Delta Anti-Merger Video

[bigbusdrvr]

Well, when most people think of cutting costs, they automatically think of spending less. Natural, I guess, since that's about the only way to do it in our personal lives.

With airlines, the "cost" that really matters is CASM. Take WN, who spends more on just about every catagory of expense than US does yet has lower "costs" (CASM).

That "cost" (or CASM) can be reduced another way, which parpdoxicly may entail spending more - efficiency, which is what WN is all about. Unfortunately, US has concentrated on only the spending less method for the last 5 years and ignored efficiency. So for, it seems the management in Tempe is largely using the same method.

Jim

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Jim didnt Southwest's CEO say they would have lost money if not for the fuel hedges? Assuming that, wont they eventually have to cut back somewhere, and since they are so efficient at everything, wouldnt the prudent speculator assume employee wages?

Could a person sumise that this is the delima of Jetblue...the legacies are finally at a level, (above them in cost, but with the inherent level of service assumed) that the upstarts cant encourage the traveler away?

The day of the resurgent legacy might be just around the corner...Delat should be proud that their name will live on!!

 

[BoeingBoy]

Jim didnt Southwest's CEO say they would have lost money if not for the fuel hedges? Assuming that, wont they eventually have to cut back somewhere, and since they are so efficient at everything, wouldnt the prudent speculator assume employee wages?

I didn't see it but he most certainly could have. The only catch is that for that to be completely true, you have to make the hedges disappear and allow nothing else to change. Since the hedges obviously don't just magically disappear, WN has time to adjust other things to offset the diminishing hedge advantage. It'd be sorta like saying that if US hadn't carried any cargo this year, we'd be losing money. Nice factoid, but somewhat irrelevant since we did carry cargo this year.

WN does still have some "aces" up their sleeve. Growth is one thing that offsets otherwise rising costs by spreading fixed costs over more ASM's. Stage length is another - they have the shortest stage length in the industry (not counting express operators). If they can get their stage length up to our's over time, that's worth about 1/2 to 2/3 of a cent in CASM - there's your offset for loss of fuel hedging right there.

The easiest way for me to think about hedges is to look at the various airlines CASM ex-fuel. WN"s is lower than ours by a fair amount, meaning that if we pay the same price for fuel they can underprice us and still make money. In fact, for the 3rd quarter WN's ex-fuel CASM was about 1 cent lower than ours. If their average stage length has been the same as ours, they'd be 1.5 to 1.65 cents lower.

Could a person sumise that this is the delima of Jetblue...the legacies are finally at a level, (above them in cost, but with the inherent level of service assumed) that the upstarts cant encourage the traveler away?

The day of the resurgent legacy might be just around the corner...Delat should be proud that their name will live on!!

Jetblue is still an interesting experiment, as far as I'm concerned. So far there hasn't been a true LCC that has broken away from the WN model and survived long term. Only time will tell for B6.

The "hybrids", like AirTran, are another interesting experiment and only time will tell. A hybrid is hard pressed to have costs as low as WN because of the amenities but has to compete with the revitalized legacies, and the most efficient legacies are definitely leveling the "cost" playing field with the likes of FL.

And FWIW, in the 3rd quarter DL's ex-fuel CASM was about the same as WN's, although achieved with a longer average stage length.

Jim

 

[BluePacific]

Funny thing, that is what I hear on the line as well. It's a done deal. DOA.

Hi Guys...........

My worries as a Delta Employee at this point would be 'IF' the Hostile Takeover failed, would a breakup of 'my' Airline be forth coming?
I knew that was my worry after the failed UAL Merger, and the possibility of the AWA/USAirways failure......
Coming from PSA,I have seen more than one merger in my past, and while this one, a merger to some, but actually a takeover in reality, could bode very, very badly for the DAL people if the wrong turn is made..........actually, I think the 'Stand Alone' idea is good for them, provided they are willing to accept the possible, maybe probable outcome.......

Good Luck Guys and Girls........it WILL be needed.

Blue Pacific/aka rick

 

[757inthebarrel]

Hi Guys...........

My worries as a Delta Employee at this point would be 'IF' the Hostile Takeover failed, would a breakup of 'my' Airline be forth coming?
I knew that was my worry after the failed UAL Merger, and the possibility of the AWA/USAirways failure......
Coming from PSA,I have seen more than one merger in my past, and while this one, a merger to some, but actually a takeover in reality, could bode very, very badly for the DAL people if the wrong turn is made..........actually, I think the 'Stand Alone' idea is good for them, provided they are willing to accept the possible, maybe probable outcome.......

Good Luck Guys and Girls........it WILL be needed.

Blue Pacific/aka rick

Since you aren't a DL emplyee you don't have to worry about it. But the real DL employees don't either. Creditors receive far less in a breakup than they do if the company remains intact. A breakup is the last resort before total failure of a company. The DL restructuring is going very well and the company will emerge in the spring. RASM is way up, CASM is down and the furture looks very bright. DL's plan is based on $60 oil whereas the US plan is based on $50 oil. I'd be worried too if I were Parker.

 

[Itestwell]

Since you aren't a DL emplyee you don't have to worry about it. But the real DL employees don't either. Creditors receive far less in a breakup than they do if the company remains intact. A breakup is the last resort before total failure of a company. The DL restructuring is going very well and the company will emerge in the spring. RASM is way up, CASM is down and the furture looks very bright. DL's plan is based on $60 oil whereas the US plan is based on $50 oil. I'd be worried too if I were Parker.

If US' plan is based on $50 oil, how did they make money when oil was above $70?

Do you believe that basing a plan on $60 oil is a safe bet in today's world? Just curious....

 

[NYCDelta]

Do you believe that basing a plan on $60 oil is a safe bet in today's world? Just curious....

The $60 a barrel is an average. On Friday, it was $61 a barrel. Some "analysts" believe the price of oil next year could hit as high as $79 a barrel. Of course, if that happens, airlines will have to raise their prices-or cut costs elsewhere. I also read an article that we're sitting on 2.3 trillion barrels of oil in Colorado, Utah, and Arizona. But getting to it is costly. The article stated that it's more oil than all of the middle east.

 

[phasersonstun2]

If this merger goes through sic* the Delta employees sound like they will be determined to take it down. The bad blood that Delta has at US will not mix and match. They need to remember they are no longer the predator they are now the prey. Their sic* plan failed and we are still here.

I don't believe Delta had a plan to see U fail as much as U had a plan to merge with UAL which failed. The truth, and every U employee knows this, was that U did not have an "alternate". A "flight" to a primary destination (UAL) with no alternate and a merger put in a holding pattern was what happened.

Delta people do not hate U people; they hate Parker and his plan. Delta doesn't want any part of U because Parker would most likely spin pieces of Delta off to stave off antitrust concerns.

The funny thing is that the merger violates scope language that exists in BOTH pilot contracts. If the deal proceeds, then there better be a TON of goodies for the pilots on both sides; like $$$$$$$$$$$$$$$$$$$$$$$$$$$$$.

 

[wings396]

I have to differ with your opinion about DL planning on the demise of US as part of thier recovery plan. DL entered into many US markets in a very short period of time with some pretty heavy equipemt, as well as lots of RJ's too. DL intentionally created huge amounts of overcapacity in these markets with hopes of killing US off quickly. Given that US with CLT, is the only major compititor that DL has in the Southeast, their demise would have been a shot in the arm for DL. Not that this would have been a long term solution, but it would have increased their revenue for the short term. DL should have known that having a major competitor go away wouldn't solve all of their problems to begin with. They already had that take place when EA closed up shop...

 

[N924PS]

If this merger goes threw the Delta employees sound like they will be determined to take it down. The bad blood that Delta has at US will not mix and match. They need to remember they are no longer the predator they are now the prey. There plan failed and we are still here.

Except for the pilots of Delta Air Lines, represented by ALPA, the other employee groups could be replaced by thousands of Low Cost Employees. (Just like Philly)

Then, except for any ill will among the pilots, you would have a new generation of Delta Blue Blood's with no wish to take their new employer down and every reason to make it succeed.

 

[wings396]

As many on this board can confirm, there was a lot of
"Bad Blood" between the pilots of PI & US as well, and it never amounted to anything, nor did it do any good. Finally it was forgotten, and they came together as one to do their best. Please keep in mind, that not all participated in this form of behavior.

 

[NYCDelta]

Except for the pilots of Delta Air Lines, represented by ALPA, the other employee groups could be replaced by thousands of Low Cost Employees. (Just like Philly)

So, you would just get rid of the 45,000 of us that are not pilots? It's easy to imagine that when it's not your job we're talking about, right?
Thanks for reconfirming why I don't want this merger-I don't want to work with someone like you.

 

[N924PS]

So, you would just get rid of the 45,000 of us that are not pilots? It's easy to imagine that when it's not your job we're talking about, right?
Thanks for reconfirming why I don't want this merger-I don't want to work with someone like you.

USAirways employees will embrace you. Doug Parker will embrace you. Resistance is futile.

It just appears that you seem to have a big chip on your shoulder regarding USAirways (as if DL is vastly superior?). If it happens and you want to be an obstructionist, then move on and be replaced. It's really up to you.

Looking forward to working together someday very soon.

 

[BluePacific]

Since you aren't a DL emplyee you don't have to worry about it. But the real DL employees don't either. Creditors receive far less in a breakup than they do if the company remains intact. A breakup is the last resort before total failure of a company. The DL restructuring is going very well and the company will emerge in the spring. RASM is way up, CASM is down and the furture looks very bright. DL's plan is based on $60 oil whereas the US plan is based on $50 oil. I'd be worried too if I were Parker.

Hi Guys...........

It amazes me that a group of professional people so quickly forget that Delta's, their Delta's, business plan was to run USAirways out of business. Times do change, as the tables have, and as always Egos are involved.
My cockpit seems to be a nice place to watch all this unfold. Nice to see the 'Professionals' sweat for a change...
Perhaps it was the way that the Pan Am and Western people were treated that has them concerned.

Before the responses come pouring in...........
'75, Abe, NYC.........remember each morning to 'klick you heels and repeat....I Believe, I Believe.....that Grinstein will save us'.

The Pacific sure is BLUE from my house.....

Take Care YA ALL !!
rk

 

[Borescope]

Well US could just try and grow the airline on its own.
Ooops, what was I thinking? I forgot we we are talking about US Airways where you count on other airlines to save your hide.
Sounds eerily like a parasite.

Exactly, they can't do it on their own. This guy Parker is the "New Lorenzo" of the 21st century.

Stay independent DL, you'll be alot better off.

 

[NYCDelta]

USAirways employees will embrace you. Doug Parker will embrace you. Resistance is futile.

It just appears that you seem to have a big chip on your shoulder regarding USAirways (as if DL is vastly superior?). If it happens and you want to be an obstructionist, then move on and be replaced. It's really up to you.

Looking forward to working together someday very soon.

That's funny-and 2 posts ago, you were gonna have us all replaced with "low cost labor".

Hi Guys...........

It amazes me that a group of professional people so quickly forget that Delta's, their Delta's, business plan was to run USAirways out of business.

I can't forget something I never knew. If you read my posts on here-this was all news to me until I read it on this board. Guess I was too busy serving my passengers.

Times do change, as the tables have, and as always Egos are involved.
My cockpit seems to be a nice place to watch all this unfold. Nice to see the 'Professionals' sweat for a change...
Perhaps it was the way that the Pan Am and Western people were treated that has them concerned.

I've flown with many former Western & PanAm flight attendants. They all got a raise when they came to DL. I haven't heard too many of them complaining about DL.

Before the responses come pouring in...........
'75, Abe, NYC.........remember each morning to 'klick you heels and repeat....I Believe, I Believe.....that Grinstein will save us'.

The only person I rely on is myself. That's why I took a 4 year leave and became a cardiac nurse. I can get a job in any town, city, or state. I'm a nurse with flight benefits.
The Pacific sure is BLUE from my house.....

Take Care YA ALL !!
rk