Delta

[spanky2]

Tom-kitty,

"Bankrupsy" ?? Warred due larn to spell ?

PS - you must really believe that stuff that gets pumped into you at CL-65 school(aka "the Academy"). Every seat is aisle or window...DUH. Read the fine print:

But the RJ often seats 40 vs 50 due to weight restrictions, and don't take any luggage bigger than a gym bag, no guarantee that will make it either. Hey, they are self-financing, too. Right.

 

[General Lee]

If we sell ASA/Comair, we would still use them under the DL banner, so no big changes there. We need some extra cash to make sure we make it through the year, and at the same time we have done fairly well executing our transformation plan, according to Grinstein and Palumbo(the CFO) in the last confrence call. The problem for us is fuel, and everyone else except SW, Fedex, and UPS. That last quarter loss was terrible, but apparently it was expected, and a lot had to do with tearing down DFW, paying for moves, starting simplifares, and the gas. (GAS being the large expense now) We are trying to get $5 billion a year in savings, and we will be at around $3 billion a year by the end of this year. They are trying their best I believe.


Bye Bye--General Lee

 

[General Lee]

I just found this article on the Dalpa.net

Delta: Enough worker pay cuts

By RUSSELL GRANTHAM
The Atlanta Journal-Constitution
Published on: 04/30/05

Despite continuing financial losses and sky-high fuel prices, Delta Air Lines executives say they don't expect to go back to pilots or other employees for more pay cuts.

"That is not our plan," Chief Executive Gerald Grinstein said Friday.

​

BEN GRAY/AJC

Delta CEO Gerald Grinstein says the airline is now on the right track.​

Further employee sacrifices at the Atlanta-based airline would hurt morale and service, he suggested.

"We have gotten to the point where I think the morale and spirit of the people is so important," Grinstein said. He said he knows some workers were discouraged by the $1.1 billion net loss for the first quarter reported last week.

But Delta in coming months will stick with turnaround plans it's already launched, Grinstein said, while at the same time trying to offset fuel costs with more efficiency-boosting changes in schedules and airport operations.

Such moves include shortening the time aircraft spend on the ground between flights and trimming weekend flight schedules.

Grinstein and other Delta executives talked about their plans Friday in a meeting with editors of The Atlanta Journal-Constitution.

In a wide-ranging discussion, they said sustained high fuel prices — up about 50 percent in the past year — will make it impossible for any airline to succeed.

"There will be a lot of trauma in the industry" if conditions don't improve in coming months, said Chief Financial Officer Michael Palumbo.

"If we're measuring in terms of a race to the morgue, it's hard to make a call," he said. "But the fact is, we're in a much better position than we were last year."

The Delta executives said their cost-cutting campaign is "on target" but that the results are being masked by fuel costs that now consume about 30 percent of revenue.

The silver lining in the grim first-quarter report was significant progress in cutting costs other than fuel. The airline maintained its cash reserves at $1.8 billion, albeit by using the last installment of vendor financing that helped it avoid a bankruptcy filing last fall.

"Even with higher fuel, we didn't miss [our] plan by that much," said Grinstein, "which tells me we're on the right track."

Since 2001, Delta has announced about 23,000 job cuts, won deep pay concessions from pilots, cut other nonunion employees' pay, shut down its Dallas hub, launched more efficient operations at its huge Atlanta hub and ditched older, gas-guzzling aircraft.

Delta's strategy and network chief, James Whitehurst, said future cost-cutting efforts are aimed at creating a "hybrid" airline combining more efficient flight hubs with more of the point-to-point service that discount carrier Southwest Airlines uses.

While the overhaul hasn't stopped Delta's bleeding, management is betting it may be enough to allow the airline to survive until a rival goes out of business first, or until dropping fuel prices or rising fares give the industry some relief.

Palumbo said Delta has cut $2 billion from its operating budget since last year and expects to push annual savings to $3 billion by year-end.

As a result, Delta should continue to operate outside of bankruptcy with lower cash reserves than it would have needed in the past, the executives said.

"We'll bleed more slowly than we ever did before, and disproportionately more slowly than the rest of the industry," Palumbo said.

Some industry analysts remain skeptical and think Delta will be back at the brink of a Chapter 11 filing later this year.

Delta is burning through $4 million a day — more than any other carrier — and is "the most likely candidate for a bankruptcy filing this year," said Calyon Securities analyst Ray Neidl in a report this week.

The airline is lobbying Congress for assistance that would spread required pension reserve payments out over 25 years instead of five. That would save Delta and other big airlines hundreds of millions of dollars in coming years.

Sen. Johnny Isakson (R-Ga.) introduced a bill to that effect in the Senate and Republican Rep. Tom Price of Roswell is expected to put in a House version next week.

The legislative effort has backing from Delta and Northwest, their pilots unions and other employee groups, but may face an uphill battle because White House pension proposals don't include relief for airlines.

Grinstein said the government assistance shouldn't be seen as an industry bailout because it would help airlines stay solvent enough to pay their own pensions rather than terminating them and saddling the government-backed Pension Benefit Guaranty Corp. with the liabilities.

"I actually think of it as a bailout of the government," the Delta CEO said.

High fuel costs have prompted airlines to nudge fares upward — something the hyper-competitive industry rarely does successfully.

The latest bump came late Thursday when American Airlines added $10 roundtrip to U.S. and Canadian flights. Delta and Northwest matched the move.

Grinstein, a longtime Delta board member who took the controls in a late 2003 management shake-up, said he expects to stay in the job this year and part or all of next year.

He said he expects to name a successor from within Delta's ranks.



Interesting indeed! We'll see if they are right. I doubt it though. I think there will be another "asking" for pay cuts in late Summer. I guess we can all hope not.


Bye Bye--General Lee

 

[Tomct]

Spanky......Sorry, hit the wrong letter! Must be great being as cool as you? NOT! And by the way, there is no way in hell I would go to that academy! Thanks for playing!

 

[Tomct]

General, I believe that the only way selling us off and keeping any of the proceeds that continue to come in would be to spin us off into an IPO? We have all been saying this for years, but no one wants to listen. I guess when it gets right down to it, may GG will have what it takes to make it happen. That would be fine with me, get rid of all our mgmnt at ASA and make it happen!

 

[doh]

General,

Maybe I ain't seeing this right, but I can't see how Delta can get meaningful cash for either of us. whoever buys us will want assurances that Delta won't cancel their contract if they go to bk. They will want price high enough to make a profit on the fee for departure and they will want Delta to take over the leases on the a/c if there is a reduction in flying. I don't see how some one would be stupid enough to take a worse deal than that. Once the industry is on the upswing again I have no doubt Delta will sell us, but I just can't see it now. I hope the recalls don't get thrown back on the street though, I got friends still out and I want them back soonest!

 

[Boeingman]

Three observations people:

1: Bankruptcy will change everything. While most of these theories are workable in a company recovering, all bets are off in a bk. process. I think there is no way Delta can avoid a bankruptcy filing short of a financial miracle this year i.e. oil dropping. No company can sustain cash burns and losses like this. The "paper" losses as well. Eventually they do affect credit ratings which eventually does crimp the bottom line.

2: The "No more paycuts" is a ploy only to keep the troops from revolting. If the numbers don't improve, or Delta files,they will come back for more and it will be with a vengenace. Either through negotiations or an 1113 process it is coming. To think otherwise is not smart for your own financial planning. Ask any UAL or U pilot if they would of thought in the beggining of their saga if their contracts would of been gutted to the extent they are today.

Pilots are like a deer in the headlights. They just stop and stare and never believe the management truck isn't actually going to run them over. The problem now is ALPA (at the local and national level) has allowed the incompetent theives running these airlines to not only run over us, but to back the truck over the corpse again and again.

3: Selling the DCI carriers is akin to burning the furniture to heat the house. While on the surface it seems like a good short term move harvest cash for mother Delta to stave of liquidity problems, in the long run all it is doing is buying time. Delta must address it's debt problem. I read an analysis that showed even if Delta used all the cash from the sale, it would only pay down about 9% of their total debt.

If you don't think this is plausible, rethink and study how every airline bankruptcy has played out in the last 20 years.

 

[ATR-DRIVR]

Tom-kitty,

"Bankrupsy" ?? Warred due larn to spell ?

PS - you must really believe that stuff that gets pumped into you at CL-65 school(aka "the Academy"). Every seat is aisle or window...DUH. Read the fine print:

But the RJ often seats 40 vs 50 due to weight restrictions, and don't take any luggage bigger than a gym bag, no guarantee that will make it either. Hey, they are self-financing, too. Right.

hey spank-yourself,
i guess on top of being the spelling police you "must really believe that stuff that gets pumped into you at B-727 FE school on Virgina Avenue". just another "blame all of Delta's woes on the RJs", Gods gift to aviation experts......

 

[Palerider957]

If GG needs to sell ASA/CMR to raise a few bucks, so be it. Honestly I can't think we are worth that much in this depressed market (especially with ASA's open labor contract).

All the talk of SKYW buying us seems a farce. Virgin Atl., is interesting, but they seem to be slow to get going. I can't really think of anyone else who would want us? Mesa? JO would have his hands full with the ASA/CMR pilot groups.

I think DAL is stuck with us for at least the short-term.

 

[michael707767]

Mike Stowell, VP of engineering, says the winglets themselves would add just over 10ft (3.3m) to the overall wingspan, stand 11ft (3.4m) tall and add approximately 2,300lb to the operating empty weight, including the winglets themselves, any necessary ballast and structural modifications to the wing. The modification is predicted to save around six per cent in block fuel at the aircraft’s 6,000 mile range, or about 4.5 per cent at 3,000 miles. The higher figure would translate into annual savings of up to 400,000 gallons of fuel.

http://www.aviation-industry.com/atem/newpages/current_atempdfs/AT75b767ext.pdf

out of curiosity, why don't they just add the same wingtips as the 767-400?