Reply 2):
That's the fallacy - the UA/CO deal won't go anywhere if there is no US-DL deal. Dougie created this upon himself when he started pursuing DL - this business is a "Whose is Bigger" business dating all the way back to Juan Trippe and Howard Hughes. Does he really think that Arpey, Tilton, Kellner, and Steenland would stand by and do nothing? The biggest irony of it all is that in an effort to satisfy his ego and become the BIGGEST, he would in effect be putting the "New Delta" back to #3 and in effect, have a network nowhere near as powerful as the other two.

Parker stated that he wanted US Airways to be a major player so that there would not be concerns about US' long-term viability. Check out the merger site on usairways.com. It has several interviews by Parker and also one by Scott Kirby, US' president. Yes, it would drop DL to #3, but only if NW and CO merger with someone else. Do you honestly think we all can make money with oil approaching $100 and with ticket prices running so low contiunuously? I think not. That is why consolidation needs to happen sooner rather than later. Congress and the DOJ need to get their heads out of their asses and stop worrying about protecting "American jobs" (many of which have already been outsourced) and look at increasing the amount of control foreign airlines can have on US carriers. They also need to take a fresh look at the direction the industry is heading in. In 2000, everybody was minting money. Now, other than WN, no one is.

Quoting DeltaGuy (Reply 7):
Why can't we fend this guy off?

It's up to the creditors and judge. If you work for DL, you have absolutely no say. Stop being emotional and think with your head. The creditors will likely take whatever offer gives them the most cash back. Whoever does that will end up in control.
It's a Great Day for Hockey!
 
william
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 1:08 am

I also think its delusional for US employees to think its a walk in the park and state its only up to DL creditors and not taking into account the political forces at work too. Thats naive.
 
DeltaGuy
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 1:14 am

Quoting USPIT10L (Reply 13):
That is why consolidation needs to happen sooner rather than later.

You work for NW, seeing as you're a ramper, were you one of the outsourced ones? How do you feel about your own airline being consolidated, or your CEO selling thousands of employees up the shit creek? See what happens when NW gets picked up by someone else and see how long your senority plumets.

Quoting USPIT10L (Reply 13):
If you work for DL, you have absolutely no say. Stop being emotional and think with your head. The creditors will likely take whatever offer gives them the most cash back

We're all thinking with our heads. This isn't always about dollars and cents, when was the last time the biggest payoff was always the best choice? That way is often boobytrapped. Some of the creditors may see it as a good immediate payoff, but I believe the rest will prevail and see that this deal is a sham and will result in the demise of a once (and still) good airline. Boeing, ALPA, and alot of the rest won't let this crap happen. There's more to be made outside of this deal, Parker's "synergies" are a bunch of bullllllllshit.

DeltaGuy
"The cockpit, what is it?" "It's the little room in the front of the plane where the pilot sits, but that's not importan
 
B777-700
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 1:47 am

Quoting USPIT10L (Reply 13):
If you work for DL, you have absolutely no say. Stop being emotional and think with your head.

Incorrect.

The creditors will take into account a happy work force. If they go with the US plan, there will be workforce problems beyond belief. This will have an effect on their investment.

Again, they will take this into consideration, whether you like it or not.
If you don't chew Big Red, then @#$% you.
 
USAirPlatinum
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 1:50 am

Does he really think that Arpey, Tilton, Kellner, and Steenland would stand by and do nothing?

Tilton and Steenland have no money (though the former could pull off a CO merger), Kellner's options are limited by the NWA golden share, and Arpey's in no mood for a merger post-TWA unless UA and CO force his hand in Texas and Chicagoland.

I love how Parker uses that word, synergies. You mean to say, fuck Delta people out of all they've worked for?

Delta's people are already fucked -- they're in Chapter 11 and losing money fast. The question is how fucked they're going to be and for how long. They either "stay an independent carrier" loaded with debt and dependent upon transatlantic revenues (a dodgy proposition for long-term stability), or they merge with someone.

A merger will result in 10% to 20% capacity reduction. An independent Delta hit by $100 a barrel oil and shrinking demand for international flying could see 40% or more capacity reduction. And, of course, if Delta's poor financial performance continues, compounded by additional interest on the staggering debt they'll need for that $12 billion re-org, you'll have a liquidation where there's a 100% capacity reduction and DL employees end up with bounced paychecks and desperately hoping someone buys their piece of the airline and employs them.

Delta's advocates act like all they have to do is get a re-org plan and emerge and everything is OK, when that's not the situation. Take a look around you. . . Delta's no longer on top. Heck, Delta is only in the game because creditors are betting they'll lose less money by allowing the Delta corpse to shuffle forward as a zombie (and probably dump the stock when it goes public) versus just shutting it down and selling the assets. That's not a position of strength.
"Hey guys, Delta is OUR Delta right now." -- Unpaid Creditors
 
silentbob
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 1:55 am

Quoting Dutchjet (Reply 4):
.creditors sometimes (I said sometimes, there are no rules here) are attracted to whatever deal puts the most money in their pocket and have little interest in the longer term advantages of taking an equity interest in the reorganized corporation.

That's because they can invest that (up-front) money into another venture. The end result is more than they would get in return from the reorganized company.
 
supa7E7
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 1:58 am

However much financing Delta can get... bounded by the reality of the money they could ever actually make as a business... Doug Parker can probably get MORE via Wall Street, since his plan involves lower costs and equal revenue compared to standalone Delta.

Or, if you like, Boeing, ALPA and any other partisan players may say, "screw US Airways," we are sticking with Delta regardless of whose plan makes more money. I think this would please a.net no end. But it would probably result in a weaker Delta, fed by cronyism instead of rationality. Cronyism has its limits.... the open market does not.

It still amazes me how much people love Delta management. What a 180 degree turn from just 3 or 4 years ago. Don't people realize Doug would run Delta well enough, not "screwing" people out of jobs? Did the US/HP merger screw people out of jobs? YES... mostly executives.

Sure, at let's say BNA airport you'd be somewhat (but not grossly) overstaffed. In time, headcount would fall back plenty quick. It would not be a layoff situation. US's main challenge has been hiring ENOUGH workers...
"Who's to say spaceships aren't fine art?" - Phil Lesh
 
USPIT10L
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:01 am

Quoting DeltaGuy (Reply 15):
You work for NW, seeing as you're a ramper, were you one of the outsourced ones? How do you feel about your own airline being consolidated, or your CEO selling thousands of employees up the shit creek? See what happens when NW gets picked up by someone else and see how long your senority plumets.

As long as I have a job I'll be happy. My training with NW starts January 6th. Until then, I'm going to watch very closely to see how it shakes out. Frankly, unless AA gives NW a sweetheart deal, I doubt NW will succumb to anyone.

Quoting DeltaGuy (Reply 15):
We're all thinking with our heads. This isn't always about dollars and cents, when was the last time the biggest payoff was always the best choice? That way is often boobytrapped. Some of the creditors may see it as a good immediate payoff, but I believe the rest will prevail and see that this deal is a sham and will result in the demise of a once (and still) good airline. Boeing, ALPA, and alot of the rest won't let this crap happen. There's more to be made outside of this deal, Parker's "synergies" are a bunch of bullllllllshit.

Glad to see that. Tell WorldTraveler that. I've gotten the impression that all Delta is doing lately is posturing due to these talks/takeovers. I do think Delta has the best overall network right now, with very few holes (Asian expanion is next on the agenda, under US control or not), along with excellent employees. My beef was with DGS, not mainline DL, whom I love. I just never understood why a wholly-owned subisidiary would outsource to OTHER airlines! I think it's bad for business and hurts DL's overall reputation. Sure, airlines do other airlines' work, especially maintenance, but they don't create a whole new subdivision to do it. What position are you in at DL? I was ramp/cabin service (Dept 120) in PIT.
It's a Great Day for Hockey!
 
ANNOYEDFA
Posts: 441
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:02 am

Excellent! This is great news! I knew they would up the offer!! The best part about it is DL employee's are almost all non-union and they can do whatever they need to do with them to make the airline work. I hope this happens! Fingers crossed!  Smile
"TWA... One Mission, Yours."
 
jacobin777
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:05 am

Quoting DeltaGuy (Reply 15):
You work for NW, seeing as you're a ramper, were you one of the outsourced ones? How do you feel about your own airline being consolidated, or your CEO selling thousands of employees up the shit creek? See what happens when NW gets picked up by someone else and see how long your senority plumets.

Not to be rude mate, but that is the nature of all business, especially in the aviation industry....

It's unfortunate, but if you want to be the one in charge, you have to either be in management or start your own business....
"Up the Irons!"
 
USAirPlatinum
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:07 am

Boeing, ALPA and any other partisan players may say, "screw US Airways," we are sticking with Delta regardless of whose plan makes more money

In which case, Boeing shareholders have a revolt when Delta collapses into bankruptcy again in 24 months and people say "how come you didn't take the higher offer?"

a weaker Delta, fed by cronyism instead of rationality

No doubt. I expect the US merger will fail, Delta will "emerge independently" loaded up with debt, and yields/loads will decline on the international expansion (which I hear involves flying a lot of empty planes on very thin routes). Couple a fare war and $100 a barrel oil, along with European green taxes sending international fares to Europe up 25% to 40%, and Delta's kissing the tarmac again.

The second bankruptcy will be a "merger oriented" transaction, with lots of cronyists (as you call them) seeking a government bailout, but I suspect creditors will have had their fill. Delta, in this scenario, won't merge but rather will have the constituent parts with value (mostly Atlanta) sold to carriers filling in holes in their network. Most of the employment ends, most of the planes go in the desert, etc.

Don't people realize Doug would run Delta well enough, not "screwing" people out of jobs?

The problem is, he'd have labor dead-set against him. Labor militancy, pride, etc. at the former Delta would stymie his every move, and they'd all be complaining about the 10% capacity reduction -- never mind the fact that there will be at least a 30% reduction with an "independent" Delta once the poo hits the fan.

There's also just an element of snobbery -- like what the old USAir had towards SWA. "We're a great carrier, they're a stinky low-cost upstart." Ironic that the tables are turned here.

US's main challenge has been hiring ENOUGH workers...

This logic simply isn't going to get through. Delta's key stakeholders hate change and will fight it every step of the way, all the way to the employment line. Remember, these are the folks who did "full pay to the last day" all the way into bankruptcy, and whose pilot's union came within a whisker of shutting the carrier down altogether.

If they're willing to do that to their "own" management, imagine what they'll do when profit-oriented guys who make tough decisions take over. It would be an operational disaster for US.
"Hey guys, Delta is OUR Delta right now." -- Unpaid Creditors
 
B777-700
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:08 am

Quoting USAirPlatinum (Reply 17):
they're in Chapter 11 and losing money fast.

Incorrect, and you've been shown time and time again evidence to the contrary. Stop saying it.

Quoting USAirPlatinum (Reply 17):
They either "stay an independent carrier" loaded with debt and dependent upon transatlantic revenues (a dodgy proposition for long-term stability), or they merge with someone.

These are not the only two options. You've been shown time and time again evidence to the contrary. Stop saying it.

Quoting USAirPlatinum (Reply 17):
Delta's no longer on top

Leading carrier across the Atlantic, practically tied for first in customer service in JD Powers, just to name a few...

Quoting USAirPlatinum (Reply 17):
Heck, Delta is only in the game because creditors are betting they'll lose less money by allowing the Delta corpse to shuffle forward as a zombie (and probably dump the stock when it goes public) versus just shutting it down and selling the assets. That's not a position of strength.

Please show some documentation of this or admit it's your own, biased opinion.
If you don't chew Big Red, then @#$% you.
 
USPIT10L
Posts: 1868
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:10 am

Quoting USAirPlatinum (Reply 23):
There's also just an element of snobbery -- like what the old USAir had towards SWA. "We're a great carrier, they're a stinky low-cost upstart."

Ironically, that's also the same attitude Delta has towards airTran. Funny, isn't it?
It's a Great Day for Hockey!
 
USAirPlatinum
Posts: 242
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:14 am

Incorrect, and you've been shown time and time again evidence to the contrary

No I haven't. Delta is cash-flow negative and losing money when operational plus debt service costs are put together. When it "emerges," assuming revenues at the same level, it will continue to lose money. More likely, revenues will decline, accelerating losses and negative cash flow.

These are not the only two options.

They're the only two options -- "emerge" or "merge."

Leading carrier across the Atlantic

Leading money-loser across the Atlantic. Delta disclosed that its international ops were not a profit center.

practically tied for first in customer service in JD Powers

TWA won a variety of JD Powers awards for their international long-haul and domestic long-range products not long before going down.

Please show some documentation of this

The documentation is simple. The unsecured creditors will not receive the billions they're due, but rather some share of the stock in the "new Delta." That stock is unlikely to be worth anywhere near the amount owed. The problem is that if they shut down Delta and sold off the assets in a fire sale, they'd get even less. Their situation is pennies on the dollar in a liquidation, or nickels on the dollar in a re-org. Parker is offering them dimes on a dollar, with the proviso that they are buying into a new carrier which is about 50% profitable and 50% no profit.
"Hey guys, Delta is OUR Delta right now." -- Unpaid Creditors
 
B777-700
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:21 am

Quoting USAirPlatinum (Reply 27):
No I haven't.

Sure you have. You choose to ignore it because it's devastating to your argument.

Quoting USAirPlatinum (Reply 27):
They're the only two options -- "emerge" or "merge."

Yes. Emerge. But not in the way you described.

Quoting USAirPlatinum (Reply 27):
Leading money-loser across the Atlantic. Delta disclosed that its international ops were not a profit center.

I think it's only a matter of time before Panamair or Worldtraveler blows you out of the water...again. Or maybe they've realized you're hopeless?

Quoting USAirPlatinum (Reply 27):
TWA won a variety of JD Powers awards for their international long-haul and domestic long-range products not long before going down

And TWA and Delta are two different airlines, and their situations are very different.

So, again, I'll thank you for not using incorrect statements like "Delta is no longer tops of anything".

Quoting USAirPlatinum (Reply 27):
The documentation is simple. The unsecured creditors will not receive the billions they're due, but rather some share of the stock in the "new Delta." That stock is unlikely to be worth anywhere near the amount owed. The problem is that if they shut down Delta and sold off the assets in a fire sale, they'd get even less. Their situation is pennies on the dollar in a liquidation, or nickels on the dollar in a re-org. Parker is offering them dimes on a dollar, with the proviso that they are buying into a new carrier which is about 50% profitable and 50% no profit.

This does not qualify as documentation. This is your opinion. Please don't confuse the two.

I'll be waiting for some links and data to back up your 'facts'.
If you don't chew Big Red, then @#$% you.
 
FlyPNS1
Posts: 5271
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:25 am

Quoting B777-700 (Reply 28):
I think it's only a matter of time before Panamair or Worldtraveler blows you out of the water...again.

Actually, WT has posted DOT data that shows DL is losing money on transatlantic (and latin america). In fact, WT's words were that DL was using domestic profits to subsidize international losses.
 
USAirPlatinum
Posts: 242
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:28 am

Actually, WT has posted DOT data that shows DL is losing money on transatlantic (and latin america). In fact, WT's words were that DL was using domestic profits to subsidize international losses.

Bingo.

You choose to ignore it because it's devastating to your argument.

No it's not. Arguing about what might have happened in the past is irrelevant. I freely admit US and HP were bailed out -- but that and 50 cents will buy you a newspaper.

The key is what's happening now and what will happen in the future. It doesn't look good for DL.

I think it's only a matter of time before Panamair or Worldtraveler blows you out of the water

Tossing a couple of insults isn't "blowing out of the water," I'm afraid.

This does not qualify as documentation.

Your determination of what "qualifies" matters as much as TWA's 2007 expansion plans. I.e. not much. Neither does mine, for that matter, but I'm not candy-coating a money-losing situation without a plan and facing further revenue declines in the near future.
"Hey guys, Delta is OUR Delta right now." -- Unpaid Creditors
 
B777-700
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:33 am

Quoting USAirPlatinum (Reply 30):
but I'm not candy-coating a money-losing situation without a plan and facing further revenue declines in the near future.

No, you're not. You're completly making it up.

Do you think upper management isn't looking at these things?

I along with most rational people, trust them over you. Don't flatter yourself.
If you don't chew Big Red, then @#$% you.
 
USAirPlatinum
Posts: 242
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:37 am

Do you think upper management isn't looking at these things?

They might be looking at them. They're also the guys who were in charge when Delta was "looking at returning to profitability" and instead ended up unable to pay its bills and in Chapter 11. So you'll pardon me if I don't have utmost confidence in their ability to pull a rabbit out of an increasingly tattered hat.

I along with most rational people, trust them over you.

That's fine, it's your perogative to do so. As I've expressed earlier, I'm hoping the merger doesn't go through because US allowing Delta to die will provide more toom for the industry (and better return on capital for US).

In the end, neither of us will make much of a difference in the outcome. I'm simply discussing the issues from a position other than the "Delta is so great, they're going to take over the world when they exit BK" propaganda that's so common here.
"Hey guys, Delta is OUR Delta right now." -- Unpaid Creditors
 
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:47 am

Quoting USAirPlatinum (Reply 32):
So you'll pardon me if I don't have utmost confidence in their ability to pull a rabbit out of an increasingly tattered hat.

Only if you'll pardon me if I think you're a hypocrite for bashing Delta for using chapter 11 when your airline has used it twice, and your Messiah Dung Parker wanted to use it again to destroy Delta. Deal?

Quoting USAirPlatinum (Reply 32):
That's fine, it's your perogative to do so. As I've expressed earlier, I'm hoping the merger doesn't go through because US allowing Delta to die will provide more toom for the industry (and better return on capital for US).

I think you're setting yourself up to be very disappointed. Time will tell.
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 2:54 am

bashing Delta for using chapter 11 when your airline has used it twice

I'm not bashing Delta in the slightest. I am pointing out that Delta is not in charge of its own future and cannot pay its bills. This is not in dispute. And just as the US creditors demanded a merger to get their money back (and they did well with HP) versus US's "stand alone transformation plan," it's possible the DL creditors will want the same thing. Increasingly likely, in fact.

your Messiah Dung Parker wanted to use it again to destroy Delta

I've got bad news for you. Delta is already destroyed. Chapter 11 is the worst state that a company can be in while still operating. An independent Delta will be a husk emerging from the ashes with new debt and a fervent hope that it can suddenly increase profitability in a down market with too much capacity and pending economic weakness. That's a bad bet.

You don't seem to understand the fact that Delta as you know it is gone. It's not coming back. It's in its death gasps. Whether DL is acquired or "emerges," it will end up a profoundly different animal from what it is today -- and likely gone if it's loaded with the debt required to sustain the supposed $12 billion offer.

I think you're setting yourself up to be very disappointed.

I'd actually be more disappointed by a Delta collapse. They're an interesting company with a great culture -- but their business model is fundamentally broken and they're being obstinate in ignoring (or just plain denying) the path in front of them.

It reminds me of the Alabama pension fund that bought US out of Chapter 11 the first time, and did nothing other than a slight reorg and drawing down the PIT hub. Without the radical transformation Parker brought, it wouldn't have survived. And it's obvious that DL is in the same situation -- it needs big-time transformation which simply isn't coming, unless Grinstein surprises us all in his reorg plan in a few days.
"Hey guys, Delta is OUR Delta right now." -- Unpaid Creditors
 
JetBlueGuy2006
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 3:09 am

I need clarification, if I am wrong, please correct me. Wasn't HP the one that bailed out US? They just chose to keep the US name because it was more well-known?

If I am mistaken, please correct

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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 3:13 am

Quoting JetBlueGuy2006 (Reply 35):
I need clarification, if I am wrong, please correct me. Wasn't HP the one that bailed out US? They just chose to keep the US name because it was more well-known?

That is indeed how it happened. US was on the verge of liquidation and was merged into HP.
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 3:22 am

Quoting USPIT10L (Reply 13):
It's up to the creditors and judge. If you work for DL, you have absolutely no say. Stop being emotional and think with your head. The creditors will likely take whatever offer gives them the most cash back. Whoever does that will end up in control.

DL's pilots are indeed creditors, and they have a say. They've said no already and will say no when the deal is approved/disproved. This deal is not worth anything and will only lead to a carrier who is completely lopsided on the East Coast. It would be a shame if UA/CO or AA/NW go ahead and merge and see the uselessness that this merger created. DL/US would be no match at all for the aforementioned carriers after a merger.

Jeremy
 
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 3:34 am

Wasn't HP the one that bailed out US? They just chose to keep the US name because it was more well-known?

That is correct. And it worked well, despite HP being much smaller as a percentage of the new entity than the "New US" would be as a percentage of a US/DL merged entity.

DL's pilots are indeed creditors, and they have a say. They've said no already and will say no when the deal is approved/disproved.

That's fine. They're not the only creditors, and they weren't likely on board in the first place.

It's an unwise choice on their part, but they're obviously acting from a position other than seeking to maximize their return on the defaulted debt.

This deal is not worth anything and will only lead to a carrier who is completely lopsided on the East Coast.

That remains to be seen as well.

Delta will have a lot of long haul capacity available after a rationalization (pulling down poor performing routes from JFK and shrinking that "hub"), which will probably result in a number of new routes. PHX (and perhaps LAS) will likely get some European flying, and US will probably also connect PHL and perhaps PHX to Tokyo once they can buy or juggle slots.

It's also possible -- perhaps even likely -- that additional capacity will be shifted to new focus cities. US could make a credible focus city in SJC, LAX, or another West Coast location (given the pulldowns occurring by major carriers at both airports) and also bolster its point-to-point flying (by returning the old HP BOS to LAX and SFO service, for instance -- using its strong position in the BOS focus city as a result of the merger).

There's also significant potential in the Midwest with CVG (and perhaps some PIT optimization).

Assuming the DL (or remote possbility, US) employees didn't drag their feet or disrupt the operation over bygones, the combined entities could build a decent business. Parker is certainly motivated, and the 10% reduction he pledges suggests that he's thinking not just of closing "redundant" hubs, but of shifting capacity around the system, connecting new dots, and creating new focus cities.

I could envision a US-DL that's a "national" carrier with the following presence:

ATL hub (kept as-is with some efficiency improvements and baggage system updates)
PHL hub (with Asian service)
PHX hub (with new European and Asian service)
LAS focus city (with London service)
CLT focus city (with limited European service)
JFK focus city (O&D focused to major European business centers)
LGA focus city (with shuttle)
BOS focus city (with services to London and Paris)
SJC or LAX focus city (with transcon and perhaps Asian flying)
CVG focus city (better midwest coverage)

That's a national carrier who has a strong (or dominant) presence in two of the three largest cities in the country (with a Star Alliance partner to cover the "gap" in Chicago).
"Hey guys, Delta is OUR Delta right now." -- Unpaid Creditors
 
AA787823
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 3:40 am

IMHO, I think Doug Parker is taking on way more than he should at this point/
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ScottB
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 4:00 am

Quoting USAirPlatinum (Reply 17):
A merger will result in 10% to 20% capacity reduction. An independent Delta hit by $100 a barrel oil and shrinking demand for international flying could see 40% or more capacity reduction. And, of course, if Delta's poor financial performance continues, compounded by additional interest on the staggering debt they'll need for that $12 billion re-org, you'll have a liquidation where there's a 100% capacity reduction

But...US Airways plans to borrow over $7 billion from Citigroup to try to pimp Parker's merger idea. How is it that a combined airline which would be $7 billion deeper in debt is a recipe for success, given this doomsday scenario?

Quoting USAirPlatinum (Reply 27):
No I haven't. Delta is cash-flow negative and losing money when operational plus debt service costs are put together.

The problem is, US Airways is hemorrhaging money as well. They posted a net loss of $78 million in the last quarter. They're also already highly leveraged, with essentially all assets mortgaged to back existing loans. Combine a deeply indebted airline with a bankrupt one and you've got a recipe for yet another Chapter 11 filing.

Quoting USAirPlatinum (Reply 34):
It reminds me of the Alabama pension fund that bought US out of Chapter 11 the first time, and did nothing other than a slight reorg and drawing down the PIT hub. Without the radical transformation Parker brought, it wouldn't have survived.

You can actually thank Bruce Lakefield and GECAS for most of the "radical transformation" which has essentially been little more than additional cuts in capacity. Oh, and the disastrous new website.
 
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 4:04 am

Quoting USAirPlatinum (Reply 34):
I'm not bashing Delta in the slightest.

You sure? I mean reeeeeally sure?

Quoting USAirPlatinum (Reply 1):
Hahahaha. I'd pay to buy a "Make Delta My B****" pin just to annoy the Deltoids.



Quoting USAirPlatinum (Reply 5):
Here's my quick-n-dirty entry.



Quoting USAirPlatinum (Reply 8):
This is just a poke in the eye at their parochialism



Quoting USAirPlatinum (Reply 13):
I don't know why the Delta folks take themselves so seriously. . . all the metrics show an airline in decline/collapse.

D'OH!

Quoting USAirPlatinum (Reply 34):
And just as the US creditors demanded a merger to get their money back (and they did well with HP)

Not merged yet. 'I'm not bashing' US, just pointing that out.  Wink

Quoting USAirPlatinum (Reply 34):
Increasingly likely, in fact.

All indications are this is incorrect. Please provide documentation of this claim.

Quoting USAirPlatinum (Reply 34):
I've got bad news for you. Delta is already destroyed.

Another in a series of incorrect statements from you.

Quoting USAirPlatinum (Reply 34):
An independent Delta will be a husk emerging from the ashes with new debt and a fervent hope that it can suddenly increase profitability in a down market with too much capacity and pending economic weakness. That's a bad bet.

Please provide documentation of this, Nostradamus.  Yeah sure

Quoting USAirPlatinum (Reply 34):
Delta as you know it is gone. It's not coming back. It's in its death gasps.

 rotfl   rotfl   rotfl 

Documentation please? Please link me to a chapter 7 filing.

Quoting USAirPlatinum (Reply 34):
but their business model is fundamentally broken and they're being obstinate in ignoring (or just plain denying) the path in front of them.

Again, don't flatter yourself. The people running Delta right now are smarter than you. Hate to break it to you.

Quoting USAirPlatinum (Reply 34):
And it's obvious that DL is in the same situation -- it needs big-time transformation which simply isn't coming

You have no factual basis to back this up.

Keep going and I'll gladly keep showing you words for the meaningless drivel that they are.

You have no basis, no data, and no documentation to back up anything you say. All you have is what you think, and we all thinking something different.
If you don't chew Big Red, then @#$% you.
 
DL787932ER
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 4:06 am

Let's hope filing the DL reorg plan can put an end to this lunacy. All the speculation (even the wild-eyed rants thrown out by the DL bashers) has been fun to read and I suspect it won't end, but realistically this is about the worst merger possible between any 2 U.S. majors, for the customers, employees, and creditors of both airlines.

There will obviously be some people here who are going to take it very badly for some reason when DL emerges from bankruptcy next year as a profitable, independent airline. Deal with it. Even for the bashers, isn't that a better outcome than having both DL and US cease to exist?
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 4:23 am

Quoting FlyPNS1 (Reply 29):

Actually, WT has posted DOT data that shows DL is losing money on transatlantic (and latin america). In fact, WT's words were that DL was using domestic profits to subsidize international losses.

FlyPNS1, you rightly pointed this out. However, you didn't comment on the general discussion. I'd love to hear your thoughts on USAirPlatinum's general line of thought. Of all the knowledgeable, informed posters on this board with some sort of history looking at Delta you probably the most critical of Delta. I'm curious to hear what you think about his musings.

It seems to me like he knows absolutely nothing about Delta, its current situation, its recovery plan or its management team. He has decided that it is a black or white issue and that Delta either merges or dies. Oddly, that is an opinion I've heard from absolutely NOBODY else who I would consider knowledgable on the issue...from a.net posters to wall street analysts, to other airline execs.

I'm not sure I've ever read anybody so sure of himself, yet so full of it.
 
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 4:26 am

Quoting AA787823 (Reply 39):
IMHO, I think Doug Parker is taking on way more than he should at this point/

Meanwhile, Mr. Grinstein builds his monument - to himself.

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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 4:37 am

Formerly Boeing vs Airbus, now.... US vs. Delta.

We really cant influence what happens, but I hope that no people loose their jobs. Of course in a business environment, it's always the gamble.
"None are more hopelessly enslaved, than those who falsly believe they are free" -Goethe
 
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 8:26 am

Quoting Flyorski (Reply 46):
Formerly Boeing vs Airbus, now.... US vs. Delta.

Yeah - isn't this fun! A lot of US people like it, most Delta people don't (shocking).

Now, what will be very exciting is IF  ducking  the merger goes through, is the first point of speculation will of course be "So, will the new Delta buy the 787 or the A350?"

For now, I'm buying poor misunderstood Doug a pair of devil-horns for Christmas (he can wear'em to Atlanta if the deal goes through  Wink
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 8:37 am

Documentation please? Please link me to a chapter 7 filing.

Give me 24 months.

There will obviously be some people here who are going to take it very badly for some reason when DL emerges from bankruptcy next year as a profitable, independent airline.

I'm not going to take it badly at all. I just look at the facts, which indicate that Delta will emerge from bankruptcy next year as a heavily indebted, money-losing, weak airline with an old fleet, careening towards insolvency (again).

he knows absolutely nothing about Delta, its current situation, its recovery plan or its management team

And you do?

I'm just looking at the losses, the declining cash balance, the soaring debt required for an "independent emergence," the softening transatlantic travel market, the desperate throwing of empty planes at thin routes, the lack of a coherent strategy, the employee unrest, the deterioration of customer retention policies (like the depreciation of SkyMiles), the crumbling hubs in need of major investment cash that isn't there, the need for new aircraft that cannot be bought due to a lack of cash, etc. and don't see how it's going to work.

In business, cash flow needs to be positive and operations need to consistently pay for all expenditures. Delta's not doing that now and they're not going to do it without a massive, painful downsizing -- or a merger with someone else who will right-size the bloated, inefficient company.
"Hey guys, Delta is OUR Delta right now." -- Unpaid Creditors
 
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 9:26 am

Quoting Mariner (Reply 45):
Meanwhile, Mr. Grinstein builds his monument - to himself.

mariner

Thank god someone else noticed that too.

[Edited 2006-12-19 01:27:53]
 
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 9:31 am

Quoting Jetlanta (Reply 44):
FlyPNS1, you rightly pointed this out. However, you didn't comment on the general discussion. I'd love to hear your thoughts on USAirPlatinum's general line of thought. Of all the knowledgeable, informed posters on this board with some sort of history looking at Delta you probably the most critical of Delta. I'm curious to hear what you think about his musings.

I've largely ignored his rantings because I don't even know where to start. While I have certainly been critical of DL, I don't think DL is in as bad shape as he claims. Not to mention that some of what he writes is just factually incorrect.

I personally believe that DL can survive w/o merging. The only things that could possibly derail DL would be a rapid economic collapse or major terrorist attack. If either of those happen, all bets are off. Of course, DL won't be the only one in trouble should either of those events happen.

While I don't think that DL will be the world-dominator that some DL cheerleaders believe, I expect that a stand-alone DL can produce some significant profits in the near term (2-3 years). DL's management has laid the foundation, through a combination of costs cuts, customer service improvements and network restructuring, for a DL that can be profitable when times are good. Of that, I am pretty certain.

The longer-term is a tad harder to predict since I expect there will be another economic downturn in that time frame. I don't know if DL's management has laid the foundation for DL to profit when times are bad. In a downturn, DL could take a double hit as many of the marginal international routes fail, while at the same time face mounting red ink at its weaker domestic hubs (CVG/SLC).

To me, the ultimate measure of success for a company (airline or otherwise), isn't how much money you make when times are good. The ultimate measure is how you perform when times are bad. By this metric, most airlines are pretty miserable failures....WN being the notable exception.
 
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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 9:34 am

Quoting CA2OHHP (Reply 49):
Thank god someone else noticed that too.

The last roar of the old lion?

 Smile

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RE: US May Increase Offer For DL..news

Tue Dec 19, 2006 9:37 am

Quoting USAirPlatinum (Reply 48):
I'm just looking at the losses,

US Airways lost $78 million last quarter. Should they be merging or fixing their own losses?

Quote:
the declining cash balance,

Is that the cash balance that "declined" from $2.0 billion to $2.8 billion from 12/31/2005 to 9/30/2006?

Quote:
the soaring debt required for an "independent emergence,"

And this is different from the additional $7.2 billion in debt that Parker proposes to take on in order to finance his merger plans?

Quote:
the softening transatlantic travel market, the desperate throwing of empty planes at thin routes,

Wow, I guess these are why stage-length-adjusted passenger RASM was up 15% year-over-year at Delta, right?

Quote:
the lack of a coherent strategy,

Please explain how Delta's strategy is less "coherent" than US Airways.'

Quote:
the employee unrest,

It appears to me that a US Airways takeover would result in far more employee unrest. How is US Airways doing with fixing its own issues of employee unrest, by the way?

Quote:
the deterioration of customer retention policies (like the depreciation of SkyMiles),

Funny, all the scuttlebutt is that the US Airways frequent flyers are up in arms about the changes to Dividend Miles, actually. How does the "Everything Counts" promotion provide value to the existing loyal customers by allowing people to accrue status miles for everything? How about the decisions to standardize First Class cabin sizes on the smaller America West seat counts?

Quote:
the crumbling hubs in need of major investment cash that isn't there,

Which hubs are "crumbling" aside from JFK? Is there an ETA for US Airways to "fix" PHL?

Quote:
the need for new aircraft that cannot be bought due to a lack of cash, etc. and don't see how it's going to work.

Delta has ex-TW 757's coming from AA, new 777-200's from Boeing, the world's largest 767 fleet, one of the world's largest 757 fleets, 70+ young 737-800's, and a refreshed MD-88 fleet. US Airways is buying some E190's, which they currently plan to fly on low-yielding routes against Southwest. How does this "need for new aircraft" reconcile with your claims that they need to abandon their transatlantic expansion? How does this all match up with US Airways' new transatlantic services for 2007 and their extremely limited widebody fleet?