No 787s for DAL

[Gunfighter]

If Delta wants some additional intl aircraft they could probably pick up a good deal on some new 767 now that the USAF went with Airbus.

 

[Headfake14]

If Delta wants some additional intl aircraft they could probably pick up a good deal on some new 767 now that the USAF went with Airbus.

I heard a little about that...were any of those 767s already produced? If so, I bet it'd be a b!tch to re-configure and everything.



As far as the 787 vs 767. Eventually, they'll have to replace it as other airlines get the 787 or A350. The 767 won't have a dog in that fight of fuel efficiency.

 

[Andy]

And besides we're growing our mainline with more wide bodies, it works for me.

Nice to see our mainline growing again unlike some other companies at the moment.

Rapid expansion into a major recession is NOT a sustainable business strategy in the airline industry. Right now, airlines should be hunkering down, hoarding cash, and have solid plans to trim capacity.
Most other companies have pared back growth plans significantly; Delta is doing the opposite. Do you think that the rest of the world is going to avoid recession? Take a look at home price appreciation in Europe over the last few years. Even more of a housing bubble has occurred in India. There is a saying that when the US economy sneezes, the rest of the world catches a cold. I don't see it 'being different this time.' Rapid growth at this point in the economic cycle has the potential to end very poorly for Delta.

 

[General Lee]

Rapid expansion into a major recession is NOT a sustainable business strategy in the airline industry. Right now, airlines should be hunkering down, hoarding cash, and have solid plans to trim capacity.
Most other companies have pared back growth plans significantly; Delta is doing the opposite. Do you think that the rest of the world is going to avoid recession? Take a look at home price appreciation in Europe over the last few years. Even more of a housing bubble has occurred in India. There is a saying that when the US economy sneezes, the rest of the world catches a cold. I don't see it 'being different this time.' Rapid growth at this point in the economic cycle has the potential to end very poorly for Delta.

Delta had too many widebodies flying domestic only routes (ATL--MCO and FLL etc), and has recently redeployed those assets to routes with more favorable yields. While doing that, they have moved smaller planes (767 domestic routes replaced by 757s, 757 routes replaced by 738s, etc...al the way down to RJs) around and have tightened the number of seats allowed, which has brought up prices and fares. Being flexible with aircraft types has brought up revenue. Also, with intense LCC competition domestically, searching for higher yields in far away places is not a bad thing, and the weaker dollar has now allowed foreigners the ability to fly to the US, instead of Americans flying to INTL destinations. Adding INTL routes brings in INTL currency, which is probably worth more than the dollar.

Bye Bye--General Lee

 

[Mr.B]

Rapid expansion into a major recession is NOT a sustainable business strategy in the airline industry. Right now, airlines should be hunkering down, hoarding cash, and have solid plans to trim capacity.
Most other companies have pared back growth plans significantly; Delta is doing the opposite. Do you think that the rest of the world is going to avoid recession? Take a look at home price appreciation in Europe over the last few years. Even more of a housing bubble has occurred in India. There is a saying that when the US economy sneezes, the rest of the world catches a cold. I don't see it 'being different this time.' Rapid growth at this point in the economic cycle has the potential to end very poorly for Delta.

Good points.

But IF I was the merger God...

AA and NWA
UA and CAL
Let the other two fight it out

 

[General Lee]

Good points.

But IF I was the merger God...

AA and NWA
UA and CAL
Let the other two fight it out

AA and NWA? Three hubs right next to each other? ORD between MSP and DTW? Which one would you let go? There is NO WAY the DOJ would allow 3 hubs all within 1 hour flying between each other. Pick again merger God....


Bye Bye--General Lee

 

[Andy]

Delta had too many widebodies flying domestic only routes (ATL--MCO and FLL etc), and has recently redeployed those assets to routes with more favorable yields. While doing that, they have moved smaller planes (767 domestic routes replaced by 757s, 757 routes replaced by 738s, etc...al the way down to RJs) around and have tightened the number of seats allowed, which has brought up prices and fares. Being flexible with aircraft types has brought up revenue. Also, with intense LCC competition domestically, searching for higher yields in far away places is not a bad thing, and the weaker dollar has now allowed foreigners the ability to fly to the US, instead of Americans flying to INTL destinations. Adding INTL routes brings in INTL currency, which is probably worth more than the dollar.

Bye Bye--General Lee

GL, as usual, you're missing the point.

The consumer is tapped out. This is going to result in decreased air travel.
The US recession will drag down the entire world economy. The foreign consumer will also decrease air travel.

Delta is expanding at the end of the business cycle. This does not bode well for Delta. Why do you think everyone else is paring back their growth plans?

 

[General Lee]

GL, as usual, you're missing the point.

The consumer is tapped out. This is going to result in decreased air travel.
When the US economy sneezes, the world catches a cold. The foreign consumer will also decrease air travel.

Delta is expanding at the end of the business cycle. This does not bode well for Delta. Why do you think everyone else is paring back their growth plans?

Thanks for your version of the point. Can you tell me which US airlines are curbing INTL growth? I can see domestic curbing, but not INTL growth. That is where the money is, and we are shifting planes to meet the demand. We are getting some new planes, and they are going straight to INTL. Our new 777LRs that will be put on the BOM-JFK runs will make us an extra $10 million a year alone thanks to more cargo uplift capabilities. The planes will replace 777ERs, which will start ATL to PVG (Shanghai). United started IAD to PEK a year ago and has shown the ability to add an extra $200 million a year on that NEW route alone. If we get new route authority, we will exploit it. Very little domesitc growth is needed now, but INTL growth is essential. You have to go after the higher valued currency, and that is foreign currency at the moment. That is the point you are missing. Domestic coverage is to be maintained to block LCC growth as much as possible, while adding INTL growth. That is the plan.

Bye Bye--General Lee

 

[johnsonrod]

Good points.

But IF I was the merger God...

AA and NWA
UA and CAL
Let the other two fight it out

AA has enormous debt and very old aircraft (but not as old as NWA's Diesel 9s). Why would anyone want to align with an airline with that level of debt? I thought AA had the most debt of any major by far.... Am I wrong?

 

[Andy]

AA and NWA? Three hubs right next to each other? ORD between MSP and DTW? Which one would you let go? There is NO WAY the DOJ would allow 3 hubs all within 1 hour flying between each other. Pick again merger God....


Bye Bye--General Lee

Good point. It'd be like USAirways having PHL, PIT, DCA, and BWI as hubs. Oops - they did have all four of them as hubs at the same time pre-911.
The DOJ gets concerned about route overlap, which is where competition gets eliminated. I've never seen anything where DOJ was concerned with geographic location of hubs.

 

[General Lee]

Good point. It'd be like USAirways having PHL, PIT, DCA, and BWI as hubs. Oops - they did have all four of them as hubs at the same time pre-911.
The DOJ gets concerned about route overlap, which is where competition gets eliminated. I've never seen anything where DOJ was concerned with geographic location of hubs.

USAir CREATED those hubs internally, not through a merger. The DOJ can't stop an airline from creating their own hubs. None of those were acquired from another airline. Wrong!

The DOJ would say NO to an airline who wanted to merge with another with 3 hubs next to each other. And local politicans would not want the job loss that would result in a possible closing of one of those three hubs. Nah. As usual Andy, you are shooting from the hip with no ammo.


Bye Bye--General Lee

 

[Andy]

AA has enormous debt and very old aircraft (but not as old as NWA's Diesel 9s). Why would anyone want to align with an airline with that level of debt? I thought AA had the most debt of any major by far.... Am I wrong?

AMR debt = $11.14B.
UAUA debt = $9.84B.
DAL debt = $9.30B.
NWA debt = $7.09B.
CAL debt = $5.02B.
LCC debt = $3.55B.

Relative to size, AMR's debt doesn't appear to be excessive.

 

[Andy]

USAir CREATED those hubs internally, not through a merger. The DOJ can't stop an airline from creating their own hubs. None of those were acquired from another airline. Wrong!

The DOJ would say NO to an airline who wanted to merge with another with 3 hubs next to each other. And local politicans would not want the job loss that would result in a possible closing of one of those three hubs. Nah. As usual Andy, you are shooting from the hip with no ammo.


Bye Bye--General Lee

And that'd be why the DOJ was going to allow the United/USAirways merger to keep the fortress hubs of IAD, PHL, and PIT?
BWI had already been dissembled by USAirways and the DCA fortress hub was going to be sold off in a sham deal to "DC Air," which would likely have ended up being a subsidiary of the combined airline.

DOJ's concerns lie in the number of fortress hubs, not the location of hubs.

 

[freightdogfred]

I have heard that the lease rates for Delta's 767s is less than that of an RJ.

Where the hell did ya hear that? That's got to be one of the most ridiculous things ever posted on FI.

 

[Tomct]

Actually no - the versions are in the correct order. I heard she was battling Cancer.

Possibly from all of those "Special Facials" she used to get on a regular basis.