Delta wants to cancel more RJ contracts---next up--Pinnacle--article

[Superpilot92]

True, but you can't make that case in the DC9 / RJ comparison. The DC9's average stage length is almost the same as the RJ's.

If they want to cut capacity by 10%, a CRJ900 very nearly fits the bill. The A319 and 737 pick up at 125 to 135 seats.

ACL65 directed me to an article in AW&ST which pointed out that a 737/DC9 replacement will not be on the market for at least another ten years.

You and I agree on the important point - that scope has to be written in such a way to protect this flying, regardless of what airframe it is operated with.

When i said they have different missions with the dc9/rj200, i meant the dc9 can do the routes it does with 100+seats and no real weight restrictions. If mgmt want to cut some of the 50 seaters out the 9 can be used for that. I hear Airtran wants to sell the 717s maybe we can pick those up. we shall see how the scope works out under the new merged company.

 

[FLYLOW22]

Your all missing the point.

My what?

 

[Occam's Razor]

Um, no he isn't based on the charts. But, usually you don't post without a factual basis, so you have me wondering.

Someone else re-ran the ALPA's EFA numbers with data double checked from Aviation Daily. The numbers were nearly identical, but did support you (Occam) on the smaller RJ's. The large RJ's beat the DC9's by a cas mile

CASM (inclusive of ACMI)
DC9-30=11.1
DC9-40=9.5
DC9-50=8.8

Next highest:
CRJ200=10.0
CRJ700=7.9
CRJ900(76seats)=7.3

Let's start with the simplest error:

He wrote: "ALPA's own analysis showed that the NWA DC9s have a higher seat cost than the 50 seat RJs"

The 50-seat CRJ200 (and keep in mind, our Airlink operated 44-seat variants too - the CRJ440) have a higher CASM than the DC-9-50 and -40. That's in the numbers. So his generalization is...wrong.

Second, a little more digging would show the structure of the capital leases for the CRJ's NWA bought for PCL. The final "cap cost" obligation is buried in the 10k with other "term obligations". Those obligations are not amortized within the CASM numbers used by Aviation Daily or ALPA E&FA...but they are cost-of-operations nonetheless. The DC-9's (all of them) have none of these non-ACMI obligations. All CRJ's do. Our cap ends are mostly at 90% of purchase value for the older hulls...and 75% for the newer ones.

Third, The ASA's we have with PCL, MSA, and CPZ are greater than the flat operating expenses of those aircraft...ALL variants of the CRJ. [Hint: The "greater than" part is the loot the managers at those airlines get paid] That means the parent corporation rolls them into our effective CASM. The way it was explained to us: "If you're paying someone to operate it...it's an operating cost" Ironically, that's one of the strongest financial arguments we've used for One List with our Airlinks. I wouldn't expect Joe M. to clue-in on that...he's more the irrationally bitter crank type.

 

[PCL_128]

Occam, the 44-seaters were all outfitted with 50 seats about 2 years ago after the scope changed. No more CRJ440s.

 

[~~~^~~~]

Occam:

The numbers I'm posting have a line item entry for Aircraft Cap. Cost. The DC9's are nearly free ($138 to $232 an hour) but the RJ's decreased fuel burns (on even a per seat basis) make up the difference and then some.

Including Capital Costs, the replacement of a DC9 with an RJ "saves" about $1,000 a block hour if you chart out the loss of revenue along a straight line. In reality the revenue change is more of a curve on a per seat basis that increases at an increasing rate until you get to the point on the curve where the fractionals make their business.

So, I'd feel safe taking ~ $3.5 million or so to the bank yearly for every DC9 replaced.

I think Steenland has been frank with us and Delta's managers are just trying not to give the NWA pilots as little as possible to be upset about. Pure guess, but a 737 order once NWA's issues are resolved would not surprise me a bit.

The DC9 is a great & legendary airplane and who knows maybe they can hang GTF's on it and go another 50 years. But the time has passed for the JT8.

 

[Occam's Razor]

Occam, the 44-seaters were all outfitted with 50 seats about 2 years ago after the scope changed. No more CRJ440s.

D'oh!

Typo. I meant to type a "d", but typed an "s".

As in "operated"

I fixed it.

 

[General Lee]

Pinnacle Worries About Northwest Contract
Lisa LaMotta, 06.10.08, 6:45 PM ET

Peltan/charts.prophet.net/servlet/Charmbol=DAL&price.display=0&duration=5d&interval= 5&frequency=0&width=162&height=120&service=fo
Delta Airlines is too busy worrying about fuel woes to play nice.
Delta has been running into a slew of trouble as it tries to consolidate. The legacy carrier has not only been cutting its own capacity, but trying to terminate contracts with its regional carriers; pushing those carriers to the brink of bankruptcy and beyond.
The Atlanta-based airline notified Pinnacle Airlines (nasdaq: PNCL - news - people ) on Tuesday that it would be terminating its contract as a Delta Air Lines (nyse: DAL - news - people ) affiliate due to an inability to meet minimum arrival time.
Shares of Pinnacle dropped 25.8%, or $1.54, to $4.44by the close of trading. Meanwhile, Delta was off 2.6%, or 16 cents, to $5.93. Neither Delta nor Pinnacle returned calls for comment.
The smaller carrier countered, saying Delta's termination of the contract is "wrongful" based on the notion that Delta establishes the company's operational scheduling and therefore is partly responsible for the airlines on-time performance.
"We are extremely surprised and disappointed that Delta is attempting to take this drastic and improper action," said Phil Trenary, Pinnacle's chief executive. "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 could face the same fate as its regional brethen.

The biggest problem for the smaller carrier may be what this terminated contract will mean for the contract Pinnacle has with its largest customer, Northwest Airlines. Delta is set to merge with Northwest pending regulatory approval and could the merge could bring cloudy skies for Pinnacle.
"At this time, we have no plans to change our relationship with Pinnacle as a Northwest Airlink partner," a Northwest spokeswoman told the Associated Press.
Earlier in the month, a Federal judge blocked the major carrier from ending a contract with Mesa Air Group (nasdaq: MESA - news - people )'s subsidiary Freedom Airlines. Delta notified Freedom Airlines of the termination of the 50-seat, 34 aircraft Delta Connection operating agreement due to operational performance at the end of March. The company told a Federal judge that it wouldn't be able to pay bondholders and would default on aircraft leases if the contract was canceled. (See: " Mesa + Delta = Big Mess")
Delta , which plans to merge with Northwest Airlines (nyse: NWA - news - people ), said it would cut 2,000 jobs through voluntary retirement and reduce its 2008 domestic capacity by 10% year over year. (See “ Delta, Northwest Fall From The Sky”)
Other regional airlines are having better luck. ExpressJet recently turned down a $3.50 per share offer from SkyWest when it retained a new seven-year agreement to provide regional service for Continental Airlines, guaranteeing stable income for the small carrier for the foreseeable future. ExpressJet will continue flying 205 jets for Continental. The legacy carrier said their new deal, which will take effect July 1, includes lower rates that are more competitive with other regional carriers.


Bye Bye--General Lee

 

[Occam's Razor]

The numbers I'm posting have a line item entry for Aircraft Cap. Cost. The DC9's are nearly free ($138 to $232 an hour) but the RJ's decreased fuel burns (on even a per seat basis) make up the difference and then some.

The Cap End obligations for the CRJ leases aren't included. Our BOD member made a very specific point of explaining this to our MEC when NWA started buying them. He called them the "hidden" costs of the aircraft. If NWA (DAL soon) is smart, they'll turn-back or restructure the lease agreements prior to the due date of the obligations. But while they're being operated, the deferred obligations are lumped on the 10k with other back-ended debt (eg: The Cap End "balloon" on Building J)

But the simplest truth is this: The DC-9-40 and -50 operate cheaper than the 50-seat RJ's. The numbers you posted confirm that "Sue Boy" posted a flawed generalization.

Period.

I think Steenland has been frank with us and Delta's managers are just trying not to give the NWA pilots as little as possible to be upset about. Pure guess, but a 737 order once NWA's issues are resolved would not surprise me a bit.

Steenland cares?

Ha! Ha! Ha! Ha!

Good one!

The parking schedule for the DC-9 fleet was posted in early '99...and NWA has stuck very closely to it since. The only significant exceptions were the DC-9-10's that were kept flying 8-months longer than scheduled, and the 4 wrecked aircraft.

The DC9 is a great & legendary airplane and who knows maybe they can hang GTF's on it and go another 50 years. But the time has passed for the JT8.

Naw, the aft pressure bulkheads must be replaced at 104,000 cycles. Too spendy...so they are scraped.

 

[JoeMerchant]

The information I posted came directly from ALPA EF&A...It was a DALPA document....

Either it is accurate or ALPA is wrong.....I'm OK with either answer......:laugh:

 

[Occam's Razor]

The information I posted came directly from ALPA EF&A...It was a DALPA document....

Either it is accurate or ALPA is wrong.....I'm OK with either answer......:laugh:

The data was correct, for what it showed. The inaccurate generalization was all yours.

Ops normal.

 

[Hypoxik]

The numbers mean one thing but the aircraft usage means another. There are some routes that work for some and not for others regardless of the numbers. Either way the DC9 will have its role in the new DAL as a filler for the 100+ seat market.

The DC9 works good and lasts a long time

Thats what she said! Owe

 

[PCL_128]

The data was correct, for what it showed. The inaccurate generalization was all yours.

Ops normal.

Typical for Short Bus.

 

[EMB170Pilot]

Typical for Short Bus.

Thppppppt

 

[800Dog]

What do you guys typically tip for a lap dance? Attractive girl, 2 songs? Thanks.

 

[Jmoney]

I understand your nervousness, thats why i left the regionals. Good luck :nuts:

I don't understand why God made you such an idiot. He should have disbursed that much stupid over at least 1000 democrats.