Delta Strike

[Spooky 1]

I had this email forwarded to me this morning. Read want you want into it, but it is interesting. It certainly is not flamebait and since I know the source, I believe it is real, regardless of the stupidity and reckless disregard for the legal process. To top it off, this individual does have the ear of upper management on occasion.

"Whether we want to believe it or not, there is a possibility of a pilot's strike at Delta. I don't want to believe it can happen, but things could spiral out of control".

"As things stand, a strike means Chapt. 7 liquidation".

"I am not willing to let DL die if there is a possibility of keeping it alive".

"I am considering making a proposal to DL to man the international operations in the event of a strike".

"They would probably laugh at me. But, if they didn't".

"My concept would not be to replace striking pilots, but rather to operate as contract pilots until ALPA and the company reached an agreement. While I anticipate that the bulk of the guys would come from Delta, I'd also hire guys from any legacy carrier that we could use with just requal training".

"I have no desire to destroy ALPA but I have a deep desire to keep Delta alive".

"If we could keep the company alive while negotiations were ongoing, I think ultimately we'd be doing everyone a favor, including the pilot group, a favor".

"We woudn't want to be seen as opportunists. I think the best way to do it would be to work for a fairly small salary and perhaps an agreement with the company that they do something for the pilot group (scholaships for kids of deceased pilots perhaps)".

"So I am creating a list of retired guys who would consider being trained and be willing to operate international flights in the event of a strike".

"This is not about a windfall for us, it's about repaying Mr. Woolman and Garett and saving the jobs of 50,000 other Delta emolyees".

 

[G4G5]

Delta CFO Sees Burning $500M Cash Over Next 90 Days

DOW JONES NEWSWIRES
November 17, 2005 3:52 p.m.

--
By Christopher Scinta Of DOW JONES NEWSWIRESNEW YORK (DOW JONES)--Delta Air Lines Inc. (DAL) expects to burn through $500 million in cash over the next 90 days.
Delta Chief Financial Officer Edward Bastian told the U.S. Bankruptcy Court in Manhattan Thursday the company is burning about $5 million a day as it moves through a period of weaker demand at the end of the year.
The Atlanta-based airline is seeking to impose wage and benefit cuts on its pilots totaling about $325 million, saying it can't be profitable without further givebacks from workers. The pilots, represented by the Air Line Pilots Association, are fighting the proposal, saying they agreed to $1 billion in cuts last year.
For the third quarter, Delta reported an operating loss of about $438 million, Bastian said. Delta is hitting all the targets in its business plan for the year, except fuel costs have far exceeded projections. Fuel absorbed about 40% of Delta's total revenue in October, or around $550 million.
Delta's 2006 business plan has the company on track to break even on cash flow, while its 2007 plan is to generate $1 billion of cash, said Bastian, who has been Delta CFO since July.
However, Bastian said, "this is a very volatile industry," where the surprises tend to be negative, not positive, so the givebacks from employees are necessary.
The executive said Delta's planes are running "fairly full," and there isn't a lot of extra seats on the planes to boost revenue.

 

[Tomct]

Stand Tall DALPA! I would be proud to walk the picket-line with any of you!!
God Bless Us ALL!

 

[AlbieF15]

So...I will SCAB, but I am doing to HELP YOU FROM YOURSELF... (I scoff...)

Good luck to all of you fine guys over there. If you do give up and bail, FedEx, Continental, JetBlue, and Southwest are hiring. If you ride through this storm I wish all of you the best. I've got several good buddies and co-workers either working or furloughed at Delta, and I know its got to be rough.

 

[proftomda]

Good luck to all the hard working folks at Delta, contract and non contract. This holiday season will be especially trying given the burden of possible career evaporation added to the normal stress of getting ready for the holidays. On a positive note remember there is life after Delta and its not that bad either. For me, a big financial setback but much better work atmosphere if you can believe it.

 

[OffHot]

Let's see Delta Mgmt expects to be 1 billion in the Black by 2007, yet they need 325 million from the pilots instead of 91 million. They must need to fund their exit bonus.

 

[Draginass]

Best of luck to the DAL guys.

However, when all the bluster and thunder is done, they're going to take whatever the company pushes accross the table at them. Management is not going to take them seriously unless they are convinced beyond a shadow of a doubt that the pilots will shut the company down and walk away. That's going to take a significant show of collective anger and action and not biz as usual while negotiations go on. So far, I haven't seen that fear in management. What I've seen is inner smirks and outward crockadile tears.

It would appear that none of the travel writers are fearful of a shutdown. They know ALPA will fold . . . again.

 

[michael707767]

Management is not going to take them seriously unless they are convinced beyond a shadow of a doubt that the pilots will shut the company down and walk away. .

if they think the pilots will not undertake self help, they really are stupid.

 

[YourPilotFriend]

If they cross the picket line to keep the company afloat well............Thats the last thing this industry needs right now. We can't afford someone creating contract pilots to support the company while the real pilots are on strike. I hope we have learned something from the NWA mechanics situation. If it's Delta's time to go, let the DELTA pilots decide that. Nobody, not even the president, should interfer.

 

[FDJ2]

Delta's 2006 business plan has the company on track to break even on cash flow, while its 2007 plan is to generate $1 billion of cash, said Bastian, who has been Delta CFO since July.

Well if they intend to break even in 2006 and make $1B in 2007, then it doesn't appear as if they need $325M in additional concessions from the pilots thru 2010.

Here are some key numbers which were filed by Delta.

Pilot CASM 2Q2005 .105
Pilot CASM anticipated in 2006 with no concessions .88 (CASM continues to drop in the out years)
Pilot CASM DAL states they need to restructure .82

Pilot CASM drops to .88 in 2006 because that is when the efficiencies generated by LOA 46, such as PBS, will be realized.

Based on DAL's own published numbers on pilot costs, in order to drop pilot casm to .82 from .88 an average concession of approx. $78M/year would suffice.

When generating its demand for $325M/year, DAL conveniently takes a snap shot of 2Q2005 Delta pilot costs and ignores the yet unrealized savings from LOA46. It's an opportunistic grab by management, but that's to be expected.