Interesting Delta article......read this

[XRMEFLYER]

Just don't put them up against Southwest (with its low fares) on LCC routes (like SLC-PHX) and expect them to make big profits.

As opposed to the big profit your 73 or mad dog or phantom 100 seater will make when more than half empty. Your argument is assuming that there are enough people wanting to go to fill these planes up and that is simply not always the case. I wish that it were, but it is not. Thus the need for right sizing the aircraft to the market.

 

[On Your Six]

I guess AirTran is WRONG then....

Are you ignoring AirTran's recent decision to drop CRJ usage? What does that tell you? Hmmmmmmmmmm. The 717 will always be more comfortable than the CRJ/CR7 and its economics are favorable in a low-fare environment. It's like a plan out of Southwest's playbook - drive additional traffic (i.e., people who would take the train or car) with lower fares but still have a reasonably lower cost structure to support healthy margins.

I agree that CRJs are great for non-competitive hub-feeding routes. You want to offer an LAX passenger the opportunity to fly to ISP or HPN. vs. just to JFK. Hub connecting traffic tends to be pretty profitable - that's a fact. But we are talking about LCC competitive routes here and not hub-connecting, non-competitive routes.

However, until DAL has a 100-seater plan (besides using the gas guzzler 737-200s), all of this is moot. DAL currently has no serious alternatives at the moment because it failed to plan long ago. Fred Reid went RJ crazy and now he is gone to Virgin - although he talked about incorporating A318/9s a long while ago but no plan was implemented for a variety of reasons...

The CRJ works in a number of markets - but not directly up against LCCs - that's why delaying a 100-seat decision was not a good idea. Now Jet Blue, AirTran and maybe ATA will be using 100 seaters to take advantage of mid-sized markets in which passenger-unfriendly CRJ/ERJs are so prevalent. Read the AirTran article in FDJ2's post above - you'll see why using CRJs on LCC-competitive routes is not such a good idea...

 

[XRMEFLYER]

Are you ignoring AirTran's recent decision to drop CRJ usage?

Yes, what does that have to do with the price of tea in
China? If you have 50 people who want to go put them on a 50 seat airplane, 70 people put them on a 70 seater, 100 people...
This is not difficult!

 

[InclusiveScope]

Ditto! And when 50 and 70 seat aircraft are consistently oversold on certain segments, DAL will have to upgrade those segments to ML aircraft. We won't be complaining about our jobs being taken away (except the RJDC pukes),

As one of those "RJDC pukes", I have to correct you. Us "RJDC pukes" will not complain if a mainline plane replaces an RJ as has happened in VPS, MYR, GPT, MHT, among others. We understand better than most that the decision on which airplane to use should be made based on demand - not arbitrary "scope limitations". If the market is built up and there is more demand, then by all means put a larger aircraft on it. It is good for both of us. Likewise, if the demand drops in a mainline market, it is smart to replace the mainline aircraft with an RJ. We will only complain if they take away our jobs in our aircraft, not if their aircraft replaces one of ours ON A MARKET THAT CAN SUPPORT IT.

 

[wms]

RJs aren't the only uncomfortable ride. SW crams 'em in and Air Tran is no joy ride when the plane is full, as is coach on a DAL 75. To get the nice ride you have to pay the bucks or earn the points to sit up front. Granted an RJ doesn't give you the option, but the points are still accrued for when there is an opportunity.

I do agree on the LCC issue, though. That is a job for ML, but no matter who does it, it's for market share and results in a financial loss, because neither ML or the RJ can match the ASMs of the LCC.

 

[FDJ2]

Yes, what does that have to do with the price of tea in
China? If you have 50 people who want to go put them on a 50 seat airplane, 70 people put them on a 70 seater, 100 people...
This is not difficult!

But the mile costs of the 717 are equivalent to the CRJ and it provides, more seating, business class upgrades and more overhead space. A superior product at roughly the same segment cost.

JOE LEONARD: I think the other thing I would add, Michael, is the beauty of the 717 is the plane mile costs are not that much different than an RJ. But, the seat mile costs are incredibly lower.

 

[Pez D. Spencer]

Fee for departure.

Six, Whereas your contract carriers operate this way, the WO's don't. Perhaps "fee for departure" with contract carriers is more costly (Airtran, UAL)? You might look at that when you talk about why Comair and ASA are dragging down DAL. (Still reporting profits -- or did you not read the Cinci Enquirer today?)

FDJ2, if Michelle Burns was such a good representative of DAL's finacial books, why couldn't she say what Comair/ASA'a direct contribution to the overall bottomline is?? Don't be naive -- she would have known that -- were it true, they would have shouted it from a mountain top to get wage concessions from us -- and to squash ASA's contract negotiations. There's a reason why she won't say that I think you might be missing.

 

[FDJ2]

Fee for departure.

Six, Whereas your contract carriers operate this way, the WO's don't. Perhaps "fee for departure" with contract carriers is more costly (Airtran, UAL)? You might look at that when you talk about why Comair and ASA are dragging down DAL. (Still reporting profits -- or did you not read the Cinci Enquirer today?)

ASA and CMR are also contract carriers, being wholly owned does not change the fact that they operate under contract with DAL just like the non wholly owned. Regardless, just because a contract carrier can pull down a guaranteed profit, doesn't mean that carrier's operations are profitable for the carrier that contracts out for the small jet lift. NWA and UAL have both posted losses from their use of RJs. ASA and CMR are wholly owned, but their operations are just as costly, if not more so, particularly in CMR's case. Which might be the reason why DAL opted for Chautauqua over CMR on the recent RFP. Is DAL profitable using ASA/CMR? Hard to tell, since DAL subsidizes those operations. ASA/CMR only pay for direct operating costs, the rest is picked up by DAL. DAL doesn't file whether or not DCI makes a profit or not for DAL, those numbers are blended in for the entire network.

 

[XRMEFLYER]

But the mile costs of the 717 are equivalent to the CRJ

Yes they are on a per seat basis, if not cheaper(although I doubt they could put them at Delta right now and achieve anything on the order of the costs that Citrus flys them for).

What you are conveniently leaving out of your argument is that since there are twice as many seats, the total cost to operate a given flight is twice that of the RJ.

This argument reminds me of how my wife will tell me how much she "saved" by buying such and such for this or that on sale. I say "We only have $100 in the account how much did you spend?" She says " $150 but look at how much I saved."

 

[ADG]

70 seat aircraft for UAL have or will have first class.

The 50 seat jet is a, "scope aircraft" they would all be at least 70 seats if management would of had their way.

Why order more RJ's if they do not work and do not make money?

Funny thing, I fly an RJ, but I avoid jumpseating on it (50 seater) because of comfort, but then again I also avoid SouthWest on certain routes because I know the airplane will be packed, again not very comfortable. On the other hand, if the flight is short, then I really don't care what I am on. As long as it is on time!

But back to the question, why is Delta ordering more of them RJ's?

ADG

 

[~~~^~~~]

ASA and CMR are also contract carriers, being wholly owned does not change the fact that they operate under contract with DAL just like the non wholly owned.

Is DAL profitable using ASA/CMR? Hard to tell, since DAL subsidizes those operations. ASA/CMR only pay for direct operating costs, the rest is picked up by DAL. DAL doesn't file whether or not DCI makes a profit or not for DAL, those numbers are blended in for the entire network.

FDJ,retread:

Which is it? Are ASA and Comair contract carriers, or integrated into the entire network? Why would Delta subsidize a subcontractor, then claim a false profit? Do you have a copy of the mysterious contract? I'm raising the B.S. flag.

Delta management is doing everything they can do to make this airline survive. That would not include lying about RJ performance and buying billions of dollars worth of airplanes just to pick on you. Delta is focused on bottom line performance first, they have to be.

The RJ makes money. A Cessna 210 on these routes would also make money. The problem is that the 210 and the RJ don't generate near the revenue that a 150 seat MD88 will. If the Delta MEC would negotiate in good faith to get the MD88's operational costs in line with American's MD88's I can guarantee the company would be focused on money making MD88's rather than using RJ's to avoid a loss on cash and market position.

"Full pay to the last day" is your enemy, not the RJ. But who you choose to believe is up to you.

~~~^~~~

 

[~~~^~~~]

70 seat aircraft for UAL have or will have first class.

The 50 seat jet is a, "scope aircraft" they would all be at least 70 seats if management would of had their way.

But back to the question, why is Delta ordering more of them RJ's?

ADG

Because the difference between Delta's current payroll and the payroll if they had American's contract is a billion dollars a year according to Fred Reid.

But you hit the scope comment exactly right. Duane Woerth said years ago that the line would be 50 seats and ALPA got what it bargained for.

The pivotal event in both cases was not 9/11. It was the ratification of Contract 2000. Just look at the numbers.