mptpa
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Delta's Biggest Creditor.... Boeing?

Wed Apr 25, 2007 9:20 pm

I have a simple question for all you armchair CEOs?

Upon emergence of Delta from Ch10 on April 30, 90% of the new ownership will be owned by the Delta Creditors. I know Boeing is one of the large creditors to Delta, but I do not know the percentage. If it is substantial, then Boeing would be one of the bigger stakeholders of Delta! In that case, how does competition look when time comes for Delta's fleet renewal. I know about their exclusive deal, but it is irrelevant (legally).

Thx.
MP
 
DAYflyer
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RE: Delta's Biggest Creditor.... Boeing?

Wed Apr 25, 2007 9:29 pm

Quoting Mptpa (Thread starter):
In that case, how does competition look when time comes for Delta's fleet renewal.

Airbus has zero chance of putting the DL livery on it's airframes as lons as Boeing is a major creditor.
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VgnAtl747
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RE: Delta's Biggest Creditor.... Boeing?

Wed Apr 25, 2007 9:40 pm

I'm assuming you meant chapter 11  Wink

I do believe DL has historically been a Boeing operator, correct me if I'm wrong, but I do not believe they've ever operated Airbus frames, and I wouldn't expect that to change anytime soon. That much loyalty toward one manufacturer wouldn't just change overnight, regardless of Boeing's stake in the airline.

I think the question is more of what type they will go with. With all of the 787 orders, part of me thinks that Delta might have missed the boat on 787 delivery slots, and I wonder if Boeing might try to push them to another type as an interim solution until the 787's can be delivered. I think it'll be tough for DL to continue with their expansion with adequate spare aircraft without pre-2011 deliveries--unless they've somehow negotiated earlier delivery slots somewhere. Although, that said, the real question's won't be answered until next week, and once Boeing starts assembling some frames to see if they can meet their assembly timeline (which I'm sure they can).
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Arniepie
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RE: Delta's Biggest Creditor.... Boeing?

Wed Apr 25, 2007 9:42 pm

Quoting VgnAtl747 (Reply 2):
but I do not believe they've ever operated Airbus frames

They had the A310 for a while (not very succesfull IIRC)
[edit post]
 
airtran737
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RE: Delta's Biggest Creditor.... Boeing?

Wed Apr 25, 2007 9:42 pm

Quoting VgnAtl747 (Reply 2):
, but I do not believe they've ever operated Airbus frames,

They operated some Airbus 310's in the past.
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VgnAtl747
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RE: Delta's Biggest Creditor.... Boeing?

Wed Apr 25, 2007 9:45 pm

Quoting AirTran737 (Reply 4):
They operated some Airbus 310's in the past.



Quoting ArniePie (Reply 3):
They had the A310 for a while (not very succesfull IIRC)

I stand corrected then, thanks... I did not know that!
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aloges
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RE: Delta's Biggest Creditor.... Boeing?

Wed Apr 25, 2007 10:24 pm

If I'm not mistaken, those A310 were ex-Pan Am aircraft.
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SLCUT2777
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RE: Delta's Biggest Creditor.... Boeing?

Wed Apr 25, 2007 10:32 pm

Quoting VgnAtl747 (Reply 2):
I do believe DL has historically been a Boeing operator, correct me if I'm wrong, but I do not believe they've ever operated Airbus frames, and I wouldn't expect that to change anytime soon. That much loyalty toward one manufacturer wouldn't just change overnight, regardless of Boeing's stake in the airline.

While they are a Boeing operator now, in the past the term "Fly Delta Jets" was synonymous with McDonnell/Douglas aircraft. There are still many MDD loyalists who hope DL will fly their MD-88/90 aircraft like NW has their DC-9s and try and get a second life out of them just to keep the Douglas heritage alive at DL.

Quoting Aloges (Reply 6):
If I'm not mistaken, those A310 were ex-Pan Am aircraft.

Some were part of an order PanAm made and took delivery of in the 1980s, and some DL took delivery of. None the less, DL got rid of the last one in 1996 if I'm correct.
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roseflyer
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RE: Delta's Biggest Creditor.... Boeing?

Wed Apr 25, 2007 10:32 pm

Delta over its history in the jet age has operated quite a diverse fleet. They opereated Convairs early on. They were a douglas customer with the DC-8 and DC-9. Delta then switched allegiance to Lockheed when they ordered the L1011. That was a bit of a shock. Delta overall has been a Douglas company, but they merged with Boeing.

In summary, DL could switch. Yes Boeing is a creditor, but they owe it to their other creditors to find the best plane for their cost structure. The US government I believe has banned exclusivity contracts that it is rumored that CO and DL has in the late 90s.
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OttoPylit
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RE: Delta's Biggest Creditor.... Boeing?

Thu Apr 26, 2007 3:28 am

First of all, most of Delta's A310's were ex-PA. There were a couple that they purchased that were already set up for PA delivery, IIRC. Other than that, no Airbus has ever been in Delta livery and probably never will be.


I would say that Boeing is the largest Delta creditor, in addition with AMEX being a close second. Which suits both just fine, since Delta has been a Boeing operator for a very long time and there is no planned end to that.

Quoting VgnAtl747 (Reply 2):
part of me thinks that Delta might have missed the boat on 787 delivery slots, and I wonder if Boeing might try to push them to another type as an interim solution until the 787's can be delivered.

I wouldn't say that, but Delta learned its lesson from being a launch customer for an aircraft type from the MD-11. Promises, promises, promises, and none were ever lived up to. From now on, I think you will always see Delta say, "Let's see how it works for everyone else, and then we will make up our mind."

Quoting SLCUT2777 (Reply 7):
While they are a Boeing operator now, in the past the term "Fly Delta Jets" was synonymous with McDonnell/Douglas aircraft. There are still many MDD loyalists who hope DL will fly their MD-88/90 aircraft like NW has their DC-9s and try and get a second life out of them just to keep the Douglas heritage alive at DL.



Quoting RoseFlyer (Reply 8):
They were a douglas customer with the DC-8 and DC-9. Delta then switched allegiance to Lockheed when they ordered the L1011. That was a bit of a shock. Delta overall has been a Douglas company, but they merged with Boeing.

Correct. Delta's founder C.E. Woolman was a good friend of Donald Douglas. Whenever Mr. Woolman wanted to make an airplane order, he would invite Douglas to drop by and they would work out an order over a bottle of brandy(pretty good deal if you ask me). A contract was never signed, as Mr. Woolman's hearty handshake was his bond. And when Douglas would go into work on Monday morning, he would set up the order for Delta. After Mr. Woolman's death, it fell into a more traditional ordering process, but Delta always stuck with MD until they started to slip from the industry. Delta fell into the traditional legacy trick in the 70's by ordering 747's in order to "Keep up with the Joneses." Everyone was ordering them, they were the hype of the time, so they were purchased. By this time, Delta already had made orders with Douglas(DC-10), Boeing(747), and Lockheed(L1011). Eventually, only the L-1011 became the big winner for Delta with Delta being the largest operator of the type. Now, time has progressed, Lockheed is out of the airline game(mainly because of the almost L-1011 disaster), McDonnell-Douglas has been absorbed by Boeing, and the only other option is Airbus. I think we can rest assured that Boeing is losing no sleep over who Delta will order their aircraft from in the future.



OttoPylit
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mptpa
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RE: Delta's Biggest Creditor.... Boeing?

Thu Apr 26, 2007 3:49 am

Thx for the inputs.

Yes, I meant Ch11.... slip of the fingers...or was it mind!
DL did operate A310 as part of the PA purchase, but did not last long.
They were a true MDD customers, and now Boeing.

My question was related to despite Boeing being the largest shareholder (post-Apr30), how much would be dependent on fair and technical evaluation of the competing products? How much of a "deal" would Boeing be giving? They have to make this fair, balanced and equitable a deal, as not to fringe on borderline conflict. But Boeing will not hold any board seats, so they do not have any voting or veto power.

What happens if Airbus comes and offers an economically superior deal? What if Boeing delivery slots are not available to suit DL's lift needs?

I am just thinking aloud in terms of business and legal points of view.
 
Alitalia744
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RE: Delta's Biggest Creditor.... Boeing?

Thu Apr 26, 2007 3:51 am

Quoting Mptpa (Reply 10):
What if Boeing delivery slots are not available to suit DL's lift needs?

Doesn't DL have MFN with Boeing?
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DLPMMM
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RE: Delta's Biggest Creditor.... Boeing?

Thu Apr 26, 2007 10:18 am

Boeing has a claim of about $3.7 billion against DL with a description of "Future aircraft committments" plus some tens of millions in trade debt. DL's total debt entering Chapter 11 was ~$28 Billion.

In any case, Boeing would be maximum in the single digits of percentage of ownership upon exiting chapter 11.

I think you are grasping at some straws here.
 
deltal1011man
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RE: Delta's Biggest Creditor.... Boeing?

Thu Apr 26, 2007 10:26 am

Quoting Aloges (Reply 6):
If I'm not mistaken, those A310 were ex-Pan Am aircraft.

you are right and they where replaced by the 763ERs ASAP

Quoting Mptpa (Reply 10):
They were a true MDD customers, and now Boeing.

but i would like to note they have had almost every Boeing plane (no 707s or 717s)
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