UAL getting 43 New 777's

[PHXFLYR]

Please...no more mergers . I've already been thru one too many...pick someone else.


PHXFLYR

 

[whymeworry?]

EMBpilot,

Look at the route map and think who flies politicians in their Delta Elite fleet. The losses can be sustainable for a long-long time

Seriously? You regard DALs sustainability because of it's correlation to the politicians they fly? Sounds like all the AQ pilots who said their 61 yr airline could never go out of business because: "Hawaii politicians would never allow it." Or the Air India pilots who claim their government will never let the state-run airline fail. As of today, AI is on the verge of going under, 98% of their routes lose money (Forbes Nov 2009) and they haven't paid their pilots in 4 months (a strike is scheduled for next week).

BTW, CAL flys political big-wigs too. So does everyone. Why do you think SWA gets so much support in Washington?

In business, you either have a sustainable model or you don't. No company is too big, or too connected, to fail. But I suppose you know all this already (que the GM/ GS/ AIG bailout history to make your point, I get it. Those were the exception. Beside the US gov't is broke).

As far as your making money on DAL. So did I... when the stock went from $7 to $8. Whoopy. Big deal. The fact is, the stock traded lower from the day the merger was announced and has never meaningfully recovered. Even today it is lower. Shareholders have been clobbered. But I doubt many noticed since so many lost money last year. For the time being the pilots are content because no significant cross-bidding has occurred and no furloughs have been announced as yet.

Regarding DAL's liabilities, I rechecked my numbers... to clarify, DAL lost $14.5 billion from 2000-2008. I should have been more clear about that. But it was an amount far higher than any other airline. And yes, they are $44 billion in debt.

As far as a UAL/ CAL merger, most of us think think the SLI process will be a blood-bath. No doubt! But overlap and excess staffing? No way. Much less overlap than NW/DAL. And if we adopt UAL's staffing formulas (which we and they will obviously push for) , there will be a need for up to 3000 more pilots. CAL's workrules suck, we've been understaffed for years because of it. But if they adopt our rules, there will be a furlough of an additional 1200 pilots between the two carriers.

Of course, these are just my opinions. But I have done the research based on current info.

Back to the point. Until DAL makes money, I don't think a merger is a forgone conclusion. Thus far the only thing a mega-carrier has amounted to is one heaping loss and debt-load. But I will agree it is early in the game as yet and they may actually pull this off. Their timing sucked and all those DC-9s aren't helping (despite what GH says).

It does beg the question though, why are Anderson and his team unloading all their shares right now if DALs future is so bright? I'm no rocket scientist but I'm pretty sure mgmt's lack of faith in the stock is not a good sign.

As humans, we all tend to see life through rose-colored shades. DAL pilots really exaggerate this point. I recall in 2003 when my good DAL buddy, who was furloughed at the time, made some rather foolish moves with his career at the company he was flying for. When I warned him to be careful he told me he wasn't worried 'cause he'd be going back to DAL soon (that didn't happen until 4 yrs later in 2007). I went on to warn him that I thought DAL was in a precarious position because they had more than $2.5 in liabilities coming due in 2004 and that he should be prepared to hunker down. You'd have thought I just stole his wife based on his response. Folks, this is all public information. I hardly think I am being biased about it when I'm merely sifting through financial data (not a hobby, it's just so easily available if you know how to read a financial report). So dont' shoot the messenger. Get educated and enlighten yourself.

Belive me, I am under no illustions that UAL is a sinking ship that may eventually bring CAL down. But there isn't much I can do about it except hope that my merger committee is prepared for the battle that may come; or that UAL will get its act together and become a great carrier once again. In the meantime, we wait.

 

[contrail67]

As far as a UAL/ CAL merger, most of us think think the SLI process will be a blood-bath. No doubt! But overlap and excess staffing? No way. Much less overlap than NW/DAL. And if we adopt UAL's staffing formulas (which we and they will obviously push for) , there will be a need for up to 3000 more pilots. CAL's workrules suck, we've been understaffed for years because of it. But if they adopt our rules, there will be a furlough of an additional 1200 pilots between the two carriers.


What are some of the "major" differences that would cause 3000 more pilots? Not sure of how CAL does their staffing.

 

[G4G5]

Since UAL has emerged from BK, Tilton has managed to accumulate $8 BILLION in debt. Their will be no sale of the Pacific routes because they are in essence owned by Citi as collateral on the debt. Citi and all of the other banks understand that UAL needs cash flow to service the debt. How would selling or merging help the banks?

UAL has managed to put it into a position where it's debt is to large for a merger.

Cal mgt will never merge with UAL, code share yes, merge never. No creditor will accept anything less then 100% on the UAL debt because UAL is currently servicing the debt. That puts CAL or AMR in the position of having to pay $8 billion to the banks before they incur a single penny of merger costs. Delta(15+ billion in debt) may have been willing to take on huge debt but AMR (9 billion in debt) and CAL's mgt (5+ billion in debt) appears to be of the mind set that in this economy cash and not debt is king.


The banks will continue to lend UAL money for assets just like October's $800+ million dollar loan for aircraft (12% pay out to the banks) until UAL has nothing left. At that point they will keep them on life support by purchasing FF miles.

It's going to be a long slow death by paper cuts until they either turn it around or reorganize under another BK.

Tilton burning through an average of $2 billion a year (in debt) and growing.........

Not so sure that DAL taking on $15+ billion in debt in a recessionary economy is a good thing, only time will tell....

 

[Yuppyguppy]

wow....you are such an expert G4G5 holy ********************

 

[G4G5]

wow....you are such an expert G4G5 holy ********************

Thanks

 

[atpcliff]

Hi!

I read that UAL thinks the -777ER is old technology, and won't be buying any more (Emirates agrees).

cliff
NBO

 

[whymeworry?]

As far as a UAL/ CAL merger, most of us think think the SLI process will be a blood-bath. No doubt! But overlap and excess staffing? No way. Much less overlap than NW/DAL. And if we adopt UAL's staffing formulas (which we and they will obviously push for) , there will be a need for up to 3000 more pilots. CAL's workrules suck, we've been understaffed for years because of it. But if they adopt our rules, there will be a furlough of an additional 1200 pilots between the two carriers.


What are some of the "major" differences that would cause 3000 more pilots? Not sure of how CAL does their staffing.[/QUOTE]

You know, I'm not exactly sure. Some of the items might be that we DH our IROs out to Europe, UAL works them. UAL has some sort of rigs and perhaps better contractural staffing formulas. I got the info from one of our guys who sat down with the UAL NC last year when it looked like a merger was imminent (shortly before the CAL BOD rejected UAL's advances). He told me so long as we take their work rules and keep our pay rates we would all do pretty well in a merger. But now that I think about it, 3000 new pilots might be a high number considering both airlines have considerably reduced fleet size since I was told that number in Spring 2008 (CAL parking 67 737s, UAL parking 100 737s). But starting in 2010, CAL willl grow its fleet again. At the moment UAL doesn't have any fleet growth plans but I assume they will eventually replace at least half the airframes they parked. So factoring in "re-growth" to where we all were Spring '08 and their staffing formulas, we could see close to that 3000 number if a merger ever occurred... again, assuming we took their work rules.

 

[contrail67]

Well I am all for keeping United's work rules but I don't want CAL's current pay rates OR UAL's current pay rates. It would not surprise me at all if there is a "merger" contract already written....in some drawer somewhere.

 

[ATRCA]

3000 more pilots? What a joke! You can't be serious. No merger has EVER LEAD TO HIRING IN THE HISTORY OF THE WORLD! and this one won't either. There will be at least 1200 furloughes. CALALPA has already hinted about reductions at both companies should they merge.

Furloughs and workforce poison, that's what you're gonna get. I'll throw in a fist fight here and there for good measure too. This merger will be like all of it's predecessors, it will create wealthy executives who will all be on a 5 year exit plan, the employees will forever blame one another for their woes and the company will bleed cash and shrink. That's been the formula for decades in this industry. Anyone who thinks otherwise is foolish.