Should Delta Spin Off Comair and ASA?

[General Lee]

Exactly.

And, Delta could easily give ASA/Comair a 10 year contract (like Skywest) and that would attract potential investors, and at the same time giving needed cash. Also, a lot of that debt is from RJs--and we would love to give that away too. As soon as Comair's contracts expire---the new company would DEMAND new wage cuts also--so you could actually bid for new work--since other Majors would require that before they pay for the feed. Our scope would still apply too---and that wouldn't allow the new Comair or ASA to get anything larger than 70 seats. I think the larger investors (like GE Capital) will demand Grinstein sell ASA/Comair before any Chap 11 situation gets close. The COEX/Xpressjet sale would be the model. And then the new company etc....would actually pay for our services that they currently get for free (to make them look profitable)--like reservations, insurance, gate services at Delta staffed airports, etc....


Bye Bye---General Lee

 

[wil]

Great ideas, keep DCI in place with non-wholly owned carriers! That way the furloughs can operate the Lazy-boy handle a little longer instead of a yoke. We all know the answer in the log run...

 

[FlyComAirJets]

Let's see, Gee Lee ... spin off ASA and Comair and pocket the cash, saddle them with a ten year contract, and make sure your scope still applies so that we "could not get anything larger than 70 seats." Why the hostility chief? With friends like you, we sure don't need management to villify, we seem to be doing just fine sticking it to each other.

As I said before, perhaps Delta should spin off the true money losers like the Shuttle, Express, and sad Song. Then we could all compete with one another when our "contracts expire" (uh, actually they amend). I'll bet we can compete VERY effectively with your cost structure. And you too can pay for services we allegedly "get for free."

See you at The Whipsaw Bar & Grill.

 

[bladeusa]

careful what u wish for.. sell off comair and asa.. while they keep making money while mainline loses it.. next thing u know comair and asa will be buying delta.. stapling them to the bottom and the wronged mainline pilots forming a MLDC for fair and equal representation =)~

 

[XRMEFLYER]

I think the larger investors (like GE Capital) will demand Grinstein sell ASA/Comair before any Chap 11 situation gets close.

More like you hope they will be asking those questions!

 

[ATR-DRIVR]

JUST WHO IS GOING TO BUY THEM???

 

[AMANSWORLD]

Let em spin ASA and Comair, we will just compete with em.

 

[anon]

Let's see...

A Ch. 11 null & voids scope in all respects.

Maybe DAL will use that chance to place 90-100 seaters at DCI.

Good seat-per-mile costs, appropiate size for many markets, and D-scale wages for crews and support personnel.

 

[General Lee]

First of all---I am just suggesting what COULD happen. Grinstein might do it---or he might not. It is interesting to think about this senario----since every other senario has been presented.

When it comes to DCI being profitable, I think that could be true. But what about this: After 9-11 we parked many many planes--and a couple fleets---including the remaining 727s and L1011's, and then the MD-11s after the IRAQ war. We needed then RJs after 9-11 to save market share, and they did a great job. Now, after 3000 less pilots at mainline and probably an extra 1000 at DCI, the passengers are coming back. They are--but there is one big change--the fares. The fares are probably half what they used to be. So, now we have 50-60 less mainline planes (20 727s, 14 MD-11s, and 20 or so L1011s) and they were replaced with quite a few more RJs---70 seaters now also included. The passengers are back, but the fares are lower---and what we really need is MORE PASSENGERS to fill seats to try to MAKE UP FOR the lower fares. We need more feed to bring in more passengers to ensure our hubs are full to the max---trying to squeeze out as much revenue as we can out of the lower fares. But, we have problems---more RJs which clog up the system(ORD)--costing more for fuel due to holding and congo takeoff lines---but still result in less seats than if we still had those larger planes. One 727 could carry more than 3 50 seat RJ loads---but equal one blip on the radar screen. So what are the other airlines doing? Airtran is dumping it's Airwisky contract in favor of only mainline airplanes. Jetblue's smallest plane will have 100 seats. Southwest doesn't want any RJs. What can we do? Well, we have now pulled out every plane from the desert (except the MD-11s) that we planned to come back, and then we are stuck. We are stuck with too many RJs that clog the system, and not enough mainline aircraft to make up the difference for the lower fares. We could make more revenue with the lower fares if we had more seats. Look at the stats---they say this summer will be as busy or busier than the Summer of 2000. We will have unbelievable holding at ATL--even on VFR days, and ORD is limiting the number of departures and arrivals---and most of the flights that will be cut will be RJ flights.

This problem, IMO, is not the pilots' fault at DCI or mainline, but a planning problem. Yes, we need some pay cuts also to help cut costs--and I really hope they come to an agreement on that soon---but we really need larger airplanes and more seats to compete with the LCCs. Song is doing better,(it's now been around almost 1 year---and with a name like Song---it needed time for people to get used to it) and the Delta Shuttle is still a prized asset that does well with the 737-300Gs. (the 738s were moved to other markets that needed more seats than MD88s)

As far as the POSSIBLITY of selling of ASA/Comair---I really don't know if that is an option, but there would absolutely be investors---especially if Delta tagged on a guaranteed 10 year contract onto it and allowed other carriers to bid for their services too. Investors would know that the money from the IPO would help Delta and make it even a little bit financailly better, helping it try to weather this storm. As soon as fuel prices become more realistic (in the $25-28 per barrel range), the airlines will become a lot more healthy.

Bye Bye--General Lee

 

[General Lee]

Anon,

If you want to fly a 100 seater for D scale wages and sit on it until you retire(with no retirement), go for it.

Bye Bye--General Lee

 

[Heavy Set]

Just to clarify, spinning off an entity does not necessarily mean selling it to another company. Spinning off to the public means selling shares in the entity to the public. Continental spun off COEX to the public (sold shares to the public) but kept a slice of the equity for itself.

You don't need corporate buyers to spin off a division or subsidiary...

 

[anon]

Ugh ... "General" ... I don't feel the love here...

Ouch ... that really hurt. You are truly a wit and God's gift to aviation. Thank you so much for your advice, I'm a much better person now by far.

This humble servant has been put back in his place ... his "D" scale place.

(... you gotta love it ...)

 

[General Lee]

anon,

I personally don't want the future 100 seaters to go to D scale, I would rather have some of the 1060 Delta furloughs fly them, and then as they eventually go back to larger planes, have ASA or Chataqua pilots get hired to move right into them---for mainline. I am sure the wages on the 100 seaters would be negotiated to be lower than the other mainline planes---but that was also the case at Delta Express on the 737s.

As far as my tone to you---I got the impression from your post that you guys at DCI would want the 100 seaters----over looking our 1060 furloughs---which should have first rights. The rates, as I said, would be reduced for a new aircraft anyways---but we should get them back into a cockpit. If I misread your tone or point, I apologize.

Bye Bye--General Lee

 

[anon]

Noted... and accepted... likewise, if I took offense too early, I also apologise.

(I was merely repeating something I had heard from some GO Mgmt types recently.)

I don't want to see any pilots furloughed. I was on strike with Eastern and furloughed by Pan Am and it's not fun.

I've had the chance to work with some of the DAL, UAL, and USAir furloughs that ASA has hired. They have been, without a doubt, great folks and deserve the best. They work hard and have good attitudes considering what they have been through.

Most of the ASA guys are in favor of hiring DAL furloughs. In my opinion, I love to hire in the following order...

DAL/DCI furloughs
OAL furloughs
... all others...

When Eastern went on strike, 9000 of us were on the street. Many other airlines came to our aid, offering preferential interviews and such. I'd love to see that happen again.

Good luck to all to furloughed guys ... may you get back to work quickly.

 

[GogglesPisano]

JUST WHO IS GOING TO BUY THEM???

None other than Johnny O of course.