Delta axes Pinnacle's flying

[TapitLight]

We shall see. Maybe they did it because they could not get rid of Freedom or maybe they are that confident that they are going cut and fight both of them in court. I believe that Freedom's case may be a little bit stronger because of the constant irregular ops out of JFK.

Pinnacle Airlines Calls Delta Attempt to Terminate Contract 'Wrongful'
Tuesday June 10, 8:13 am ET
Regional Carrier 'Surprised, Disappointed'
'Business as Usual' for Passengers, No Immediate Effect on Routes, Schedules

MEMPHIS, TN--(MARKET WIRE)--Jun 10, 2008 -- Pinnacle Airlines Corp. (NasdaqGS:PNCL - News) reported today that its Pinnacle Airlines, Inc. subsidiary has been notified by Delta Air Lines of Delta's intent to terminate Pinnacle's contract as a Delta Connection carrier, effective July 31. Pinnacle believes that this attempted termination is wrongful.[SIZE=-2]ADVERTISEMENT[/SIZE]
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Delta contends that Pinnacle did not meet minimum arrival-time performance requirements for a period since flights began late last year. However, many factors affecting on-time performance are beyond Pinnacle's control, said Phil Trenary, Pinnacle Airlines Corp.'s president and chief executive officer. The operational schedule created by Delta is a key factor affecting on-time performance, he said. Under the capacity purchase agreement, Delta is required to collaborate with Pinnacle to create a mutually acceptable operating schedule. Delta has created Pinnacle's operational schedule since the beginning of operations in December 2007.
"We are extremely surprised and disappointed that Delta is attempting to take this drastic and improper action," said Trenary.
"From the very beginning of our Delta Connection operations, we expressed our concern that the flight schedules Delta created were unrealistic. Our position was affirmed when recent schedule changes by Delta allowed immediate improvement in our on-time performance, well above the agreed minimum standard and above most other Delta Connection carriers."
Pinnacle entered into a new capacity purchase agreement with Delta in April 2007 to operate 16 CRJ-900 aircraft as a Delta Connection carrier and began operations under the agreement in December. The CRJ-900 has operating costs that are the lowest among comparably sized regional jets, providing for an economic, efficient aircraft in the Delta network. Pinnacle has currently taken delivery of nine of the 16 CRJ-900 aircraft on order.
"We believe that the attempt by Delta to terminate this contract is wrongful, and we intend to pursue appropriate remedies," Trenary said.
Trenary emphasized that the issue between Pinnacle and Delta will have no immediate effect on schedules, routes or staffing.
"At this time, it remains business as usual for our passengers and our People," he said. "We look forward to building on our hard-earned reputation for operating a safe, reliable and cost-effective airline."

 

[Max Q]

No WAY!!!

-Brett

 

[EngineOut]

We shall see. Maybe they did it because they could not get rid of Freedom or maybe they are that confident that they are going cut and fight both of them in court. I believe that Freedom's case may be a little bit stronger because of the constant irregular ops out of JFK.

You realize Delta has terminated their contract with Freedom. MAG only won a preliminary injunction (which is under appeal). Nobody will force Delta to give Freedom flying. They will probably just end up paying a fine and moving on. It will probably be playing out the same way with PCL.

 

[Jmoney]

I believe that all these guys signed a CPA which had certain completion and on-time goals over a floating 3 or 6 month period. Looks like they didn't make those goals.
I do know that Pinnacle has had a lot of cancellations in ATL-may have sometihng to do with all their planes being new. I think whether those cancellatioins are initiated by DAL or PNCL may have some bearing if they choose to sue-apparently that is what the Freedom suit is based on.

 

[wms]

These numbers are the very same reason ASA has gone all out for performance with ACARS, D-0 meals and working with DAL to get the ramp working better. If our numbers are down, we're history also.

 

[atlcrashpad]

Watt did Delta axe Pinnacle?

 

[XPOO]

Watt did Delta axe Pinnacle?

Delta axed Pinnacle if they would please GTFO. Oh yeah, you can't read this reply. I guess you'll never know now.

 

[Max Q]

I just lol'd.

-Brett

 

[siucavflight]

Why is this thread so spread out?

 

[Hovernut]

Why is this thread so spread out?

Because PCL flies the 9---0---0!

This $ucks! I have friends who jumped ship here to do the street CA thing there...as I almost did after my u/g class got cx'd last spring. I decided to stick it out here and u/g'd 6 months after the original fubar.

OH is growing (really shrinking not as fast as ordered by DL), but if it's to cover this flying, then it's a bunch of craaap! And for PCL to lose 900 flying when they're not even DL's airframes to re-assign; well, that's just plain dumb!

Good luck guys. Hope someone is smart enough to pick up that 900 capacity!

 

[ohplease!]

told ya' so..... good bye and god riddance.....oh yeah, leave the keys for those 90's on the seat as you leave

 

[silver02ex]

told ya' so..... good bye and god riddance.....oh yeah, leave the keys for those 90's on the seat as you leave

You wish... When Pinnacle leaves ATL the airlplane will leave also.

Under the agreement, Pinnacle will directly acquire and finance the aircraft. Pinnacle will take delivery of the aircraft between November 2007 and July 2008, with scheduled service as a Delta Connection carrier beginning in December 2007. The term of the agreement is for ten years.

N-number : N162PQAircraft Serial Number : 15162
Aircraft Manufacturer : BOMBARDIER INC
Model : CL600-2D24
Engine Manufacturer : GE
Model : CF34-8C5
Aircraft Year : 2008
Owner Name : PINNACLE AIRLINES INC
Owner Address : 1689 NONCONNAH BLVD STE 111
MEMPHIS, TN, 38132-2111
Type of Owner : Corporation
Registration Date : 01-Feb-2008
Airworthiness Certificate Type : Standard
Approved Operations : Transport

 

[wms]

Keeping the airplanes means nothing if there's no one to fly them for And it's not like they're the only -900s around.

 

[Broke in CVG]

Actually, DL owns those airframes.... they are only registered in Pinnacle's name.

Delta Air Lines adds to Bombardier CRJ fleet

February 2007

Delta Air Lines has placed a firm order for 30 CRJ900 regional jets and taken options on 30 additional CRJ900 aircraft. Contract value of the 30 firm ordered aircraft is approximately $1.1 billion US and could rise to $2.3 billion if all options are exercised.

"The fit with our fleet, timing of delivery and ownership economics made the Bombardier CRJ900 aircraft the best overall solution to our need," said Shawn Anderson, Delta's Vice-president of Delta Connection.

Steven Ridolfi, President of Bombardier Regional aircraft noted that Delta Air Lines and Delta Connection have been CRJ customers since 1989 and currently operate more than 350 CRJ aircraft. "Delta has played a major role in the success of the CRJ program and we are grateful for their continuing confidence in our regional jet products," he said.

 

[SEVEN]

Pinnacle will not keep those airplanes. DAL owns them as mentioned and registers them to 9E. The fate of Pinnacle with reference to the DAL/NWA merger was set in place long ago. Unless they get firm replacement orders soon, they are in deep trouble. The 200 flying will be drastically reduced when options for the 900 and 170 are exercised with Compass/Mesaba.
I often thought there might be a place for Pinnacle to operate the 900 for NWA, but after the latest news, I think this is the tip of the iceberg and the writing is on the wall. No doubt, the next 12 months will be trying times for some of the DAL/NWA regional carriers.

 

[DTWFO]

Why is this so hard to understand?? Pinnacle owns the 900's. They bought them. From the annual report:


Property and Equipment Nature of Estimates Required: More than 35% of our total assets are invested in property and equipment, which will continue to increase as we acquire additional aircraft to support our new agreements with Delta and Continental.

Item 1.01 Entry into a Material Definitive Agreement
On October 3, 2007, Pinnacle Airlines Corp. and its operating subsidiaries (collectively, the "Company"), entered into the second of two short-term pre-delivery payment financing facilities (the "Facility") with Export Development Canada ("EDC") for up to $38.5 million to finance certain pre-delivery payments to Bombardier, Inc. ("Bombardier") under the Company's aircraft purchase agreements.


Overview During the third quarter of 2007, we continued to make progress in what we have identified as a significant year of transition for the Company. We have continued to prepare for our new operations with Continental Airlines and Delta Air Lines by entering into agreements to obtain financing for the Q400 and CRJ-900 aircraft pre-delivery payments. We further increased shareholder value through our recently expanded share repurchase program, and through continued use of our hedging program, designed to reduce our exposure to interest rate risk related to financing our aircraft purchases.

Delta does NOT own these planes...period.

 

[rickair7777]

Duplicate Post.....

 

[rickair7777]

Here's a little business perspective for the aviation science grads. I'm not in this mess, so nothing personal or emotional, just business logic.

PCL does not have many options to re-utilize the airplanes. Not many scopes allow regional 900 flying, not to mention to state of the industry (downsizing).

Best option: Get DAL to reinstate the flying. If not, then get them to buy out the contract. This will at least provide income/profit to safeguard management bonuses...which is what it's REALLY all about, if you didn't know.

Plan B: Hope mesa tanks, and pick up some Airways 900 flying.

NWA is probably not an option...they are in a merger process with, guess who? Delta Airlines! They are not likely to piss off their wedding partner by turning around and hiring their rejects. Stranger things have happened, but still.

Also, I'm pretty sure that PCL does not "own" the 900's, rather they "lease" them. What will happen if they can't make the payments? Reference the home mortgage industry for more details. If they cannot cover their leases, they will unload the airplanes in a flash. The good news is that 900's are a hot commodity, and they may be able to re-lease them at a markup...ensuring positive cash flow and management bonuses. These people are NOT in business to fly airplanes or employ pilots...they just want to make money.

Best of luck to the pilots.

 

[DTWFO]

Also, I'm pretty sure that PCL does not "own" the 900's, rather they "lease" them. What will happen if they can't make the payments? Reference the home mortgage industry for more details. If they cannot cover their leases, they will unload the airplanes in a flash. The good news is that 900's are a hot commodity, and they may be able to re-lease them at a markup...ensuring positive cash flow and management bonuses. These people are NOT in business to fly airplanes or employ pilots...they just want to make money.

Best of luck to the pilots.

You are correct. PNCL is just leasing the airplanes. It is just irritating to see how many people are foaming at the mouth to get their hands on these airplanes. And also those claiming they are the authority on something they know NOTHING about.

 

[Spicepilots]

And also those claiming they are the authority on something they know NOTHING about.

FI would not exist otherwise