Significant Comair News

[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?

~~~^~~~

 

[~~~^~~~]

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

The memo I'm referencing was dated 10/28/03 and it is two pages long. I will try to scan it, but I'm not sure we can post it on the net since it is an internal memo.

 

[vc10]

FDJ2, the memo you posted does not reference the flying that was apparently up for grabs (according to the first post in this thread).

Can anyone post the memo that does reference that flying? i.e.

45 growth aircraft by 2007
Transfer of 30 aircraft to Comair
Eight CRJ 700 deliveries, confirmed
Snap back provisions
B scale for new employees

 

[abenaki]

I wouldn't believe in the validity of one of those new $20 bills if Don Osmundson handed it to me....let alone anything else he has to say......

 

[FurloughedAgain]

Cincy Enquirer

Comair appeals to flight crews


--------------------------------------------------------------------------------
Airline promises 80 new jets if contracts altered

By James Pilcher
The Cincinnati Enquirer


Comair management Wednesday went directly to pilots and flight attendants in its quest to cut labor costs, promising more than 80 new jets if those workers would agree to adjust their contracts.

In Wednesday's memo to all flight crew members, obtained by the Enquirer, Comair vice president of flight operations Don Osmundsen made the promises. Those include getting 83 new jets for the Erlanger-based airline and the jobs that would come along with that new flying, as well as a guarantee that Comair flight crews would remain the highest paid in the regional industry.

The memo came less than a week after leaders of Comair's branch of the Air Line Pilots Association turned down a request to renegotiate its contract.

Wednesday's memo said Comair's corporate parent, Delta Air Lines, was giving the company until Saturday to get the concessions and lower costs; otherwise, those planes would be put out for bid to other carriers.

Pilot union leaders said Friday that management was not giving the pilots enough time. The decision to cut off talks also ended talks with the flight attendants, represented by the International Brotherhood of Teamsters.

The pilots' current contract, reached after a bitter 89-day strike in the spring of 2001 almost killed the airline, does not expire until 2006. The flight attendants signed their five-year deal in July 2002.

ALPA chairman J.C. Lawson III on Wednesday confirmed the offer made in the memo. But he would not comment on what it would do to the possibility of reopening the contract or say what it would take to start talks.

He did say that the union was still open to the possibility of talks, although he would not comment on what concessions the airline was seeking.

Comair spokesman Nick Miller would not confirm the details of the memo, nor would he discuss what the airline was asking for in return for the promises made in the memo.

 

[rjcap]

So let me get this straight. To grow the airline you guys need to take a paycut?

I would then assume the next time the airline wants to grow that another pay cut would be in order till eventualy you are working for free. All in an effort to grow the airline.

I think your union should tell mgmt to give those shiny new airplanes to somebody else.

 

[Tim47SIP]

Just spin?

45 growth aircraft by 2007
Transfer of 30 aircraft to Comair
Eight CRJ 700 deliveries, confirmed
Snap back provisions
B scale for new employees

First, there are no more aircraft other than the rest of the original 70 seat order and maybe the DoJets. So where are they coming up with 45 growth aircraft by 2007. If we add the 70's and the DoJets (if the number 30 is correct), that is 38, so there is still 7 left. I am fairly certain that Delta does not want anymore 50 seaters and hasnt purchased additional 70 seaters, but I could be wrong here. Like earlier posts, Comair management does not have the ability to make this happen.
On the "B" scale item??? What are they getting at here? Isn't "B" scale a lower scale than current?

"Airline promises 80 new jets if contracts altered "

And this one is quite interesting as the number 80 comes from what source? Thats 35 more than the above reference. I think this is nothing but a subversive atempt at best by management.

 

[jetflyer]

Re: Just spin?

And this one is quite interesting as the number 80 comes from what source? Thats 35 more than the above reference. I think this is nothing but a subversive atempt at best by management.

80 aircraft he's talking about:
45 new growth aircraft
30 ACA CVG based dojets possibly being transfered to Comair
8 70 seat deliveries left

hope that helps,
Jet

 

[surplus1]

There are only two parties to the DAL contract, DAL and DAL pilots.

You are correct when you say there are only two parties to the Delta contract, but I think you named them incorrectly. The contract is between DAL and ALPA and it covers the pilots in the service of Delta.

Another aspect of your statement may be this. If its a two party contract between DAL and DAL pilots, then CMR and CMR pilots are not bound by it. Neither are ASA and ASA pilots. Is that right?

Careful, contracts are not as simple as you would have them be. If you do not choose to recognize that ALPA is the contracting party, you could be left with little.

 

[surplus1]

Re: Just spin?

45 growth aircraft by 2007
Transfer of 30 aircraft to Comair
Eight CRJ 700 deliveries, confirmed
Snap back provisions
B scale for new employees

First, there are no more aircraft other than the rest of the original 70 seat order and maybe the DoJets. So where are they coming up with 45 growth aircraft by 2007. If we add the 70's and the DoJets (if the number 30 is correct), that is 38, so there is still 7 left. I am fairly certain that Delta does not want anymore 50 seaters and hasnt purchased additional 70 seaters, but I could be wrong here. Like earlier posts, Comair management does not have the ability to make this happen.
On the "B" scale item??? What are they getting at here? Isn't "B" scale a lower scale than current?

"Airline promises 80 new jets if contracts altered "

And this one is quite interesting as the number 80 comes from what source? Thats 35 more than the above reference. I think this is nothing but a subversive atempt at best by management.

Try this concept as "food for thought".

33 Do-jets from ACA. Cancel that agreement.
8 CRJ-700 already on order and scheduled for Comair. These are not "growth" aircraft, they are already bought.

Sub total = 33

Cancel the agreemet with SKYW (they've been caught in bed with United - a competitor that Delta would not mind having go away).

That frees up aprox 47 slots (without exceeding the Delta PWA Scope ratios).

Convert any deferred orders for CRJ-200 to CRJ-700. Get them from Bombardier (they are hurting and will make a better deal now than before.

33 + 47 = 80

That leaves one problem, i.e., the 57 airframe limit of the Delta PWA. There are two ways to go. 1) Get them to change it; 2) violate it and see what an arbitrator might do when ALPA grieves it.

Delta, Inc. has plenty of leverage to get the DMEC to change that proviso, if they choose to push it.

Do you really think the senior D pilots won't sell that scope limit if it means protecting their pension or they pay rates? Think again.

Watch for a J4J deal, behind the scenes, to placate the Delta pilots and put the furloughees in the "growth" seats.

As for Comair management that's a joke. Everyone knows that Delta is calling these shots. Comair management just gets to sign the memos, as directed.

It will take Delta, Inc's signature on the bottom line to get Comair pilots to the table. JMO.

 

[Mr. Irrelevant]

Just curious......If management at Delta/Comair is asking for concessions from the pilots and flight attendants, have they led by example and taken a paycut of their own?????


Mr. I.