Delta cuts fares 50%

[satpak77]

just wonder how DAL is gonna pay the bills with the new "fare overhaul"

DAL management just obtained XXX millions in cost savings, now they cut fares 50%. (???) I am not an Ivy League MBA so what do I know....

one can only guess the strategy, I wonder if they are trying to force US Airways and UAL to match and finally drive the last nail into the coffin. Maybe when UAL and UAIR die, the fares will return to normal.

who knows?

http://www.thestreet.com/_yahoo/stocks/transportation/10201856.html?cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA


http://cbs.marketwatch.com/news/story.asp?guid=%7BF8497575%2D496A%2D42BC%2DA17E%2DA0678BC717D9%7D&siteid=mktw&dist=

 

[User546]

I dont know.

Even though they cut their fares 50%, I'm still never going to fly with them.

 

[FarginDooshbahg]

I dont know.

Even though they cut their fares 50%, I'm still never going to fly with them.

I really doubt that there is one person on this great Earth that gives a fat rat's a$$ whether you are "still never going to fly with them".

 

[mattpilot]

hey.. i'm happy!

My family almost exclusively flies delta. My dads close to 2 million miles :/

 

[chperplt]

You guys need to read and then comprehend what you read. Delta is not cutting it's fares by 50%. What they are doing is cutting their overall fares by "UP TO" 50%.

What does that mean? The walk up $2500 fare will now be $1250 bucks. That's the fare that sells maybe .001% of the time. They are also reducing the number of total fares offered to 8 (I think) in coach and 2 in first. The only thing they are cutting in half is the cost to change a ticket, from $100 to $50.

They are doing nothing more than falling in line with Southwest and all the other LCCs out there. They sell a number of seats for a low advertised price and then raise that fare as the seats on the airplane sell.

I don't see why this is so earth shattering?

 

[satpak77]

I don't see why this is so earth shattering?

you might ask the investors on Wall Street who hold DAL (and other airline stocks) that question

after the "not so earth shattering" announcement, DAL stock took a 10% hit in one day. Merrill Lynch downgraded ratings on four airlines, to include the rarely used "SELL" which occurred today for Delta.

other than that, nothing earth shattering

 

[User546]

I really doubt that there is one person on this great Earth that gives a fat rat's a$$ whether you are "still never going to fly with them".

Wow, you couldn't have picked a more appropriate username!

I was just making my opinion, I wasn't pretending that a single one of you cared if I was ever going to fly on them or not. Lighten up pal.

 

[chperplt]

Satpak

Tell me why this news is going to shake the industry as your experts predict?

 

[FlyChicaga]

It's just the perception. Putting an already money-starved industry (and carrier) deeper into the red. I was watching CNBC earlier and they also put AirTran on a "neutral to sell." I guess the expectation of fare matching out of ATL by AirTran is making analysts think it will negatively affect that carrier as well.

I'm surprised they didn't say more about US Airways. This fare war will tighten the belt even more on them, seriously pushing them more towards demise. Time will tell.

 

[tk855]

chperplt,

Satpak isn't kidding, it is really raising heck with everyone's stock today.

tk

 

[Ailerongirl]

You guys need to read and then comprehend what you read. Delta is not cutting it's fares by 50%. What they are doing is cutting their overall fares by "UP TO" 50%.

What does that mean? The walk up $2500 fare will now be $1250 bucks. That's the fare that sells maybe .001% of the time. They are also reducing the number of total fares offered to 8 (I think) in coach and 2 in first. The only thing they are cutting in half is the cost to change a ticket, from $100 to $50.

They are doing nothing more than falling in line with Southwest and all the other LCCs out there. They sell a number of seats for a low advertised price and then raise that fare as the seats on the airplane sell.

I don't see why this is so earth shattering?

I'm with you on this one chper....it just looks like a big deal...big hype as usual. I'm afraid that all it will realy do is give ASA mgmt another excuse to push the stupid 'cost-neutral' contract b/s.....

 

[MedFlyer]

It's just the perception. Putting an already money-starved industry (and carrier) deeper into the red. I was watching CNBC earlier and they also put AirTran on a "neutral to sell." I guess the expectation of fare matching out of ATL by AirTran is making analysts think it will negatively affect that carrier as well.

I'm surprised they didn't say more about US Airways. This fare war will tighten the belt even more on them, seriously pushing them more towards demise. Time will tell.

What many people don't realize is that DL is actually raising the lowest fares in many markets. This move could actually be revenue positive....assuming the other airlines don't do anything stupid like try and undercut DL by 50%. If that happens, all bets are off.

 

[chperplt]

TK

I realize what it's doing today. But what happens today means nothing.

The airline industry and the stock market are pretty similar in that they are run/influenced by stupid people.

I think this will be a positive for Delta and the industry as a whole. It just may take a few days for people to understand what DAL really did.

 

[tk855]

I agree with you. Lets hope it is for the better.


tk

 

[Vik]

I knew something was up with DAL before that news article came out.

I just bought a ticket for someone that normally costs $1200-$1400 for only $900. I was shocked, but I suppose, no surprise. The only way to get $900 on that route was to fly Korean Airlines .. *shudder*

 

[jeff333]

I guess Delta has found a way to waste all the savings the pilots just gave them.
Hey lets lower our revenue so we can file BK and give the pilots the shaft in court.

 

[Vik]

Its a desperate act to get quick cash probably to pay bills to avoid Ch.11 this month.

I guess Delta has found a way to waste all the savings the pilots just gave them.
Hey lets lower our revenue so we can file BK and give the pilots the shaft in court.

 

[skyslug]

I believe DL is raising their deep discounted fares and also making less of them available. They are not just simply slashing prices 50%. This is a short term loss with (as CVG has shown) long term gains in ridership which should equate to more $$.

 

[chperplt]

If the numbers DAL says about CVG are accurate and work out nation wide, this will be a step in the right direction.

 

[ifly4food]

Delta's fare cutting is meaningless if they can't get their costs down. It only means they'll fill even more airplanes that don't make money.

The point is that Delta must match JBLU, WN and Airtran's cost structure before they can match their fares. Simply matching the fares with the same high costs will only accelerate the race to bankruptcy.

Right now, Delta is filling planes, but charging less per seat than it costs them. Pilot pay cuts alone won't save this company, it's time for management to do their part... cut management.

Merge ASA and Comair, eliminate half of the meaningless VP positions at the GO, and cut management pay by 25% across the board. Then quit flying planes to places nobody wants to go just to "maintain market share". Then Delta will have begun to come close to what the LCCs are doing.