Will Delta pilots destroy the airline?

[Clyde]

This is not humor.

Obviously in Atlanta this has been on the news quite a bit and I'm curious to hear from someone in the know. I understand wanting to be paid a fair wage etc. but if you know they will go under if you don't take a pay cut is that like your pay back or what? I'm not slamming Delta pilots and am very ignorant on the whole situation. I'm just curious if the plan is to nuke em if they don't come up with what you want. That sounds stupid to me.

I think it's safe to say that management has destroyed the airline. When you look at Delta, United,and US Airways, they (as well as many others) are in dire financial straits. How many times have the pilots safely delivered their passengers to their destinations? Countless times, and in a very professional manner.

It's our job to make sure the airplane is operated correctly and headed in the right direction. It's management's job to make sure the airline itself is run in a similare manner. If pilots begin to screw up and cause incidents and accidents out on the line, they are replaced. It should be the same for management. They start causing incidents and accidents on the balance sheet, it should be sianora to them.

I don't mean to be venting, but I have yet to see an airline fail due to the actions of John Q. Pilot. (exceptions for labor strife, like a strike). We are doing our part, all of us, to be professional and do exactly what our job descriptions demand us to do. What is not part of our job description however, is to take it in the shorts when the suits upstairs screw up.

So, to answer what was originally asked, I don't think the pilots will cause Delta to fail. The MBA's upstairs have already done that.

 

[capt. megadeth]

Let's all fly for free!

That will save all the airlines! We can all live together in a compound eating Ramen noodles after we all file personal bankruptcy. What do you all think?

 

[Clyde]

Let's all fly for free!

That will save all the airlines! We can all live together in a compound eating Ramen noodles after we all file personal bankruptcy. What do you all think?

Um, what flavor noodles?

 

[Publishers]

OK The pilots have not screwed up the airline......On the other hand, there have been a few things happening that management had to deal with that are not of their own making.

At this point-- who is at fault is not really the point.

The only important point is this -- what do we do to get ourselves out of this mess. This business was not created so you can have a job no matter how well you did it. As to some specific points.

United may be paying less for a 747-200 than a 737.. They took bankruptcy and under that scenario, contracts can be forgotten. That does not mean the lessors wanted to reduce payments, it meant they were forced to. Will your bank reduce the payments on your car because you are going through tough times.

Fuel prices-- well really not controllable past a certain point. Sourthwest hit the hedge lottery and Delta did not. Let's tell the Arabs they need to kick in some funds for Delta -- a good customer-- and see where that leads.

Insurance-- one thing before September 11 and another since. Surely they want to contribute.

Airports -- well they are doing real well since 9/11 having their basic security budgets increase by 100% or in some cases more. They should be a soft touch.

Banks-- well we have $30billion in debt --surely they will line up to forgive that.

Let's see-- that leaves 2 things-- labor cost and ticket revenues.

The only way out is to sell more tickets at higher prices and or reduce one big expense -- payroll. And who is the most expensive part of payroll,,,,,,, ah, ah, Oh yeah, pilots.

Chapter 11 means -- we failed........

 

[michael707767]

United may be paying less for a 747-200 than a 737.. They took bankruptcy and under that scenario, contracts can be forgotten. That does not mean the lessors wanted to reduce payments, it meant they were forced to. Will your bank reduce the payments on your car because you are going through tough times.

No, lessors do not want to reduce payments....anymore than the pilots want to take pay cuts. But, that is the new reality. Our contract was signed during different times, difference economic conditions. Times have changed. The finances of the airlines are totally different. Our contract will have to be adjusted to reflect that, and so should contracts on leases. Bottom line is the same for the pilots and the lessors. We can negotiate a deal now, out of bankruptcy, or we can wait for a deal in bankruptcy, where we will probably get even less.

And to answer your last question above, yes. If you are on the verge of bankruptcy and defaulting on a loan, call your bank. They will probably deal with you.

 

[secks]

Common reaction from a CFI. Been there done that.
The question people (and passengers) should ask is whether they want their pilots flying angry and preoccupied or focused. Face it, if a flight attendant has their mind on financial matters what's the worse that can happen? She spills a coke?

Think of it this way, would you want to go under the knife when your surgeon is tired, cranky, po'd, and discontent? Doubtful.

Something tells me passengers aren't going to relate to a pilot's bad attitude when he's still making six figures, even after hefty pay cuts. Besides, nobody is forcing people to become pilots. If you can't do your job with a reasonably positive attitude, you don't need more money (esp. when you're pulling in 6 figures and competition for your job is fierce), you need to get the hell out before you end up hurting someone.

Oh, and if you've ever worked in a medical field, you'd know that practically all surgeons ARE tired, cranky, PO'd and discontented when performing their duties. You show me a happy surgeon and I'll show you a great actor.

 

[FDJ2]

.

Let's see-- that leaves 2 things-- labor cost and ticket revenues.

The only way out is to sell more tickets at higher prices and or reduce one big expense -- payroll. And who is the most expensive part of payroll,,,,,,, ah, ah, Oh yeah, pilots.

The largest part of labor costs are actually the non contract employees. Delta pilots make up about 1/3 of DAL labor costs the rest are non contract employees. You also failed to address DAL management sinking $2.3B into a stock buy back deal which did nothing to improve customer service, improve aircraft interiors, reduce Delta debt etc. Just another poor mangement decision. Also, fuel hedging is not a lottery, it is a management decision. DAL management chose poorly and it has now cost DAL over $600M this year in additional costs. If you read DAL's latest quarterly report you'll see that revenues are up and fuel nuetralized CASM is down, but when you factor in the decision of a feeble minded old man to sell the fuel hedge, despite a war in the Middle East and political uncertainty and coup attempts in Venezuela ( a major exporter of crude oil) DAL's CASM skyrocketed. Two major screw ups by Mr Grinstein are the selling of the DAL fuel hedge which has cost us over $600M this year in order to make a voluntary contribution to the non contract employees pension fund of over $300M. Those two decisions have cost DAL nearly $1B in cash liquidity in his first year at DAL as CEO, which also happens to be how much DAL's cash position has deteriorated this year. Unquestionably the most expensive item in DAL's ledger this year has been the poor management of the company by our crack management team.

 

[General Lee]

The key here is that management doesn't have to be around for many years---they only have to be around long enough to get credit for a supposed pension (Leo got credit for 30 years, even though he was here for six), and then he took his exit money (negotiated in his contract---which Delta surely cannot break---only pilot contracts can they change......) and went off to Nantucket to build a dream mansion. (he also got free 1st class travel privileges for life for his family---yeah, I would like to see him on my plane.....)


We WANT TO BE HERE for a long time. (knock on wood) We have been saddled with this problem, and we will have to try to fix it. That is the deal unfortunately.



Bye Bye--General Lee

 

[enigma]

I just started it this morning.

My bad, I was avoiding some string, probably the majors vs beliefs. Besided's, I'm on reserve, one day seems like three.

enigma

 

[VMA214]

"Oh, and if you've ever worked in a medical field, you'd know that practically all surgeons ARE tired, cranky, PO'd and discontented when performing their duties. You show me a happy surgeon and I'll show you a great actor."

A "tired, cranky, PO'd surgeon" can only kill ONE person at a time...and they NEVER have to pee in a cup!!

 

[Ty Webb]

You can be sure if two or three legacy carriers went out of business, the LCC's as well as new start ups would once again start flooding the market with more seat miles..

Apparently, our village has a new idiot. LCC's do not "flood the marketplace", they bring down the average ticket price. The Legacy carrier's response has been to add a ton of capacity, trying to keep people off the LCC airplanes, so if you really want to blame someone for "flooding the market" put the blame where it belongs.

AirTran is Delta's main competition at ATL, and we only have about 180 flights a day, on SNB aircraft, to a whopping 42 cities. Hardly "flooding the market".

Get your facts straight before you post junk.

 

[G100driver]

Delta could stem the increase in its debt and pay off existing debt if it can cut other expenses, like pilot costs, said Joel Denney, an analyst for Piper Jaffray & Co. in Minneapolis.
End


The last paragraph pretty well sums up the general attitude, and frustrates me to no end. The writer spends the whole article, detailing problems which have nothing to do with pilot wages, but ends up with the conclusion that cutting pilot costs is the solution. Dirty barsards.

enigma

Jeeez, your are starting to sound like a Democrat. The next thing you know you will think that pilots have a right to collective bargining.

Heretic.

 

[RVR300]

Secks,

Stick to general aviation.

 

[MedFlyer]

Those two decisions have cost DAL nearly $1B in cash liquidity in his first year at DAL as CEO, which also happens to be how much DAL's cash position has deteriorated this year. Unquestionably the most expensive item in DAL's ledger this year has been the poor management of the company by our crack management team.

So what? DL has an extra billlion dollars in liquidity...what good would it do? Instead of filling for Ch 11 in November 04, DL would instead file in March 05.

If DALPA knew DL had an extra billion, do you think they would be offering any meaningful concessions? Of course not. You and I both know that DALPA won't offer meaningful concessions until the company is run into the ground. So, DL management is doing exactly what DALPA wants.

You can throw in or out lots of items, but the bottomline is that DL is not operationally profitable.

 

[Publishers]

That is really the point, the patient is sick. There are really few things that it can deal with out of 11. Everyone assumed that it would always grow bigger, faster, more, forever and the market would never leave them.

Like I said, a small company this sick goes out of business leaving all the employees, suppliers, and customers out to lunch. Instead of bitching about management, adopt the position of my company failed. We are working on what the new company will be like.