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Notes from the Delta Conference Call...

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Just a couple of points open for discussion.

The first is that as with the NWA merger being more-or-less a foregone conclusion from the beginning, I think the Alaska thing will be the same way.

It appears to me that Delta is simply buying up the competition, so to speak.

Secondly, with a third airline possibly in the mix, it would make sense that there has to be some kind of consolidation at some point. That means overlapping routes and finally furloughed pilots.

Growth happens over time in a give and take fashion.
 
13. As others have noted Hauntein said "yesterdays trash is todays treasure". He said the DC9 six months ago was not a good airplane to operate with fuel so high but now it can be a good asset to fill in the needs of the route with a 100 seater (presumably in the place of two less economical 50 seat RJ's). Also mentioned ealier in the webcast delta has removed 150 RJ's from what they had in 2007. Probably looking to replace a few more now with these DC9's in my opinion.
 
Just a couple of points open for discussion.

The first is that as with the NWA merger being more-or-less a foregone conclusion from the beginning, I think the Alaska thing will be the same way.

It appears to me that Delta is simply buying up the competition, so to speak.

Secondly, with a third airline possibly in the mix, it would make sense that there has to be some kind of consolidation at some point. That means overlapping routes and finally furloughed pilots.

Growth happens over time in a give and take fashion.

There was not very much overlap between NWA and Delta and this is a large reason in my opinon why it got approved. Likewise there is little overlap between Alaska and Delta and unless the goverment takes a stance that Delta is just getting too big and therefore has monopolistic powers I do not see why it wouldnt be approved as well if the same criteria is used. I think there will be furloughs but not due to alot of overlap. More due to greater efficiency in how destinations are served with less airplanes, utilization of hubs and the ability to trim the 10% for routes that were losers on both pre merger airlines and focus only on the money makers in a bad economy. Still stinks no matter the reason. That said, in three years or so with alot of money in the bank and returning economy I believe the furloughies will all be back and heavy hiring under way for further expansion. I could be wrong on all this and ACL65 probably has a better idea from an insiders perspective.

As another alternative and hopefully Delta management would understand the importance of taking care of its newest pilots who are about to spend the next 15 to 40 years operating thier aircraft more SILS (reduced hour schedules) would be used to prevent furloughs in the interum.
 
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13. As others have noted Hauntein said "yesterdays trash is todays treasure". He said the DC9 six months ago was not a good airplane to operate with fuel so high but now it can be a good asset to fill in the needs of the route with a 100 seater (presumably in the place of two less economical 50 seat RJ's). Also mentioned ealier in the webcast delta has removed 150 RJ's from what they had in 2007. Probably looking to replace a few more now with these DC9's in my opinion.

Bullsh*t. They are looking to replace 50 seat rj's with 76 seat rj's. The point of outsourcing to the the regionals to begin with was to attack our wages. They are never going to go the other way. You will never see an rj replaced by a mainline aircraft. You are way too optimistic. We should have gotten way better scope in regards to the 76 seater. This is going to bite us in the ass.
 
I dont dissagree with what you say. I never said all RJ will be replaced with DC9's. I believe what is stated or implied in the webcast is some replacement of some RJ's with DC9's. I absolutely agree Delta pilot leadership (I wasnt on the property) completely blew it on scope and it continues to be a problem and yes they are looking to add 76 seaters and larger if they can get away with it. I think we can agree it needs to be right at the top of the list of priorities, at least holding the ground we have now and push to bring "RJ" on as mainline flying or get rid of them altogether.

PS- Please dont attack me for reporting what was said in a webcast. What I speculated was not all inclusive and did not contradict what you said.
 
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Bullsh*t. They are looking to replace 50 seat rj's with 76 seat rj's. The point of outsourcing to the the regionals to begin with was to attack our wages. They are never going to go the other way. You will never see an rj replaced by a mainline aircraft. You are way too optimistic. We should have gotten way better scope in regards to the 76 seater. This is going to bite us in the ass.

Your thinking is pilot centric. 50 rj's will be replaced by larger equipment and larger RJ's routes will be replaced by DC-9s. Pilot wages are just one of the many costs to look at when choosing which aircraft will make up Delta's new fleet.

Did you think about the offset cost savings of having one flight versus two? One ground handling rather than two? One landing fee rather than two? One aircraft that is paid for rather than two lease payments on RJs? One crew to pay rather than two?

The BOTTOM LINE is that when you pull a greater number of passengers out of Northwest and Delta between two city pairs you can UP-GAUGE equipment and SAVE money. That is a huge benefit to the operational costs of Delta going forward and therefore scope by the way of economics.
 
Hockey's correct... and Delta can't get out of any of their fee for departure contracts. ( we will see if the Mesa case makes a liar out of me, but so far Mesa's fate hangs on their insolvency)

Delta is trying to trade big RJ's and contract extensions for small RJ's and F4D cancellations. Thus far the regionals are saying "no thanks, a contract is a contract."
 
Hockey's correct... and Delta can't get out of any of their fee for departure contracts. ( we will see if the Mesa case makes a liar out of me, but so far Mesa's fate hangs on their insolvency)

Delta is trying to trade big RJ's and contract extensions for small RJ's and F4D cancellations. Thus far the regionals are saying "no thanks, a contract is a contract."

Fins, do you have any recollection of the agreement Delta struck with Skywest when Skywest purchased ASA? I seem to recall there was a ten year agreement signed by Leo with skywest but Delta could get out of if but it would cost a few hundred million dollars?
 
14. The system that will allow flowing aircraft freely from both the NWA fleet and DAL fleet and how crews follow planes etc will not be in place until fourth quarter 2009. They are "taking their time" to put this into place to avoid the fiascos US Airways ran into.
 
15. Based on what was said at 2:54 on the webcast it doesnt sound like there will be much moving of airplanes due to several issues including the required necessity for automation at the Delta Operational Control Center, etc until the SOC is achieved. The second the SOC is finished Glen H will have everything pre planned and lots of moving of aircraft will happen at that time.

The training on the other hand will be "pre loaded" so that when SOC is achieved the new plan hits the ground running. Based on this information I would think the bases/aircraft and bidding will be announced and take place before SOC. They didnt specify FAA approval vs SOC regarding training.
 
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