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Lootess
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Re: Delta ALPA concerned over continued JV scope flying violations

Fri Aug 21, 2020 2:40 pm

It's not like Delta wasn't actively trying to get the JV scope flying under control before the pandemic. From attempting to buy LATAM's A350s to use for those South America routes in the short term, and inhering their A350 order book. The 777 likely would have still been flying as well. Now they will be more behind than they were previously.

Things should land closer to what the contract says over time because you have other factors like AF retiring the A380, VA retrenchment, KE is doing fine but that transpac hub was also getting started in 2019.
 
Cactusjuba
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Re: Delta ALPA concerned over continued JV scope flying violations

Fri Aug 21, 2020 3:31 pm

Lootess wrote:
It's not like Delta wasn't actively trying to get the JV scope flying under control before the pandemic. From attempting to buy LATAM's A350s to use for those South America routes in the short term, and inhering their A350 order book. The 777 likely would have still been flying as well. Now they will be more behind than they were previously.

Things should land closer to what the contract says over time because you have other factors like AF retiring the A380, VA retrenchment, KE is doing fine but that transpac hub was also getting started in 2019.


You can't say the 350s from LATAM we're to fix their scope violations, and executives never expressed that either. They stated it was for growth and fleet replacement, in context with more opportunities to fly to South America. Consider that Aeromexico and Korean JVs were the primary offenses, with a fair portion of the KE dispute resulting from Japan flying reductions out of Hawaii (which is included in the flying ratios).

"It's not like Delta wasn't actively trying to get the JV scope flying under control before the pandemic..." that's not true at all. When it was clear that they we're in violation, they went years without doing anything except waiting for a grievance hearing, and they attempted to lobby that Japan shouldn't be included (it was in the contract, and KE flew TYO-HNL). And the Mexico violations were blatant, cheaper to pay the fine than do the right thing kinda deal.
 
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adambrau
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Re: Delta ALPA concerned over continued JV scope flying violations

Sat Aug 22, 2020 5:01 am

Cactusjuba wrote:
adambrau wrote:
As an AF employee at JFK, I can only say that Delta folks were better paid prior to the pandemic.

Delta and ALPA agreed to use JV partners where DL could not compete.

No one is making money these days.

Agree the line can be angry at DL management for allowing us to dominate JFK-CDG. And more so to KE beyond ICN.

No one complained much until the Virus brought everyone to their knees. Everyone said AA and UA were smarter to increase their int'l flying while DL outsourced.

But the truth is DL was smart to outsource int'l flying, because now UA and AA are going to tank.

Domestic travel will pick up first.

Let's keep the Skyteam happy fellas.


Not true. Pilot's have been fighting for a long time. Only since Ed took the helm have we seen this aggressive push to favor lower cost JV partners in lieu of organic growth. The non-contract employees are ignorant because they only hear what their bosses tell them. And for the record, the ALPA message has never been anti-JV, only 'equitable growth" and both airlines (including stakeholders like employees) equally growing together.

But their CFO said earlier this year: "through our alliance network and joint ventures… we are able to really broaden the network internationally and globally with a much more effective rate of return…more than it would be for us to buy widebody airplanes and go out and grow organically…”.

Delta asked ALPA in negotiations last year to set the baseline for the Aeromexico JV at 66% AM, 33% DL. The JVs for AM and KE still have not reached any ratio agreement, as DL firmly commits to less than equitable ratios. We read above why they don't want to grow organically. This pandemic has swung leverage back towards management. Never let a good crisis go to waste. ALPA has been stalled in scope negotiations for years now. Pilots have learned hard scope lessons in the past, and won't be played like a fiddle this round.


While I admit I don't know much about AM or KE negotiations with DL, I do suspect AF has higher overall costs than DL. But we are in the JV with DL KL and VS so revenue should be shared. Regardless as a DL flight crew - I would be angry at all the outsourcing of DL int'l flying to it's partners. In the medium term all airlines need to find a way to survive until int'l returns.

Wishing our DL cousins the best. It's gonna be tough and rumor-driven experience for the next 18 - 24 months. Stay strong all!
JFK Friendly
 
abrelosojos
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Re: Delta ALPA concerned over continued JV scope flying violations

Sat Aug 22, 2020 2:15 pm

I can't believe I am going to support DALPA on this, but they are right. It is a contractual obligation, and DL should not have entered if it did not have plan to honor it.

Saludos,.
Alex
Live, and let live.
 
775899
Posts: 1033
Joined: Sat Jul 27, 2019 8:03 pm

Re: Delta ALPA concerned over continued JV scope flying violations

Sat Aug 22, 2020 3:36 pm

It seems there needs to be limits on how many JV partnerships can be entered into in the first place. For example, DL shouldn’t be allowed to have both AM and WS, VS and AF/KL, etc. It should be one per continent.

Furthermore, there ought to be stricter enforcement of metal neutral flying.
 
n9801f
Posts: 364
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Re: Delta ALPA concerned over continued JV scope flying violations

Sat Aug 22, 2020 5:09 pm

Remarkable. Can't remember any other airline found guilty of so many violations, though please correct me if that's wrong.

Seems to show very poor faith

As mentioned previously, non-organized employees should take note. If this behavior occurs when a contract's in place, imagine what happens when there's none.

For DALPA, not only is there the question of the JV flying given to partners instead of Delta, there's the question that $4 BILLION was spent to buy stakes in overseas partners, and those stakes are highly likely to evaporate in Chapter 11 proceedings.

Net result seems that $4B was spent to buy nothing.

Now Delta wants taxpayer money?
 
IPFreely
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Re: Delta ALPA concerned over continued JV scope flying violations

Sun Aug 23, 2020 12:03 am

Lootess wrote:
It's not like Delta wasn't actively trying to get the JV scope flying under control before the pandemic. From attempting to buy LATAM's A350s to use for those South America routes in the short term, and inhering their A350 order book. The 777 likely would have still been flying as well. Now they will be more behind than they were previously.

Things should land closer to what the contract says over time because you have other factors like AF retiring the A380, VA retrenchment, KE is doing fine but that transpac hub was also getting started in 2019.


What Delta was "actively trying" to do is irrelevant. So is "things should land closer". A contract is a contract, unless the contract says Delta "should try" or should "come close" to the terms, they are in violation. An ethical company doesn't sign a contract then "try" or "come close" to living up to their commitment.

I don't normally support unions but a contract is a contract. Delta is behaving in a highly unethical manner and the union should, and probably will, pursue and receive full compensation.
 
FlyHossD
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Re: Delta ALPA concerned over continued JV scope flying violations

Sun Aug 23, 2020 5:08 pm

IPFreely wrote:
Lootess wrote:
It's not like Delta wasn't actively trying to get the JV scope flying under control before the pandemic. From attempting to buy LATAM's A350s to use for those South America routes in the short term, and inhering their A350 order book. The 777 likely would have still been flying as well. Now they will be more behind than they were previously.

Things should land closer to what the contract says over time because you have other factors like AF retiring the A380, VA retrenchment, KE is doing fine but that transpac hub was also getting started in 2019.


What Delta was "actively trying" to do is irrelevant. So is "things should land closer". A contract is a contract, unless the contract says Delta "should try" or should "come close" to the terms, they are in violation. An ethical company doesn't sign a contract then "try" or "come close" to living up to their commitment.

I don't normally support unions but a contract is a contract. Delta is behaving in a highly unethical manner and the union should, and probably will, pursue and receive full compensation.


I consider this to be a rather short-sighted action by Delta and the Scope violations predate the COVID crisis. The message this sends to the other employee groups will be unmistakable except to the heaviest Kool-Aid drinkers.
My statements do not represent my former employer or my current employer and are my opinions only.
 
strfyr51
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Re: Delta ALPA concerned over continued JV scope flying violations

Sun Aug 23, 2020 5:34 pm

Here's the problem as I see it. Delta has had a Long and Harmonious relationship with it's ALPA contingent. But not all of these guys are homegrown Delta either.
Quite a few have come from Northwest. and they KNOW how it used to be at Northwest. So? it's just a matter of time and effort to see that Delta is playing a game. and a Game they might NOT like as well..
Bringing in outsourced work they could be doing? And you're intending to park some of their pilots in the process?? REALLY? Would any of YOU go for some mess like that?? Now I know some A-net types would go for that, but? How many A-net professional Pilots would go for that mess?? In truth? I'm retired. So I don't have a dog in this fight. and? i have Never worked for Delta. I worked for United. My nephew works for Delta. and he chose to work there as Atlanta is his home town.
 
Wayfarer515
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Re: Delta ALPA concerned over continued JV scope flying violations

Sun Aug 23, 2020 6:29 pm

It´s funny how DALPA complains about their JV partners doing the flying instead of Delta pilots, buy they are doing exactly the same to Aeromexico's pilots by taking routes previously flown by Aeromexico and now being flown by Delta. Hypocrisy and hubris at its best.

If they want to remain competitive, they should consider taking a good paycut like everybody else, if not, prepare to go bust.
 
Corpsnerd09
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Re: Delta ALPA concerned over continued JV scope flying violations

Sun Aug 23, 2020 8:14 pm

Wayfarer515 wrote:
It´s funny how DALPA complains about their JV partners doing the flying instead of Delta pilots, buy they are doing exactly the same to Aeromexico's pilots by taking routes previously flown by Aeromexico and now being flown by Delta. Hypocrisy and hubris at its best.

If they want to remain competitive, they should consider taking a good paycut like everybody else, if not, prepare to go bust.


Why exactly should they care about AM's pilots?
 
bigb
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Re: Delta ALPA concerned over continued JV scope flying violations

Sun Aug 23, 2020 8:34 pm

Wayfarer515 wrote:
It´s funny how DALPA complains about their JV partners doing the flying instead of Delta pilots, buy they are doing exactly the same to Aeromexico's pilots by taking routes previously flown by Aeromexico and now being flown by Delta. Hypocrisy and hubris at its best.

If they want to remain competitive, they should consider taking a good paycut like everybody else, if not, prepare to go bust.


TheAM pilots need to negotiate a scope into theiR contract...
 
Boof02671
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 1:44 am

n9801f wrote:
Remarkable. Can't remember any other airline found guilty of so many violations, though please correct me if that's wrong.

Seems to show very poor faith

As mentioned previously, non-organized employees should take note. If this behavior occurs when a contract's in place, imagine what happens when there's none.

For DALPA, not only is there the question of the JV flying given to partners instead of Delta, there's the question that $4 BILLION was spent to buy stakes in overseas partners, and those stakes are highly likely to evaporate in Chapter 11 proceedings.

Net result seems that $4B was spent to buy nothing.

Now Delta wants taxpayer money?

Delta has written off $2 billion in ownership of Virgin Australia, LATAM and AeroMexico. Virgin Atlantic isn’t doing to well either.
 
Max Q
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 2:38 am

A contract is a contract, if management wants to change it there’s a negotiation process


If they don’t follow that it’s completely appropriate the union take legal action
The best contribution to safety is a competent Pilot.


GGg
 
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par13del
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 3:45 am

So why exactly have the DL pilots not withdrawn their service?
DL at present is only a domestic carrier, so all activity would stop. I can understand the pilots giving a break after the first break, but multiple and wining arbitration and they are still working? I guess the bonus program bought a lot of loyalty.
 
Boof02671
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 4:15 am

par13del wrote:
So why exactly have the DL pilots not withdrawn their service?
DL at present is only a domestic carrier, so all activity would stop. I can understand the pilots giving a break after the first break, but multiple and wining arbitration and they are still working? I guess the bonus program bought a lot of loyalty.

Because they can’t strike by law which is the Railway Labor Act. That’s why there is a no lockout no strike clause until if they were in Section 6 negotiations and the NMB releases them to a 30 day cooling off period.
Before you post your anti union garbage take the time to educate yourself on the process. DALPA won multiple arbitration’s on this matter and Delta hasn’t corrected it yet.

http://www.pennfedbmwe.org/Docs/referen ... ified.html
 
Cactusjuba
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 6:15 am

Wayfarer515 wrote:
It´s funny how DALPA complains about their JV partners doing the flying instead of Delta pilots, buy they are doing exactly the same to Aeromexico's pilots by taking routes previously flown by Aeromexico and now being flown by Delta. Hypocrisy and hubris at its best.

If they want to remain competitive, they should consider taking a good paycut like everybody else, if not, prepare to go bust.


Nobody cares about routes. Who cares about routes? What's the big deal if DL takes a LAX-MEX flight when AM then takes GDL-SLC? It's block hours. Flagarant strawman argument.

Flights between the USA-MEX are within a profit/loss JV. DL wanted the ratio to be 33% DL, 66% AM, with many of them AM connect on 190s. Same ones that took-off into a T-storm with an intern in the co-pilot seat at Durango. Total outsourcing to dirt cheap Mexican regional airline labor. What's fair is that both airlines grow equally. So no, never been about screwing AM pilots, just equitable and fair growth for everyone.

Why should pilots take cuts in the 10s to 100 millions annually, when this is a revenue issue? Aren't pilots already working slashed hours and no overtime, thus making less than before? If all the pilots worked for free, DL would save enough cash to stay alive only about a week from pandemic highs. Nevermind $12B in stock buybacks, billions in JV losses, and the $170M the Chief Executive compensated himself in the boom years. It's the greedy pilots who just 10 years ago took net 60% paycuts and wiped out pensions to blame? Please, your hypocrisy and hubris is showing.
 
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TVNWZ
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 1:52 pm

In the end a group of pilots designated by the union as being harmed will get a bunch of penalty pay. Most likely.
 
deltairlines
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 3:38 pm

Wayfarer515 wrote:
It´s funny how DALPA complains about their JV partners doing the flying instead of Delta pilots, buy they are doing exactly the same to Aeromexico's pilots by taking routes previously flown by Aeromexico and now being flown by Delta. Hypocrisy and hubris at its best.

If they want to remain competitive, they should consider taking a good paycut like everybody else, if not, prepare to go bust.


Under the agreement, there was a certain percentage of ASMs that were to be on Delta metal.

If you look at the route networks pre-COVID, Delta handled all the beach market flying (which was substantial), while AM handled most of the business destinations to the US (with DL metal only on ATL-MEX and a single frequency to JFK/DTW/LAX/SLC daily, plus MTY-ATL/DTW and GDL-ATL).

With COVID hitting, a lot of that beach flying is gone. CZM has already been completely pulled off the map. A lot of CUN flying has been cut (those 30 flights on Saturdays add up really fast to the allocated flying total). Moving those JFK/LAX-MEX frequencies to DL metal simply rebalances things to account for the shift in market dynamics.
 
FlyHossD
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 4:07 pm

Boof02671 wrote:
par13del wrote:
So why exactly have the DL pilots not withdrawn their service?
DL at present is only a domestic carrier, so all activity would stop. I can understand the pilots giving a break after the first break, but multiple and wining arbitration and they are still working? I guess the bonus program bought a lot of loyalty.

Because they can’t strike by law which is the Railway Labor Act. That’s why there is a no lockout no strike clause until if they were in Section 6 negotiations and the NMB releases them to a 30 day cooling off period.
Before you post your anti union garbage take the time to educate yourself on the process. DALPA won multiple arbitration’s on this matter and Delta hasn’t corrected it yet.

http://www.pennfedbmwe.org/Docs/referen ... ified.html


Spot on. par13del really needs to read the Railway Labor Act. DL is clearly in violation of the DL ALPA contract and is making no effort to come into compliance.
My statements do not represent my former employer or my current employer and are my opinions only.
 
Cactusjuba
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 4:44 pm

TVNWZ wrote:
In the end a group of pilots designated by the union as being harmed will get a bunch of penalty pay. Most likely.

No, since scope affects all pilots , they will all get a check. Probably just a small amount x 14500.
 
TYWoolman
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 4:52 pm

Wonder how much of the newly announced Delta international expansion for 2021 is part reconciliatory. (?)
 
Cactusjuba
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 7:19 pm

TYWoolman wrote:
Wonder how much of the newly announced Delta international expansion for 2021 is part reconciliatory. (?)

This underscores a point spoken about further up thread. Which is, scope doesn't just protect pilot jobs from outsourcing. Delta flying all these routes keeps tens of thousands of non-pilot workers employed directly and indirectly in the US aviation sector. Thank god these scope clauses.
 
Cactusjuba
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Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 24, 2020 7:42 pm

Delta just announced 1,941 pilot furloughs.
 
KFLLCFII
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 4:18 am

I agree with the pilots...keep Delta metal moving until they've bled out the entire company of liquid assets and can no longer pay the fuel supplier. We had a contract, remember?

Oh wait, their Trainer oil refinery should more than adequately be able to handle the company's fuel needs.
"About the only way to look at it, just a pity you are not POTUS KFLLCFII, seems as if we would all be better off."
 
Boof02671
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 2:03 pm

TYWoolman wrote:
Wonder how much of the newly announced Delta international expansion for 2021 is part reconciliatory. (?)

Delta just posted massive international cuts for 2021 through October
 
Boof02671
Posts: 2546
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 2:17 pm

KFLLCFII wrote:
I agree with the pilots...keep Delta metal moving until they've bled out the entire company of liquid assets and can no longer pay the fuel supplier. We had a contract, remember?

Oh wait, their Trainer oil refinery should more than adequately be able to handle the company's fuel needs.

So Delta should just get a pass for violating a contract they agreed too? And these violations occurred pre Covid.

So what if your mortgage or car loan said we are just going to double your payments even though you have a signed contract with them?
 
KFLLCFII
Posts: 3617
Joined: Sat Sep 11, 2004 7:08 am

Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 4:53 pm

Boof02671 wrote:
KFLLCFII wrote:
I agree with the pilots...keep Delta metal moving until they've bled out the entire company of liquid assets and can no longer pay the fuel supplier. We had a contract, remember?

Oh wait, their Trainer oil refinery should more than adequately be able to handle the company's fuel needs.

So Delta should just get a pass for violating a contract they agreed too? And these violations occurred pre Covid.

So what if your mortgage or car loan said we are just going to double your payments even though you have a signed contract with them?

Your mortgage company isn't paying you and Delta pilots aren't paying off the planes to own them.

Like I said, I agree with the pilots...Delta should be forced to honor their contract and keep Delta metal moving until there's nothing left of the company.
"About the only way to look at it, just a pity you are not POTUS KFLLCFII, seems as if we would all be better off."
 
Boof02671
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 5:03 pm

KFLLCFII wrote:
Boof02671 wrote:
KFLLCFII wrote:
I agree with the pilots...keep Delta metal moving until they've bled out the entire company of liquid assets and can no longer pay the fuel supplier. We had a contract, remember?

Oh wait, their Trainer oil refinery should more than adequately be able to handle the company's fuel needs.

So Delta should just get a pass for violating a contract they agreed too? And these violations occurred pre Covid.

So what if your mortgage or car loan said we are just going to double your payments even though you have a signed contract with them?

Your mortgage company isn't paying you and Delta pilots aren't paying off the planes to own them.

Like I said, I agree with the pilots...Delta should be forced to honor their contract and keep Delta metal moving until there's nothing left of the company.

Ok so your employer decides to cut your pay and benefits and you have a signed employment contract.
 
KFLLCFII
Posts: 3617
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 5:11 pm

Boof02671 wrote:
KFLLCFII wrote:
Boof02671 wrote:
So Delta should just get a pass for violating a contract they agreed too? And these violations occurred pre Covid.

So what if your mortgage or car loan said we are just going to double your payments even though you have a signed contract with them?

Your mortgage company isn't paying you and Delta pilots aren't paying off the planes to own them.

Like I said, I agree with the pilots...Delta should be forced to honor their contract and keep Delta metal moving until there's nothing left of the company.

Ok so your employer decides to cut your pay and benefits and you have a signed employment contract.

Like I said, I agree with the pilots...Delta should be forced to honor their contract and keep Delta metal moving until there's nothing left of the company.
"About the only way to look at it, just a pity you are not POTUS KFLLCFII, seems as if we would all be better off."
 
Boof02671
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 5:29 pm

KFLLCFII wrote:
Boof02671 wrote:
KFLLCFII wrote:
Your mortgage company isn't paying you and Delta pilots aren't paying off the planes to own them.

Like I said, I agree with the pilots...Delta should be forced to honor their contract and keep Delta metal moving until there's nothing left of the company.

Ok so your employer decides to cut your pay and benefits and you have a signed employment contract.

Like I said, I agree with the pilots...Delta should be forced to honor their contract and keep Delta metal moving until there's nothing left of the company.

One that is asinine and two it breaks the executives fiduciary responsibilities and breaks financial covenants of financial agreements.
 
KFLLCFII
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Joined: Sat Sep 11, 2004 7:08 am

Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 5:35 pm

Boof02671 wrote:
KFLLCFII wrote:
Boof02671 wrote:
Ok so your employer decides to cut your pay and benefits and you have a signed employment contract.

Like I said, I agree with the pilots...Delta should be forced to honor their contract and keep Delta metal moving until there's nothing left of the company.

One that is asinine and two it breaks the executives fiduciary responsibilities and breaks financial covenants of financial agreements.

Well, would the pilots like their cake...or eat it?
"About the only way to look at it, just a pity you are not POTUS KFLLCFII, seems as if we would all be better off."
 
Cactusjuba
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 5:47 pm

How about we stop the hyperbole. Delta can keep their deals with labor, contractors, Airbus/Boeing, governments, banks, airports, partner airlines, etc. They are free to negotiate more favorable terms should they feel they require it. You cannot just act in bad faith by refusing to honor your deals and close channels of communication.
 
Boof02671
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 5:59 pm

Cactusjuba wrote:
How about we stop the hyperbole. Delta can keep their deals with labor, contractors, Airbus/Boeing, governments, banks, airports, partner airlines, etc. They are free to negotiate more favorable terms should they feel they require it. You cannot just act in bad faith by refusing to honor your deals and close channels of communication.

Exactly. The Pilots won their grievances before Covid. If Delta doesn’t like it they can address when their contract becomes amendable (which it is) and it’s the pilots’ choice to agree or not. Unfortunately many people on here are union haters and don’t care that the law is on the pilots’ side.
 
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lightsaber
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 6:33 pm

Boof02671 wrote:
Cactusjuba wrote:
How about we stop the hyperbole. Delta can keep their deals with labor, contractors, Airbus/Boeing, governments, banks, airports, partner airlines, etc. They are free to negotiate more favorable terms should they feel they require it. You cannot just act in bad faith by refusing to honor your deals and close channels of communication.

Exactly. The Pilots won their grievances before Covid. If Delta doesn’t like it they can address when their contract becomes amendable (which it is) and it’s the pilots’ choice to agree or not. Unfortunately many people on here are union haters and don’t care that the law is on the pilots’ side.

Agreed. This needs to be complied with. Only if Delta cannot comply should a discussion even start (e.g., temporary runway shortening DL doesn't have the right aircraft). First, rule of law which is based off contracts being honored.

Lightsaber
8 months without TV. The best decision of my life.
 
HunterATL
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 8:51 pm

The claim that the pilots won "all their grievances" is incorrect and so is any claim that Delta was in violation of the scope provisions governing the Korean JV in a pre-covid world. The pilots lost on the issue of how to calculate compliance and, accordingly, lost on the issue of constant and continuing violations. The pilots subsequently withdrew their grievances related to months April 2019 through July 2019 and have not asserted any grievances after July 2019 in order to avoid an actual loss. For PR purposes, the pilots wanted to be able to claim that "they won all their grievances" when, in fact, they had not, hence the withdrawal. It was a smart PR stunt, but a stunt nonetheless.

Delta won the arbitration on the most important issue: how to calculate compliance. The arbitrator held that as of April 2019 and possibly earlier, Delta was in full compliance with the JV's block-hour scheduling requirements and that the pilots had incorrectly calculated Delta's block-hour deficiencies. Delta's and the arbitrator's methodology resulted in the pilots' losing many of their claimed lost block hours. This should result in a significantly reduced remedy award, which is still forthcoming, compared to the amounts sought by the union at the onset of the arbitration.

Regardless of the various opinions related to scope, JVs, compliance, etc., it is important to know the actual conclusions reached in the arbitration in order to form cogent opinions and arguments on these issues.
 
Boof02671
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Aug 25, 2020 11:28 pm

HunterATL wrote:
The claim that the pilots won "all their grievances" is incorrect and so is any claim that Delta was in violation of the scope provisions governing the Korean JV in a pre-covid world. The pilots lost on the issue of how to calculate compliance and, accordingly, lost on the issue of constant and continuing violations. The pilots subsequently withdrew their grievances related to months April 2019 through July 2019 and have not asserted any grievances after July 2019 in order to avoid an actual loss. For PR purposes, the pilots wanted to be able to claim that "they won all their grievances" when, in fact, they had not, hence the withdrawal. It was a smart PR stunt, but a stunt nonetheless.

Delta won the arbitration on the most important issue: how to calculate compliance. The arbitrator held that as of April 2019 and possibly earlier, Delta was in full compliance with the JV's block-hour scheduling requirements and that the pilots had incorrectly calculated Delta's block-hour deficiencies. Delta's and the arbitrator's methodology resulted in the pilots' losing many of their claimed lost block hours. This should result in a significantly reduced remedy award, which is still forthcoming, compared to the amounts sought by the union at the onset of the arbitration.

Regardless of the various opinions related to scope, JVs, compliance, etc., it is important to know the actual conclusions reached in the arbitration in order to form cogent opinions and arguments on these issues.

That funny cause ALPA went back to the arbiter and he is deciding the award penalties.
“ 
The arbitrator who heard the first four Korean Air Joint Venture (JV) Scope grievances—MEC Grievance Numbers 18-22, 19-03, 19-04 and 19-08— has issued a liability award on all eight Scope violations alleged by ALPA. The arbitrator sustained all four grievances and confirmed that the Company violated Section 1 of the PWA in all eight instances, including one violation of Section 1 E. 10. and seven violations of Section 1 E. 8. 


This ruling reaffirms the Company's obligation to abide by the terms of the Delta pilots' PWA and its Scope clause.

ALPA will post the arbitrator's decision on the MEC website shortly.



Key Takeaways

The arbitrator sustained ALPA's first four Scope grievances related to the Korean Air JV.
The arbitrator held that the Company committed a total of eight violations of Section 1 of the PWA, including one violation of Section 1 E. 10. and seven violations of Section 1 E. 8.
Now that these violations have been proven, the case will proceed to a second phase to determine the remedies for the violations.”


 
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Re: Delta ALPA concerned over continued JV scope flying violations

Wed Aug 26, 2020 12:34 am

Boof02671 wrote:
n9801f wrote:
Remarkable. Can't remember any other airline found guilty of so many violations, though please correct me if that's wrong.

Seems to show very poor faith

As mentioned previously, non-organized employees should take note. If this behavior occurs when a contract's in place, imagine what happens when there's none.

For DALPA, not only is there the question of the JV flying given to partners instead of Delta, there's the question that $4 BILLION was spent to buy stakes in overseas partners, and those stakes are highly likely to evaporate in Chapter 11 proceedings.

Net result seems that $4B was spent to buy nothing.

Now Delta wants taxpayer money?

Delta has written off $2 billion in ownership of Virgin Australia, LATAM and AeroMexico. Virgin Atlantic isn’t doing to well either.


Correction: the write-down was for Virgin Atlantic, not Virgin Australia. While DL has/had a JV with Virgin Australia, I don't believe they had an ownership stake.
This is my signature until I think of a better one.
 
n9801f
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Re: Delta ALPA concerned over continued JV scope flying violations

Wed Aug 26, 2020 3:41 am

Boof02671 wrote:
Delta has written off $2 billion in ownership of Virgin Australia, LATAM and AeroMexico. Virgin Atlantic isn’t doing to well either.

This writeoff supports my point: Delta expects to lose the asset it bought (ownership in LATAM) so it recognized this in its accounting.

But I think your comment is incomplete and understates the full scale of Delta's true cash loss, which I see at about $3.9 Billion. Here's how I figure.

The total cash Delta spent on the airlines you mention adds to $3.557 Billion if you include the following items:

    LATAM = $1.9B investment + $350M "investment for strategic partnership" + $62M A350 cancellation fees
    AM = $65M initial investment + $620M final investment
    Virgin Atlantic (not Australia) $360M initial investment + $200M JV settlement forgiveness

Additionally Gol is scheduled to repay Delta $300M in September. Since Gol is in very poor financial condition itself, I'd be pleasantly surprised if they paid.

Adding the Gol debt brings the grand total for the above items to $3.857B.

This is cash Delta spent on assets it is highly likely to lose.

Delta desperately needs cash now. Considering these losses, as a US taxpayer, I don't want to make up for Delta's bad investments by giving or loaning it more taxpayer money.

And Delta pilots may also be understandably unhappy about these losses.
 
Boof02671
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Re: Delta ALPA concerned over continued JV scope flying violations

Wed Aug 26, 2020 8:00 am

n9801f wrote:
Boof02671 wrote:
Delta has written off $2 billion in ownership of Virgin Australia, LATAM and AeroMexico. Virgin Atlantic isn’t doing to well either.

This writeoff supports my point: Delta expects to lose the asset it bought (ownership in LATAM) so it recognized this in its accounting.

But I think your comment is incomplete and understates the full scale of Delta's true cash loss, which I see at about $3.9 Billion. Here's how I figure.

The total cash Delta spent on the airlines you mention adds to $3.557 Billion if you include the following items:

    LATAM = $1.9B investment + $350M "investment for strategic partnership" + $62M A350 cancellation fees
    AM = $65M initial investment + $620M final investment
    Virgin Atlantic (not Australia) $360M initial investment + $200M JV settlement forgiveness

Additionally Gol is scheduled to repay Delta $300M in September. Since Gol is in very poor financial condition itself, I'd be pleasantly surprised if they paid.

Adding the Gol debt brings the grand total for the above items to $3.857B.

This is cash Delta spent on assets it is highly likely to lose.

Delta desperately needs cash now. Considering these losses, as a US taxpayer, I don't want to make up for Delta's bad investments by giving or loaning it more taxpayer money.

And Delta pilots may also be understandably unhappy about these losses.

And those losses have zero to do with the arbitration and the violations were pre Covid and pre write off.
 
n9801f
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Re: Delta ALPA concerned over continued JV scope flying violations

Wed Aug 26, 2020 4:21 pm

Boof02671 wrote:
And those losses have zero to do with the arbitration and the violations were pre Covid and pre write off.

The connection to the arbitration is clear: the investments made the JV partners partial subsidiaries. DALPA flying was exported to these Delta-owned off shore entities.

And the timing is an irrelevant technicality. The final result is that the cash is gone, the flying sent overseas, and the investments are sour today.

Delta would be in a stronger position to to weather Covid, and the outlook for DALPA jobs would be stronger, if it still had this $3.9B.
 
Nola
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Re: Delta ALPA concerned over continued JV scope flying violations

Wed Aug 26, 2020 8:21 pm

n9801f wrote:
Boof02671 wrote:
And those losses have zero to do with the arbitration and the violations were pre Covid and pre write off.

The connection to the arbitration is clear: the investments made the JV partners partial subsidiaries. DALPA flying was exported to these Delta-owned off shore entities.

And the timing is an irrelevant technicality. The final result is that the cash is gone, the flying sent overseas, and the investments are sour today.

Delta would be in a stronger position to to weather Covid, and the outlook for DALPA jobs would be stronger, if it still had this $3.9B.


Of course DL would be in a stronger position now to weather Covid if it still had the money. But you assume that DL wouldn't have made other investments, perhaps in equipment or facilities, or returned more cash to stockholders through dividends or buybacks. DL had pretty strong liquidity to weather a normal recession so, the greatest likelihood is that the 3.9 wouldn't be on the balance sheet regardless. And, absent Covid, the investments and strategy were considered sound.

Now, the impact of those investments on DL flying DL metal is something different. I think that is what other posters and you are really focused on, which is a relevant issue in light of the alleged violations. But whether the money would be on the balance sheet is something that is too unknown to really focus on.
 
n9801f
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Re: Delta ALPA concerned over continued JV scope flying violations

Wed Aug 26, 2020 10:21 pm

Nola wrote:
But you assume that DL wouldn't have made other investments, perhaps in equipment or facilities, or returned more cash to stockholders through dividends or buybacks.

This is a reasonable point. But if you follow it through, it still leads to a bad place.

For instance, if Delta had bought airplanes with the $3.9B instead, two things would be better:

1) The residual value of the planes would be greater than zero, unlike the partner investments
2) Delta would at least still retain possession and use of the depressed-value asset (airplanes), again unlike the partner investments
 
Nola
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Re: Delta ALPA concerned over continued JV scope flying violations

Wed Aug 26, 2020 10:34 pm

n9801f wrote:
Nola wrote:
But you assume that DL wouldn't have made other investments, perhaps in equipment or facilities, or returned more cash to stockholders through dividends or buybacks.

This is a reasonable point. But if you follow it through, it still leads to a bad place.

For instance, if Delta had bought airplanes with the $3.9B instead, two things would be better:

1) The residual value of the planes would be greater than zero, unlike the partner investments
2) Delta would at least still retain possession and use of the depressed-value asset (airplanes), again unlike the partner investments


That's correct, but I'm not sure there was a need for additional frames beyond those in the pipeline (Airbus 220 family). Or, was there a need beyond the capital budget that was already planned for? Were the capital markets charging so much for financing that it would have been better to use cash from the balance sheet instead of debt?

The greater likelihood is that the cash would have been used for stock buybacks or dividends, which would have led to the same result--money spent. The argument as to better uses of cash is because of Covid and is, I think, separate from the JV scope issues.

Should DL have anticipated covid?

The investments weren't unreasonable at the time they were made. AM and Latam built up Latin America, an area where DL has been traditionally weak compared to AA. Virgin was crucial for DL to gain a meaningful presence at LHR. KE helped solve the problem of reliance on Japan as a transfer hub when UA and AA had JV partners in Asia.

The only area DL didn't invest willy-nilly in everything that came along---there wasn't an investment in Jet despite a former DL exec taking the reins of that airline.
 
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Re: Delta ALPA concerned over continued JV scope flying violations

Wed Aug 26, 2020 10:48 pm

Nola wrote:
n9801f wrote:
Nola wrote:
But you assume that DL wouldn't have made other investments, perhaps in equipment or facilities, or returned more cash to stockholders through dividends or buybacks.

This is a reasonable point. But if you follow it through, it still leads to a bad place.

For instance, if Delta had bought airplanes with the $3.9B instead, two things would be better:

1) The residual value of the planes would be greater than zero, unlike the partner investments
2) Delta would at least still retain possession and use of the depressed-value asset (airplanes), again unlike the partner investments


That's correct, but I'm not sure there was a need for additional frames beyond those in the pipeline (Airbus 220 family). Or, was there a need beyond the capital budget that was already planned for? Were the capital markets charging so much for financing that it would have been better to use cash from the balance sheet instead of debt?

The greater likelihood is that the cash would have been used for stock buybacks or dividends, which would have led to the same result--money spent. The argument as to better uses of cash is because of Covid and is, I think, separate from the JV scope issues.

Should DL have anticipated covid?

The investments weren't unreasonable at the time they were made. AM and Latam built up Latin America, an area where DL has been traditionally weak compared to AA. Virgin was crucial for DL to gain a meaningful presence at LHR. KE helped solve the problem of reliance on Japan as a transfer hub when UA and AA had JV partners in Asia.

The only area DL didn't invest willy-nilly in everything that came along---there wasn't an investment in Jet despite a former DL exec taking the reins of that airline.

I think the LATAM JV will go forward and bring business to DL.

VS and DL still partner, when Covid19 goes away, that will help DL. Same with KE and AM.

The is much more business and profit in a JV. The fact DL lost their share of the partners' profits is interesting, but is a sunk cost.

There is no getting investment money back.

Lightsaber
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n9801f
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Re: Delta ALPA concerned over continued JV scope flying violations

Wed Aug 26, 2020 11:03 pm

Nola wrote:
The greater likelihood is that the cash would have been used for stock buybacks or dividends, which would have led to the same result--money spent. The argument as to better uses of cash is because of Covid and is, I think, separate from the JV scope issues.

You can boil this argument down to "Well, it's OK that they made a bad investment, because the alternative investment was also bad."

I'm not persuaded. If Delta had bought some other hard asset (OK, not airplanes) instead of stakes in JV partners, Delta would likely have retained ownership and use of that asset, and that asset's value would not have fallen to near zero.

The ownership stakes were a particularly poor investment, in addition to being a poke in the eye to DALPA and other Delta employees.

Nola wrote:
Should DL have anticipated covid?

Any airline person who experienced the economic crises of 2001 and 2008 (as the current DL senior team did) should have learned two lessons:

    1) Fortunes can change harshly very quickly (2001)
    2) Cash on hand is essential to avoid liquidation - DIP loans became scarce (2008)

Cash is king!

The hard part for an airline is to hold onto cash but not be criticized or become vulnerable for not investing or otherwise using that cash.

Bottom line: Yes, based on the lessons of 2001 and 2008, Delta should have anticipated that some sort of Covid-like event was possible.
 
Nola
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Re: Delta ALPA concerned over continued JV scope flying violations

Thu Aug 27, 2020 4:07 pm

n9801f wrote:
Nola wrote:
The greater likelihood is that the cash would have been used for stock buybacks or dividends, which would have led to the same result--money spent. The argument as to better uses of cash is because of Covid and is, I think, separate from the JV scope issues.

You can boil this argument down to "Well, it's OK that they made a bad investment, because the alternative investment was also bad."

I'm not persuaded. If Delta had bought some other hard asset (OK, not airplanes) instead of stakes in JV partners, Delta would likely have retained ownership and use of that asset, and that asset's value would not have fallen to near zero.

The ownership stakes were a particularly poor investment, in addition to being a poke in the eye to DALPA and other Delta employees.

Nola wrote:
Should DL have anticipated covid?

Any airline person who experienced the economic crises of 2001 and 2008 (as the current DL senior team did) should have learned two lessons:

    1) Fortunes can change harshly very quickly (2001)
    2) Cash on hand is essential to avoid liquidation - DIP loans became scarce (2008)

Cash is king!

The hard part for an airline is to hold onto cash but not be criticized or become vulnerable for not investing or otherwise using that cash.

Bottom line: Yes, based on the lessons of 2001 and 2008, Delta should have anticipated that some sort of Covid-like event was possible.



I disagree. At the time the investments were made, they helped secure JV partners and fortify areas where DL was weak. While cash is king, most businesses don't keep excess liquidity on their balance sheets--it doesn't lead to greater returns for shareholders and can even lead to the company being subject to a hostile takeover so the acquirer can get its hands on the cash.

To say that the investments were bad when made is using 20/20 hindsight.

I don't have the statistics for cash burn in 2001 or 2008. But, neither was a prolonged 80% or greater reduction in travel and only 2011 was even an abrupt reduction in travel (followed by a steady recovery). I suspect, but others who have the data will have to confirm, that DL and the other legacy carriers had either enough cash on hand or enough credit facilities to weather a 2001/2008 style crisis. And that is logically what they would have planned for in terms of most likely bad case scenario. 2020 is completely different since there hasn't been any significant upswing.
 
n9801f
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Re: Delta ALPA concerned over continued JV scope flying violations

Thu Aug 27, 2020 4:46 pm

Nola wrote:
I disagree. At the time the investments were made, they helped secure JV partners and fortify areas where DL was weak. While cash is king, most businesses don't keep excess liquidity on their balance sheets--it doesn't lead to greater returns for shareholders and can even lead to the company being subject to a hostile takeover so the acquirer can get its hands on the cash.

While I respect your point of view, I also disagree. Here's why.

    The history of investments in foreign airlines is crystal clear.


    One of the most relevant examples is SAS' investment in Continental. Lost in one of the Continental bankruptcies. If I'm not mistaken, Glen Hauenstein himself was at Continental when all this went down.

    But it's a very long list. Etihad - Alitalia and Air Berlin. Swissair - lost the whole home company due to poor airline investments. Air New Zealand - Ansett. Lufthansa - bmi. etc. etc.

      So I think it's hardly 'unforeseeable' that investments in an overseas airline could end badly.

      If Delta does get a JV with the likes of LATAM, it will be with a much-shrunken version of what was initially anticipated. No more Argentina subsidiary. Fewer intercontinental routes, etc. Overall a less valuable network that before.
       
      Nola
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      Re: Delta ALPA concerned over continued JV scope flying violations

      Thu Aug 27, 2020 8:41 pm

      n9801f wrote:
      Nola wrote:
      I disagree. At the time the investments were made, they helped secure JV partners and fortify areas where DL was weak. While cash is king, most businesses don't keep excess liquidity on their balance sheets--it doesn't lead to greater returns for shareholders and can even lead to the company being subject to a hostile takeover so the acquirer can get its hands on the cash.

      While I respect your point of view, I also disagree. Here's why.

        The history of investments in foreign airlines is crystal clear.


        One of the most relevant examples is SAS' investment in Continental. Lost in one of the Continental bankruptcies. If I'm not mistaken, Glen Hauenstein himself was at Continental when all this went down.

        But it's a very long list. Etihad - Alitalia and Air Berlin. Swissair - lost the whole home company due to poor airline investments. Air New Zealand - Ansett. Lufthansa - bmi. etc. etc.

          So I think it's hardly 'unforeseeable' that investments in an overseas airline could end badly.

          If Delta does get a JV with the likes of LATAM, it will be with a much-shrunken version of what was initially anticipated. No more Argentina subsidiary. Fewer intercontinental routes, etc. Overall a less valuable network that before.


          I think that's a slightly different argument than what you've been making. I agree that many foreign investments in airlines haven't worked out and DL certainly would have evaluated the risk in light of that history. But to suggest that they should have priced a pandemic into their cash needs and investment strategy doesn't seem reasonable to me.

          I disagree that DL would have kept the cash on its balance sheet if it hadn't made the investments. I don't think the money would have been there--it would have been used for a stock buy back or a dividend or something else. It
           
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          Re: Delta ALPA concerned over continued JV scope flying violations

          Thu Aug 27, 2020 11:28 pm

          Nola wrote:
          n9801f wrote:
          Nola wrote:
          The greater likelihood is that the cash would have been used for stock buybacks or dividends, which would have led to the same result--money spent. The argument as to better uses of cash is because of Covid and is, I think, separate from the JV scope issues.

          You can boil this argument down to "Well, it's OK that they made a bad investment, because the alternative investment was also bad."

          I'm not persuaded. If Delta had bought some other hard asset (OK, not airplanes) instead of stakes in JV partners, Delta would likely have retained ownership and use of that asset, and that asset's value would not have fallen to near zero.

          The ownership stakes were a particularly poor investment, in addition to being a poke in the eye to DALPA and other Delta employees.

          Nola wrote:
          Should DL have anticipated covid?

          Any airline person who experienced the economic crises of 2001 and 2008 (as the current DL senior team did) should have learned two lessons:

            1) Fortunes can change harshly very quickly (2001)
            2) Cash on hand is essential to avoid liquidation - DIP loans became scarce (2008)

          Cash is king!

          The hard part for an airline is to hold onto cash but not be criticized or become vulnerable for not investing or otherwise using that cash.

          Bottom line: Yes, based on the lessons of 2001 and 2008, Delta should have anticipated that some sort of Covid-like event was possible.



          I disagree. At the time the investments were made, they helped secure JV partners and fortify areas where DL was weak. While cash is king, most businesses don't keep excess liquidity on their balance sheets--it doesn't lead to greater returns for shareholders and can even lead to the company being subject to a hostile takeover so the acquirer can get its hands on the cash.

          To say that the investments were bad when made is using 20/20 hindsight.


          It's easy to forget what DL was doing was attempting to extend its successful JV strategy with AF/KL to other parts of the world, where their competitors already had JVs. In the past five years, DL decided it wanted to have a seat on the board of each of those carriers so they could influence decision making. This may have been so that they could more broadly influence JV coordination more directly. In order to have those board seats, they had to make investments. Most of them were in the millions of dollars, not in the billions, so it's not as though DL exposed itself to undue risk. In Asia, DL found itself as the odd man out when AA and UA were able to tie themselves to JL/NH. Once DL finally made a JV with KE work (likely due to the investment they made in them), they were finally on an even playing field with their competitors. Frankly, I don't see what advantage DL would have had by not moving forward with their strategy of investing these partners, and I doubt the JVs with VS, KE, LA or AM would have gone through without the investments they made. In short, DL may have had to buy its way into those partnerships and would have likely been unsuccessful without offering some sort of cash. Any discussion of "failed investments" is purely secondary at this point, as DL will still need those partnerships in the future.

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