Significant Comair News

[~~~^~~~]

Comair's memo to all flight crew members was an interesting look into what is in play for DCI in the next several years. To get concessions, management was offering:
45 growth aircraft by 2007
Transfer of 30 aircraft to Comair
Eight CRJ 700 deliveries, confirmed
Snap back provisions
B scale for new employees

The threats management has up their sleeve include:
Mesaba and Mesa as potential / probable DCI additions
ACA probably out of DCI

Fortunately the Comair MEC stood strong. We at ASA owe them our gratitude. They could have undermined our bargaining, but took the high road instead.

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[ASH]

Man I love that group over there. Comair shines as an example for us all. Go get em' boys! As to Mesaba: we behind ya yo! ACA: Don't give an inch, you are valuable and don't you forget it!

 

[prodigal]

Comair's memo to all flight crew members was an interesting look into what is in play for DCI in the next several years. To get concessions, management was offering:
45 growth aircraft by 2007
Transfer of 30 aircraft to Comair
Eight CRJ 700 deliveries, confirmed
Snap back provisions
B scale for new employees
~~~^~~~

The scuttlebutt I've heard indicates that the 8 CR7s will go to CMR anyway, no???

 

[~~~^~~~]

Prodigal :

You are correct. They were offering "confirmation" of a firm order. That is one of several resons why this was not much of an offer. For starters, Delta controls the flying.

But this memo confirmed the ACA Dornier rumor is true. Those airplanes are in play - FWIW. Shame on Delta for signing cancellation guarantees and also signing a deal with their pilots that requires the operator not fly them if that independent operator uses their independence to fly an airplane thet ALPA does not want flown by ACA pilots.

Someone at ACA, or Delta, needs to attack C2K scope on anti trust grounds. Surprised they have not already done so.

It would be poetic justice if ALPA got those 328's on the Delta property with the "concessionary" wages for the poor mainline saps that got furloughed as a result of their MEC's war on regional pilots. Divide and conquer is such a good union strategy, isn't it?

~~~^~~~

 

[rjcap]

"B" wage scale for the regionals. Thats a piece of work.

 

[fanman]

Someone at ACA, or Delta, needs to attack C2K scope on anti trust grounds. Surprised they have not already done so.

BLAH, BLAH, BLAH......... Get a clue, the only reason ACA flies those aircraft, is because the Delta pilot group allowed them to! Delta Air Lines Inc. owns the code, and the Delta pilots have an exclusive contract with the company. A contract is a contract!

When you get some negoiating leverage, negoitiate your own scope! You are lucky the Comair pilots did not make your current contract talks all that more difficult to by undercutting you!

 

[~~~^~~~]

But a contract to exclude competitors from the marketplace is anti-competitive.

Delta can contract with their pilots to control Delta code. Where C2K scope goes over the line is that it is used as a mechanism to control flying done by other airlines, competitive airlines, like AA, UA and America West.

The only reason Delta and ALPA have gotten away with this is that the DOJ has bigger fish to fry. If this was in the FTC's clearance agreement the provisions of the C2K scope restricting operation of independent airlines under their own code would have already been struck down and penalties applied.

As it turns out nobody wants the Dorniers. ACA is not complaining because they get to dump the financial obligation for these airplanes on Delta. Just what Delta needs - more debt.

So an illegal contract that is not challenged stands, but it is only a matter of time until someone (other than Delta who signed the stupid deal) smaks this down in Court.

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[DAL737FO]

"The only reason Delta and ALPA have gotten away with this is that the DOJ has bigger fish to fry."

"So an illegal contract that is not challenged stands"

It's amazing to me that you spew this drivel as if it is fact just because you say so. If you are correct then the RJDC should have a cake walk. It hasn't proven so as of today. If you guys at the wholly owned airlines had some scope clauses of your own then you would still be flying out of Orlando instead of CHQ. Good luck trying to circumvent our contract.

Furloughed DAL737FO

 

[Patriot328]

As it turns out nobody wants the Dorniers. ACA is not complaining because they get to dump the financial obligation for these airplanes on Delta. Just what Delta needs - more debt.

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You summed it up best right there. ACA doesn't want the Dojets. They are a pain in the ass to keep in the air and will only be getting more expensive as they get older.

I think ACA would love to dump the Dodos on DAL/CMR/ASA/Whoever will fly them. The one major drawback is it'll create a helluva training cycle at ACA if the boys and girls flying the dojets A) aren't offered a position at whatever airline takes them and/or B) decide not to go.

Personally I think it'll be status quo for a while. I think it'll give the DAL pilot group something to twist managements screws and put a little pressure on them. They may even let ACA operate the dojets, but demand something else in return.

 

[~~~^~~~]

Yep - I think you are right. Delta does not want the planes, ALPA really does not want their furloughed guys working at ACA wages, so they will probably agree to losen scope. But, as they carve another niche out of the DL code, how will they keep Skywest, Mesa and the others from acquiring bigger airplanes to operate under non DL code?

Another rumor coming from the FAA, of all places, is that ASA and Comair are going to be sold around the first of the year to help with Delta's liquidity crunch in 2004 / 2005.

 

[~~~^~~~]

It's amazing to me that you spew this drivel as if it is fact just because you say so. If you are correct then the RJDC should have a cake walk. It hasn't proven so as of today. If you guys at the wholly owned airlines had some scope clauses of your own then you would still be flying out of Orlando instead of CHQ. Good luck trying to circumvent our contract.

Furloughed DAL737FO

First of all, it is not my quote - it a quote from an FTC attorney.

Second, the RJDC issues have nothing to do with anti-trust. ASA and Comair pilots have not been effected by Delta and ALPA's conspiracy to engage in anti-competitive practices. As far as the representation issue goes, the RJDC does have a pretty easy walk, but it is still expensive and difficult to force your union to abide by its own Constitution. The RJDC effort should not be necessary.

Third, we agree. Had ALPA not blocked our attempts to negotiate with Delta we would have scope.

I'm not trying to circumvent your contract. I'm just pointing out the obvious. How does it benefit me if ACA and Skywest start flying 737's while you are unemployed and my company loses billions? I truly wish you had not elected the radicals to your LEC's and that you had an enforceable contract. Heck, I am not looking forward to starting over again after you guys wreck the Company I'm at.

You should vent your frustration in the MEC that kept us separate, put you on the street, and who negotiated an "over the top" contract that went completely over the cliff from the perspective of what is legally enforceable.

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[Pez D. Spencer]

Originally posted by ~~~^~~~

Another rumor coming from the FAA, of all places, is that ASA and Comair are going to be sold around the first of the year to help with Delta's liquidity crunch in 2004 / 2005.

Fins,
I realize you may not have the answers, but:

Spin-off, or third party sale?

Are their provisions in CMR and/or ASA contracts for a third party sale by DAL?

Would this release the two from any scope provisions (so long as the planes were not operated for DAL)? (not sure if that was worded correctly, but I'm sure you follow...)

Merger, then the sale, or two separate entities being sold?

 

[rjcap]

DAL 737FO

If you are correct then the RJDC should have a cake walk. It hasn't proven so as of today.

Weren't you one of the posters who swore that the judge would dismiss the case outright ???

 

[RichO]

...

Aren't rumors just grand........the other day I heard that Delta was selling Comair/ASA to a third party who is also buying Mesa/ACA/CHQ/Mesaba and was going to put Skywest out of business with this new huge company..,..........................LOL..........and if you believe that, then the solar flares coming to earth today are aliens......


remember that song from the 80's "Rumors" wasn't that a great song...........

 

[vc10]

Can someone post the Comair memo?

 

[DAL737FO]

RJCap "Weren't you one of the posters who swore that the judge would dismiss the case outright ???"

No freaking way did I say that. Not in a country where a woman can sue McDonald's because her coffee was too hot.

 

[FDJ2]

But a contract to exclude competitors from the marketplace is anti-competitive.

Delta can contract with their pilots to control Delta code. Where C2K scope goes over the line is that it is used as a mechanism to control flying done by other airlines, competitive airlines, like AA, UA and America West

~~~^~~~

You have got to lay off the pipe. Where do you come up with this stuff. LOL.

The DAL PWA only limits the DL code, which as you pointed out can be contracted with their pilots. DAL can only contract out the DL code to ACA if it is in compliance with the limitations specified in the DAL PWA. At any rate, there is a provision to allow both ACA and DAL to go their seperate ways. Nothing in the DAL PWA excludes a competitor, it only limits who flies the DL code and under what conditions. There are only two parties to the DAL contract, DAL and DAL pilots. If ACA wants to be a competitor, than they can't expect DAL to subsidize theirr efforts with our code. ACA is free to compete all they want with there own code, but not with ours.

 

[~~~^~~~]

Spin-off, or third party sale? Are their provisions in CMR and/or ASA contracts for a third party sale by DAL? Would this release the two from any scope provisions (so long as the planes were not operated for DAL)? (not sure if that was worded correctly, but I'm sure you follow...) Merger, then the sale, or two separate entities being sold?

Got no clue and I'm pretty sure the rumor I heard was incorrect. What I suspect is that Delta might try an IPO along the lines Continental did with express. The timing might be right.

ASA and Comair are about as pretty as they are ever going to look to outside investors. We are at the scope limits next year and will begin to report flat numbers as we begin to stagnate, or shrink with the retirement of the ATR's. This year our numbers are good. Further, Delta never realized an increase in its market capitalization commensurate with the 2.4 Billion they spent to purchase us. The market correctly figured Delta got what they paid for. However, in the current environment that 2.4 billion would finance another two years of mainline losses, pushing the nasty issue of bankruptcy further off into the future.

But, separating out Comair and ASA will further outline just how unprofitable mainline is. Right now I'm guessing based on DOT data that between 200 and 350 million are offset from Connection to mainline on the books yearly.

Also spinning ASA and Comair off would undermine something Leo Mullins has made a name for himself on - the idea that the "network" is everything. Frequency and destinations set Delta apart from Airtran - our only competitive advantage. Sure this can be done, but Delta will lose some level of operational control if they no longer are the owner.

As far as scope goes the Delta MEC filed a similar lawsuit to stop ASA from acquiring the BAE 146's. I don't know why, but DALPA lost that suit and ASA flew the 146. In my unprofessional analysis it appears irrelevant who owns ASA and Comair. As long as it is DL code then the scope applies. Once you go outside the DL code the issue becomes much more uncertain. I don't think a pilot group could challenge the scope, but a consumer who could prove damages could bring suit on the aforementioned anti - competitive nature of the Delta scope controlling the operation of a non DL code flight.

But candidly, ASA and Comair don't have the infastructure to market their own code. They are simply alter ego divisions of the Delta AirLines operation, so I can't see it being an issue.

 

[FDJ2]

Can someone post the Comair memo?

October 24, 2003
TO: All Comair People
FROM: Randy Rademacher
SUBJECT: Update On Growth Opportunities

For several months, we have been talking with you about how the market is forcing
changes within our industry. As part of those changes, smaller regional airlines with
lower costs and expanding regional jet capabilities are now emerging as competitive
threats. We have been working very hard to improve our operational reliability and
remove costs from every area of the company to better position us to compete with these
carriers. As part of this effort, we approached our pilot and flight attendant unions about
helping us address areas in our working agreements where market-based analysis shows
we have a competitive disadvantage.

We have been informed by Comair representatives of the Air Line Pilots Association
(ALPA) that they are not prepared to open discussions at this time regarding possible
market-based adjustments to their working agreement. Today’s decision by ALPA means
that at this point we also will not pursue further discussions with Comair representatives
of the International Brotherhood of Teamsters (IBT).

We are obviously disappointed that we were unable to move forward on discussions with
our pilots at this crucial time and concerned that we could not seize the growth
opportunity that was immediately before us. It is important to know that without marketbased
contract adjustments, we are severely hindered in our efforts to compete
successfully for future growth aircraft. Industry conditions obligate Delta Connection and
all other airline programs to seek carriers for growth aircraft that can offer operational
reliability at competitive costs.
I am confident we will continue to pull together as a team to move our airline forward.
Thank

 

[~~~^~~~]

You have got to lay off the pipe. Where do you come up with this stuff. LOL.

The DAL PWA only limits the DL code, which as you pointed out can be contracted with their pilots. DAL can only contract out the DL code to ACA if it is in compliance with the limitations specified in the DAL PWA.

Nothing in the DAL PWA excludes a competitor, it only limits who flies the DL code and under what conditions. There are only two parties to the DAL contract, DAL and DAL pilots. If ACA wants to be a competitor, than they can't expect DAL to subsidize theirr efforts with our code. ACA is free to compete all they want with there own code, but not with ours.

Aside from the fact you contradict yourself in the same paragraph....

You have written that ACA can not perform DL codeshare flying if they operate a non permitted aircraft type (IE more than 70 seats). If ACA operated a 737 the DMEC would file a grievance to stop that flight, or cancel the codeshare. In fact, this contract language has provided a way for ACA to dump their DOJets on Delta when they decide to operate larger aircraft.

Skywest serves as a better example than does ACA because ACA does not seem to care whether they keep the DL code, or the Dorniers. Skywest can not operate CRJ900's or narrow bodies under the UA code due to an agreement between Delta and their pilots. Somebody somewhere is going without UA service due to DL's restriction and you can bet your last dime taking competitors like UA out of cities served by DL is anti-competitive.

In fact, to illustrate this by using the rediculous - if the "permitted aircraft types" language prejudicial to "Connection" pilots were removed from the DAL contract you would find that Continental, Northwest, and American Eagle would have to cease operations to be in compliance with your scope. But of course you would not see anything anti-competitive in that, would you?

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