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Boof02671
Posts: 2498
Joined: Sun Jul 10, 2016 12:15 am

Re: Delta ALPA concerned over continued JV scope flying violations

Fri Aug 28, 2020 12:19 am

A joint venture is different than buying a part of an airline
 
Nola
Posts: 384
Joined: Thu May 29, 2014 1:40 am

Re: Delta ALPA concerned over continued JV scope flying violations

Fri Aug 28, 2020 12:25 am

usdcaguy wrote:
Nola wrote:
n9801f wrote:
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.


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.


I would agree with this. Each purchase was to further a strategic goal: AM and LA in South America to compete with (and in the case of LA really hurt) AA, KE to fight with UA/AA and their own JV's, and VS to compete in the most lucrative route in the world, JFK-LHR. VS definitely wouldn't have happened without the purchase, which wasn't terribly expensive actually. The big expense was LA, and the timing was very unfortunate. And that expense keeps potentially growing as DL apparently had to maintain a loan guarantee for Gol after selling its stake in that carrier. (There probably wouldn't have been a way out of that without the lenders releasing DL from the guarantee, regardless of the stakeholding being sold).

https://www.reuters.com/article/us-delt ... SKBN25N1BG
 
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par13del
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Re: Delta ALPA concerned over continued JV scope flying violations

Fri Aug 28, 2020 4:07 am

Boof02671 wrote:
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

Exactly, they have won multiple arbitration's against DL and as you state DL has not corrected the failure. By now the union should be pushing beyond arbitration, and yes, the Railway Labour Act does not prevent strikes, it just mandates a very thorough process.
So in kind, why don't you stop your management support and answer the question as to why the union has not been more forceful protecting the rights of its members after winning multiple cases against management. As I said, my opinion is that the bonus has bought a lot of loyalty.
 
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par13del
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Re: Delta ALPA concerned over continued JV scope flying violations

Fri Aug 28, 2020 4:19 am

FlyHossD wrote:
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.

Everyone knows that DL is in violation of the contract, the question is what else is the union doing, sitting waiting for management to have a light bulb moment and say they are sorry?
How many losses in arbitration must management suffer before the union goes further?
Obviously management is ignoring the arbitrator and the rulings, the act in and of itself is meant to resolve the situation, not maintain a new status quo after already ruling who is at fault.
 
Boof02671
Posts: 2498
Joined: Sun Jul 10, 2016 12:15 am

Re: Delta ALPA concerned over continued JV scope flying violations

Fri Aug 28, 2020 5:14 am

par13del wrote:
Boof02671 wrote:
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

Exactly, they have won multiple arbitration's against DL and as you state DL has not corrected the failure. By now the union should be pushing beyond arbitration, and yes, the Railway Labour Act does not prevent strikes, it just mandates a very thorough process.
So in kind, why don't you stop your management support and answer the question as to why the union has not been more forceful protecting the rights of its members after winning multiple cases against management. As I said, my opinion is that the bonus has bought a lot of loyalty.

I’m quite familiar with the RLA as I’ve negotiated contracts under it. And yes it does prevents strikes. You have to get NMB approval to strike. And you can’t strike over a failure to correct an arbitration award.
 
Boof02671
Posts: 2498
Joined: Sun Jul 10, 2016 12:15 am

Re: Delta ALPA concerned over continued JV scope flying violations

Fri Aug 28, 2020 5:16 am

par13del wrote:
FlyHossD wrote:
Boof02671 wrote:
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.

Everyone knows that DL is in violation of the contract, the question is what else is the union doing, sitting waiting for management to have a light bulb moment and say they are sorry?
How many losses in arbitration must management suffer before the union goes further?
Obviously management is ignoring the arbitrator and the rulings, the act in and of itself is meant to resolve the situation, not maintain a new status quo after already ruling who is at fault.

The union can’t strike and they did go further and went back to the arbiter.
 
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par13del
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Re: Delta ALPA concerned over continued JV scope flying violations

Fri Aug 28, 2020 12:13 pm

Boof02671 wrote:
I’m quite familiar with the RLA as I’ve negotiated contracts under it. And yes it does prevents strikes. You have to get NMB approval to strike. And you can’t strike over a failure to correct an arbitration award.

Its a process that has to be followed before strike action can be taken, the pilots union need to continue the process. I agree that the letters sound like whining, and my point is that the process does allow the union to continue the good fight, they are not powerless and have to sit there and watch management continue to ignore rulings against them which they do not correct. It was not the pilots who ruled against management in arbitration, so next step.
 
Boof02671
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Re: Delta ALPA concerned over continued JV scope flying violations

Fri Aug 28, 2020 12:29 pm

par13del wrote:
Boof02671 wrote:
I’m quite familiar with the RLA as I’ve negotiated contracts under it. And yes it does prevents strikes. You have to get NMB approval to strike. And you can’t strike over a failure to correct an arbitration award.

Its a process that has to be followed before strike action can be taken, the pilots union need to continue the process. I agree that the letters sound like whining, and my point is that the process does allow the union to continue the good fight, they are not powerless and have to sit there and watch management continue to ignore rulings against them which they do not correct. It was not the pilots who ruled against management in arbitration, so next step.

You can only strike if they are in Section 6 negotiations and the NMB has declared a 30 day cooling off period and the President doesn’t invoke a PEB.

Like I stated I worked under, negotiated under and even went on strike under the RLA.

They can’t do anything in regards to the arbitration except follow the process.

They did the next step which was go back to the arbitrator who is determining the award.

You can’t strike over an arbitration it is against the law and a violation of the no strike no lockout clause of their contract

You are seriously misinformed.
 
Boof02671
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Re: Delta ALPA concerned over continued JV scope flying violations

Fri Aug 28, 2020 2:11 pm

Image
 
n9801f
Posts: 338
Joined: Tue Apr 13, 2004 8:29 am

Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 31, 2020 2:38 am

usdcaguy wrote:
I disagree. At the time the investments were made, they helped secure JV partners and fortify areas where DL was weak.

Nola wrote:
I would agree with this. Each purchase was to further a strategic goal…

Again I respect your views. But again I must disagree.

For a serious businessperson, saying, “Oh, it’s strategic!” hardly makes something sacrosanct, beyond question, or justifies unlimited losses.

Strategies can be flawed and can even cost the whole company. There are many airline examples of this.

In my opinion, these investments did the following:

    Affected DALPA jobs
    Failed to establish durable Delta ownership
    Removed $4B of Delta cash

DALPA and The Board should be asking some hard questions about this.
 
Nola
Posts: 384
Joined: Thu May 29, 2014 1:40 am

Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 31, 2020 5:28 pm

n9801f wrote:
usdcaguy wrote:
I disagree. At the time the investments were made, they helped secure JV partners and fortify areas where DL was weak.

Nola wrote:
I would agree with this. Each purchase was to further a strategic goal…

Again I respect your views. But again I must disagree.

For a serious businessperson, saying, “Oh, it’s strategic!” hardly makes something sacrosanct, beyond question, or justifies unlimited losses.

Strategies can be flawed and can even cost the whole company. There are many airline examples of this.

In my opinion, these investments did the following:

    Affected DALPA jobs
    Failed to establish durable Delta ownership
    Removed $4B of Delta cash

DALPA and The Board should be asking some hard questions about this.


I think what you're saying is that in light of an event that was not anticipated, and had it been anticipated, would have been considered highly remote, that the decision wasn't sound at the time it was made. That's a post hoc fallacy.

If your argument is limited to "given covid, these decisions haven't turned out that well" I don't think any one would disagree with you but to say that the strategy was fundamentally flawed because of Covid happening in some instances years after the purchases/JV's were entered into doesn't make sense to me. I would agree that the timing for the largest stock purchase (Latam) was very unfortunate.
 
FlyFree27
Posts: 22
Joined: Sat Feb 23, 2013 4:52 am

Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 31, 2020 7:12 pm

I understand the anger here but at the same time it really makes no sense as a doable argument. One reason being their main argument is widebody intl flying into cities that have major operators in place. First off DL is an airline that inherited a considerable size widebody fleet and intl op from NW. Before NW they had around 12 triples which had just replaced the MD11s. Second you're not going to go into LHR AMS CDG ICN and overtake market share. LHR is pretty self explanatory with BA/AA, DL intl product will not compete with BA or the frequency provided by OW. AMS/CDG are a safe place for DL but its not even their backyard. It is their neighbors mansion which they are welcome in. ICN is laughable considering DL has one fleet type that can operate the route from ATL now days (A350). How many more birds do you want to tie up in a ICN rotation when you're serving it from 4 hubs already? If you look at DL track record they have never been shy of competition and a good fight. Bottom line, if DL thought it was doable and profitable they would be doing it. They are trying to keep the company up not fly it into the ground in markets they can not sustain frequency in.
 
Boof02671
Posts: 2498
Joined: Sun Jul 10, 2016 12:15 am

Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 31, 2020 7:38 pm

FlyFree27 wrote:
I understand the anger here but at the same time it really makes no sense as a doable argument. One reason being their main argument is widebody intl flying into cities that have major operators in place. First off DL is an airline that inherited a considerable size widebody fleet and intl op from NW. Before NW they had around 12 triples which had just replaced the MD11s. Second you're not going to go into LHR AMS CDG ICN and overtake market share. LHR is pretty self explanatory with BA/AA, DL intl product will not compete with BA or the frequency provided by OW. AMS/CDG are a safe place for DL but its not even their backyard. It is their neighbors mansion which they are welcome in. ICN is laughable considering DL has one fleet type that can operate the route from ATL now days (A350). How many more birds do you want to tie up in a ICN rotation when you're serving it from 4 hubs already? If you look at DL track record they have never been shy of competition and a good fight. Bottom line, if DL thought it was doable and profitable they would be doing it. They are trying to keep the company up not fly it into the ground in markets they can not sustain frequency in.

Doesn’t matter what they are trying to do. They have a legal and binding contract with DALPA under the RLA and have blatantly violated that contract multiple times and lost multiple arbitrations
 
n9801f
Posts: 338
Joined: Tue Apr 13, 2004 8:29 am

Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 31, 2020 8:01 pm

Nola wrote:
I think what you're saying is that in light of an event that was not anticipated...


Nola wrote:
If your argument is limited to "given covid, these decisions haven't turned out that well"....


No - neither. It's clearly laid out above. And it's not based on Covid. To reiterate for clarity:

    The record of airline investments in other airlines is long and consistently very poor worldwide
    For decades, such ownership stakes have, more frequently than not, been wiped out in bankruptcies
    This has happened since long before Covid
    See above for many examples
    So the loss of Delta's stakes is not at all surprising or unforeseeable
 
kalvado
Posts: 3126
Joined: Wed Mar 01, 2006 4:29 am

Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 31, 2020 8:26 pm

n9801f wrote:
Nola wrote:
I think what you're saying is that in light of an event that was not anticipated...


Nola wrote:
If your argument is limited to "given covid, these decisions haven't turned out that well"....


No - neither. It's clearly laid out above. And it's not based on Covid. To reiterate for clarity:

    The record of airline investments in other airlines is long and consistently very poor worldwide
    For decades, such ownership stakes have, more frequently than not, been wiped out in bankruptcies
    This has happened since long before Covid
    See above for many examples
    So the loss of Delta's stakes is not at all surprising or unforeseeable

Do you think these investments happened without board approval? I am pretty sure board was involved and shareholders were well aware. So if shareholders are unhappy with board decision, it is one thing - but likely most parties thought it was OK. Looking back is always a good thing, but it is hard to blame anyone here.

And unions have nothing to do with this.
 
n9801f
Posts: 338
Joined: Tue Apr 13, 2004 8:29 am

Re: Delta ALPA concerned over continued JV scope flying violations

Mon Aug 31, 2020 11:25 pm

kalvado wrote:
And unions have nothing to do with this

Delta ALPA as well as other Delta employees' jobs are directly affected by these JV's.

That's the point of this whole thread.

Employees are also affected by reduced health of the company resulting from the loss of $4B.


kalvado wrote:
it is hard to blame anyone here

Good corporate governance includes accountability.

When management makes bad recommendations to the board, even if the board approves these, management is held accountable for outcomes.

If the board fails to exercise sufficient oversight then the board itself can be replaced - United and Smisek come to mind here.

Based on decades of numerous precedents, the outcome of these JV investments is hardly surprising and was readily foreseeable, with or without Covid.
 
kalvado
Posts: 3126
Joined: Wed Mar 01, 2006 4:29 am

Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 12:08 am

n9801f wrote:
kalvado wrote:
And unions have nothing to do with this

Delta ALPA as well as other Delta employees' jobs are directly affected by these JV's.

That's the point of this whole thread.

Employees are also affected by reduced health of the company resulting from the loss of $4B.


kalvado wrote:
it is hard to blame anyone here

Good corporate governance includes accountability.

When management makes bad recommendations to the board, even if the board approves these, management is held accountable for outcomes.

If the board fails to exercise sufficient oversight then the board itself can be replaced - United and Smisek come to mind here.

Based on decades of numerous precedents, the outcome of these JV investments is hardly surprising and was readily foreseeable, with or without Covid.

OK, let's look at it from the other perspective:
If the doom of current crisis, when airlines are hit very hard, bleeding cash and likely would not turn profit for a few years, and with the bakrupcy being a distinct possibility - wouldn't you expect it to be wise for the board to advice against continuing operations, and proceeding to sell off assets and liquidating the company?
It is well known that airlines are loosing capital. DL went through bankruptcy in 2005-2007, stripping investor valiue. Considering these losses, as a US taxpayer, I don't want to make up for Delta's bad business by giving or loaning it more taxpayer money.
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)

Bottom line: Yes, based on the lessons of 2001 and 2008, Delta should have anticipated that some sort of Covid-like event was possible and go out of business well before covid!
 
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par13del
Posts: 10731
Joined: Sun Dec 18, 2005 9:14 pm

Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 4:34 am

Boof02671 wrote:
Image

So if the union continues the good fight they can strike.
The last airline strike POTUS cancelled it within hours, so I do know that your document is correct, the process does ultimately allow the pilots to withdraw their services if management continues their intransigence.
 
Gremlinzzzz
Posts: 299
Joined: Fri Jan 24, 2020 4:28 am

Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 5:38 am

n9801f wrote:
usdcaguy wrote:
I disagree. At the time the investments were made, they helped secure JV partners and fortify areas where DL was weak.

Nola wrote:
I would agree with this. Each purchase was to further a strategic goal…

Again I respect your views. But again I must disagree.

For a serious businessperson, saying, “Oh, it’s strategic!” hardly makes something sacrosanct, beyond question, or justifies unlimited losses.

Strategies can be flawed and can even cost the whole company. There are many airline examples of this.

In my opinion, these investments did the following:

    Affected DALPA jobs
    Failed to establish durable Delta ownership
    Removed $4B of Delta cash

DALPA and The Board should be asking some hard questions about this.
Why on earth would a business, any business ever answer to employees how it invests its money?

If said employees are shareholders, they can question this at the AGM. And there is nothing called a DALPA job, what you have is unionized staff who are working for Delta i.e. Delta jobs.

I love aviation, but the entitlement that I see in the business is sometimes off putting.
 
Gremlinzzzz
Posts: 299
Joined: Fri Jan 24, 2020 4:28 am

Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 6:43 am

kalvado wrote:
n9801f wrote:
kalvado wrote:
And unions have nothing to do with this

Delta ALPA as well as other Delta employees' jobs are directly affected by these JV's.

That's the point of this whole thread.

Employees are also affected by reduced health of the company resulting from the loss of $4B.


kalvado wrote:
it is hard to blame anyone here

Good corporate governance includes accountability.

When management makes bad recommendations to the board, even if the board approves these, management is held accountable for outcomes.

If the board fails to exercise sufficient oversight then the board itself can be replaced - United and Smisek come to mind here.

Based on decades of numerous precedents, the outcome of these JV investments is hardly surprising and was readily foreseeable, with or without Covid.

OK, let's look at it from the other perspective:
If the doom of current crisis, when airlines are hit very hard, bleeding cash and likely would not turn profit for a few years, and with the bakrupcy being a distinct possibility - wouldn't you expect it to be wise for the board to advice against continuing operations, and proceeding to sell off assets and liquidating the company?
It is well known that airlines are loosing capital. DL went through bankruptcy in 2005-2007, stripping investor valiue. Considering these losses, as a US taxpayer, I don't want to make up for Delta's bad business by giving or loaning it more taxpayer money.
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)

Bottom line: Yes, based on the lessons of 2001 and 2008, Delta should have anticipated that some sort of Covid-like event was possible and go out of business well before covid!
All businesses should have anticipated that there might have been a black swan event that might cause a downturn. However, almost all businesses did the same thing because of how the economy especially in the developed world has been structured post 2008 financial meltdown.

Interest rates cratered, individuals that might have saved money in the bank saw such low returns that the only way they could make money was to go to the stock market. This includes your retirement funds too, and in the stock market, the name of the game was growth, increasing profits, and share prices going up. With interest rates so low, companies far and wide chose to borrow, sometimes to expand, sometimes to do stupid stuff like buy back their own stock (Boeing).

Companies that started stocking up on cash reserves e.g. General Motors under Mary Barra saw activist investors that eventually forced the company to have a limit on the money that they could hold while at the same time insisting that she had not done enough to ensure that the share price was higher than it was.

Shareholders are part of the problem, and even on this very platform, we have users that have essentially been at the forefront stating the benefits of stock buybacks, huge dividend payments, and not having significant cash reserves because it could lead to a hostile takeover. Employees too are an issue because unions have always pushed for more and more without ever thinking that well paid as they are, extracting more from the employer carries its own penalty down the line.

You look at how alliances are structured and you see how some airlines try and wade off competition that would have lower operating economics even in the same alliance. Aeroflot had an issue with Sky Team because they were not allowed to undercut others when it came into US routes. Kenya Airways corruption riddled and all has had an agreement with Air France-KLM that has limited their expansion into Europe.
US airlines pay more than European mainline carriers who pay more than gulf carriers, and it is inefficient. Same carriers will pay more than Asian carriers and then start throwing their arms up when they cannot compete on price. JV's are simply a natural progression to try and get revenue where there might be losses.
 
Boof02671
Posts: 2498
Joined: Sun Jul 10, 2016 12:15 am

Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 7:11 am

par13del wrote:
Boof02671 wrote:
Image

So if the union continues the good fight they can strike.
The last airline strike POTUS cancelled it within hours, so I do know that your document is correct, the process does ultimately allow the pilots to withdraw their services if management continues their intransigence.

Only in Section 6 negotiations, not over a Grievance
 
kalvado
Posts: 3126
Joined: Wed Mar 01, 2006 4:29 am

Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 11:09 am

Gremlinzzzz wrote:
kalvado wrote:
n9801f wrote:
Delta ALPA as well as other Delta employees' jobs are directly affected by these JV's.

That's the point of this whole thread.

Employees are also affected by reduced health of the company resulting from the loss of $4B.



Good corporate governance includes accountability.

When management makes bad recommendations to the board, even if the board approves these, management is held accountable for outcomes.

If the board fails to exercise sufficient oversight then the board itself can be replaced - United and Smisek come to mind here.

Based on decades of numerous precedents, the outcome of these JV investments is hardly surprising and was readily foreseeable, with or without Covid.

OK, let's look at it from the other perspective:
If the doom of current crisis, when airlines are hit very hard, bleeding cash and likely would not turn profit for a few years, and with the bakrupcy being a distinct possibility - wouldn't you expect it to be wise for the board to advice against continuing operations, and proceeding to sell off assets and liquidating the company?
It is well known that airlines are loosing capital. DL went through bankruptcy in 2005-2007, stripping investor valiue. Considering these losses, as a US taxpayer, I don't want to make up for Delta's bad business by giving or loaning it more taxpayer money.
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)

Bottom line: Yes, based on the lessons of 2001 and 2008, Delta should have anticipated that some sort of Covid-like event was possible and go out of business well before covid!
All businesses should have anticipated that there might have been a black swan event that might cause a downturn. However, almost all businesses did the same thing because of how the economy especially in the developed world has been structured post 2008 financial meltdown.

Interest rates cratered, individuals that might have saved money in the bank saw such low returns that the only way they could make money was to go to the stock market. This includes your retirement funds too, and in the stock market, the name of the game was growth, increasing profits, and share prices going up. With interest rates so low, companies far and wide chose to borrow, sometimes to expand, sometimes to do stupid stuff like buy back their own stock (Boeing).

Companies that started stocking up on cash reserves e.g. General Motors under Mary Barra saw activist investors that eventually forced the company to have a limit on the money that they could hold while at the same time insisting that she had not done enough to ensure that the share price was higher than it was.

Shareholders are part of the problem, and even on this very platform, we have users that have essentially been at the forefront stating the benefits of stock buybacks, huge dividend payments, and not having significant cash reserves because it could lead to a hostile takeover. Employees too are an issue because unions have always pushed for more and more without ever thinking that well paid as they are, extracting more from the employer carries its own penalty down the line.

You look at how alliances are structured and you see how some airlines try and wade off competition that would have lower operating economics even in the same alliance. Aeroflot had an issue with Sky Team because they were not allowed to undercut others when it came into US routes. Kenya Airways corruption riddled and all has had an agreement with Air France-KLM that has limited their expansion into Europe.
US airlines pay more than European mainline carriers who pay more than gulf carriers, and it is inefficient. Same carriers will pay more than Asian carriers and then start throwing their arms up when they cannot compete on price. JV's are simply a natural progression to try and get revenue where there might be losses.

Well, talking about black swan preparedness... Airlines faced a situation when a few months worth of revenue just dissapeared.
Comparing that to the personal finance.. Do you have enough savings to cover a few months out of work?
 
Gremlinzzzz
Posts: 299
Joined: Fri Jan 24, 2020 4:28 am

Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 12:42 pm

kalvado wrote:
Gremlinzzzz wrote:
kalvado wrote:
OK, let's look at it from the other perspective:
If the doom of current crisis, when airlines are hit very hard, bleeding cash and likely would not turn profit for a few years, and with the bakrupcy being a distinct possibility - wouldn't you expect it to be wise for the board to advice against continuing operations, and proceeding to sell off assets and liquidating the company?
It is well known that airlines are loosing capital. DL went through bankruptcy in 2005-2007, stripping investor valiue. Considering these losses, as a US taxpayer, I don't want to make up for Delta's bad business by giving or loaning it more taxpayer money.
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)

Bottom line: Yes, based on the lessons of 2001 and 2008, Delta should have anticipated that some sort of Covid-like event was possible and go out of business well before covid!
All businesses should have anticipated that there might have been a black swan event that might cause a downturn. However, almost all businesses did the same thing because of how the economy especially in the developed world has been structured post 2008 financial meltdown.

Interest rates cratered, individuals that might have saved money in the bank saw such low returns that the only way they could make money was to go to the stock market. This includes your retirement funds too, and in the stock market, the name of the game was growth, increasing profits, and share prices going up. With interest rates so low, companies far and wide chose to borrow, sometimes to expand, sometimes to do stupid stuff like buy back their own stock (Boeing).

Companies that started stocking up on cash reserves e.g. General Motors under Mary Barra saw activist investors that eventually forced the company to have a limit on the money that they could hold while at the same time insisting that she had not done enough to ensure that the share price was higher than it was.

Shareholders are part of the problem, and even on this very platform, we have users that have essentially been at the forefront stating the benefits of stock buybacks, huge dividend payments, and not having significant cash reserves because it could lead to a hostile takeover. Employees too are an issue because unions have always pushed for more and more without ever thinking that well paid as they are, extracting more from the employer carries its own penalty down the line.

You look at how alliances are structured and you see how some airlines try and wade off competition that would have lower operating economics even in the same alliance. Aeroflot had an issue with Sky Team because they were not allowed to undercut others when it came into US routes. Kenya Airways corruption riddled and all has had an agreement with Air France-KLM that has limited their expansion into Europe.
US airlines pay more than European mainline carriers who pay more than gulf carriers, and it is inefficient. Same carriers will pay more than Asian carriers and then start throwing their arms up when they cannot compete on price. JV's are simply a natural progression to try and get revenue where there might be losses.

Well, talking about black swan preparedness... Airlines faced a situation when a few months worth of revenue just dissapeared.
Comparing that to the personal finance.. Do you have enough savings to cover a few months out of work?

It is not a few months worth of work that has disappeared, is it?

In normal circumstance, any normal business would have fired people it did not need without the government induced spending that is propping up these companies at a time when they have no money coming in. In normal circumstance, these airlines would have sent wide body fleet employees at home because that is going to be the last thing that recovers.

When I lost my first paying job, I had about a year's worth of money lying around that could cover my day to day costs i.e. rent, food, utility bills, internet costs. I had been working for just over a year.
As stated, these companies were always under pressure from shareholders who needed dividends, stock buy backs and growth at all costs. They were under pressure from unions to pay more than airline should pay employees who were already some of the best paid in the world more. You had management that has been looking more and more the short term as opposed to the long term because of this and the interest rate situation. I find it strange that right now people expected that Delta should have had more money in the bank, even those that argued it was bad strategy to do so.

Very few people have talked about how horrible these companies have been run, or how them getting CARES act funds does not let them restructure in ways that they ought to in order to come of this crisis in better shape. In short, what any company would do in any normal condition. Plus we maybe ought to be looking at what some of these JV partners are doing in this Covid mess in terms of laying off staff, downsizing, reducing wages etc.
 
n9801f
Posts: 338
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 2:33 pm

Gremlinzzzz wrote:
Why on earth would a business, any business ever answer to employees how it invests its money?

It's all business. Dollars and cents.

The short answer is that organized employees will temper their reply to management's upcoming calls for sacrifice based on how the company spends its money.

The longer answer is that the airline industry is a people-intensive business and tends to have highly organized labor. (Delta is an exception.) As a group, companies that have fostered good labor relations have tended to perform better financially than those that haven't. Eastern. etc.

Pilots are one of a few groups that can shut down an airline. Management is ill-advised to brush off their concerns.
 
n9801f
Posts: 338
Joined: Tue Apr 13, 2004 8:29 am

Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 2:41 pm

Gremlinzzzz wrote:
All businesses should have anticipated that there might have been a black swan event that might cause a downturn

Your posts are good and I generally agree strongly.

Beware that Kalvado's post #117 is not a sincere post. He copied some things I wrote word for word without attribution and put it into satire. I give it an A for effort but an F for funny.

He probably knows that rather than shut down, the best strategy for airlines in this crisis is to retreat or shrink back to core strengths - established and historically profitable markets - and fly only those operations that cover variable expenses.
 
Gremlinzzzz
Posts: 299
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 3:14 pm

n9801f wrote:
Gremlinzzzz wrote:
Why on earth would a business, any business ever answer to employees how it invests its money?

It's all business. Dollars and cents.

The short answer is that organized employees will temper their reply to management's upcoming calls for sacrifice based on how the company spends its money.

The longer answer is that the airline industry is a people-intensive business and tends to have highly organized labor. (Delta is an exception.) As a group, companies that have fostered good labor relations have tended to perform better financially than those that haven't. Eastern. etc.

Pilots are one of a few groups that can shut down an airline. Management is ill-advised to brush off their concerns.
Any union that makes its company less competitive is one that is on borrowed time, and one that is not doing its members a favor. It is surprising that DALPA cannot see their own fingerprints all over these JV's, or think that going forward the only way for Delta to compete across the Atlantic into LHR, CDG will be to lower operational cost, move into operating larger more efficient aircraft. The same applies to Incheon, or South America where its own JV partners like AeroMexico are looking to restructure rather aggressively.

After all, what sense does it make to have planes flying when your own alliance partners can give mileage benefits to consumers, a good service and at a lower price flying into hubs that are their fortress? What airlines felt compelled to give unions despite it not making sense, they will look to claw back via concessions in any crisis. We have seen airlines that were making losses and pilots still asked for more money e.g. Air India or South African, so it is not unlike unions to behave in an irrational manner.

As stated, you have an employee class that is well remunerated, but one that also cannot see that in a neo-liberal world cost is what matters most to a consumer. This is how manufacturing jobs left to go elsewhere, and this is why you always see complaints about the gulf carriers or Norwegian.

In any case, all it will take is for a mainline airline to declare bankruptcy before we see all other major airlines doing the same. Seems like this is the only thing that airline unions seem to understand, and this is not an issue isolated to DALPA.
 
dstblj52
Posts: 642
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 4:18 pm

Gremlinzzzz wrote:
n9801f wrote:
Gremlinzzzz wrote:
Why on earth would a business, any business ever answer to employees how it invests its money?

It's all business. Dollars and cents.

The short answer is that organized employees will temper their reply to management's upcoming calls for sacrifice based on how the company spends its money.

The longer answer is that the airline industry is a people-intensive business and tends to have highly organized labor. (Delta is an exception.) As a group, companies that have fostered good labor relations have tended to perform better financially than those that haven't. Eastern. etc.

Pilots are one of a few groups that can shut down an airline. Management is ill-advised to brush off their concerns.
Any union that makes its company less competitive is one that is on borrowed time, and one that is not doing its members a favor. It is surprising that DALPA cannot see their own fingerprints all over these JV's, or think that going forward the only way for Delta to compete across the Atlantic into LHR, CDG will be to lower operational cost, move into operating larger more efficient aircraft. The same applies to Incheon, or South America where its own JV partners like AeroMexico are looking to restructure rather aggressively.

After all, what sense does it make to have planes flying when your own alliance partners can give mileage benefits to consumers, a good service and at a lower price flying into hubs that are their fortress? What airlines felt compelled to give unions despite it not making sense, they will look to claw back via concessions in any crisis. We have seen airlines that were making losses and pilots still asked for more money e.g. Air India or South African, so it is not unlike unions to behave in an irrational manner.

As stated, you have an employee class that is well remunerated, but one that also cannot see that in a neo-liberal world cost is what matters most to a consumer. This is how manufacturing jobs left to go elsewhere, and this is why you always see complaints about the gulf carriers or Norwegian.

In any case, all it will take is for a mainline airline to declare bankruptcy before we see all other major airlines doing the same. Seems like this is the only thing that airline unions seem to understand, and this is not an issue isolated to DALPA.

The most competative option for delta would be to sub contract all flying to the connection carriers but that is explicitly not in delta pilots interest so yeah there is a balance between a healthy company and a good carrier to be maintained from a union perspective
 
Gremlinzzzz
Posts: 299
Joined: Fri Jan 24, 2020 4:28 am

Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 5:19 pm

dstblj52 wrote:
Gremlinzzzz wrote:
n9801f wrote:
It's all business. Dollars and cents.

The short answer is that organized employees will temper their reply to management's upcoming calls for sacrifice based on how the company spends its money.

The longer answer is that the airline industry is a people-intensive business and tends to have highly organized labor. (Delta is an exception.) As a group, companies that have fostered good labor relations have tended to perform better financially than those that haven't. Eastern. etc.

Pilots are one of a few groups that can shut down an airline. Management is ill-advised to brush off their concerns.
Any union that makes its company less competitive is one that is on borrowed time, and one that is not doing its members a favor. It is surprising that DALPA cannot see their own fingerprints all over these JV's, or think that going forward the only way for Delta to compete across the Atlantic into LHR, CDG will be to lower operational cost, move into operating larger more efficient aircraft. The same applies to Incheon, or South America where its own JV partners like AeroMexico are looking to restructure rather aggressively.

After all, what sense does it make to have planes flying when your own alliance partners can give mileage benefits to consumers, a good service and at a lower price flying into hubs that are their fortress? What airlines felt compelled to give unions despite it not making sense, they will look to claw back via concessions in any crisis. We have seen airlines that were making losses and pilots still asked for more money e.g. Air India or South African, so it is not unlike unions to behave in an irrational manner.

As stated, you have an employee class that is well remunerated, but one that also cannot see that in a neo-liberal world cost is what matters most to a consumer. This is how manufacturing jobs left to go elsewhere, and this is why you always see complaints about the gulf carriers or Norwegian.

In any case, all it will take is for a mainline airline to declare bankruptcy before we see all other major airlines doing the same. Seems like this is the only thing that airline unions seem to understand, and this is not an issue isolated to DALPA.

The most competative option for delta would be to sub contract all flying to the connection carriers but that is explicitly not in delta pilots interest so yeah there is a balance between a healthy company and a good carrier to be maintained from a union perspective
Let them take less money, let costs equalize. At that point, it would not make any sense for Delta to sub contract. All these mainline airlines do that because it is cheaper, and employees looking not to make any more concessions i.e. what would be a natural fit put in scope clauses.

At some point in time we need people to be honest about what is going on, and how the industry has got to where it is.
 
Cactusjuba
Posts: 273
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 7:59 pm

Gremlinzzzz wrote:
dstblj52 wrote:
Gremlinzzzz wrote:
Any union that makes its company less competitive is one that is on borrowed time, and one that is not doing its members a favor. It is surprising that DALPA cannot see their own fingerprints all over these JV's, or think that going forward the only way for Delta to compete across the Atlantic into LHR, CDG will be to lower operational cost, move into operating larger more efficient aircraft. The same applies to Incheon, or South America where its own JV partners like AeroMexico are looking to restructure rather aggressively.

After all, what sense does it make to have planes flying when your own alliance partners can give mileage benefits to consumers, a good service and at a lower price flying into hubs that are their fortress? What airlines felt compelled to give unions despite it not making sense, they will look to claw back via concessions in any crisis. We have seen airlines that were making losses and pilots still asked for more money e.g. Air India or South African, so it is not unlike unions to behave in an irrational manner.

As stated, you have an employee class that is well remunerated, but one that also cannot see that in a neo-liberal world cost is what matters most to a consumer. This is how manufacturing jobs left to go elsewhere, and this is why you always see complaints about the gulf carriers or Norwegian.

In any case, all it will take is for a mainline airline to declare bankruptcy before we see all other major airlines doing the same. Seems like this is the only thing that airline unions seem to understand, and this is not an issue isolated to DALPA.

The most competative option for delta would be to sub contract all flying to the connection carriers but that is explicitly not in delta pilots interest so yeah there is a balance between a healthy company and a good carrier to be maintained from a union perspective
Let them take less money, let costs equalize. At that point, it would not make any sense for Delta to sub contract. All these mainline airlines do that because it is cheaper, and employees looking not to make any more concessions i.e. what would be a natural fit put in scope clauses.

At some point in time we need people to be honest about what is going on, and how the industry has got to where it is.


So let me understand the consensus here. Delta couldn't have foreseen a black swan this abominable, no airline could have. They entered this crisis with $2.9B in cash. They spent $11.5B on stock buy backs over the last 7 years, including taking out a $1B loan last year to repurchase shares. Ed B himself netted in around $170M personally over the same frame. About $4.5B was spent primarily just to gain boardroom access in a handful of JVs, which may no longer exist. Rightfully, billions of free cash was also spent on planes, airports, and other projects. In 3 years, debt went from $6B in 2017 to $13B in 1Q2020.

May I ask, what is the underlying cause to the cash burn? You seem to imply bloated employee costs. How was Delta making close to 6B profit every year with this labor expense? The heart of the problem is revenue loss caused by the overnight evaporation in customers. Are hotel workers, movie theater employees, restaurant workers overpaid too? Or is profitability unrealistic near term with "worst ever" revenue environment? But yes, pontificate from the sidelines where you have zero skin in the game. Advocate the continued decline of the American Middle-class, the aviation skilled professionals. Mandate their livelihoods compete with peers in Mexico or outsource their jobs out of the country. Exploit this crisis to permanently reduce labor, so when demand recovers again the executives and hedge fund managers keep a larger share of pie, and continue to reward themselves on a job well, er...a job done!
 
DashTrash
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 8:59 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.

With a post like this, I’m sure you wouldn’t mind posting a link to the arbitrator’s decision.


Sent from my iPhone using Tapatalk
 
Gremlinzzzz
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Re: Delta ALPA concerned over continued JV scope flying violations

Tue Sep 01, 2020 10:54 pm

Cactusjuba wrote:
Gremlinzzzz wrote:
dstblj52 wrote:
The most competative option for delta would be to sub contract all flying to the connection carriers but that is explicitly not in delta pilots interest so yeah there is a balance between a healthy company and a good carrier to be maintained from a union perspective
Let them take less money, let costs equalize. At that point, it would not make any sense for Delta to sub contract. All these mainline airlines do that because it is cheaper, and employees looking not to make any more concessions i.e. what would be a natural fit put in scope clauses.

At some point in time we need people to be honest about what is going on, and how the industry has got to where it is.


So let me understand the consensus here. Delta couldn't have foreseen a black swan this abominable, no airline could have. They entered this crisis with $2.9B in cash. They spent $11.5B on stock buy backs over the last 7 years, including taking out a $1B loan last year to repurchase shares. Ed B himself netted in around $170M personally over the same frame. About $4.5B was spent primarily just to gain boardroom access in a handful of JVs, which may no longer exist. Rightfully, billions of free cash was also spent on planes, airports, and other projects. In 3 years, debt went from $6B in 2017 to $13B in 1Q2020.

May I ask, what is the underlying cause to the cash burn? You seem to imply bloated employee costs. How was Delta making close to 6B profit every year with this labor expense? The heart of the problem is revenue loss caused by the overnight evaporation in customers. Are hotel workers, movie theater employees, restaurant workers overpaid too? Or is profitability unrealistic near term with "worst ever" revenue environment? But yes, pontificate from the sidelines where you have zero skin in the game. Advocate the continued decline of the American Middle-class, the aviation skilled professionals. Mandate their livelihoods compete with peers in Mexico or outsource their jobs out of the country. Exploit this crisis to permanently reduce labor, so when demand recovers again the executives and hedge fund managers keep a larger share of pie, and continue to reward themselves on a job well, er...a job done!
1. There is a problem with how business has been structured post 2008. Business as I know it exists to make money (profits) and accumulate assets. My view has always been that a healthy company has no debt, one that is relatively unhealthy is one with little debt, and one that should go to the gutter is one that has massive amounts of money owed to others and does not have much in assets i.e. leases a lot of planes, has a tonne of debt.

My view is that management should be custodians of the company, and their primary focus has to be that there is a better company tomorrow than the company there exists today. Some of that comes with ensuring that you disappoint the short sighted investors that look at growth no matter what, the employees who are well paid that want even more, and you do things that count in the long term like pay down debt and accumulate more assets. This is a view that I think I have expressed here before. To this end, I gave an example of Mary Barra: she came in when GM was in the gutter, she paid down the debt the company owed the government, and she started saving money for a rainy day. Her stance was always that GM should never have to borrow money again or be bailed out as they had done to survive. Enter the short term idiots and these insisted that she buy back stock, that there be a cap in how much money GM could hold in the bank. These got their way.

Were they right? Of course not. Had GM continued to strengthen its balance sheet, it would have been in a far better state today than it is. If GM had more money in the bank, it would weather COVID better, and would be even better placed to ride out the post COVID recession and possible inflation that is bound to follow. The post 2008 inflation ended up in housing, but mostly the stock market. The post COVID inflation could hit main street. So, I am not stating that management done great, they have not. They have spent money not in investments that made the company better, but things that goosed up their stock price. They have not invested aircraft, they have invested in JV partners, part of that being a realization that they would still not be competitive even if they bought new aircraft and tried competing against not only Sky Team members, but also other airlines that have lower wages.

These JV's are an acceptance to this very fact. The way airline alliances are shaped, how some of the bigger partners limit growth or smaller carriers or try and limit what they can charge, thereby limiting what might be fair competition is all an attempt to mask the fact that some of these airlines have accumulated more debt than they should, have C suite officials making more money than they should, and in most cases shoddy decisions that were more short term than they were long term plays. It is also an acceptance that they have acquiesced to unions thereby offering a product that is not going to be competitive at a given price.

2. We live in a world where those who make decisions want free trade. Planes for the most part cost the same, they use the same amount of fuel if they are in the same family. The difference in operating economics is in how well any one company manages its cost. This is supply chain and employee cost. It is a paradox that employees want more pay, managers want more in salary and stock options, shareholders want higher stock price, phenomenal growth, stock buybacks and dividends while on the opposite side, customers want better service at an ever decreasing cost.
So, what have airlines done? They have segmented what was a singular business, to one that has 'ancillary revenue'. Do we need checked bag fees? Do we need to pay to reserve a seat? Do we need to pay to have meals, and can airlines simply not offer internet as part of the ticket at a reasonable price? Those with lower operating economics will eventually beat those with bloated wage bills; and as is the case in business, they will use their savings to give a better product out.

Some of us are old enough to remember that there was a time when Japan and The USA were the manufacturing powerhouses in the world. That there was a time when Europe could have companies that could bring out good products in electronics. All of this is gone as consumers want great quality, but at a price. The barriers to trade that existed have gone down thus it more about where labor is cheapest. This is why no one will manufacture something as simple as a bike in the US, it is the reason why legacy carriers even in Europe will not compete with low cost counterparts, and why low cost in the US will never come down to the prices we see elsewhere. This is why companies will automate any time they have an opportunity.
This is why jobs are farmed out to regional partners, and you then have scope clauses on how many jets regionals can have, how many seats they can have. Silly shit like that. This is why you will see 757's going transcon from US carriers, but you will almost never see the same from legacy carriers from Europe in this day and age. It is why you will see JV's, and these skewed towards outside JV partners.

The whole structure is broken from how Wall St. views business, how little managers care about the future (and if they do not bend to the will of Wall St. they will be out of the job) to the entitlement you see from union groups. When all is said and done, other airlines will come out better from this because they downsized, because concessions on wage were made, and almighty CASM that favored them, will be even more skewed in their favor.

Those stock buy backs? They no longer make sense, do they?
Those investments in what were unhealthy companies? They no longer make sense either.
Huge employee wages compared to competition will not make any sense once airlines that restructured come out better in all of this. In the US, the weakest is American Airlines, and should it go through chapter 11, Delta and United will have to follow suit. In normal times, this ought to have already happened, routes cut and all that comes with that.

There is a problem with aviation as a whole, yet in all of this, all groups need to evaluate whether what they contribute helps a company in the long term. None has done what is right.
 
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LAXintl
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Re: Delta ALPA concerned over continued JV scope flying violations

Thu Oct 22, 2020 9:36 pm

Seems DALPA has additional concerns - 76 seat cap violation.

Per the pilot scope agreement, DL is required to comply with the permitted 76-seat cap of 188 frames as of August 31st following the closure of Compass. Seems DALPA has identified DL operating at least 12 aircraft above this limit and issued a cease and desist notice to the company on October 14th.
From the desert to the sea, to all of Southern California
 
jbs2886
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Re: Delta ALPA concerned over continued JV scope flying violations

Thu Oct 22, 2020 9:45 pm

LAXintl wrote:
Seems DALPA has additional concerns - 76 seat cap violation.

Per the pilot scope agreement, DL is required to comply with the permitted 76-seat cap of 188 frames as of August 31st following the closure of Compass. Seems DALPA has identified DL operating at least 12 aircraft above this limit and issued a cease and desist notice to the company on October 14th.


The carrier is struggling to survive, with facts constantly changing. This type of technicality is so counterproductive because DL can probably just pull 12 E175s, take out 6 seats, and put them back into service. Those 6 seats, which actually is less with seat blocking, make absolutely zero difference to DL or the pilots.
 
wingnutmn
Posts: 528
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Re: Delta ALPA concerned over continued JV scope flying violations

Thu Oct 22, 2020 9:59 pm

jbs2886 wrote:
LAXintl wrote:
Seems DALPA has additional concerns - 76 seat cap violation.

Per the pilot scope agreement, DL is required to comply with the permitted 76-seat cap of 188 frames as of August 31st following the closure of Compass. Seems DALPA has identified DL operating at least 12 aircraft above this limit and issued a cease and desist notice to the company on October 14th.


The carrier is struggling to survive, with facts constantly changing. This type of technicality is so counterproductive because DL can probably just pull 12 E175s, take out 6 seats, and put them back into service. Those 6 seats, which actually is less with seat blocking, make absolutely zero difference to DL or the pilots.


With 1721 pilots being furloughed in 9 days, I appreciated ALPA keeping this management team honest. They may claim an oversight, but this "oversight" excuse has happened repeatedly. A contract is a contract. The company doesn't let the parts that suck for us pilots just slip by. They make us fly the contract to the letters written! Honor your agreement!!

Wingnut
Any landing you can walk away from is a good landing! It's a bonus if you can fly the plane again!!
 
jbs2886
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Re: Delta ALPA concerned over continued JV scope flying violations

Thu Oct 22, 2020 10:04 pm

wingnutmn wrote:
jbs2886 wrote:
LAXintl wrote:
Seems DALPA has additional concerns - 76 seat cap violation.

Per the pilot scope agreement, DL is required to comply with the permitted 76-seat cap of 188 frames as of August 31st following the closure of Compass. Seems DALPA has identified DL operating at least 12 aircraft above this limit and issued a cease and desist notice to the company on October 14th.


The carrier is struggling to survive, with facts constantly changing. This type of technicality is so counterproductive because DL can probably just pull 12 E175s, take out 6 seats, and put them back into service. Those 6 seats, which actually is less with seat blocking, make absolutely zero difference to DL or the pilots.


With 1721 pilots being furloughed in 9 days, I appreciated ALPA keeping this management team honest. They may claim an oversight, but this "oversight" excuse has happened repeatedly. A contract is a contract. The company doesn't let the parts that suck for us pilots just slip by. They make us fly the contract to the letters written! Honor your agreement!!

Wingnut


While it may be a technical violation of the contract, if complying in the spirit, there shouldn't be this type of action (should DALPA do oversight - absolutely! - but this isn't a battle that benefits them IMO). Forcing DL to spend additional money to get back to the those aircraft flying aren't benefiting those 1,721 pilots. This won't create new mainline flying, only an expense by DL to reduce seat count on RJs.
 
TonyClifton
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Re: Delta ALPA concerned over continued JV scope flying violations

Thu Oct 22, 2020 10:12 pm

There’s A220s parked that could be flown by soon to be furloughed pilots, it absolutely matters that agreements are met. Pilots do not have the ability to disregard sections of the contract when it suits them, nor can the company.
 
wingnutmn
Posts: 528
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Re: Delta ALPA concerned over continued JV scope flying violations

Thu Oct 22, 2020 10:14 pm

jbs2886 wrote:
wingnutmn wrote:
jbs2886 wrote:

The carrier is struggling to survive, with facts constantly changing. This type of technicality is so counterproductive because DL can probably just pull 12 E175s, take out 6 seats, and put them back into service. Those 6 seats, which actually is less with seat blocking, make absolutely zero difference to DL or the pilots.


With 1721 pilots being furloughed in 9 days, I appreciated ALPA keeping this management team honest. They may claim an oversight, but this "oversight" excuse has happened repeatedly. A contract is a contract. The company doesn't let the parts that suck for us pilots just slip by. They make us fly the contract to the letters written! Honor your agreement!!

Wingnut


While it may be a technical violation of the contract, if complying in the spirit, there shouldn't be this type of action (should DALPA do oversight - absolutely! - but this isn't a battle that benefits them IMO). Forcing DL to spend additional money to get back to the those aircraft flying aren't benefiting those 1,721 pilots. This won't create new mainline flying, only an expense by DL to reduce seat count on RJs.


We need to fly the contract, So does Delta management. The whole point of our Section 1, is because management wants to give away all our flying to cheaper international airlines, or regional airlines. No offense, but Delta management salivate at the thought of being able to outsource pilots to Indonesia, and pay $40/hr for a pilot with no benefits.
Any landing you can walk away from is a good landing! It's a bonus if you can fly the plane again!!
 
jbs2886
Posts: 2942
Joined: Wed Apr 01, 2015 9:07 pm

Re: Delta ALPA concerned over continued JV scope flying violations

Thu Oct 22, 2020 10:21 pm

wingnutmn wrote:
Delta management salivate at the thought of being able to outsource pilots to Indonesia, and pay $40/hr for a pilot with no benefits.


This is highly exaggerated. I'm sure DL wants to pay significantly less as its pilots are among the highest paid (if you ran a business, wouldn't you want to minimize your costs if possible?), but DL isn't so short-sighted to want to outsource to Indonesian pilots for those costs. US airlines, and particularly DL, emphasizes safety and I think the American public is pretty sensitive to safety, something cheap Indonesian pilots won't bring (not a knock on them, but the training, experience, etc. is far different in the US). I think its this attitude that causes the friction between management and pilots that is not necessary.
 
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klm617
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Re: Delta ALPA concerned over continued JV scope flying violations

Fri Oct 23, 2020 1:24 am

jbs2886 wrote:
wingnutmn wrote:
Delta management salivate at the thought of being able to outsource pilots to Indonesia, and pay $40/hr for a pilot with no benefits.


This is highly exaggerated. I'm sure DL wants to pay significantly less as its pilots are among the highest paid (if you ran a business, wouldn't you want to minimize your costs if possible?), but DL isn't so short-sighted to want to outsource to Indonesian pilots for those costs. US airlines, and particularly DL, emphasizes safety and I think the American public is pretty sensitive to safety, something cheap Indonesian pilots won't bring (not a knock on them, but the training, experience, etc. is far different in the US). I think its this attitude that causes the friction between management and pilots that is not necessary.


First off if I was CEO I would get myself in a situation where I have to repeatedly waste time and energy on cutting costs I would get the best deal I can out of the gate. Don't kid yourself if Delta thought they could get away with outsourcing the pilots they would without blinking an eye. These corporate geniuses make agreement and then try to change the rules as they go along and Delta is notorious for bending the rules almost to the breaking point. We are talking about an airline that circumvents paying taxes by flying their aircraft into a third country. So what you are saying then is pilots from certain parts of the world are less skilled and safe do to lack of training and yes you are knocking on them. Pilots trained any where else in the world should be just as capable as the pilot that operate US based jets.
the truth does matter, guys. too bad it's often quite subjective. the truth is beyond the mere facts and figures. it's beyond good and bad, right and wrong...
 
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klm617
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Re: Delta ALPA concerned over continued JV scope flying violations

Fri Oct 23, 2020 1:26 am

wingnutmn wrote:
jbs2886 wrote:
wingnutmn wrote:

With 1721 pilots being furloughed in 9 days, I appreciated ALPA keeping this management team honest. They may claim an oversight, but this "oversight" excuse has happened repeatedly. A contract is a contract. The company doesn't let the parts that suck for us pilots just slip by. They make us fly the contract to the letters written! Honor your agreement!!

Wingnut


While it may be a technical violation of the contract, if complying in the spirit, there shouldn't be this type of action (should DALPA do oversight - absolutely! - but this isn't a battle that benefits them IMO). Forcing DL to spend additional money to get back to the those aircraft flying aren't benefiting those 1,721 pilots. This won't create new mainline flying, only an expense by DL to reduce seat count on RJs.


We need to fly the contract, So does Delta management. The whole point of our Section 1, is because management wants to give away all our flying to cheaper international airlines, or regional airlines. No offense, but Delta management salivate at the thought of being able to outsource pilots to Indonesia, and pay $40/hr for a pilot with no benefits.


These are the facts and anyone who doesn't see this is blind to how business works in this day and age. The pilots need to keep Delta honest if the pilots were in violation of any contract Delta would have them in court.
the truth does matter, guys. too bad it's often quite subjective. the truth is beyond the mere facts and figures. it's beyond good and bad, right and wrong...
 
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UPlog
Posts: 716
Joined: Sat Jan 27, 2018 5:45 am

Re: Delta ALPA concerned over continued JV scope flying violations

Fri Oct 23, 2020 2:07 am

Good for DALPA.

The company expects the union to follow the agreement to the letter, so must the company. Sure this might be an honest oversight, however, an agreement is an agreement and Delta rightfully needs to abide.

Its been quite clear in this thread that left alone Delta will play fast and loose with its pilot agreement when it comes to scope as pilots have affirmed through repeated arbitration wins.
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