Moderators: jsumali2, richierich, ua900, PanAm_DC10, hOMSaR

 
User avatar
thewizbizman
Posts: 148
Joined: Wed May 03, 2017 4:15 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 1:16 pm

ScottB wrote:
lightsaber wrote:
Going from 13 to 8 fleet types is Wise:
Current types:
A220
A320 CEO
*A330 CEO
A330 NEO
A350
717
737NG
*757
*767
*777-200ER (RR Engines)
777-200LR (GE engines)
*MD-88
*MD-90

I put a star next to the frames I think will leave, add A321NEO. No huge surprises.

Lightsaber


The OP mentions 13 fleet families in 2020 so I suspect they are counting the 77Es and 77Ls as a single fleet family; the A321neos start to arrive in 2020.

I think you're right about the MD-88, MD-90, 757, and 767 fleets departing, but I think the fifth fleet to go is the 717. They have an obvious replacement with the A221/A223 and the vast majority of the 717 fleet is leased. And as we have seen with the MD-88 and MD-90 fleets, the small size of the global 717 fleet will make spare parts more costly as these aircraft enter their third decade. That said, DL would have some leverage with Boeing and lessors to keep the 717s flying; while they are leasing most of their 717 fleet from WN, those subleases would likely have expirations connected to WN's leases, and IIRC Boeing Capital is the lessor for many of those 717s. Obviously it depends on the amount of lease cash flow measured against the cost of maintaining vendor support.

But in the timeframe that 757s, 767s, and 717s would exit the fleet, I think there's an obvious need for something else to fill the gap between the A321neo and the A332. I wouldn't be surprised to see whatever Boeing proposes next (NMA? 737MAX/757 replacement?) in there. That'd probably come in as the 777s exit.


They have made statements they want to keep the type through 2030, also they are on a lease to buy with Southwest, so I dont see them going anywhere until at least early 2030s.https://onemileatatime.com/delta-717/
"Aviation is the youngest big industry, but it is the fastest growing baby ever. A few years ago, it was called impossible to fly…The day of the airplane is surely here."

April 17, 1929 / C. E. Woolman
 
JAMBOJET
Posts: 293
Joined: Tue Dec 11, 2018 6:23 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 1:36 pm

jplatts wrote:
JAMBOJET wrote:
Delta is the weakest of the Big 3 in California, remains to be seen how SJC will work out.
Going into AUS or SJC was always going to be tough given the complete lack of a strong presence anywhere nearby.
Now that AA responded in AUS, it’ll be interesting to see how Delta responds. Feels like a losing battle for Delta but they have plenty of cash to burn if they want.


DL already has a hub at LAX, and there are many non-DL hub destinations that already have nonstop service out of LAX on DL.

Here are the non-DL hub destinations that DL currently serves nonstop from LAX: ABQ, AUS, BOI, CUN, CVG, CMH, DFW, DEN, GUA, HNL, IND, OGG, MCI, LAS, LIR, LIH, MEM, MEX, BNA, MSY, OMA, MCO, CDG, PHX, PDX, PVR, RDU, SMF, SAT, SAN, SFO, SJC, SJD, SJO, PVG, GEG, SYD, TPA, HND, TUS, DCA

There are also still more nonstop routes out of LAX that could be added by DL such as LAX-BUF, LAX-CLT, LAX-ORD, LAX-CLE, LAX-ELP, LAX-FLL, LAX-IAH, LAX-MKE, LAX-OKC, LAX-PHL, LAX-PIT, LAX-RNO, and LAX-STL.

If I ever implied Delta doesn't have a hub in LAX, sorry. That wasn't my intent. Simply noting that they're the smallest of the big 3 in California and, unlike BOS and RDU Focus cities, Delta doesn't have a dominant hub or presence nearby. That's not a snub at their LAX hub, no carrier has a dominant presence in LAX. United is dominant in California overall, by far, of the US3, AA is the biggest at LAX, but not by much.

Delta's focus city recipe has, to date, been finding an, in their view, underserved strong economy nearby a major hub, adding a few P2p routes, then using those to direct actual real high-yielding traffic through the nearby major hub, like RDU>ATL. SJC doesn't really have that, IMO (arguing that LAX and SEA could serve that role... fun debate, sure). AUS definitely does not.

But yes... Delta could also add LAX-AGS or LAX-PWM if they wanted, they don't serve those either if we're randomly listing markets they don't serve from LAX and don't have the gates to start either.
 
jplatts
Posts: 3717
Joined: Sat Mar 18, 2017 6:42 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 1:52 pm

JAMBOJET wrote:
But yes... Delta could also add LAX-AGS or LAX-PWM if they wanted, they don't serve those either if we're randomly listing markets they don't serve from LAX and don't have the gates to start either.


The routes that I listed that DL could serve nonstop from LAX are the top domestic routes out of LAX that DL doesn't currently serve nonstop from LAX. LAX-AGS and LAX-PWM also have much lower PDEW's than the routes that I mentioned could be added by DL out of LAX.
 
JAMBOJET
Posts: 293
Joined: Tue Dec 11, 2018 6:23 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 2:29 pm

jplatts wrote:
JAMBOJET wrote:
But yes... Delta could also add LAX-AGS or LAX-PWM if they wanted, they don't serve those either if we're randomly listing markets they don't serve from LAX and don't have the gates to start either.


The routes that I listed that DL could serve nonstop from LAX are the top domestic routes out of LAX that DL doesn't currently serve nonstop from LAX. LAX-AGS and LAX-PWM also have much lower PDEW's than the routes that I mentioned could be added by DL out of LAX.

As much as I’m sure Delta is studying Lax-buf, the lack of lax destinations for aa, dL, or UA, has never been desire or PDEW, but gates. That’s the point, ags and pwm are pure sarcasm.
 
WA707atMSP
Posts: 1913
Joined: Sun Oct 08, 2006 8:16 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 2:51 pm

One issue which won't help "fleet simplification", but still needs to be dealt with is replacing the ex-NW A320s. The newest A320 just turned 20 years old, and much of the fleet is 25+ years old. Many of these aircraft are older than the 717s, and they're going to need to be retired in the next 5 to 10 years. I also think that when a recession comes and DL needs to reduce capacity, they may retire at least some of these aircraft as they come due for D-checks, rather than continuing to invest in them.
 
MIflyer12
Topic Author
Posts: 8300
Joined: Mon Feb 18, 2013 11:58 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 3:05 pm

With the dual objectives of fleet simplification and upgauging, IMHO the replacement for the first tranche of A320s - ~34 aircraft now 26-29+ years old - is 321neos.
 
AirFiero
Posts: 1548
Joined: Wed Aug 28, 2013 11:43 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 4:38 pm

BNAMealer wrote:
JAMBOJET wrote:
I agree with your overall point that delta could build a mini hub, in theory, in aus and aa/UA wouldnt respond to that degree, but the reality is Aus isn’t big enough for a mini hub nor does delta have enough gates to build one unless they know about some new terminal project no one else Does.


AUS is most certainly big enough for a hub due to the strong local economy and the large catchment area it serves, which includes parts of SAT. They will be building a whole new concourse, doubling the amount of gates in the next decade. Beyond that, there is enough space where AUS could theoretically be built out to 150+ gates.

The problem is not that they aren’t capable, it’s that DL doesn’t seem interested and has their priorities elsewhere. The whole focus city designation seems to be a PR stunt.

AirFiero wrote:
BNAMealer wrote:
DL could easily win the AUS battle if they want to, they just seem to have priorities elsewhere. However, due to the lack of a nearby strong presence, they are gonna have to build a small hub if they want to win, simply adding a few p2p routes isn’t gonna cut it. If they go that route, AA won’t be able to respond.

SJC is a waste of time with SFO right up the road.


It depends on what DL has planned. DL isn’t exactly a powerhouse at SFO. They could move some frequencies to SJC, or even go big. Or...do nothing but press releases.


My point was SJC service has traditionally struggled with SFO right up the road and it will be difficult to compete with the UA hub there. Regardless of what people may say about traffic, it appears SFO is still the preferred airport in the region.


True, SFO is the 800 pound gorilla in the area, and UA has a fortress hub there. But SFO can’t handle all the airline business, and both WN and AS have had huge growth at SJC. I believe SJC is one of the top airports for growth over the last few years. DL is a competitor of UA, and evidently sees an opportunity at SJC.
 
reltney
Posts: 660
Joined: Fri Jun 25, 2004 1:34 am

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 5:44 pm

lightsaber wrote:
MIflyer12 wrote:
Select the '8-K, Current Report Filing' from the available choices. https://ir.delta.com/financials/default.aspx#sec

This is the first time I recall DL talking about fleet simplification as a goal: Reduce complexity with fewer aircraft types. From 13 (2020 estimate) to 8 fleet families by some unspecified future date.

Year-over-year revenue growth:

9% core hubs
10% coastal hubs
14% focus cities
domestic systemwide 8% vs. 4% for industry

Dumping an early $500 million into the pension plan this month/qtr. (The Feds don't mandate any contributions this year but the plan is still under-funded.)

Projecting after-tax ROIC of 15% this year vs. 11% in 2010. (IIRC, Southwest routinely beats that.)

Core Cap-Ex spending of $4.5 Billion in 2020 comparable to 2019. Expecting ~80 new aircraft deliveries.

Going from 13 to 8 fleet types is Wise:
Current types:
A220
A320 CEO
*A330 CEO
A330 NEO
A350
717
737NG
*757
*767
*777-200ER (RR Engines)
777-200LR (GE engines)
*MD-88
*MD-90

I put a star next to the frames I think will leave, add A321NEO. No huge surprises.

Lightsaber

Well, that pretty interesting. They announced at the base meetings the 757 fleet will stay at current numbers and possibly grow a little until 2026. Pretty much the same for the 767. The 321 is not a replacement for a 767. Something about range, number of passengers and narrow body vs wide body. Can’t compare apples to oranges.

Also, Delta did fleet simplification many years ago for those trivia guys. From the mid to late 70s they trimmed the fleet till it was just the DC-9, 727, DC-8, L 1011.. then came the 767 and it started to go back up....

Cheers
Knives don't kill people. People with knives kill people.
OUTLAW KNIVES.

I am a pilot, therefore I envy no one...
 
MIflyer12
Topic Author
Posts: 8300
Joined: Mon Feb 18, 2013 11:58 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 6:02 pm

The route network of the late 70s was pretty simple compared to today. The totality of international destinations: LGW, FRA, YUL, NAS, BDA. See the link below.

https://www.deltava.org/thread.do?id=0x9b49
 
Wacko55
Posts: 89
Joined: Tue Oct 22, 2019 4:59 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 6:08 pm

Delta Air Lines' (DAL) CEO Ed Bastian Hosts Investor Day Conference - Transcript

https://seekingalpha.com/article/431229 ... transcript
 
ScottB
Posts: 7071
Joined: Fri Jul 28, 2000 1:25 am

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 6:09 pm

thewizbizman wrote:
They have made statements they want to keep the type through 2030, also they are on a lease to buy with Southwest, so I dont see them going anywhere until at least early 2030s.https://onemileatatime.com/delta-717/


They planned to keep the MD-90s around for longer when they purchased virtually the entire extant worldwide fleet. Plans change. An amenity like seatback IFE isn't as critical on sectors which rarely exceed 1000 miles but the lack of it on the 717 fleet is notable on an airline like DL which has invested quite a bit of capital on product consistency.
 
jagraham
Posts: 1132
Joined: Sun Jul 17, 2016 11:10 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 7:52 pm

1989worstyear wrote:
Is there something particularly wrong with the 757 and 767 fleet? No mention in this thread about retiring similar aged A320's or 77E's.


DL is getting new A32x planes, so that family will stay.
The 75 and 76 families aren't getting any new planes. No telling if DL will pick up some used ones along the way, but without new planes they will eventually disappear.
 
jagraham
Posts: 1132
Joined: Sun Jul 17, 2016 11:10 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 7:58 pm

FromCDGtoSYD wrote:
I might be missing something here but there doesn't seem to be that much of a difference in seatcounts between a 767-300 and a A330-200 especially once the fleet is retrofitted with premium economy. I could see DL taking up a few A330-800 that would give some confidence in the program...



Lie flat seating
 
umichman
Posts: 145
Joined: Sun Apr 07, 2019 2:42 am

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 8:16 pm

jagraham wrote:
FromCDGtoSYD wrote:
I might be missing something here but there doesn't seem to be that much of a difference in seatcounts between a 767-300 and a A330-200 especially once the fleet is retrofitted with premium economy. I could see DL taking up a few A330-800 that would give some confidence in the program...



Lie flat seating


Not sure what you are saying. The DL 767-300's all have lie flat seats (they are all international ER models now -- the domestic 763's are gone).
 
tnair1974
Posts: 322
Joined: Sun Sep 15, 2019 5:37 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 9:23 pm

MIflyer12 wrote:
With the dual objectives of fleet simplification and upgauging, IMHO the replacement for the first tranche of A320s - ~34 aircraft now 26-29+ years old - is 321neos.


I get the impression this is the plan (if not-so-official at the moment) once A320 retirements resume...any further 321NEO delivery delays not withstanding.

In comparison, ideas on what will replace 763s and 752s are seemingly in more flux.

But with DL having recently finished interior upgrades of their remaining 320s, seems even the most elderly A320s will stay a while. The new cabins have more seats shoehorned in (so yes Y is more cramped although this is hardly new news these days in the airline industry). Thus the new interiors may(?) be generating a decent return on investment. Anyway, thanks to the Airbus life extension, even the oldest DL A320s still have a fair number of cycles/hours left. Also, NW put many of their A320s in desert storage during the last recession. A possible caveat is how much DL is willing to deal with rising maintenance costs of the oldest planes. But NW did some wonders in keeping their older DC-9s/DC-10s somewhat like the Energizer Bunny.
 
TObound
Posts: 783
Joined: Mon May 27, 2019 12:54 am

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 9:34 pm

I'm kinda surprised that people don't think the 717 is going to be replaced. They've already got the obvious replacement being fielded. Looking at fleets with the definition of a type (ignoring NEO/CEO or subtype) and looking at ages:

https://www.airfleets.net/ageflotte/Del ... 0Lines.htm

Add 10 years to those average ages and the types they need to get rid off sort of become obvious. Here's my list of what is to be replaced and potential replacements:

717 --> 221
MD 88/90 --> 321N
757 --> 321N/321XLR/NMA
767 --> 339N
77E/77L --> 359/35J

Those are the five "families". There's parts of families (types) that will get replaced with newer versions. 320s get replaced with 321Ns and 333s get replaced 339Ns. Etc. But that's not getting rid of a "family". Getting rid of a family means all variants of that type and one less crew and tech pool, simulator set, support equipment, etc. to manage.
 
tnair1974
Posts: 322
Joined: Sun Sep 15, 2019 5:37 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 9:45 pm

1989worstyear wrote:
Is there something particularly wrong with the 757 and 767 fleet? No mention in this thread about retiring similar aged A320's or 77E's.

Even the oldest DL 777s are only from 1999. At the time, the 777s helped DL to dispose of their relatively new MD-11s.
https://www.airfleets.net/flottecie/Del ... e-b777.htm

Current DL A320s start from 1990, 752s/763s from 1989 (although DL has significantly newer copies of all three models).

Any chances DL could sell some of their newest 763s to become freighters for the likes of Amazon? Granted, DL has been investing more in their 763s than AA which has sold a lot of their former 763s to become cargo birds.
 
UWPAviation
Posts: 148
Joined: Mon Dec 19, 2016 7:36 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 10:20 pm

So their is a chance by early 2030's the only Boeing aircraft in DL's fleet are the 737's. Wow
 
B757Forever
Posts: 887
Joined: Tue May 04, 2010 3:23 am

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 10:30 pm

UWPAviation wrote:
So their is a chance by early 2030's the only Boeing aircraft in DL's fleet are the 737's. Wow


DL plans to still be flying the youngest group of 757s into the mid 2030s...
The Rolls Royce Dart. Noise = Shaft Horsepower.
 
MIflyer12
Topic Author
Posts: 8300
Joined: Mon Feb 18, 2013 11:58 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 11:17 pm

I'll take the under on that. Way under. When did you retire your Windows 95 computer or Android 1.0 phone? Capable of flying doesn't mean economical to fly in typical utilization for U.S. passenger service. FedEx might be flying 757s just 5 hours a day in 2034; I don't believe DL will be. A 757 is going to look awfully fuel-guzzling compared to 739ER, Max 10, 321neo, NSA, etc.
 
1989worstyear
Posts: 887
Joined: Sun Dec 04, 2016 6:53 pm

Re: Delta Investor Day Presentation 12/12/2019

Fri Dec 13, 2019 11:43 pm

MIflyer12 wrote:
I'll take the under on that. Way under. When did you retire your Windows 95 computer or Android 1.0 phone? Capable of flying doesn't mean economical to fly in typical utilization for U.S. passenger service. FedEx might be flying 757s just 5 hours a day in 2034; I don't believe DL will be. A 757 is going to look awfully fuel-guzzling compared to 739ER, Max 10, 321neo, NSA, etc.


The same would apply to the A320 CEO, but I would say 2034 seems late.
Stuck at age 15 thanks to the certification date of the A320-200 and my parents' decision to postpone having a kid by 3 years. At least there's Dignitas...
 
User avatar
thewizbizman
Posts: 148
Joined: Wed May 03, 2017 4:15 pm

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 12:26 am

UWPAviation wrote:
So their is a chance by early 2030's the only Boeing aircraft in DL's fleet are the 737's. Wow


They have states plans to keep the 717 in service until 2030s
"Aviation is the youngest big industry, but it is the fastest growing baby ever. A few years ago, it was called impossible to fly…The day of the airplane is surely here."

April 17, 1929 / C. E. Woolman
 
TObound
Posts: 783
Joined: Mon May 27, 2019 12:54 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 1:59 am

B757Forever wrote:
UWPAviation wrote:
So their is a chance by early 2030's the only Boeing aircraft in DL's fleet are the 737's. Wow


DL plans to still be flying the youngest group of 757s into the mid 2030s...


I bet they start parting them out as soon as the next recession hits. Especially once they have enough N
321Ns in the stable and start seeing the savings in their network first hand.

Question: what routes does DL deploy 752s on where standard 321N range would be insufficient?

They may not even need the XLR to retire the the 757.

thewizbizman wrote:
UWPAviation wrote:
So their is a chance by early 2030's the only Boeing aircraft in DL's fleet are the 737's. Wow


They have states plans to keep the 717 in service until 2030s


Will argue same as the above. These will be chopped when the time comes for them to cut capacity and park airplanes. All those 220s on order give them lots of options. And they have more cash on hand than their competitors to take advantage of discounts from the OEMs if a recession hits.
 
LFW
Posts: 12
Joined: Wed Jan 27, 2016 11:16 pm

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 2:30 am

An interesting game of predicting the future going from 13 to 8, and I will pick the arbitrary 12 years from now. Makes eliminating all of the 717s and 767s plausible, as the youngest 767 is 17.7 years.

A220
A320 CEO
A320 NEO
A330 CEO (GE engines youngest is 2.8 years) and 332 CEO(youngest 13.2 years)
A330 NEO
A350
737NG
777-200LR (youngest is 9.7 years)

But I am troubled by the above list, for example what replaces the 767-300ER on JFK-LAX ? NMA ? 332 ? 338 ? Other something new ?
 
TObound
Posts: 783
Joined: Mon May 27, 2019 12:54 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 2:42 am

LFW wrote:

But I am troubled by the above list, for example what replaces the 767-300ER on JFK-LAX ? NMA ? 332 ? 338 ? Other something new ?


They can cycle TPAC and TATL aircraft on JFK-LAX. Or deploy 321Ns and increase frequency.
 
jagraham
Posts: 1132
Joined: Sun Jul 17, 2016 11:10 pm

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 2:48 am

umichman wrote:
jagraham wrote:
FromCDGtoSYD wrote:
I might be missing something here but there doesn't seem to be that much of a difference in seatcounts between a 767-300 and a A330-200 especially once the fleet is retrofitted with premium economy. I could see DL taking up a few A330-800 that would give some confidence in the program...



Lie flat seating


Not sure what you are saying. The DL 767-300's all have lie flat seats (they are all international ER models now -- the domestic 763's are gone).


Widebodies can accommodate a decent number of lie flat seats and still have reasonable overall capacity. A narrowbody with decent numbers of lie flat seats ends up like AA 321Ts. Lie flat seats in a narrowbody, yes; but only 1/2 the total seats. Which about doubles the CASM
 
LFW
Posts: 12
Joined: Wed Jan 27, 2016 11:16 pm

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 2:58 am

Yes exactly, JFK to LAX has 10 daily departures, all 767-300ER with Delta One.
 
jagraham
Posts: 1132
Joined: Sun Jul 17, 2016 11:10 pm

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 3:34 am

The 717s hang around a bit because they don't have MD80 engines or instruments. And because DL wants to shift to 76 seat RJ flying a little further. To do so, the 100 seat category must grow some more. So another year or two of A220 deliveries need to go to 100 seat growth. Then the 717 replacement cycle can begin. Note also that there are A220 production constraints. And if Airbus decides to go ahead with a A220-500, that will divert some of that limited capacity. It may take DL a decade to get 100 more A220-100s
 
TObound
Posts: 783
Joined: Mon May 27, 2019 12:54 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 4:27 am

jagraham wrote:
The 717s hang around a bit because they don't have MD80 engines or instruments. And because DL wants to shift to 76 seat RJ flying a little further. To do so, the 100 seat category must grow some more. So another year or two of A220 deliveries need to go to 100 seat growth. Then the 717 replacement cycle can begin.


Spot on. The only question is how the economy plays into the cycle. A recession would drive them to park planes faster. Given 100 seater requirements at mainline would that impact 717s?

jagraham wrote:
Note also that there are A220 production constraints. And if Airbus decides to go ahead with a A220-500, that will divert some of that limited capacity. It may take DL a decade to get 100 more A220-100s


The current ramp has stabilized. And they are on track to hit rate 14 by the end of 2024. Some rough math suggests their entire backlog will be clear by then. So it really wouldn't take till the end of the decade to field 100 A221s if they really wanted. They've already got orders in for 45. And they have at least 30 options left to exercise. I see them flying at least 200 A220s by 2030, using that fleet to replace the 319s, 320s, 73Gs and 717s. Exercising the options they have and ordering another 75 frames would let them do that. Aggressive but doable by 2030.
 
User avatar
DeltaMD90
Posts: 8928
Joined: Tue Apr 15, 2008 11:25 pm

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 4:59 am

Makes me wonder why they went with all the various types they currently had... delivery slots? Opportunistic purchases? They've been shrewd in a lot of their deals, no doubt, but increasing fleet types does come at a cost. Are they having a change of heart? Or only doing the logical thing after a bunch of deals too good to resist?
 
PSU.DTW.SCE
Posts: 8166
Joined: Mon Jan 28, 2002 11:45 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 5:06 am

again it’s a bit of a softball since it’s what the investors want to hear. Upgauging, fleet simplification, capacity disipline all are what the investors want to hear, most of which have zero clue on the operational nuances and complexity of the industry.

They are at the point where the pre merger fleet is approaching retirement over the next decade so it’s a logical next step.
 
Dalmd88
Posts: 3150
Joined: Fri Jul 28, 2000 3:19 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 3:06 pm

DeltaMD90 wrote:
Makes me wonder why they went with all the various types they currently had... delivery slots? Opportunistic purchases? They've been shrewd in a lot of their deals, no doubt, but increasing fleet types does come at a cost. Are they having a change of heart? Or only doing the logical thing after a bunch of deals too good to resist?

A few reasons. Plan for the MD90 and MD11 was either buy up every last one or shed them rapidly. Bought the 90, but now we have to let them go due to rising mtc costs. MD11 exits so more 777. NW merger brought in all the Airbus fleets plus the 757ER and -300. 717 a deal too good to pass up to rid us of the 50 seat RJ. The CanBus is seen as a future fleet for the lower gauge of the fleet, also a real good deal I imagine. A350 likely a better deal than more 777. The A350 deal also brought in a lot of MRO engine work from R-R. This can also be said for the CanBus with the GTF. Those two engine contracts could possibly offset most of DL's mtc costs for all fleet types.
 
MIflyer12
Topic Author
Posts: 8300
Joined: Mon Feb 18, 2013 11:58 pm

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 3:16 pm

DeltaMD90 wrote:
Makes me wonder why they went with all the various types they currently had... delivery slots? Opportunistic purchases? They've been shrewd in a lot of their deals, no doubt, but increasing fleet types does come at a cost. Are they having a change of heart? Or only doing the logical thing after a bunch of deals too good to resist?


They have gotten around to 'Complexity comes at a cost.' They've tried to concentrate types as certain stations - not just MD-88/MD-90 out of ATL but also no more flying eight types into MCI kind of thing. That has maintenance efficiencies. There are big pilot efficiencies - more subs available, less training across types. More subs means better operational reliability. I don't see them turning into WN but somebody must have built some impressive cost worksheets to change their way of thinking.
 
TObound
Posts: 783
Joined: Mon May 27, 2019 12:54 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 3:37 pm

There's cost savings from commonality. But also the ability to leverage large orders to get large discounts when timed right.

They have 137 330CEOs, 767s and 777s. They have another 49 339s and 359s on order. That means 88 frames to replace in due course. They'll get Emirates levels of discounts when they replace nearly 90 frames with 1-2 types.

They played it right. The bought used frames when they were cheap. And now have the capital to buy lots of new frames when the OEMs are willing to negotiate.
 
WidebodyPTV
Posts: 279
Joined: Fri Sep 20, 2019 9:06 pm

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 6:47 pm

A lot of people are reading too deeply into his comments (although I know that a.net loves nothing more than a good fleet replacement thread). Let's add some facts to this thread.

Here is a breakdown of DL's fleet, by the total number of aircraft and the year in which they entered service for their original operator (mainline aircraft only; excludes MD-88, MD-90 and the VIP-configured 757):

1990 - 11
1991 - 14
1992 - 33
1993 - 17
1994 - 0
1995 - 7
1996 - 17
1997 - 19
1998 - 35
1999 - 55
2000 - 84
2001 - 85
2002 - 63
2003 - 30
2004 - 18
2005 - 10
2006 - 8
2007 - 8
2008 - 6
2009 - 12
2010 - 4
2011 - 0
2012 - 1
2013 - 14
2014 - 20
2015 - 23
2016 - 37
2017 - 48
2018 - 63
2019 - 78

The number of aircraft that DL will need to replace in the next decade (remember, that list doesn't include the MD-88/MD-90) is astonishing. These aircraft will likely collectively average 30-years-old by the time they're retired... and given that DL has 55 B767 (including 34 B763) that went into service in 1997 or later, sorry to disappoint but they'll be around for quite awhile. Given that DL's discussed that it expected 737NG / 320CEO values to fall as MAX & NEOs mature into service, I'd expect that DL will seek late-model, second-hand 737NG and 320CEO to back-fill its fleet (and probably 330CEO and 777 as well). So for everybody wondering what will replace the 320CEO... it could very well be more 320CEO!!
 
VictorKilo
Posts: 256
Joined: Wed Jul 05, 2006 7:39 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 7:10 pm

A couple of implications of the fleet rationalization idea:

First, DL can now say that they’re not ordering the MAX to keep their fleet simple, not because of any of the issues related to the MAX.

Second, DL has no interest in acquiring a new fleet type to allow it to fly >5000mi routes with planes smaller than a 359 or 339.

Third, DL wants a NMA family that can fly TATL 757/767 routes. If the NMA doesn’t happen, will that change the number from 8?
 
SteelChair
Posts: 1437
Joined: Fri Aug 25, 2017 11:37 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 7:19 pm

WidebodyPTV wrote:
A lot of people are reading too deeply into his comments (although I know that a.net loves nothing more than a good fleet replacement thread). Let's add some facts to this thread.

Here is a breakdown of DL's fleet, by the total number of aircraft and the year in which they entered service for their original operator (mainline aircraft only; excludes MD-88, MD-90 and the VIP-configured 757):

1990 - 11
1991 - 14
1992 - 33
1993 - 17
1994 - 0
1995 - 7
1996 - 17
1997 - 19
1998 - 35
1999 - 55
2000 - 84
2001 - 85
2002 - 63
2003 - 30
2004 - 18
2005 - 10
2006 - 8
2007 - 8
2008 - 6
2009 - 12
2010 - 4
2011 - 0
2012 - 1
2013 - 14
2014 - 20
2015 - 23
2016 - 37
2017 - 48
2018 - 63
2019 - 78

The number of aircraft that DL will need to replace in the next decade (remember, that list doesn't include the MD-88/MD-90) is astonishing. These aircraft will likely collectively average 30-years-old by the time they're retired... and given that DL has 55 B767 (including 34 B763) that went into service in 1997 or later, sorry to disappoint but they'll be around for quite awhile. Given that DL's discussed that it expected 737NG / 320CEO values to fall as MAX & NEOs mature into service, I'd expect that DL will seek late-model, second-hand 737NG and 320CEO to back-fill its fleet (and probably 330CEO and 777 as well). So for everybody wondering what will replace the 320CEO... it could very well be more 320CEO!!


Thank you for posting that.

The "record" 78 delivered in 2019 is not a record at all, and is barely sufficient to keep up with what is needed. I think the projection for 2020 is back down in the 60s, and that is far below what is needed.
 
xdlx
Posts: 965
Joined: Mon Aug 04, 2008 12:29 pm

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 7:43 pm

I do not understand why has delta not picked up some 77W since the ER will eventually go away?

lightsaber wrote:
MIflyer12 wrote:
Select the '8-K, Current Report Filing' from the available choices. https://ir.delta.com/financials/default.aspx#sec

This is the first time I recall DL talking about fleet simplification as a goal: Reduce complexity with fewer aircraft types. From 13 (2020 estimate) to 8 fleet families by some unspecified future date.

Year-over-year revenue growth:

9% core hubs
10% coastal hubs
14% focus cities
domestic systemwide 8% vs. 4% for industry

Dumping an early $500 million into the pension plan this month/qtr. (The Feds don't mandate any contributions this year but the plan is still under-funded.)

Projecting after-tax ROIC of 15% this year vs. 11% in 2010. (IIRC, Southwest routinely beats that.)

Core Cap-Ex spending of $4.5 Billion in 2020 comparable to 2019. Expecting ~80 new aircraft deliveries.

Going from 13 to 8 fleet types is Wise:
Current types:
A220
A320 CEO
*A330 CEO
A330 NEO
A350
717
737NG
*757
*767
*777-200ER (RR Engines)
777-200LR (GE engines)
*MD-88
*MD-90

I put a star next to the frames I think will leave, add A321NEO. No huge surprises.

Lightsaber
 
WidebodyPTV
Posts: 279
Joined: Fri Sep 20, 2019 9:06 pm

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 8:04 pm

VictorKilo wrote:
A couple of implications of the fleet rationalization idea:

First, DL can now say that they’re not ordering the MAX to keep their fleet simple, not because of any of the issues related to the MAX.

Second, DL has no interest in acquiring a new fleet type to allow it to fly >5000mi routes with planes smaller than a 359 or 339.

Third, DL wants a NMA family that can fly TATL 757/767 routes. If the NMA doesn’t happen, will that change the number from 8?


You and others are reading too much into these comments. DL merely mentioned that as the decade goes on, its "complex" fleet is on track to be simplified to "nine or less" types, which will save the company tens of millions. Such comments are typical for these types of events. But I don't doubt for a second that if the right deal came up, DL would order the MAX or 787, there's no hard or fast rule that they HAVE to have nine or less types.

Nor has DL ever formally stated interest in a 757/767 replacement. The comments that have been made are informal, and directly in response to 'why aren't you ordering Boeing?' I'd bet $$$ that DL's more interested in Boeing building a 737 replacement... than a 757/767. Worth noting that in the transcript they mention that they're unsure if a narrowbody across the Atlantic makes financial sense given their current labor cost...
 
TObound
Posts: 783
Joined: Mon May 27, 2019 12:54 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 8:43 pm

Does DL have a lot of TATL with 757s?
 
SteelChair
Posts: 1437
Joined: Fri Aug 25, 2017 11:37 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 8:50 pm

MIflyer12 wrote:
Select the '8-K, Current Report Filing' from the available choices. https://ir.delta.com/financials/default.aspx#sec

This is the first time I recall DL talking about fleet simplification as a goal: Reduce complexity with fewer aircraft types. From 13 (2020 estimate) to 8 fleet families by some unspecified future date.


In the late 90s Delta's plan was only 4 fleet types: 737, 757, 767, and 777.
 
SteelChair
Posts: 1437
Joined: Fri Aug 25, 2017 11:37 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 9:47 pm

MIflyer12 wrote:
Select the '8-K, Current Report Filing' from the available choices. https://ir.delta.com/financials/default.aspx#sec

This is the first time I recall DL talking about fleet simplification as a goal: Reduce complexity with fewer aircraft types. From 13 (2020 estimate) to 8 fleet families by some unspecified future date.


Dupe
 
Sightseer
Posts: 997
Joined: Mon Jan 12, 2015 6:04 am

Re: Delta Investor Day Presentation 12/12/2019

Sat Dec 14, 2019 10:46 pm

SteelChair wrote:
MIflyer12 wrote:
Select the '8-K, Current Report Filing' from the available choices. https://ir.delta.com/financials/default.aspx#sec

This is the first time I recall DL talking about fleet simplification as a goal: Reduce complexity with fewer aircraft types. From 13 (2020 estimate) to 8 fleet families by some unspecified future date.


In the late 90s Delta's plan was only 4 fleet types: 737, 757, 767, and 777.


Five. Don't forget the MDs.
 
WidebodyPTV
Posts: 279
Joined: Fri Sep 20, 2019 9:06 pm

Re: Delta Investor Day Presentation 12/12/2019

Sun Dec 15, 2019 3:54 am

WA707atMSP wrote:
One issue which won't help "fleet simplification", but still needs to be dealt with is replacing the ex-NW A320s. The newest A320 just turned 20 years old, and much of the fleet is 25+ years old. Many of these aircraft are older than the 717s, and they're going to need to be retired in the next 5 to 10 years. I also think that when a recession comes and DL needs to reduce capacity, they may retire at least some of these aircraft as they come due for D-checks, rather than continuing to invest in them.


The 320 are common with the 319 and 321, so keeping them around isn't much of an issue. 35 of the original 50 320 delivered to NW remain in DL's fleet; these aircraft were delivered from 1990 through 1993 and were intended to be replaced with the 739 at one time. The other 27 were delivered from 1998 until 2003, making them similar in age to the 738 fleet. The 320 will be around for quite awhile... and I would be surprised IF DL didn't add used, late-model frames as CEO residuals drop. Including the MD-88/90, at least 60% of the mainline fleet will need to be replaced in the next decade... that's a major drain on capital; it would be surprising if DL didn't add used frames and set its sights on a 737/320 replacement program.

320 deliveries by year: 90 (1), 91 (4), 92 (20), 93 (10), 98 (13), 99 (7), 01 (3), 02 (2), 03 (2).
319 deliveries by year: 99 (2), 00 (7), 01 (13), 02 (22), 03 (13)
321 deliveries by year: 16 (14), 17 (20), 18 (31), 19 (30)

SteelChair wrote:
The "record" 78 delivered in 2019 is not a record at all, and is barely sufficient to keep up with what is needed. I think the projection for 2020 is back down in the 60s, and that is far below what is needed.


The number of aircraft delivered this year is a record for DL. Keep in mind the numbers I posted are for when the aircraft in DL's current fleet entered service (not limited to DL). So the watermark years of 2000 and 2001 include deliveries to DL, NW, FL (717), TW (757), etc.
 
WidebodyPTV
Posts: 279
Joined: Fri Sep 20, 2019 9:06 pm

Re: Delta Investor Day Presentation 12/12/2019

Sun Dec 15, 2019 4:06 am

Sightseer wrote:
SteelChair wrote:
MIflyer12 wrote:
Select the '8-K, Current Report Filing' from the available choices. https://ir.delta.com/financials/default.aspx#sec

This is the first time I recall DL talking about fleet simplification as a goal: Reduce complexity with fewer aircraft types. From 13 (2020 estimate) to 8 fleet families by some unspecified future date.


In the late 90s Delta's plan was only 4 fleet types: 737, 757, 767, and 777.


Five. Don't forget the MDs.


Short memories? DL's fleet was hardly simplified in the late 1990s...

L1011-1/25 (not retired until 2001)
L1011-500 (not retired until 2001)

MD-88
MD-90
MD-11 (not retired until 2004)

727-200A (not retired until 2003)
737-200A (not retired until 2006)
737-300 (not retired until 2006)
737-300 - Glass Cockpit (not retired until 2006)
737-800
757-200
767-200 (not retired until 2006)
763-300
763-300ER
764-400ER
777-200ER
 
User avatar
PacoMartin
Posts: 901
Joined: Sun May 27, 2018 8:18 pm

Re: Delta Investor Day Presentation 12/12/2019

Sun Dec 15, 2019 4:36 am

thewizbizman wrote:
They have made statements they want to keep the type B717 through 2030, also they are on a lease to buy with Southwest, so I dont see them going anywhere until at least early 2030s.


That is interesting that Delta is going to keep their B717s until their average age is about 30 years. Although it is true that Delta's smaller single aisle jet fleet is currently older than United's, that is rapidly changing as they acquire A220s and retire MD-80s

406 Delta Airlines 19.42 years
27 Airbus A220 0.5
57 Airbus A319 17.8
62 Airbus A320 24.3
91 Boeing 717 18.2
10 Boeing 737-700 10.9
77 Boeing 737-800 18.3
54 McDonnell Douglas MD-80 28.6
28 McDonnell Douglas MD-90 22.5

528 American 11.76 years
132 Airbus A319-100 15.5
48 Airbus A320-200 18.5
304 Boeing 737-800 9.9
24 Boeing 737 MAX 8 1.2
20 Embraer ERJ-190 11.9

361 United 18.37 years
80 Airbus A319 18.00
99 Airbus A320 21.40
41 Boeing 737-700 20.60
141 Boeing 737-800 15.80

United Airlines has only acquired 68 new B738s since 2001. Other than those 68 jets, they have not done anything to add new smaller jets to their fleet.
2002 4
2003 4
2004 11
2005 7
2006 6
2008 12
2010 10
2011 3
---- post Continental merger
2016 7
2017 4

I think Delta will inevitably poach a big percentage of United's passengers in smaller Domestic airports which won't be well served by the B737-900s.
 
WidebodyPTV
Posts: 279
Joined: Fri Sep 20, 2019 9:06 pm

Re: Delta Investor Day Presentation 12/12/2019

Sun Dec 15, 2019 4:48 am

Clarification on the 717 longevity: if you read the transcript, DL said it's keeping the 717 around because of its low capital cost, and that the type will be its "flex fleet" going forward (e.g. their utilization depends entirely on economic conditions & needs). They also mentioned that it will be retired "this" (2020s) decade, although they didn't know when. Most likely... the aircraft have one major overhaul left in them, and the fleet will gradually shrink as DL cannibalizes frames for parts.
 
CriticalPoint
Posts: 1062
Joined: Thu Jan 19, 2017 5:01 pm

Re: Delta Investor Day Presentation 12/12/2019

Sun Dec 15, 2019 4:52 am

PacoMartin wrote:
thewizbizman wrote:
They have made statements they want to keep the type B717 through 2030, also they are on a lease to buy with Southwest, so I dont see them going anywhere until at least early 2030s.


That is interesting that Delta is going to keep their B717s until their average age is about 30 years. Although it is true that Delta's smaller single aisle jet fleet is currently older than United's, that is rapidly changing as they acquire A220s and retire MD-80s

406 Delta Airlines 19.42 years
27 Airbus A220 0.5
57 Airbus A319 17.8
62 Airbus A320 24.3
91 Boeing 717 18.2
10 Boeing 737-700 10.9
77 Boeing 737-800 18.3
54 McDonnell Douglas MD-80 28.6
28 McDonnell Douglas MD-90 22.5

528 American 11.76 years
132 Airbus A319-100 15.5
48 Airbus A320-200 18.5
304 Boeing 737-800 9.9
24 Boeing 737 MAX 8 1.2
20 Embraer ERJ-190 11.9

361 United 18.37 years
80 Airbus A319 18.00
99 Airbus A320 21.40
41 Boeing 737-700 20.60
141 Boeing 737-800 15.80

United Airlines has only acquired 68 new B738s since 2001. Other than those 68 jets, they have not done anything to add new smaller jets to their fleet.
2002 4
2003 4
2004 11
2005 7
2006 6
2008 12
2010 10
2011 3
---- post Continental merger
2016 7
2017 4

I think Delta will inevitably poach a big percentage of United's passengers in smaller Domestic airports which won't be well served by the B737-900s.


Don’t forget about the China southern 319s, the easy jet 319s the Southwest 737-700s and the 2 320s they got from some European carrier. I think that’s somewhere around 50 small jets. Granted not all have been delivered yet......but they will almost all be here by the end of next year.
 
TTailedTiger
Posts: 2635
Joined: Sun Aug 26, 2018 5:19 am

Re: Delta Investor Day Presentation 12/12/2019

Sun Dec 15, 2019 6:39 am

When could we hear about some regional flying out of MIA to feed LATAM flights? I would think one or two E175 or CRJ-7/9 would work well to cities like MCO, TPA, JAX, PNS, RDU, CHS, BNA. I could also see CVG and LAX returning.
 
User avatar
fanoftristars
Posts: 1669
Joined: Mon Jul 17, 2000 9:03 am

Re: Delta Investor Day Presentation 12/12/2019

Sun Dec 15, 2019 4:04 pm

WidebodyPTV wrote:
Sightseer wrote:
SteelChair wrote:

In the late 90s Delta's plan was only 4 fleet types: 737, 757, 767, and 777.


Five. Don't forget the MDs.


Short memories? DL's fleet was hardly simplified in the late 1990s...

L1011-1/25 (not retired until 2001)
L1011-500 (not retired until 2001)

MD-88
MD-90
MD-11 (not retired until 2004)

727-200A (not retired until 2003)
737-200A (not retired until 2006)
737-300 (not retired until 2006)
737-300 - Glass Cockpit (not retired until 2006)
737-800
757-200
767-200 (not retired until 2006)
763-300
763-300ER
764-400ER
777-200ER

I think he meant that's what Delta's long term fleet plan was, not their 1990s fleet.
"FLY DELTA JETS"

Popular Searches On Airliners.net

Top Photos of Last:   24 Hours  •  48 Hours  •  7 Days  •  30 Days  •  180 Days  •  365 Days  •  All Time

Military Aircraft Every type from fighters to helicopters from air forces around the globe

Classic Airliners Props and jets from the good old days

Flight Decks Views from inside the cockpit

Aircraft Cabins Passenger cabin shots showing seat arrangements as well as cargo aircraft interior

Cargo Aircraft Pictures of great freighter aircraft

Government Aircraft Aircraft flying government officials

Helicopters Our large helicopter section. Both military and civil versions

Blimps / Airships Everything from the Goodyear blimp to the Zeppelin

Night Photos Beautiful shots taken while the sun is below the horizon

Accidents Accident, incident and crash related photos

Air to Air Photos taken by airborne photographers of airborne aircraft

Special Paint Schemes Aircraft painted in beautiful and original liveries

Airport Overviews Airport overviews from the air or ground

Tails and Winglets Tail and Winglet closeups with beautiful airline logos