"If Delta does not take delivery of CRJ jets"

[spinproof]

Time to go back on your meds....

No not really I don't have to take anything else till 18:00 EDT. But hey thanks for being concerned!

 

[jetflyer]

There's some serious DENIAL on the state of affairs at Delta by Delta pilots.

Wouldn't you be in DENIAL if your company was in as bad of shape as Delta is? Heck 2-5 years from now people could be talking about Chapter 7 at Delta not just at US Airways!!

Let's all bury our heads in the sand and deny, deny, deny!!


2 years ago all of the Delta pilots were saying how great Delta was doing, even when it was losing MONEY hand over fist. "But we have a lot of CASH"
OH CASH, OH CASH where have you gone???!

Delta analysts have said by the end of this year they should have only a little over 700 MILLION in CASH!! Not much CASH there. Delta is losing about 3 million in CASH a day, by most estimates. It won't take long till all of the cash is gone at these rates!

Heck half of the Delta pilots still think Comair and the RJ are to blame for all of THE FINANCIAL TROUBLES AT DELTA.
>It couldn't be Delta's high cost structure, inefficient use of equipment, or their old gas guzzler aircraft.
>It couldn't be because prices for an airline ticket have shifted back to where they were around 1990 because of competition from Low Cost Carriers like Jetblue, Airtran, Southwest, Independence Air, etc.
>It couldn't be because people now know how to get the CHEAP TICKETS on the INTERNET at sites like CHEAPTICKETS.com, ORBITZ.com, PRICELINE.com, TRAVELOCITY.com, HOTWIRE.com, EXPEDIA.com, or God-forbid SOUTHWEST.com.
>It couldn't be because gasoline now costs over $53.00 a BARREL and that many analysts say $50.00 a barrel is going to become the NEW norm in the future. Worldwide demand for oil is going up over 10% a year thanks to the U.S., CHINA, INDA, and many other quickly developing nations. Demand is increasing way too quickly to keep up with.
>It couldn't be because Delta has over $22 BILLION in Debt and a $5 BILLION under funded Pension plan which ALONE is going to make Delta have trouble competing for the FORESEEABLE FUTURE because they eventually are going to have to pay back these DEBTS + INTEREST where other HEALTHY AIRLINES will not.

But many Delta guys still paint rosy pictures of their future and say the company is just using the current problems as an EXCUSE TO STEAL OUR PAY and that we still need to KEEP AS MUCH PAY as possible for the future pilots of our industry. Some Delta pilots say "Oh but we have a lot of CASH!!" Many Delta pilots also say "We trust DALPA and they're gonna make sure we give up only what we have to. They'll help us get out of these problems."

I bet the pilots at US Airways, United, Eastern, Pan Am, Braniff, TWA, etc. trusted their unions to get them out of their problems.

Things are BAD. VERY BAD. 20 years from now people are going to look back and say, "WOW THE EARLY 2000's were the worst time ever for the airline industry. Can you believe all those airlines (hopefully not Delta) went out of business!!"

A lot of people need to wake up and realize things are bad and sacrifices are going to have to be made QUICKLY SO WE ALL STILL HAVE JOBS IN THE FUTURE!!!!

Maybe I'm too pessimistic or maybe I'm a realist?? I don't know. I know I'm scared. I think a lot of people associated with Delta should be. Things are bad and a lot of people are in serious denial and it frustrates me. Actions need to be taken and they should have been made YESTERDAY! But the good 'ole union is gonna watch out for us and make sure we don't give up too much. Maybe that good 'ole UNION SHOULD HAVE BEEN SMART AND GIVEN UP WHAT DELTA MANAGEMENT WAS asking you to give up about 2 years ago!! Wasn't that a lot less money??

Do you guys realize the AVERAGE HOUSEHOLD INCOME in the U.S. is only $36,000/year.
Do you guys realize only 1 out of 100 people in the United States makes over $100,000/year.

Seems like GREED has made a lot of people in the Airline industry desire way too much for way too long, and many feel that all pilots are entitled to be multi-millionaires. Corrections are coming unfortunately and those that correct first will survive and those that don't or are last to act will PERISH.
The effects of DEREGULATION are UNFORTUNATELY and FINALLY upon us.

We all want to be PAID 1% more than the next guy, but I think there's something to be said for JOB SECURITY with fair compensation.

Let's all pray for Delta's future because a lot of precious and wonderful lives and families are dependent upon it.

Jet

 

[spinproof]

Wow jetflyer you sure are brave...We who have gone before you,salute you! I can hear the breeches cocking .....get ready...steady...INCOMING!!!!!!!!!!!!!!!

 

[General Lee]

Jetflyer,


Easy now, simmer down now----ya hear? Grinstein and company are trying to negotiate with the creditors to get the debt payments and lease payments lower, and the pilots will take a $1 billion pay cut, and the non-union people will take an additional $1 billion pay cut. We are closing a large base, and realigning planes and people. Those pay cuts will get us through the high oil prices for a while, and then another large carrier will probably tank, and ticket prices will eventually go up and help us all out.

The reason, I say again---the reason why the pilots have delayed with the pay cuts was to ensure getting the creditors onboard. I would bet that Grinstein and Malone knew what they were doing---and they knew that they needed everyone onboard. I don't personally know ONE GUY at all that thought we currently deserve the high pay--even though we weren't just going to hand it over. We all knew that we would eventually get pay cuts, and that is left to the union. The arrogance you talk about is not with most of our pilots, we all knew it was coming.


Bye Bye--General Lee

 

[MedFlyer]

Jetflyer,

Those pay cuts will get us through the high oil prices for a while, and then another large carrier will probably tank, and ticket prices will eventually go up and help us all out.

Bye Bye--General Lee

With a business plan like this, it's no wonder the creditors have balked at giving DL help. Unfortunately, DALPA and DL management have spent way too long sitting around hoping another carrier would go under so that they wouldn't have to fix their own problems. So far, that strategy has been a miserable failure and now DL is teetering on the edge.

Rumors I've heard, say that DL and DALPA are still quite a way from an agreement. The biggest problem is the pension issue. DL can't afford to be stuck with giant pension tab if U and UAL are both dumping theirs. So, unless DALPA agrees to major pension cuts, DL management will likely want CH 11.

DL isn't going to get much from the creditors outside of BK....DALPA knows it, DL management knows it and the creditors know it. AA got very little relief from its creditors...they relied mostly on labor cuts and some improvements in efficiency. The same will be true for DL outside of BK.

 

[spinproof]

Jetflyer,


Easy now, simmer down now----ya hear? Grinstein and company are trying to negotiate with the creditors to get the debt payments and lease payments lower, and the pilots will take a $1 billion pay cut, and the non-union people will take an additional $1 billion pay cut. We are closing a large base, and realigning planes and people. Those pay cuts will get us through the high oil prices for a while, and then another large carrier will probably tank, and ticket prices will eventually go up and help us all out.

The reason, I say again---the reason why the pilots have delayed with the pay cuts was to ensure getting the creditors onboard. I would bet that Grinstein and Malone knew what they were doing---and they knew that they needed everyone onboard. I don't personally know ONE GUY at all that thought we currently deserve the high pay--even though we weren't just going to hand it over. We all knew that we would eventually get pay cuts, and that is left to the union. The arrogance you talk about is not with most of our pilots, we all knew it was coming.


Bye Bye--General Lee

OK who RU and what have you done with the General...we've had our differences but I must protest in the stearnest terms we will not rest until you release him. We have at our desposal a crack team of professionals ready to strike if needed. I would suggest you re-think your position and turn him over to us!!!!!!

 

[jetflyer]

General Lee,

I don't think even the $1 Billion in concessions by the pilots will be enough to avoid CH 11 by the end of the month. One sneaky reason I think they may just file before the end of the month, even with the concessions and maybe even after help from the creditors, is to get rid of the Independence Air/ ACA DO-Jets. That alone would save money for Delta in the future and then the judge could force even more help from the creditors.

Getting rid of the Do-Jets and making Independence Air keep the leases would hurt significantly a growing threat and competitor, in Independence Air, on the east coast.

This is all just my opinion. I don't own Delta stock nor do I have any futures contracts on Delta stock, so I'm not trying to manipulate the stock price.

Let's hope the actions Delta is taking will be enough to help Delta become stronger and one day maybe even BREAK EVEN on the balance sheets.

It's going to be a very difficult uphill battle for Delta even after closing the base, getting rid of fleet types, all the pay cuts, and help from the creditors to get the debt payments and lease payments lower.

Delta will still have to deal with the:
1) Out of control COMPETITIVENESS from LCCs
2) The INTERNET which allows one to find the lowest price among as many 10 airlines at once
3) OIL PRICES that will probably stay near $50.00 a barrel or HIGHER from now on because of increased global demand from China, India, and other developing nations.
4) The $22 BILLION in debt and $5 BILLION under funded pension plan which will hamper Delta's competitiveness for the rest of their future.


Let's all hope that Grinstein's PLAN for DELTA is good enough to deal with today's reality in the airline industry.

Why a business man like Richard Branson would try to start an airline in the U.S. in today's airline industry environment blows me away and just seems ridiculous.

Let's all pray for Delta's future because a lot of precious and wonderful lives and families are dependent upon it.
Good luck DELTA!!

Jet

 

[chperplt]

Getting rid of the Do-Jets and making Independence Air keep the leases would hurt significantly a growing threat and competitor, in Independence Air, on the east coast.

If I'm not mistaken, Delta does not have to file CH 11 to get rid of the Dojets. As long as their credit rating drops below a certain level, and it has already, Indy can be stuck with the leases.

 

[General Lee]

Well, dumping the 30 Dojets back on Indy's lap would cost them a bundle. And, I don't know if our credit rating can get any lower.


As far as answering all of your questions Jetflyer, I guess I can try---but remember I am NOT the one in the board room or negotiating table, so I really don't know what is happening in there. Those people are a lot smarter than I am, and that is what they are paid to do.


Yes, we have debt, a lot of it. In a Chap 11 senario, most of the unsecured debt would be wiped away. The rest of the debt would be negotiated down, along with the leases. United currently pays 737 lease rates for their 747-400s. They got their leases down $1 billion a year---which is good for them. If the rumors are true about eventually selling parts of DCI for cash, then some of their debt (RJ debt) would be transfered too, helping our cause.



As far as our pension and it's underfunding--I predict we will switch to a cash balance type program, which will take away a lot of the underfunding--because our current one projects outward---looking at what Delta WILL OWE in the future. A cash balance program will be more like a 401K--with you leaving the company with whatever you have amassed---and no monthly pension after that.


The cost of oil right now is hurting everyone except Southwest. Everyone needs to raise prices or add a fuel surcharge, and I believe we just did last Friday--but I don't know if it is still sticking. That would take care of that problem, and if one large carrier tanks---that would bring fuel prices down also, besides bringing up ticket prices.


As far as $1 billion a year NOT BEING ENOUGH---well, the other non-union folks only got a 10% pay cut, so I guess there is more room there. That may sound rough, but I don't think many went to college wanting to become a flight attendant, or a ramper. Also, they have no contracts and no unions--so they don't spend money monthly to pay for union dues. That was a bad decision on their part.


Or, we could just raise the fares everywhere a LCC doesn't go. We still carry more passengers than almost any airline (I think Southwest now carries more domestically---but we are second and we have the largest hub in the world)----not everyone out there can fly on Southwest.


There you have it. I am sure we will be giving our fair share (30-35%) soon. Then management will have no other excuses---they must lead.....


Bye Bye--General Lee

 

[Indypilot]

First of all, the do jet leases cost 22M a year. Mere pocket change for delta. I really don't see that as a major reason why to file ch11. Think about it for a while. Even adding in the implicit savings from a hurting competator, or driving them out of business, is still MERE PEANUTS. That issue has nothing to do with this.

Second, lets clear up the do jet issue.

There are 2 issues going on here.

1. Who is on the lease

Right now both Delta and ACA are on the leases. They will both stay on the leases unless delta credit rating improves to be above independence's. That is the only way independence can get the lessors to remove their name. The only other way for either of them to get off the hook, is to file ch11. Whoever does that first, will have the ability to shed the leases, and transfer them over to the co-signer. That is the credit rating issue. This has no date of expiration or anything of the sort, they will both stay on the leases until the end of the 16 year term unless, One files BK or Delta's credit rating surpasses Indy's (in which case indy is released from the leases).

2. Who is Paying the leases

Right now ACA is paying the leases. They will do so until Nov 1. At that point, Delta will start paying the leases. Delta CANNOT turn this obligation over to ACA because of credit rating. They canceled the contract, now they face the penalty of canceling the contract, which is to assume the PAYMENT of the leases. No matter what anybody says, the ONLY way for delta to stop paying those leases, is to file ch11, and turn the lease over to us, as we are still the co signers. So the ONLY way indy has to start paying again, is if delta files, and requests their name off the leases. Again, this also doesn't not have a magic expiration date. Delta will continue to pay the leases until (if) they file period.


Now that we have that cleared up, if both names stay on the leases, and delta files 7 years from now, the payment of the leases goes back to independence. The only way for indy to get off, is to have delta's credit rating above theirs. This is the way the leases were set up, and it will continue until the end of the leases.



Delta at any time durning the next 12 years can get off by:

Filing CH11 anytime during the lease period.

Indy at any time during the next 12 years can get off by:

Filing CH11 anytime during the lease period.
Having Delta's credit rating exceed theirs.


Clear as mud right!

 

[jetflyer]

General Lee,

Let's hope those smart gentlemen in the boardroom at Delta can work some magic over these next couple years so we can all keep our jobs!

Indypilot,

Thanks for tackling and explaining the Dojet scenario.

Jet

 

[FDJ2]

There's some serious DENIAL on the state of affairs at Delta by Delta pilots.

Wouldn't you be in DENIAL if your company was in as bad of shape as Delta is? Heck 2-5 years from now people could be talking about Chapter 7 at Delta not just at US Airways!!

Let's all bury our heads in the sand and deny, deny, deny!!


2 years ago all of the Delta pilots were saying how great Delta was doing, even when it was losing MONEY hand over fist.

Delta pilots? Jetflyer here is what Delta management was saying in 2003

Tuesday, April 29, 2003



DELTA AIR LINES: CEO Mullin Bullish about Company's Viability
-------------------------------------------------------------
Delta Air Lines (NYSE: DAL) CEO Leo F. Mullin reported at the
company's annual shareowners meeting that, referencing the
current turmoil embracing the airline industry, he believes
"Delta can survive and can remain solvent throughout this
incredibly challenging period."

Mullin pointed to the company's strong balance sheet and success in reaching its 2002 liquidity and cash burn targets. He noted Delta's performance was consistently referred to as the best of the network carriers by independent
measures, including some Wall Street analysts



ATLANTA, April 17, 2003



“Even as we face the greatest financial crisis in Delta's history, which is deepened by the impact of military action in Iraq, Delta continues to successfully reduce costs, preserve liquidity, and implement the strategic elements of our long-term plan for survival," said Leo F. Mullin, chairman and chief executive officer. “This plan has allowed us to end the March quarter with $2.5 billion in cash and short-term liquidity. I remain confident that we are taking the right steps to stabilize and strengthen our company while meeting the needs of our customers."

"Delta outperformed analyst expectations in the December quarter through our disciplined approach to the entire operating environment," said M. Michele Burns, executive vice president and chief financial officer. "The steps we took to optimize our network and implement cost savings initiatives led to improved cost and revenue performance in each month of the quarter."

Jetflyer the tone at DAL didn't start to seriously change until Leo left at the end of last year and GG took over and immediately started beating the BK drum. The Delta pilots have offered over $700M/year in concessions, or roughly $2M/day and yet you claim it's the Delta pilots who are in denial. Had Delta management taken that $2M/day two months ago they would have an additional $120M in the bank today. Where's the urgency from GG towards the non contract employees. The recent cuts from the non contract employees will save $1B/year yet GG won't implement those cuts until 2005. Yet somehow you insinuate that the Delta pilots are in denial. You might want consider that the Delta pilots are being prudent and it's management that has been floundering around not being able to get it's message or business plan straight.

 

[dogg]

.... Can one of the MBA's show me in plain english how a regional jet airline that is paid to fly the same whether they are empty or full can claim to be profitable-as an airline-......It seems that the day is coming when fee- for -departure contractors are going to be a thing of the past....At which point the desert will be full of 50 seat RJ's.....

 

[FDJ2]

The biggest problem is the pension issue. DL can't afford to be stuck with giant pension tab if U and UAL are both dumping theirs. So, unless DALPA agrees to major pension cuts, DL management will likely want CH 11.

Medflyer, how much has DL contributed to the Delta pilot pension plan in the last 8 years? How much will Delta have to contribute in the 2005 to the pilot pensions? How about 2006? What is the funding level of the Delta pilot pension plan today? And please, don't confuse the pilot pension plan with that of the non contract employees since it is costing DAL significantly more to fund the non contract employees pension plan. I suspect you must have the answer to these questions since you seem so sure that the pilot pension is the biggest problem.