Interesting possibility for CMR and ASA

[General Lee]

Surplus1,

A lot of those "seniors" will be leaving by June 1st---due the rising Gatt rate and huge difference in lump sum between June 1st and July 1st. The lump sum difference could be well over $100,000 for guys with more than 25 years---and there are a lot of those.

Bye Bye--General Lee

 

[FDJ2]

Surplus, you defend your original incorrect assumptions by reaching deep for a highly improbable hypothetical, a fire sale. I guess in a hypothetical world all is possible. But DAL has $300M more unrestricted cash this April than last, unit costs are down 3.6% despite fuel prices having risen over 12%, operating expenses are flat even though capacity is up 3.5% and operating revenue is up 4.3%. I don't think too many folks are predicting a fire sale any time soon.

 

[ATR-DRIVR]

Soooo what happend to the fuel hedging....?

 

[surplus1]

Surplus, you defend your original incorrect assumptions by reaching deep for a highly improbable hypothetical, a fire sale. I guess in a hypothetical world all is possible. But DAL has $300M more unrestricted cash this April than last, unit costs are down 3.6% despite fuel prices having risen over 12%, operating expenses are flat even though capacity is up 3.5% and operating revenue is up 4.3%. I don't think too many folks are predicting a fire sale any time soon.

Aren't your assumptions about the spin off of ASA/CMR equally hypothetical? One or two analysts asked a question and you immediately jump on the bandwagon "wishing" it would happen. Why is that?

Look, I don't want Delta to sell Song or anything else. Time has somewhat proven that there is little success in attempting to "shrink a company" to profitability. If selling CMR, ASA, Song, or any other asset is substantially proven to be beneficial to the Company, then it should be done. However, we should not be advocating the sale of what are argueably the Company's only profitable assets because you don't happen to "like" the regional subsidiaries. That is what you and your buddies are doing.

You find that it is OK for you to advocate that the Company dump its profitable operations because you don't like us, but you get upset when I suggest that maybe it could dump something that apparently isn't doing well, because it could adversely affect you. That is not hypothetical, it is hypocritical.

Here's another hypothesis that you probably won't like either. A) You get your wish and the Company spins off ASA and Comair. B) Shortly thereafter, Comair and ASA (now free of DAL control), merge with each other. C) Subsequently, the new Comasa acquires or mergers with CHQ and SKYW. forming a single airline with more airplanes and more pilots than Delta itself.

What will Delta's position be after that has occurred? What ability will Delta then have to play the new combinded entity against some other entity; who is that entity most likely to be [you]? Who will then control ALL of Delta's feed? What will happen to the so-called "portfolio" invented by Butrell? How will the Delta MEC be able to browbeat this new entity? What will happen to the DMEC's leverage against "us" when we are equal or greater in number to you?

Yes, it's all hypothetical, particularly your assumption that the sale of ASA and CMR will benefit your personal interests. Like I said before, be careful what you ask for, you might get it.

Spend some time thinking about what is best for the Company. It is often unwise to "bite the hand that feeds you".

 

[OH_PILOT]

That would be a good thing to do before declaring Chap.11!! At least it will protect the Comair and ASA contracts, and let the Delta contract go out the door. Then Delta pilot's pay will be on-line with Comair.

 

[General Lee]

I doubt that. We would unload you guys, gain cash, and then eventually get a lower paying contract---but you guys would be under a 10 year flying contract like Skywest. Then, if you wanted to fly for someone else also, you would have to cut your rates to compete with the likes of Mesa, Chataqua, etc..... I don't think your current contract would last long in the next round of talks....Just like ours now. We are all headed down hill.

Bye Bye--General Lee

 

[homerjdispatch]

Here's another hypothesis that you probably won't like either. A) You get your wish and the Company spins off ASA and Comair. B) Shortly thereafter, Comair and ASA (now free of DAL control), merge with each other. C) Subsequently, the new Comasa acquires or mergers with CHQ and SKYW. forming a single airline with more airplanes and more pilots than Delta itself.

How would this new "Comasa" be able to aquire SKYW or CHQ?

I would more likely bet on seeing SKYW or another carrier aquire Comair or ASA.

 

[sleepy]

Why not spin ASA and Comair off now, take DAL into CH 11, then have ASA and Comair aquire DAL out of bankruptcy. We could staple the DAL pilots to the botom of our list, then run all of DAL under the ASA or Comair PWA.

 

[igneousy2]

Let's take a look at this from a business perspective...

COMAIR/ASA making tons of money...

Delta losing tons of moey...

Choice 1: Spin-off COMAIR/ASA, lose the income from their operation, renegotiate the contract of pilots who's first officer pay scales are higher than just about every airlines CAPTAIN pay scales. Hopefully the pilots and other labor groups will be sensible and Delta will get their costs in line with the rest of the industry...

or

Choice 2: Grow COMAIR/ASA like crazy, start taking money from Delta and putting over on the COMAIR/ASA side, start selling DELTA one piece at a time. Eventually what will be left is a low labor cost structure unincumbered by archaic scope clauses that will be free to grow at will. Maybe COMAIR/ASA is a chance for Delta to start over with labor costs.

Don't think it's possible, sound's far fetched, well, AMR was 1 vote away (of the board of directors) from selling American Airlines in the early 80's. Crandall's plan was to rest the future of AMR on SABRE.

Delta pilots should be taking this opportunity to get all of the pilots on one seniority list. That is the only thing that is going to save the Delta pilots their jobs.

Delta and American Pilot's deserve that they are getting hosed by their regionals. Either group of pilots could have insisted that they fly ANY airplanes owned by their companies. Delta/American pilots were too proud to fly Turbo-props.

Oh well, hind-site is 20/20.

How much a pilot is going to make at a financially sound airline is out of our control, the only real question is what group of pilots are going to be flying those planes.

The whip-sawing has already begun.

 

[sleepy]

Remember when AirTran (a small airline with about five aircraft) bought the much larger ValueJet. I could see ASA and Comair being able to aquire a much larger DAL if DAL is in Ch 11 bankruptcy.

Right now DAL's market value is lower than Skywest's. Go into Ch11, get rid of the DAL PWA, expensive aircraft leases, lower the cost of aircraft gates, eliminate the DAL pilots's A Fund, sell off some assets, then a leaner DAL could be aquired by a smaller airline with better management and a lower cost structure.

 

[ATR-DRIVR]

The thing here is look at the management ranks at ASA/CMR. Do you think they could really manage an airline??? On their own??
The ASA side any way.

 

[sleepy]

The thing here is look at the management ranks at ASA/CMR. Do you think they could really manage an airline??? On their own??
The ASA side any way.

ASA management, no. Comair management, yes.

I would like to see DAL combine ASA and Comair into one airline under Comair management, then spin us off before the DAL Ch 11 happens. Once the Bankruptcy judge has had his or her way with the DAL PWA, the spun-off ASA/Comair Company would be free to grow as an LLC, aquire larger aircraft, and better compete with the other LLCs in the domestic market.

As for DAL, who cares what happens to them, it is everybody for themselves these days. They had their chance with onelist, and they blew it. The last thing we want at ASA and Comair is to still be WO's when DAL finally goes under. Look what has happened to those WO's at the hands of the USAir pilots and ALPA. As a seperate company, there is less of a chance for the DAL pilots to mess with us.

 

[KingAirKiddo]

The thing here is look at the management ranks at ASA/CMR. Do you think they could really manage an airline??? On their own??
The ASA side any way.

Our boys at Comair know how to run an airline, particularly when "third party" management types in Atlanta stay out of the way.

 

[michael707767]

Remember when AirTran (a small airline with about five aircraft) bought the much larger ValueJet. I could see ASA and Comair being able to aquire a much larger DAL if DAL is in Ch 11 bankruptcy.

.

Actually, ValuJet aquired AirTran. The AirTran name was kept, but it was ValuJet doing the buying.

 

[jws717]

I think an IPO on song would be a very intersting business move ( but suicidal ) , i also consider it almost impossible. One other interesting move no one ever seems to consider since it would be like desegragation is dumping the old md80s and 737s and incorperating the Delta owned regionals into main line. The fuel efficiency on the crj should out weigh paying crj guys delta pay. Everyone would be happy. ( yea right )

 

[General Lee]

Grinstein just stated at our recent CVG "town hall meeting" that Song would probably expand, and get 17 more 757s(from mainline). He also stated that flying on RJs for longer than 2.5 hours was "Crummy" (he said that) and that he didn't agree with the recent expansion of RJs. He said that he was re-evaluating the SLC hub and thought is was wrong to move so many mainline jets out and RJs in. Maybe he was just saying that to get us to take 30% pay cuts......But maybe he believes it--and his plan is now due in AUG he says.....doubtful Song is going anywhere. (Profitable last quarter too)

Bye Bye--General Lee

 

[FlyComAirJets]

Sounds like the perfect time to spin Song off. One profitable quarter (OK it was Spring Break) is just the impeccable track record they need.

 

[KingAirKiddo]

Grinstein just stated at our recent CVG "town hall meeting" that Song would probably expand, and get 17 more 757s(from mainline). He also stated that flying on RJs for longer than 2.5 hours was "Crummy" (he said that) and that he didn't agree with the recent expansion of RJs.

(I agree. Flying on RJ's for longer than 2.5 hours IS crummy. What in the world is Delta marketing thinking? We (at ComASA) should be providing frequency to existing markets and exploring new markets that are within a two hour flight of the hubs, in my humble opinion. I don't really think too many people at ComASA would disagree.)



He said that he was re-evaluating the SLC hub and thought is was wrong to move so many mainline jets out and RJs in. Maybe he was just saying that to get us to take 30% pay cuts......But maybe he believes it--and his plan is now due in AUG he says.....doubtful Song is going anywhere. (Profitable last quarter too)

(Our biggest complaint is the portfolio concept which is allowing contract carriers to grow at the expense of BOTH mainline and its wholly-owned subsidiaries. All flying for DAL should be done by Delta and the wholly-owned subsidiaries--including furloughed Delta pilots hired onto the bottom of our respective lists until they are able to return to Delta.)

Bye Bye--General Lee