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LAXintl
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Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 6:15 pm

Atter raising concerns over proposed expanded AF-KL-VS Atlantic joint venture, the Delta ALPA Master Executive Council filed with the DOT opposition to request by AM-DL to eliminate 5-year review condition on their current JV that subject to renewal in December 2020.

Delta pilots contend that the JV between AM and DL has incentivized carriers maximize aggregate rather than individual profits, which combined with DL's substantial equity interest in AM, compounds the incentives to push flying to be operated by AM which has with significantly labor standards and cost differences.

The MEC also argues DL has continues to be in violation of its own labor contracts related to the AM-DL alliance due breaches in contractual limits on minimum levels of required DL flying to Mexico and share of DL seats sold on AM flight segments.

The pilots ask the DOT to ensure JV provides conditions or mechanism that offer expanded US carrier ops and corresponding growth in job and career opportunities for US aviation workers and the competitive position of US air carriers. Pilots also ask the DOT to help ensure overall balanced growth and stop parties from engaging in labor arbitrage.


OST-2015-0070
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UPlog
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 6:36 pm

:box:

Cant really blame the DL pilots when their contract is being ignored and repeatedly violated with minimum levels of promised flying not being met.

Wait till they get to the Korean Air venture. That one has been in violation since its first day.
 
kavok
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 6:46 pm

I don’t know what stipulations are in the contract, but it does seem that due to AM’s issues with the MAX groundings, that as a result DL metal has been used a lot on routes that were originally marketed as AM operated flights. Again, I still don’t know what balance was agreed to, but it does seem that as if late there is more DL metal flying to Mexico than previously advertised.
 
FSDan
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 6:59 pm

Seems fair to me to review the effect any given JV has had on the market after a period of 5 years. There should be a recurring review of any JV between a U.S. carrier and a foreign partner to track the overall balance of the JV and the effect it has had on the market. Warnings should be issued or carveouts granted in markets that become monopolistic.

DL also should certainly be held to any agreements they have with their pilots. If they breach these contracts, there should be some sort of consequence (though I'm not sure what the best means of enforcement would look like).

Beyond the above two conditions, I think it should be left up to DL to allocate capacity between their own metal and their JV partners as they see fit. The way the DL/AM JV is structured certainly makes sense overall - the entirety of flying to the high volume U.S. point of sale beach markets (SJD, PVR, CUN, etc.) is done by DL, while the majority of the high volume Mexico point of sale markets (MTY, GDL, MEX, etc.) have much more AM than DL metal. I suppose the problem there is that there's more seasonality in the beach markets than the VFR markets, which could throw off the balance...
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MIflyer12
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 7:01 pm

Anybody - anybody - can file comments regarding this kind of regulatory issue. U.S. federal rule making procedures for regulatory law generally require a public comment period. That DALPA is doing this shouldn't surprise anybody - the contract amendable date is 12/31/2019. They're aggressively looking for things to complain about so they can agree to withdraw complaints in exchange for wage/job rule improvements. This is how it's played. That the union has asked for review has no particular meaning for DOT (or DOJ) review.
 
catiii
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 7:25 pm

UPlog wrote:
:box:

Cant really blame the DL pilots when their contract is being ignored and repeatedly violated with minimum levels of promised flying not being met.

Wait till they get to the Korean Air venture. That one has been in violation since its first day.


You really can't. The DL pilot group has very legitimate complaints here, especially when you look at the lower pilot pay rates of all this outsourced flying. I'm surprised this hasn't blown up more, contract negotiations or not.
 
jetblueguy22
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 7:49 pm

It’s always amazed me that DL can get away with so much JV flying. Business wise it makes sense, and benefits them tremendously. But it’s essentially subcontracting and I can’t believe the contract with the pilots doesn’t address it more.

I think like scope clauses, JV clauses are going to be huge going forward. Everybody says alliances are going away in favor of JVs, but the future contracts are going to determine it, not the market.
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 10:36 pm

The contract violations are being dealt with via the arbitration process. For the AM-DL JV, the union believes there have been 7 scope violations. 3 of 7 have been arbitrated and are awaiting final judgment.

Longer-term in the next contract, DL pilots will surely seek tighter scope language to protect jobs and avoid farming out of so much international flying.

I suspect DL will try to make a grand bargain and throw lots of money at the pilots, though I am not sure how much they will budge as we have repeatedly seen how scope relief can shift flying permanently reducing current and future jobs.
 
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 10:50 pm

LAXintl wrote:
Atter raising concerns over proposed expanded AF-KL-VS Atlantic joint venture, the Delta ALPA Master Executive Council filed with the DOT opposition to request by AM-DL to eliminate 5-year review condition on their current JV that subject to renewal in December 2020.

Delta pilots contend that the JV between AM and DL has incentivized carriers maximize aggregate rather than individual profits, which combined with DL's substantial equity interest in AM, compounds the incentives to push flying to be operated by AM which has with significantly labor standards and cost differences.

The MEC also argues DL has continues to be in violation of its own labor contracts related to the AM-DL alliance due breaches in contractual limits on minimum levels of required DL flying to Mexico and share of DL seats sold on AM flight segments.

The pilots ask the DOT to ensure JV provides conditions or mechanism that offer expanded US carrier ops and corresponding growth in job and career opportunities for US aviation workers and the competitive position of US air carriers. Pilots also ask the DOT to help ensure overall balanced growth and stop parties from engaging in labor arbitrage.


OST-2015-0070


As the two airlines adjust their networks to sync with each other, grow and increase profits, what are the mechanisms put in place to monitor, manage and report DL flying and DL seats sold on AM flights? Is this not transparent? What are examples where DL can game the system? Are there loop holes?

It seems like it would be in DL’s interest to push costs down (what’s being argued) but also to keep the pilot group happy.
 
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 11:14 pm

News story

DOT asked to review Delta-Aeroméxico JV
https://atwonline.com/regulation/dot-as ... om-xico-jv
 
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spinotter
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 11:28 pm

jetblueguy22 wrote:
It’s always amazed me that DL can get away with so much JV flying. Business wise it makes sense, and benefits them tremendously. But it’s essentially subcontracting and I can’t believe the contract with the pilots doesn’t address it more.

I think like scope clauses, JV clauses are going to be huge going forward. Everybody says alliances are going away in favor of JVs, but the future contracts are going to determine it, not the market.


Does anyone have any numbers comparing DL's own miles and JV partner miles with AF/KL/VS/KE/AM etc., as well as those of AA/BA/JL/etc. and UA/LH/AC/NH/etc.? Is DL particularly dependent upion its partners?
 
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Tue Sep 03, 2019 11:34 pm

UPlog wrote:
I suspect DL will try to make a grand bargain and throw lots of money at the pilots, though I am not sure how much they will budge as we have repeatedly seen how scope relief can shift flying permanently reducing current and future jobs.


Unions will always vote for short term gain (more money for current employees) at the expense of long term gain (more money for future employees who don't get a vote). Witness American Airlines "A" and "B" wage scales. I expect the pilots will give Delta lots of ability to subcontract flying in the future in exchange for guarantees for current employees.
 
KMCOFlyer
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 1:21 am

Why are they complaining about the AM JV? With the max groundings, DL has been filling in on a ton of AM routes. The JV they should really be going after is KE as it has almost gutted all of DL’s Asia flights.
 
UpNAWAy
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 1:44 am

Devil is always in the details but ultimately JVs as well as regional flying leads to more mainline flying. Those are just basic facts.
 
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 1:45 am

KMCOFlyer wrote:
Why are they complaining about the AM JV? With the max groundings, DL has been filling in on a ton of AM routes. The JV they should really be going after is KE as it has almost gutted all of DL’s Asia flights.



Much of the violations about the JV Aero Mexico flying happened before the MAX groundings..
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alasizon
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 2:02 am

UpNAWAy wrote:
Devil is always in the details but ultimately JVs as well as regional flying leads to more mainline flying. Those are just basic facts.


To an extent. There is a point at which additional regional flying begins to take away from Mainline flying (see PMUA).
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TTailedTiger
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 2:27 am

UpNAWAy wrote:
Devil is always in the details but ultimately JVs as well as regional flying leads to more mainline flying. Those are just basic facts.


Tell me, what new international routes other than a shuttle to CDG/AMS has Delta started? Zero.

AA and UA have both made recent international expansion announcements recently. DL is regressed in their own international flying. And the JV with KE will only make things worse. It won't be long before the only long-haul flying DL does will be to ICN, LHR, CDG, AMS.
 
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 2:45 am

TTailedTiger wrote:
UpNAWAy wrote:
Devil is always in the details but ultimately JVs as well as regional flying leads to more mainline flying. Those are just basic facts.


Tell me, what new international routes other than a shuttle to CDG/AMS has Delta started? Zero.

AA and UA have both made recent international expansion announcements recently. DL is regressed in their own international flying. And the JV with KE will only make things worse. It won't be long before the only long-haul flying DL does will be to ICN, LHR, CDG, AMS.


Exactly, it makes perfect sense for Delta to pawn off expansion to JV partners. Widebody crew costs are by far the most expensive for the company so limiting the amount of exposure that Delta has to that is a no brainer.

Now for every pilot and FA at Delta, it isn't great to see how many widebodies UA and AA have while seeing your company continue to make JV partnerships and not hold up their end of the labor agreements.
 
tphuang
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 2:57 am

when is the current ALPA contract up? Seems like a nasty fight ahead.
 
FlyHappy
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 3:02 am

FSDan wrote:
The way the DL/AM JV is structured certainly makes sense overall - the entirety of flying to the high volume U.S. point of sale beach markets (SJD, PVR, CUN, etc.) is done by DL, while the majority of the high volume Mexico point of sale markets (MTY, GDL, MEX, etc.) have much more AM than DL metal. I suppose the problem there is that there's more seasonality in the beach markets than the VFR markets, which could throw off the balance...


Is this actually true though?
As a paying customer, I am anecdotally seeing far, far fewer DL routes to the historically big beach markets, and seeing much more attempts to route thru MEX, onto AM connections to the beach.
And I mean from the cold north, in the winter......

It's hard for me not to perceive this as an intentional shift to lower cost flying, while providing a worse product (due to long/bad connection times).
 
SUNCTRY738
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 4:15 am

Why isn't the new DL-KE JV more balanced across the Pacific? Is it a work still in progress or does DL not intend to takeover some of the flights to Seoul from the US for more balance. Seems like they should have taken over a LAX flight and a JFK flight by now. Won't KE let them or doesn't DL want to?
 
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 4:22 am

FlyHappy wrote:
FSDan wrote:
The way the DL/AM JV is structured certainly makes sense overall - the entirety of flying to the high volume U.S. point of sale beach markets (SJD, PVR, CUN, etc.) is done by DL, while the majority of the high volume Mexico point of sale markets (MTY, GDL, MEX, etc.) have much more AM than DL metal. I suppose the problem there is that there's more seasonality in the beach markets than the VFR markets, which could throw off the balance...


Is this actually true though?
As a paying customer, I am anecdotally seeing far, far fewer DL routes to the historically big beach markets, and seeing much more attempts to route thru MEX, onto AM connections to the beach.
And I mean from the cold north, in the winter......

It's hard for me not to perceive this as an intentional shift to lower cost flying, while providing a worse product (due to long/bad connection times).


It's certainly true that DL does 100% of the U.S. -> beach market nonstop flying. AM doesn't serve any U.S. destinations from SJD, PVR, CUN, etc. (at least, not on a regularly scheduled basis). On winter Saturdays, something like 22 U.S. airports have nonstops to CUN on DL metal.

I don't have any numbers to show whether the overall ASMs in U.S.-Mexico beach market flying on DL are down, flat, or up in W20 vs W19. I know some routes have been reduced/cut (MSP-MZT/ZIH, JFK-SJD/PVR) while others have been added/increased (SEA-SJD, MSP-MEX, DTW-PVR). I think the overall frequencies roughly offset there as the cut markets were mostly 1-2x weekly while several of the added markets are daily.
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FSDan
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 4:38 am

TTailedTiger wrote:
UpNAWAy wrote:
Devil is always in the details but ultimately JVs as well as regional flying leads to more mainline flying. Those are just basic facts.


Tell me, what new international routes other than a shuttle to CDG/AMS has Delta started? Zero.


I'm not sure what timeframe you were looking for, but over the last several years:

SEA-SJD
SEA-PVR
SEA-CUN
SEA-KIX
LAX-MEX
MSP-AUA
MSP-MEX
MSP-ICN
ATL-CTG
ATL-PVG
JFK-KIN
JFK-SKB
JFK-BOG (upcoming)
JFK-GIG
JFK-LOS
JFK-PDL
JFK-BOM (upcoming)
BOS-NAS
BOS-PLS
BOS-MBJ
BOS-AUA
BOS-PUJ
BOS-DUB
BOS-EDI
BOS-MAN (upcoming)
BOS-LGW (upcoming)


TTailedTiger wrote:
It won't be long before the only long-haul flying DL does will be to ICN, LHR, CDG, AMS.


We'll hold you to that.
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 4:39 am

UPlog wrote:
:box:

Cant really blame the DL pilots when their contract is being ignored and repeatedly violated with minimum levels of promised flying not being met.

Wait till they get to the Korean Air venture. That one has been in violation since its first day.


Can you please elaborate on the Korean Air issue?
 
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 4:46 am

FSDan wrote:
TTailedTiger wrote:
UpNAWAy wrote:
Devil is always in the details but ultimately JVs as well as regional flying leads to more mainline flying. Those are just basic facts.


Tell me, what new international routes other than a shuttle to CDG/AMS has Delta started? Zero.


I'm not sure what timeframe you were looking for, but over the last several years:

SEA-SJD
SEA-PVR
SEA-CUN
SEA-KIX
LAX-MEX
MSP-AUA
MSP-MEX
MSP-ICN
ATL-CTG
ATL-PVG
JFK-KIN
JFK-SKB
JFK-BOG (upcoming)
JFK-GIG
JFK-LOS
JFK-PDL
JFK-BOM (upcoming)
BOS-NAS
BOS-PLS
BOS-MBJ
BOS-AUA
BOS-PUJ
BOS-DUB
BOS-EDI
BOS-MAN (upcoming)
BOS-LGW (upcoming)


TTailedTiger wrote:
It won't be long before the only long-haul flying DL does will be to ICN, LHR, CDG, AMS.


We'll hold you to that.


Most of that is narrowbody flying. It isn't long-haul. DL has a very weak widebody fleet compared to AA and UA. They will replace the 757/767 with the A321XLR as it should have the range to operate routes like IND-CDG. There will be even fewer wide-bodies in the fleet in the next few years when the 767 is retired.
 
grbauc
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 4:48 am

FSDan wrote:
Seems fair to me to review the effect any given JV has had on the market after a period of 5 years. There should be a recurring review of any JV between a U.S. carrier and a foreign partner to track the overall balance of the JV and the effect it has had on the market. Warnings should be issued or carveouts granted in markets that become monopolistic.

DL also should certainly be held to any agreements they have with their pilots. If they breach these contracts, there should be some sort of consequence (though I'm not sure what the best means of enforcement would look like).

Beyond the above two conditions, I think it should be left up to DL to allocate capacity between their own metal and their JV partners as they see fit. The way the DL/AM JV is structured certainly makes sense overall - the entirety of flying to the high volume U.S. point of sale beach markets (SJD, PVR, CUN, etc.) is done by DL, while the majority of the high volume Mexico point of sale markets (MTY, GDL, MEX, etc.) have much more AM than DL metal. I suppose the problem there is that there's more seasonality in the beach markets than the VFR markets, which could throw off the balance...


A 5 year review seems like good governing in my opinion.
 
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 5:47 am

SUNCTRY738 wrote:
Why isn't the new DL-KE JV more balanced across the Pacific? Is it a work still in progress or does DL not intend to takeover some of the flights to Seoul from the US for more balance. Seems like they should have taken over a LAX flight and a JFK flight by now. Won't KE let them or doesn't DL want to?


Remember too that from about 2009, when. Richard very publicly tried to dump KE for JL to make up Delta’s inferior Tokyo position, through about 2914 when KE wouldn’t play ball on certain things DL wanted and DL downgraded the MQMs on KE, they were frenemies. It could be that the flying it tilted towards KE as a make up.
 
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 5:59 am

TTailedTiger wrote:
FSDan wrote:
TTailedTiger wrote:

Tell me, what new international routes other than a shuttle to CDG/AMS has Delta started? Zero.


I'm not sure what timeframe you were looking for, but over the last several years:

SEA-SJD
SEA-PVR
SEA-CUN
SEA-KIX
LAX-MEX
MSP-AUA
MSP-MEX
MSP-ICN
ATL-CTG
ATL-PVG
JFK-KIN
JFK-SKB
JFK-BOG (upcoming)
JFK-GIG
JFK-LOS
JFK-PDL
JFK-BOM (upcoming)
BOS-NAS
BOS-PLS
BOS-MBJ
BOS-AUA
BOS-PUJ
BOS-DUB
BOS-EDI
BOS-MAN (upcoming)
BOS-LGW (upcoming)


TTailedTiger wrote:
It won't be long before the only long-haul flying DL does will be to ICN, LHR, CDG, AMS.


We'll hold you to that.


Most of that is narrowbody flying. It isn't long-haul. DL has a very weak widebody fleet compared to AA and UA. They will replace the 757/767 with the A321XLR as it should have the range to operate routes like IND-CDG. There will be even fewer wide-bodies in the fleet in the next few years when the 767 is retired.

AA has 154 WB AC
DL has 153 WB AC
UA has 191 WB AC

AA only has 1 more widebody in the fleet, and UA has 38 more than Delta and 37 more than AA.
 
INFINITI329
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 7:52 am

Is there already a JV scope clause in the pilots' contract? If so, can anyone post the verbiage?
 
catiii
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 10:16 am

TTailedTiger wrote:
They will replace the 757/767 with the A321XLR as it should have the range to operate routes like IND-CDG. There will be even fewer wide-bodies in the fleet in the next few years when the 767 is retired.


They’ve been pretty clear they’ll replace it with the NMA.
 
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 11:28 am

INFINITI329 wrote:
Is there already a JV scope clause in the pilots' contract? If so, can anyone post the verbiage?

Better yet, a link to the contract.

DL has done well with JVs. They will not willingly give them up. The benefits of metal neutral to hubs ensures profitable ops.

This will become interesting, but I expect to be a long discussion.

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tlecam
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 11:56 am

catiii wrote:
TTailedTiger wrote:
They will replace the 757/767 with the A321XLR as it should have the range to operate routes like IND-CDG. There will be even fewer wide-bodies in the fleet in the next few years when the 767 is retired.


They’ve been pretty clear they’ll replace it with the NMA.


You clearly didn't get the memo - DL will have an all airbus fleet. :roll:
BOS-LGA-JFK | A:319/20/21, 332/3, 346 || B:717, 735, 737, 738, 739, 752, 753, 762, 763, 764, 787, 772, 744 || MD80, MD90
 
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 11:57 am

FSDan wrote:
TTailedTiger wrote:
UpNAWAy wrote:
Devil is always in the details but ultimately JVs as well as regional flying leads to more mainline flying. Those are just basic facts.


Tell me, what new international routes other than a shuttle to CDG/AMS has Delta started? Zero.


I'm not sure what timeframe you were looking for, but over the last several years:

SEA-SJD
SEA-PVR
SEA-CUN
SEA-KIX
LAX-MEX
MSP-AUA
MSP-MEX
MSP-ICN
ATL-CTG
ATL-PVG
JFK-KIN
JFK-SKB
JFK-BOG (upcoming)
JFK-GIG
JFK-LOS
JFK-PDL
JFK-BOM (upcoming)
BOS-NAS
BOS-PLS
BOS-MBJ
BOS-AUA
BOS-PUJ
BOS-DUB
BOS-EDI
BOS-MAN (upcoming)
BOS-LGW (upcoming)


TTailedTiger wrote:
It won't be long before the only long-haul flying DL does will be to ICN, LHR, CDG, AMS.


We'll hold you to that.


Also, BOS-LIS.
BOS-LGA-JFK | A:319/20/21, 332/3, 346 || B:717, 735, 737, 738, 739, 752, 753, 762, 763, 764, 787, 772, 744 || MD80, MD90
 
kavok
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 12:22 pm

SUNCTRY738 wrote:
Why isn't the new DL-KE JV more balanced across the Pacific? Is it a work still in progress or does DL not intend to takeover some of the flights to Seoul from the US for more balance. Seems like they should have taken over a LAX flight and a JFK flight by now. Won't KE let them or doesn't DL want to?


Currently, KE serves 11 (12 if you include GUM) USA destinations from ICN: ATL, BOS, DFW, GUM, HNL, IAD, JFK, LAS, LAX, ORD, SEA, SFO. DL serves 4 destinations from ICN: ATL, DTW, MSP, SEA.

As the DL/KE JV was approved, the venture included all USA-Asia flying, excluding China. So from the JV perspective, outside of ICN there are 11 Delta-Japan routes also included: HND/NRT-ATL, DTW, HNL, LAX, MSP, PDX, SEA + KIX-HNL,SEA + NGO-DTW,HNL. There are also KE’s NRT-HNL and DL’s ICN/NRT-MNL tag routes.

So the DL-KE JVs include:
DL: 4 ICN routes, 11 Japan Routes, 1 MNL Route = 16 in total.
KE: 12 ICN routes, 1 Japan Route = 13 in total.

So it depends a lot on how you view the DL-KE JV as to whether the balance is out of whack or not. If you look at it just through ICN, then most definitely. If you look at it from the perspective of all USA-Asia (outside China), it becomes a bit different.

*Note, Asia in my post refers to East Asia, and excludes India, Israel, and Middle East.
 
MIflyer12
Posts: 5851
Joined: Mon Feb 18, 2013 11:58 pm

Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 12:59 pm

The U.S. DOT isn't responsible for enforcing a labor contract between pilots and Delta Air Lines. The union can file a grievance ('grieve it'), seek mediation or seek arbitration through the National Mediation Board under the Railway Labor Act. See, for example, the Alaska pilots wage arbitration from 2017: https://seekingalpha.com/article/411901 ... ration-win

Nor is the DOT responsible for enhancing career prospects for Delta's ~14,600 mainline pilots. It has responsibility instead for consumer welfare of 330 million Americans; subjective, but usually interpreted as building price competition and allowing new non-stop origins and destinations. It's why we'll have non-stops from PDX/MSP-Haneda and not just a bunch more non-stops HNL-Haneda.
 
B737Driver
Posts: 17
Joined: Tue May 15, 2018 7:26 pm

Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 1:05 pm

Oliver2020 wrote:
TTailedTiger wrote:
FSDan wrote:

I'm not sure what timeframe you were looking for, but over the last several years:

SEA-SJD
SEA-PVR
SEA-CUN
SEA-KIX
LAX-MEX
MSP-AUA
MSP-MEX
MSP-ICN
ATL-CTG
ATL-PVG
JFK-KIN
JFK-SKB
JFK-BOG (upcoming)
JFK-GIG
JFK-LOS
JFK-PDL
JFK-BOM (upcoming)
BOS-NAS
BOS-PLS
BOS-MBJ
BOS-AUA
BOS-PUJ
BOS-DUB
BOS-EDI
BOS-MAN (upcoming)
BOS-LGW (upcoming)




We'll hold you to that.


Most of that is narrowbody flying. It isn't long-haul. DL has a very weak widebody fleet compared to AA and UA. They will replace the 757/767 with the A321XLR as it should have the range to operate routes like IND-CDG. There will be even fewer wide-bodies in the fleet in the next few years when the 767 is retired.

AA has 154 WB AC
DL has 153 WB AC
UA has 191 WB AC

AA only has 1 more widebody in the fleet, and UA has 38 more than Delta and 37 more than AA.


The widebody count is a misleading stat, the type of widebody is what matters.

AA:
A330 - 24
B767 - 22
B777 - 67
B787 - 42

UA:
B767 - 55
B777 - 92
B787 - 46

DL

A330 - 45
B777 - 18
B767 - 77
A350 - 13

Delta’s majority widebody fleet is the smaller 767 which is ideal for their JV tatl route structure (flying you to AMS/CDG), however saying that Delta has a strong widebody fleet compared the the other US3 is misleading. Different widebodies pay differently, AA and UA have more top band widebodies (777/787) than DL since DL farms out the majority of its intl flying.
 
FSDan
Posts: 2619
Joined: Mon Jan 03, 2011 5:27 pm

Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 3:05 pm

TTailedTiger wrote:
FSDan wrote:
TTailedTiger wrote:

Tell me, what new international routes other than a shuttle to CDG/AMS has Delta started? Zero.


I'm not sure what timeframe you were looking for, but over the last several years:

SEA-SJD
SEA-PVR
SEA-CUN
SEA-KIX
LAX-MEX
MSP-AUA
MSP-MEX
MSP-ICN
ATL-CTG
ATL-PVG
JFK-KIN
JFK-SKB
JFK-BOG (upcoming)
JFK-GIG
JFK-LOS
JFK-PDL
JFK-BOM (upcoming)
BOS-NAS
BOS-PLS
BOS-MBJ
BOS-AUA
BOS-PUJ
BOS-DUB
BOS-EDI
BOS-MAN (upcoming)
BOS-LGW (upcoming)


TTailedTiger wrote:
It won't be long before the only long-haul flying DL does will be to ICN, LHR, CDG, AMS.


We'll hold you to that.


Most of that is narrowbody flying. It isn't long-haul. DL has a very weak widebody fleet compared to AA and UA. They will replace the 757/767 with the A321XLR as it should have the range to operate routes like IND-CDG. There will be even fewer wide-bodies in the fleet in the next few years when the 767 is retired.


Well, you can't fault me for answering the question you asked. If you're looking to get a particular answer, make sure you ask the right question... Also, about half of what's listed above is long haul, so you're not even correct on that front.
This is my signature until I think of a better one.
 
User avatar
DL747400
Posts: 722
Joined: Mon Sep 01, 2008 4:04 pm

Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 3:27 pm

jetblueguy22 wrote:
Everybody says alliances are going away in favor of JVs, but the future contracts are going to determine it, not the market.


But future contracts ARE determined by the market...the LABOR market. Terms arise from the back and forth negotiation and the contract is the end result. That is how it works.

TTailedTiger wrote:
Tell me, what new international routes other than a shuttle to CDG/AMS has Delta started? Zero.


FSDan wrote:
I'm not sure what timeframe you were looking for, but over the last several years:

SEA-SJD
SEA-PVR
SEA-CUN
SEA-KIX
LAX-MEX
MSP-AUA
MSP-MEX
MSP-ICN
ATL-CTG
ATL-PVG
JFK-KIN
JFK-SKB
JFK-BOG (upcoming)
JFK-GIG
JFK-LOS
JFK-PDL
JFK-BOM (upcoming)
BOS-NAS
BOS-PLS
BOS-MBJ
BOS-AUA
BOS-PUJ
BOS-DUB
BOS-EDI
BOS-MAN (upcoming)
BOS-LGW (upcoming)


Now WHY did you have to go muddy the water by presenting facts? Some folks on this board don't have any interest in facts which conflict with their agenda.

KMCOFlyer wrote:
The JV they should really be going after is KE as it has almost gutted all of DL’s Asia flights.


Statements like that simply ignore the fact that the Pacific has been an evolving market for more than 20 years and NW's Pacific division was not adapting to those changes anywhere near fast enough. Prior to the DL merger, NW had few options. By combining with DL, a much wider variety of options were suddenly on the table. If the NW-era, heavily NRT-focused Pacific route network was not the best way for DL to utilize very expensive widebody aircraft, then why should DL have continued with the status quo? Their network evolution and asset redeployment strategy and has been paying off handsomely. The future of trans-Pacific network airline flying will be shaped in part by the ongoing relationship between DL and KE.

SUNCTRY738 wrote:
Why isn't the new DL-KE JV more balanced across the Pacific? Is it a work still in progress or does DL not intend to takeover some of the flights to Seoul from the US for more balance. Seems like they should have taken over a LAX flight and a JFK flight by now. Won't KE let them or doesn't DL want to?


One year in, you can be assured that the new DL/KE JV relationship is still very much a work in progress. I would expect that over time, DL will be adding more USA to ICN routes, both from existing DL hubs and otherwise. This would enable KE to then shift those widebodies from USA flying to instead be used to expand service from their ICN hub, which in turn contributes to growing the overall DL/KE JV network footprint.

UpNAWAy wrote:
Devil is always in the details but ultimately JVs as well as regional flying leads to more mainline flying. Those are just basic facts.


Yes, exactly. Thank you for stating this, as there are many on this board who cannot see past their fear. :checkmark: :checkmark: :checkmark: :checkmark:

KMCOFlyer wrote:
Why are they complaining about the AM JV? With the max groundings, DL has been filling in on a ton of AM routes.


reltney wrote:
Much of the violations about the JV Aero Mexico flying happened before the MAX groundings..


Shhhhhhhhh.... ALPA doesn't want people to realize that the MAX groundings actually enabled DL to step in with additional DL flying, as that would undermine their argument that the DL/AM JV is bad.
From First to Worst: The history of Airliners.net.

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User avatar
exFWAOONW
Posts: 666
Joined: Wed Nov 25, 2009 10:32 pm

Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 3:32 pm

737Dr,

If you think more and bigger is always better, read up on Pan Am and the 747.
Is just me, or is flying not as much fun anymore?
 
User avatar
PW100
Posts: 3819
Joined: Mon Jan 28, 2002 9:17 pm

Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 3:48 pm

DL747400 wrote:
FSDan wrote:
I'm not sure what timeframe you were looking for, but over the last several years:

SEA-SJD
. . .
BOS-LGW (upcoming)


Now WHY did you have to go muddy the water by presenting facts? Some folks on this board don't have any interest in facts which conflict with their agenda.

LOL. So true. Not to mention that when presented with facts, they just move the goal posts . . .
Immigration officer: "What's the purpose of your visit to the USA?" Spotter: "Shooting airliners with my Canon!"
 
vin2basketball
Posts: 234
Joined: Sun Dec 06, 2009 7:31 pm

Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 3:50 pm

B737Driver wrote:
Oliver2020 wrote:
TTailedTiger wrote:

Most of that is narrowbody flying. It isn't long-haul. DL has a very weak widebody fleet compared to AA and UA. They will replace the 757/767 with the A321XLR as it should have the range to operate routes like IND-CDG. There will be even fewer wide-bodies in the fleet in the next few years when the 767 is retired.

AA has 154 WB AC
DL has 153 WB AC
UA has 191 WB AC

AA only has 1 more widebody in the fleet, and UA has 38 more than Delta and 37 more than AA.


The widebody count is a misleading stat, the type of widebody is what matters.

AA:
A330 - 24
B767 - 22
B777 - 67
B787 - 42

UA:
B767 - 55
B777 - 92
B787 - 46

DL

A330 - 45
B777 - 18
B767 - 77
A350 - 13

Delta’s majority widebody fleet is the smaller 767 which is ideal for their JV tatl route structure (flying you to AMS/CDG), however saying that Delta has a strong widebody fleet compared the the other US3 is misleading. Different widebodies pay differently, AA and UA have more top band widebodies (777/787) than DL since DL farms out the majority of its intl flying.


Except this misses orders.

DL is going to replace ~35 of the 767s with A330-900neos (which are 777 sized in capacity) and have 12 more A350-900s on order.
 
Sightseer
Posts: 946
Joined: Mon Jan 12, 2015 6:04 am

Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 4:18 pm

Oliver2020 wrote:
TTailedTiger wrote:
FSDan wrote:

I'm not sure what timeframe you were looking for, but over the last several years:

SEA-SJD
SEA-PVR
SEA-CUN
SEA-KIX
LAX-MEX
MSP-AUA
MSP-MEX
MSP-ICN
ATL-CTG
ATL-PVG
JFK-KIN
JFK-SKB
JFK-BOG (upcoming)
JFK-GIG
JFK-LOS
JFK-PDL
JFK-BOM (upcoming)
BOS-NAS
BOS-PLS
BOS-MBJ
BOS-AUA
BOS-PUJ
BOS-DUB
BOS-EDI
BOS-MAN (upcoming)
BOS-LGW (upcoming)




We'll hold you to that.


Most of that is narrowbody flying. It isn't long-haul. DL has a very weak widebody fleet compared to AA and UA. They will replace the 757/767 with the A321XLR as it should have the range to operate routes like IND-CDG. There will be even fewer wide-bodies in the fleet in the next few years when the 767 is retired.

AA has 154 WB AC
DL has 153 WB AC
UA has 191 WB AC

AA only has 1 more widebody in the fleet, and UA has 38 more than Delta and 37 more than AA.

Thank you, and FSDan, for taking time to post facts.
 
SteelChair
Posts: 1156
Joined: Fri Aug 25, 2017 11:37 am

Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 4:41 pm

This continuing campaign has its genesis as sour grapes from bitter PMNW drivers over the 744 retirement and the NRT drawdown. As if those items weren't going to happen anyway. And as if these pilots aren't far better off being part of the Delta network than they were as part of the failing NWA system.

It's all just posturing, and this too shall pass. Things change.....NRT and 747s are gone forever. Hopefully the MEC will return to a semblance of normalcy at some point.
 
User avatar
UPlog
Posts: 411
Joined: Sat Jan 27, 2018 5:45 am

Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 4:50 pm

tphuang wrote:
when is the current ALPA contract up? Seems like a nasty fight ahead.


December 31, 2019

INFINITI329 wrote:
Is there already a JV scope clause in the pilots' contract? If so, can anyone post the verbiage?


Yes. No point in posting long passages from paragraphs, but there is specific guidance.

In simplistic terms the JVs are based on EASK (equivalent available seat kilometers) - a measurement of capacity adjusted for an aircraft’s seat density and cargo capacity with DL pilots supposed to fly a minimum of a percentage of EASKs within the JV annually. There is also block hour requirements to be met.

MIflyer12 wrote:
The U.S. DOT isn't responsible for enforcing a labor contract between pilots and Delta Air Lines. The union can file a grievance ('grieve it'), seek mediation or seek arbitration through the National Mediation Board under the Railway Labor Act. See, for example, the Alaska pilots wage arbitration from 2017: https://seekingalpha.com/article/411901 ... ration-win

Nor is the DOT responsible for enhancing career prospects for Delta's ~14,600 mainline pilots. It has responsibility instead for consumer welfare of 330 million Americans; subjective, but usually interpreted as building price competition and allowing new non-stop origins and destinations. It's why we'll have non-stops from PDX/MSP-Haneda and not just a bunch more non-stops HNL-Haneda.


But maybe the DOT should also broaden its consideration items and think about US airline labor effect? That is one of the points DALPA makes in its pleadings.

ITSTours wrote:
Can you please elaborate on the Korean Air issue?


In simple terms since the first day launched the KE JV has not met the required threshold of EASKs or block hours to be flown by DL pilots and been in violation of the contract every month.

8 months of violations have been arbitrated already and awaiting final ruling and remedy.

B737Driver wrote:
The widebody count is a misleading stat, the type of widebody is what matters.

Delta’s majority widebody fleet is the smaller 767 which is ideal for their JV tatl route structure (flying you to AMS/CDG), however saying that Delta has a strong widebody fleet compared the the other US3 is misleading. Different widebodies pay differently, AA and UA have more top band widebodies (777/787) than DL since DL farms out the majority of its intl flying.


:checkmark: Indeed. DL only has 31 widebodies that top of scale (777/A350). The large 763 fleet pays the same as the 757 which is not much different han the 321/737 fleet.

DL747400 wrote:
Shhhhhhhhh.... ALPA doesn't want people to realize that the MAX groundings actually enabled DL to step in with additional DL flying, as that would undermine their argument that the DL/AM JV is bad.


ALPA very much wants you know about the MAX grounding at AM. They specifically have mentioned it several times in their DOT filing as its a temporary blip, and cannot be considered the normal state flying between US-Mexico. DL even confirmed this itself.
 
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LAXintl
Topic Author
Posts: 23834
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 5:06 pm

I think the point here is the pilots strongly believe their contract has been violated multiple times as Delta is on a path of shifting flying to an ever-larger degree to its partners, and that having large ownership stakes in these partners creates a perverse incentive for the company.

The pilots are following the prescribed contractual path with the required arbitration, but also want to highlight this issue on a broader stage and calling on the DOT not to give airlines carte-blanche on their JVs, but to impose review requirements which can also include looking at effects on U.S labor.
From the desert to the sea, to all of Southern California
 
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OA412
Moderator
Posts: 4678
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Re: Delta pilots now going after AeroMexico JV over concerns for labor arbitrage

Wed Sep 04, 2019 5:21 pm

Interesting. If I recall correctly, per the DL pilot contract, JV flying is supposed to be 50% DL/50% Partner flying. I know there have been complaints for years that the TATL JV is usually more than 50% partner flying, and now it sounds like the JV with AM is doing the same. I think the pilots are correct to do this. If DL is repeatedly violating their contract, things should be reviewed.
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