Delta reports record profit for Q4

[WorldTraveler]

I think that’s a pretty accurate and wise conclusion, Kev… with a few caveats and two parts to the equation.
One caveat is that you shouldn’t view that conclusion fatalistically…. Just that it is sometimes wise for each of us to pick our battles wisely and sometimes it is better to focus our attentions on things that we stand a chance of winning, even if it means shifting from some of our earlier desires.
Second is that the US has always been a very pro-business country which has not been terribly friendly to labor – no secret to you. As with most things, the airline industry is at the extreme of that reality… expecting to accomplish some of the things you want to see happen in an industry where mere survival has been far from certain but where a few businesses have figured it out (only a few), means that the airline industry might be the least receptive place to push the things that matter to you – and labor, even if some people have spent much if not all of their adult working career in the airline industry.
Third is that DL has proven itself to be a successful competitor in an industry with little long term success. Like CO before, DL set out to change some fundamentals of the way US airlines operate. It is one thing to expect change to occur in a company that isn’t succeeding but quite another to expect a company that is achieving what it said it would do and be.
But that is all the first part of the equation and has to do with the company and the industry.
There is a second part which has to do with the employee in the industry.
I have watched many people in large companies and the reality is that many do not have the personalities to fit in at a large company where they have little freedom to be who and what they want… regardless of the company, large corporations are for the most part quite stifling with respect to someone setting their own agenda and being who they want to be. Airlines are at least average if not more so. Some airline employees would do well to recognize their gifts in relation to their ability to achieve what they want and begin the path in doing what they ultimately want to do in life. Many airline employees develop side businesses which eventually become their primary source of employment. Working for a big corporation, and esp. at airlines which allow employees to have more schedule flexibility than at other companies (there is an upside to being at work at 0 dark 30), allows some people to retool themselves and invest their non-airline time developing another side of their careers.
I have been involved in internet airline discussion forums for almost 10 years – about the same time as you. I have weeded thru some pretty juvenile posts from some people – but I have also seen a lot of very intelligent people participating in these types of discussions. To be honest, I have long enjoyed reading your contributions and think you are one of the most articulate participants and seem to have a pretty good grasp of what is going on in the world and the industry. Quite frankly, I have often thought that you, among others, could accomplish far more outside of the industry – and perhaps are limited by being a part of it. Obviously that is a personal decision for you and others to make – but what I hope people like you, Dawg, Chris Perry and others realize is that there is a life outside of and beyond the airline industry and sometimes the faster you (collectively) start working toward that end, the more you will be able to achieve what you want. I hate to see people like Chris go through another round of cuts at AA…. And I hope he and others take the initiative to retake control of their lives. AA will do what it needs to do, just as DL did, and what both do/did, are not necessarily in the best interest of individual employees.
So, don’t resign yourself to the inevitability of change… just recognize that you might succeed at implementing change in politics, community service, leadership of the labor movement itself, education…
There is no better day than today to make sure you can accomplish the things you want to do in life… even if it means walking away from some of the things that you really do enjoy now.

 

[topDawg]

Translation: Corproate America always wins, so don't bother- just play nice, and try to fit in.

Ha. thanks because I'm not going to sit here and read all of that. :huh:


anyways WT. If you can't figure out that Delta is blowing smoke up your, and most of the AMTs butts then i can't help you. We have cost low enough that other airlines, 150+, are knocking on our door to do work, some of which Delta claims they can't make any money doing. (yet they do it anyway) So someone, somewhere is telling a lie. :angry:

 

[WorldTraveler]

Ha. thanks because I'm not going to sit here and read all of that. :huh:


anyways WT. If you can't figure out that Delta is blowing smoke up your, and most of the AMTs butts then i can't help you. We have cost low enough that other airlines, 150+, are knocking on our door to do work, some of which Delta claims they can't make any money doing. (yet they do it anyway) So someone, somewhere is telling a lie. :angry:

interesting that you decry DL's outsourcing yet you are willing to outsource the reading, analysis, and response regarding different viewpoints to someone else - unless you have already decided that your mind has been made up and it doesn't matter what anyone else might say or how your opinions fit in with the rest of your peers.
.
Days after we started this discussion, it still comes down to the fact that DL is a successful company... if it is not delivering the best financial performance in the US airline industry, it is near the top. They have little incentive to change a model that works for them.
If you believe you are being unfairly treated and DL mechanics are getting the raw end of the deal, then it would appear that either 1. they are asleep and too dumb to realize what is happening to them or 2. your perception is not in line with the norm for the group.
If you believe you really see things they don't and they aren't responding, then wake them and spread your message. They apparently haven't expressed a desire to change the status quo as they know it or found a mechanism that supports what they intend to do.
.
Have you also considered that perhaps the reason other airlines are bringing their work to DL is because DL has capabilities and resources which those other airlines don't have. Given that DL is seeking out and the majority of its MRO work is high value engine and component repairs would seem to argue that DL is doing higher value work because that is where DL's capabilities align with the price of providing that service in the market.... highly technical work executed right can be sold at a premium to the market.
Perhaps you aren't really aware of the the value of your own services - both underestimating some aspects of it while overestimating others.
.
Keep up the good work.... there is and always will be a market for well-trained, component technical experts in a highly developed economy doing what they do best - no more, no less.

 

[topDawg]

interesting that you decry DL's outsourcing yet you are willing to outsource the reading, analysis, and response regarding different viewpoints to someone else - unless you have already decided that your mind has been made up and it doesn't matter what anyone else might say or how your opinions fit in with the rest of your peers.
.
Days after we started this discussion, it still comes down to the fact that DL is a successful company... if it is not delivering the best financial performance in the US airline industry, it is near the top. They have little incentive to change a model that works for them.
If you believe you are being unfairly treated and DL mechanics are getting the raw end of the deal, then it would appear that either 1. they are asleep and too dumb to realize what is happening to them or 2. your perception is not in line with the norm for the group. 3) they see it but any chance to change it falls of deaf ears
If you believe you really see things they don't and they aren't responding, then wake them and spread your message. They apparently haven't expressed a desire to change the status quo as they know it or found a mechanism that supports what they intend to do.
I do, and most agree with me. the problem is how do we change it? We don't want our cost to go out of the roof so that we lose our MRO work. If its so easy to change things by all means tell me.....
.
Have you also considered that perhaps the reason other airlines are bringing their work to DL is because DL has capabilities and resources which those other airlines don't have. But if HMVs cost to much why are they coming to Delta? PIMCO does 767 HMVs, HECAO does them. I think the company in PEK does them. It not like They are forced to use Delta.... Given that DL is seeking out and the majority of its MRO work is high value engine and component repairs would seem to argue that DL is doing higher value work because that is where DL's capabilities align with the price of providing that service in the market.... highly technical work executed right can be sold at a premium to the market. Delta does everything from engine OHs to HMVs. Most of the work is on the engine side, alot of that has to do with space. We really don't have the bays in Atlanta to have a bunch of planes sit there for a long check. The engine shop has/had alot more room to grow than the airframe guys. (and Tony is a engine guy)
Perhaps you aren't really aware of the the value of your own services - both underestimating some aspects of it while overestimating others.
.All i want is to be able to do all the work on Delta planes and be close to same level of my peers in QOL. At this pointi am not close to this.
Keep up the good work.... there is and always will be a market for well-trained, component technical experts in a highly developed economy doing what they do best - no more, no less.

 

[WorldTraveler]

Thanks for your response, Dawg.
It is very possible that there are many mechanics who don’t like what they see at DL – but that doesn’t necessarily mean that they could create a business model for maintenance that would actually work. We saw with the UA ESOP and have seen it many times since in other businesses that employees are notoriously poor at being able to see the big picture perspective and make decisions that are good for the overall company, esp. if they are at their own expense.
Your commitment to keep DL airplane work done in-house where quality control is greatest is commendable – but despite years of hearing that MRO work is substandard, we simply have to acknowledge that is only partially true. I cringe when I hear that Timco is sending their work back to AA because Timco can’t get it done right – but I also see thousands of aircraft that are correctly serviced outside of their own airlines. As a passenger, I want you and the crew members that fly US aircraft to be completely comfortable that the work being done is right… and if you ever believe that DL is putting unsafe aircraft into the air, may I be the first to lend you a phone you may use to call the FAA and the press to make your point. But I hope you would be just as quick to point out flaws you find in the work done by some of your DL employee peers, some of whom I’m sure do not get everything right the first time. The fact that there are multiple checks and balances helps ensure that the final product is right, whether it be inhouse or outsourced work.
But doing everything in-house for maintenance is no more realistic than it is for DL to do all of its IT, accounting and taxes, or airport handling. DL for years has outsourced work in these and other areas because of the expertise of others in those fields and because, esp. at international stations, it simply is not cost effective to hire 20-25 people to handle a DL flight for 2-3 hours while a contractor can use the same group of employees to do that for 2-3 flights from different airlines in a day.
I just do not believe it is realistic for DL to do all maintenance work in house first because I don’t believe it is realistic to believe that DL can do everything as well as anyone can and two because DL does have facility limitations.
Another factor which I’m not sure you have considered is that DL might not be expanding its maintenance operations by bringing more work in house is because industry consolidation is not complete….. DL’s fleet plan could change which might mean the M80s might be retired sooner than DL is planning if DL merges w/ another carrier w/ either a newer fleet such as AS or one that has substantial orders. Same could be said for other older fleet types including the 320s and 757s…. expanding maintenance capabilities is a long term commitment and it is highly possible that DL’s maintenance needs will decrease significantly with a merger. They expect that even the 100 739s on order will significantly cut maintenance expenses – not unreasonable since they will push out 100 of the oldest existing domestic aircraft.
I didn’t know Tony Charaf was an engine guy…while interesting I think he is able to see the big picture even if that is his preferred area.
In the meantime, DL is insourcing a lot more than other carriers and is, as you note, doing work for insourcing customers than it does not do on its own fleet. Whether they are losing money doing that insourced work they don’t otherwise do, I don’t know. But I would hope – and assume – that if they are losing some money, they are making up for it with other high value work and the prospect to keep some clients for the very long term.
Glad to discuss these key issues with you and hope doing so will bring some understanding on both sides.

 

[topDawg]

Thanks for your response, Dawg.
It is very possible that there are many mechanics who don’t like what they see at DL – but that doesn’t necessarily mean that they could create a business model for maintenance that would actually work. We saw with the UA ESOP and have seen it many times since in other businesses that employees are notoriously poor at being able to see the big picture perspective and make decisions that are good for the overall company, esp. if they are at their own expense.
Of Course. I'm not talking about buying the airline, I'm talking about changes, but keep our cost in-line so that we can hit our 1B target and ever grow that number.
Your commitment to keep DL airplane work done in-house where quality control is greatest is commendable – but despite years of hearing that MRO work is substandard, we simply have to acknowledge that is only partially true. I cringe when I hear that Timco is sending their work back to AA because Timco can’t get it done right – but I also see thousands of aircraft that are correctly serviced outside of their own airlines. As a passenger, I want you and the crew members that fly US aircraft to be completely comfortable that the work being done is right… and if you ever believe that DL is putting unsafe aircraft into the air, may I be the first to lend you a phone you may use to call the FAA and the press to make your point. But I hope you would be just as quick to point out flaws you find in the work done by some of your DL employee peers, some of whom I’m sure do not get everything right the first time. The fact that there are multiple checks and balances helps ensure that the final product is right, whether it be inhouse or outsourced work. But that is the problem. Every time a contract comes up we change vendors. We have yet to keep a HMV line at a single place. ALOT of this is do to s**ty work. It takes them long than it did us, and the plane ends up back at TOC getting crap fixed that the MRO didn't.
and sure, Delta has its own group of f**k ups. Part of the reason HMVs went out in the first place is people were not productive. I know that I saw many, many guys come in for 10 hours and not do a damn thing, but the problem i have with Delta is, instead of fixing the system, they just farmed it out. i just want a chance, and maybe with the 1 57 HMV we are going to do it will be a real chance. I don't know. I also don't expect to get 700 HMVs tomorrow, but a slow trickle of older stuff(ie 57s we are going to keep) mixed in with 100% on new planes/those that haven't had work done outside(777s) would be a good start)
But doing everything in-house for maintenance is no more realistic than it is for DL to do all of its IT, accounting and taxes, or airport handling. DL for years has outsourced work in these and other areas because of the expertise of others in those fields and because, esp. at international stations, it simply is not cost effective to hire 20-25 people to handle a DL flight for 2-3 hours while a contractor can use the same group of employees to do that for 2-3 flights from different airlines in a day.
but you can't compare the ramp to us. HMVs would likely be 24/7 staffing, so its not like it a one off thing. Its something that would be done all the time. Just the M80s alone we would pretty much have 2 planes in a bay year round.
I just do not believe it is realistic for DL to do all maintenance work in house first because I don’t believe it is realistic to believe that DL can do everything as well as anyone can and two because DL does have facility limitations.
If we can't do HMVs "as well as anyone" why are we doing them for other carriers? and Sure, We cut 5 hangars(DFW/TPA/ORD/LAX and ATL) when DAL-S cut HMVs alone. The idea would be to slowly gear up HMVs and ass we do we add space. Take the money for the Mexico hangars and build them in the Us. I am willing to bet a city like Atlanta, Detroit and fort Worth would be willing to give Delta a hell of a deal to build a facility. On the city end id bet they could get the cost down to the GDL level.
Another factor which I’m not sure you have considered is that DL might not be expanding its maintenance operations by bringing more work in house is because industry consolidation is not complete….. DL’s fleet plan could change which might mean the M80s might be retired sooner than DL is planning if DL merges w/ another carrier w/ either a newer fleet such as AS or one that has substantial orders. Same could be said for other older fleet types including the 320s and 757s…. expanding maintenance capabilities is a long term commitment and it is highly possible that DL’s maintenance needs will decrease significantly with a merger. They expect that even the 100 739s on order will significantly cut maintenance expenses – not unreasonable since they will push out 100 of the oldest existing domestic aircraft.
I do get that, but regardless of any merger partner, even AA, we will still have 57/67s here, we will still have 73s and M90s and younger airbus. That alone is ~400 frames. (or more) that HMVs could be done on.....thats a real lame reason
I didn’t know Tony Charaf was an engine guy…while interesting I think he is able to see the big picture even if that is his preferred area. John is too. It doesn't really matter, we aren't staffed to grow airframe by a big chunk, and engine is where the money is, but that doesn't me airframe doesn't have some money in it.
In the meantime, DL is insourcing a lot more than other carriers and is, as you note, doing work for insourcing customers than it does not do on its own fleet. Whether they are losing money doing that insourced work they don’t otherwise do, I don’t know. But I would hope – and assume – that if they are losing some money, they are making up for it with other high value work and the prospect to keep some clients for the very long term.
I would hope we aren't doing anything at a loss. I wouldn't want to increase our cost to make losses, but i think growing our airframe work, so that it is cheaper to do MRO airframe work isn't a bad idea. We could offer some pretty mean package deals to 737NG, 747, 757, 767, A320 operators. That is something a good bit of the MROs can't do. All would be backed by the Delta TechOps name.
Glad to discuss these key issues with you and hope doing so will bring some understanding on both sides.

I don't want Delta to lose money, I just think things could be done to better the QOL of our employees along with grow the MRO.

 

[WorldTraveler]

I am totally with you that QOL should not be sacrificed, regardless of the goals – more MRO, less outsourcing. I would like to see all three of those as goals.
But QOL esp. is a very subjective goal… people perceive work rules differently…. But more importantly, if people had to pick and choose whether QOL issues or higher pay are more valuable, it isn’t at all clear that QOL issues would win. And let’s be honest – a company can measure its competitiveness w/ respect to “hard compensation” such as salaries and benefit costs… but it is much harder to rank QOL in total, esp. since the higher levels of vacation accrual are a difference for only a portion of the workforce.
.
But let me digress for a few minutes and attempt to give you a global perspective of what you are asking…. As you know the middle class in Brazil, China, and India among other countries is rapidly growing – in some cases solely by free market forces as those economies grow and in some cases such as in Brazil because the government is transferring via taxation and redistribution enormous amounts of wealth from the upper middle class and rich (including companies) to lower middle class individuals in an attempt to create a larger middle class comparable to what HAS existed in the “developed world. But in many parts of the world the emerging middle class still is a long ways from equality with the established middle class of the “developed nations” or of the former middle class even in their own countries.
.
Brazil is being hit by strikes in a number of public sectors, including by police in some states. Public safety is being compromised and murder rates are up significantly where strikes have occurred… the federal government is trying to keep it from all blowing up on the eve of Carnival (Mardi Gras), one of the wildest and biggest parties of the world, yet police are using that as leverage to increase their wages, which in some cases is barely more than minimum wage – and minimum wage in Brazil is lower as a percentage of GDP per capita in Brazil than it is in the US.
In Curitiba, Brazil’s 7th largest city of about 3.5M people in the south of the country, public transport employees are on strike for the 2nd day. The city whose public transport system and urban planning have been hailed as innovative in awards from around the world. In addition to several types of “normal buses” Curitiba has dedicated bus lanes that serve very high capacity (300 passenger) multi-sectional customized busses built by Volvo in which passengers board from covered tubes in which they pay their tolls and can transfer between similar busses, making the system not only very efficient for how quickly it can move people but also very low cost for a system that carriers 2 million passengers per day. Yet yesterday and probably today, virtually no buses will operate in Curitiba because the fare collectors and drivers are (IMHO rightly) tired of being paid very low wages but also working under very inhumane conditions including stifling mgmt oversight via inspectors (why is your bus late, is your uniform completely clean w/ no holes, why are you a couple dollars short on your fares) to work rules that are throwbacks to the dark ages (eating lunch in the 5 minutes between the “turn” at the end of the line – which can evaporate if traffic conditions are bad – but also when you are supposed to do your safety inspection of the bus for the next run, working 6 hours or more w/o an opportunity to have a legitimate opportunity for a bathroom break instead of having to pee in bushes on the side of the road)….
Obviously every culture and country has to work out their own issues and wealth can only go so far – but there are clearly QOL issues facing a lot of people even in countries that have fairly high regard for human rights and who are heavily influenced by European and American culture (Curitiba is largely populated by descendents from eastern and northern Europe along with Italians and Portuguese (vs. Spaniards in Hispanic Latin America).
Why does this matter to you at DL?
QOL affects ALL workers and there is no “finish line” when we say we have enough. QOL related benefits have costs and many workers do not view them the same way you might. And QOL issues affect different people differently so it is a lot harder to expect to satisfy everyone’s desires in the same way….
My suggestion – keep fighting for and asking for what matters to you. I still don’t understand why DL doesn’t budge on extra vacation time but they haven’t…. so see if there aren’t other things that you could gain…. Or sock away the money as fast as possible and then get out as soon as you can…. (rumors of another early out are floating around).
As for growing MRO and doing more work inhouse, I do believe that a lot of maintenance will return to US shores, if for no other reason that cost savings aren’t what they once were because foreign labor expenses are growing and foreign shops are full of demand in their own parts of the world. There is a growing movement toward jobs returning to the US – and some states are offering incentives to bring jobs back. Economies are both cyclical and self-correcting – if costs get too high, alternatives will be found while if the cost differences become less, the “easier” alternative will be pursued again…..
.
In DL’s case w/ respect to maintenance, I still think it is very possible that DL could acquire other carriers which could either allow DL to reduce the number of older aircraft in the fleet or acquire maintenance operations… specifically, part of the appeal DL could have to AA labor and other creditors is that DL knows what to do to maximize the value of maintenance facilities far more than any other post BK US airline. Even after significant cuts by AA at AFW and elsewhere, a combination of DL Tech Ops and TUL would be mind-boggling in scope…..
.
One thing is for certain whether in Brazil or Atlanta, Georgia… the story is still being written. Make sure your name – and more importantly your values – become a significant part of that story.

BTW, here are a few links about the labor situations in Brazil. Even if you don't read Portuguese or use google translator, there are enough pictures to convey alot of the message.
http://www.gazetadopovo.com.br/

http://www1.folha.uol.com.br/cotidiano/1048335-com-baixa-adesao-pm-e-bombeiros-suspendem-greve-no-rio.shtml

 

[topDawg]

I am totally with you that QOL should not be sacrificed, regardless of the goals – more MRO, less outsourcing. I would like to see all three of those as goals.
But QOL esp. is a very subjective goal… people perceive work rules differently…. But more importantly, if people had to pick and choose whether QOL issues or higher pay are more valuable, it isn’t at all clear that QOL issues would win. And let’s be honest – a company can measure its competitiveness w/ respect to “hard compensation” such as salaries and benefit costs… but it is much harder to rank QOL in total, esp. since the higher levels of vacation accrual are a difference for only a portion of the workforce.
.Pay is always, and will always be number one BUT i get that I can't work in the hangar and get 50 an hour. I get that my cost can't be to great or I(but mainly those JR to me) wont have a job. I can live pretty happy at 30-35 an hour. (but I live in Atlanta and not New York) So I put more focus into stuff like time off, 401K match and Health care. (along with at work stuff). But that is me, most of the SR guys would sell my ass down the river for FX rates, which is just human nature for most.
But let me digress for a few minutes and attempt to give you a global perspective of what you are asking…. As you know the middle class in Brazil, China, and India among other countries is rapidly growing – in some cases solely by free market forces as those economies grow and in some cases such as in Brazil because the government is transferring via taxation and redistribution enormous amounts of wealth from the upper middle class and rich (including companies) to lower middle class individuals in an attempt to create a larger middle class comparable to what HAS existed in the “developed world. But in many parts of the world the emerging middle class still is a long ways from equality with the established middle class of the “developed nations” or of the former middle class even in their own countries.
.
Brazil is being hit by strikes in a number of public sectors, including by police in some states. Public safety is being compromised and murder rates are up significantly where strikes have occurred… the federal government is trying to keep it from all blowing up on the eve of Carnival (Mardi Gras), one of the wildest and biggest parties of the world, yet police are using that as leverage to increase their wages, which in some cases is barely more than minimum wage – and minimum wage in Brazil is lower as a percentage of GDP per capita in Brazil than it is in the US.
In Curitiba, Brazil’s 7th largest city of about 3.5M people in the south of the country, public transport employees are on strike for the 2nd day. The city whose public transport system and urban planning have been hailed as innovative in awards from around the world. In addition to several types of “normal buses” Curitiba has dedicated bus lanes that serve very high capacity (300 passenger) multi-sectional customized busses built by Volvo in which passengers board from covered tubes in which they pay their tolls and can transfer between similar busses, making the system not only very efficient for how quickly it can move people but also very low cost for a system that carriers 2 million passengers per day. Yet yesterday and probably today, virtually no buses will operate in Curitiba because the fare collectors and drivers are (IMHO rightly) tired of being paid very low wages but also working under very inhumane conditions including stifling mgmt oversight via inspectors (why is your bus late, is your uniform completely clean w/ no holes, why are you a couple dollars short on your fares) to work rules that are throwbacks to the dark ages (eating lunch in the 5 minutes between the “turn” at the end of the line – which can evaporate if traffic conditions are bad – but also when you are supposed to do your safety inspection of the bus for the next run, working 6 hours or more w/o an opportunity to have a legitimate opportunity for a bathroom break instead of having to pee in bushes on the side of the road)….
Obviously every culture and country has to work out their own issues and wealth can only go so far – but there are clearly QOL issues facing a lot of people even in countries that have fairly high regard for human rights and who are heavily influenced by European and American culture (Curitiba is largely populated by descendents from eastern and northern Europe along with Italians and Portuguese (vs. Spaniards in Hispanic Latin America).
Why does this matter to you at DL?ha good question
QOL affects ALL workers and there is no “finish line” when we say we have enough. QOL related benefits have costs and many workers do not view them the same way you might. And QOL issues affect different people differently so it is a lot harder to expect to satisfy everyone’s desires in the same way….as I said, pay will always come first. That is why you seem them giving a raise again, but at some point that will have to stop.
My suggestion – keep fighting for and asking for what matters to you. I still don’t understand why DL doesn’t budge on extra vacation time but they haven’t…. so see if there aren’t other things that you could gain…. Or sock away the money as fast as possible and then get out as soon as you can…. (rumors of another early out are floating around).
Ha. I am not leaving Atlanta thus I am staying put at work. Delta isn't that bad(yet) but we do need change.
I hear early outs with health care, but for us it wont be many that will take it or TechOps will have to do ALOT of hiring. We are already pretty short but the GO says no(or very few) warm bodies right now. Something will have to give soon or work will have to go out.
As for growing MRO and doing more work inhouse, I do believe that a lot of maintenance will return to US shores, if for no other reason that cost savings aren’t what they once were because foreign labor expenses are growing and foreign shops are full of demand in their own parts of the world. There is a growing movement toward jobs returning to the US – and some states are offering incentives to bring jobs back. Economies are both cyclical and self-correcting – if costs get too high, alternatives will be found while if the cost differences become less, the “easier” alternative will be pursued again…..
I don't disagree. I think at some point Delta is going to say "well damn, Mexico and China are in-line we will just do it in house" but the question is when does this happen. I would rather see our 37s (new and old) and 777s never see a 3rd party HMV. That is my goal, i just don't think it will happen. (i think some 800s have already made the trip to hell....I mean ARR)
.
In DL’s case w/ respect to maintenance, I still think it is very possible that DL could acquire other carriers which could either allow DL to reduce the number of older aircraft in the fleet or acquire maintenance operations… specifically, part of the appeal DL could have to AA labor and other creditors is that DL knows what to do to maximize the value of maintenance facilities far more than any other post BK US airline. Even after significant cuts by AA at AFW and elsewhere, a combination of DL Tech Ops and TUL would be mind-boggling in scope…..
.AA and DL period would be mind boggling, but getting TUL doesn't mean much if they are going to close bays and add them in GDL. I would love to see T800s done in house(which can be done at AFW....by TESAL not sure if they will be shut down too)....but i think if we merge with anyone it will be AS. I don't think Delta wants AA, we the ramp and the FAs would all going union, and I think that would kill MRO. Plus I'm not sure i trust the TWU......
One thing is for certain whether in Brazil or Atlanta, Georgia… the story is still being written. Make sure your name – and more importantly your values – become a significant part of that story.

BTW, here are a few links about the labor situations in Brazil. Even if you don't read Portuguese or use google translator, there are enough pictures to convey alot of the message.
http://www.gazetadopovo.com.br/

http://www1.folha.uol.com.br/cotidiano/1048335-com-baixa-adesao-pm-e-bombeiros-suspendem-greve-no-rio.shtml

 

[Kev3188]

According to AA, TAESL is going to stay open...

 

[WorldTraveler]

an update on a couple of the Brazil events.
The Curitiba transit strike ended with the union agreeing to a 10.5% raise plus an increase in their monthly cost of living allowance of about $125 USD equivalent and a one time payout of a couple hundred dollars later in the year.... I don't know about the QOL related stuff like bathroom and lunch breaks - the strike did yield some benefit but it didn't result in wild increases.
In Rio, 73 police who participated in strike activity will face hearings because they apparently had a no-strike clause... and 71 of those people posted comments on on-line forums advocating a full shutdown of police activities... and the police regularly discovered these comments since they regularly monitor social media as part of their public safety duties. Rather chilling.
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Both of these incidents go to show that the progress of labor even in countries where labor has a better bargaining position makes progress very slowly.....
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And when you compound that in the US context with the fact that more American workers - who have longed worked some of the longest hours in the industrialized world - prefer money than QOL issues, then it is even harder to convince management to provide benefits which are not only costly but don't provide the biggest bang for the buck that many workers want - including younger, less long-term focused employees. Remember that few Americans now have the expectation that they will spend a career with one company, making most airline workers an exception.
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My guess is that the chances are better than 90% that DL participate in consolidation with another US airline - and the likelihood is that they will have either a younger fleet or significant orders for new equipment. DL is unique in having so few orders given the age and size of its fleet but doing so gives DL financial flexibility and increased opportunity to pursue deals that might become available. At the same time, DL has said they intend to keep aircraft longer than the traditional 20 year timeframe - more likely 30 years - because 20 years is not long enough to recover the cost of capital and technological advances are not coming fast enough to justify a faster turnover. That viewpoint is good for mechanics and not as good for airplane makers.
I doubt if DL will do large Trent overhauls in house unless they acquire significant numbers of used 777s (a possibility as the 787 comes on the market) or a large RR 77ER operator.
Yes, I do believe there is a good likelihood that DL will bring more and more airframe overhauls back to the US and I also believe there is more to the story about why DL apparently chose not to move forward with expanding OH in MSP. Hopefully in time their reasoning will become clear.

 

[topDawg]

According to AA, TAESL is going to stay open...

I would have been kinda surprised if they shut it down. Brings in a ton of money and i believe is the only T800 overhaul facility in the US. (and one of only a very few in the world.)

I do think UAL has a test cell that can handle a T895 at SFO but I'm not sure. (regardless they don't and wont be doing T800s)

 

[topDawg]

an update on a couple of the Brazil events.
The Curitiba transit strike ended with the union agreeing to a 10.5% raise plus an increase in their monthly cost of living allowance of about $125 USD equivalent and a one time payout of a couple hundred dollars later in the year.... I don't know about the QOL related stuff like bathroom and lunch breaks - the strike did yield some benefit but it didn't result in wild increases.
In Rio, 73 police who participated in strike activity will face hearings because they apparently had a no-strike clause... and 71 of those people posted comments on on-line forums advocating a full shutdown of police activities... and the police regularly discovered these comments since they regularly monitor social media as part of their public safety duties. Rather chilling.
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Both of these incidents go to show that the progress of labor even in countries where labor has a better bargaining position makes progress very slowly.....
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And when you compound that in the US context with the fact that more American workers - who have longed worked some of the longest hours in the industrialized world - prefer money than QOL issues, then it is even harder to convince management to provide benefits which are not only costly but don't provide the biggest bang for the buck that many workers want - including younger, less long-term focused employees. Remember that few Americans now have the expectation that they will spend a career with one company, making most airline workers an exception.
.This is very true. A lot of the young bucks who don't have families don't care about time off if they bid and get Fri/Sat/Sun or Sat/Sun off. For those that have a birthday for the 10 year old on a Thursday its nice to have the time to take it off. Young people are also happy with a weekend in LAS while older people like week long cruises with the family. Its the same problem with out sourcing, Its not my job so why do i give a rats ass? People are starting to come around on that though. Not fun when the air from the meat grinder is fanning your butt.
My guess is that the chances are better than 90% that DL participate in consolidation with another US airlineSigh...agreed - and the likelihood is that they will have either a younger fleet or significant orders for new equipment.agreed to a point. DL is unique in having so few orders given the age and size of its fleet but doing so gives DL financial flexibility and increased opportunity to pursue deals that might become available. At the same time, DL has said they intend to keep aircraft longer than the traditional 20 year timeframe - more likely 30 years - because 20 years is not long enough to recover the cost of capital and technological advances are not coming fast enough to justify a faster turnover. That viewpoint is good for mechanics and not as good for airplane makers.and we "have" to get our debt down to 10B, and New planes aren't bad. Us carriers wont be like an SQ where we park a plane before its first HMV or heavy C check. We will always have work, a good bit of work, to do. Unless US/UA/AA and DL merge.
I doubt if DL will do large Trent overhauls in house unless they acquire significant numbers of used 777s (a possibility as the 787 comes on the market) or a large RR 77ER operator. agreed again. Our next engine (IMO) done in house will be the V2500s, M90 engines. We will have 100+ engines and it is a growth MRO engine for the A32S with V2500s. If that isn't it then it will be LEAP-X when we order the 737MAX [/b
Yes, I do believe there is a good likelihood that DL will bring more and more airframe overhauls back to the US and I also believe there is more to the story about why DL apparently chose not to move forward with expanding OH in MSP. Hopefully in time their reasoning will become clear. its not hard to figure out why. 1) the base up there was never taken care of like Atlanta over the last 5-10 years because NW was dumping everything they could. 2) it has been cut in half. NW use to have a base by the terminal and then the building C complex. 3) Growth in MSP would likely mean bringing back pro Union ev NWers. Delta doesn't want to do that. I personally think we are going to try an hire ~1,000 more warm bodies at TechOps, that plus the 4,000-5,000 AA wants to cut will tip the scales in Delta favor for non-union TOC.

I personally think AA is our target and if we get a No then AS will be our target. I do think a large part of the AA order would be dumped though. (namely the 200 leased A319/A321s.) Also think the A320NEO and 737MAX would be pushed back/canceled or converted to 737NGs.

 

[WorldTraveler]

I personally think AA is our target and if we get a No then AS will be our target. I do think a large part of the AA order would be dumped though. (namely the 200 leased A319/A321s.) Also think the A320NEO and 737MAX would be pushed back/canceled or converted to 737NGs.

I agree with the priority of DL's strategic goals.... I think it is less than a one in three chance that DL will succeed with AA but acquiring AS should be a fairly easy transaction - and AA has to factor a DL acquisition of AS into AA's reorg plan.
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I think DL would prefer not to duplicate A and B models doing the same thing - ie the 320 and 737 families; you do it as part of the merger, but you have to ask what the value of doing it on a long term basis is, other than in AA's case which is to acquire alot of airplanes quickly in order to drive down price.
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As for the Trent overhauls, unless DL acquires AA or buys dozens of used 777s, the case is pretty weak for even wanting to gain the competency to overhaul a relatively few number of engines, even if DL could be certified as an RR approved station.
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There are many other competencies that could be developed and used to make money, including the ones you note that DL already has such as more airframe work.
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I don't think you can underestimate how much DL is driving to have some of the best finances in the industry - a key factor that will be considered during future stages of consolidation.
Let's not forget that the value of AF-KL has sunk dramatically along with other European carriers.... while there may be little strategic value gained above the current JV, don't rule out that DL couldn't use its shekels to go shopping elsewhere in the world.

 

[tom barry]

WT,

Still opining about DL "the invincible" aye ?

Your OWN words are Correct. DL NEEDS more LHR, more SA (especially from MIA) and more west coast.
(guess that PDX brilliant move didn't work out to expectations) ! So, lets see. Which airline has a Monopoly on your "4 things wish list". Is it US ? Ah NO. Is it WN ? No, guess again. Frontier ?
Nope. (I know) JET BLUE ! "BLAAAAAAAAAAAAAA" (thats the sound of the ungodly BUZZER going off, to inform you that the Time IS UP)

It's A A ! (Who is presently going through the "get SCRUBBED real Clean $$$$ BK car wash" ) !

Yes (thanx to the Famous RED TAILS), DL is looking pretty good. ($$$$$) You'll get no argument from me on DL's Current situation. But I really have to laugh about all the "Buy AA in BK talk", or even thier demise. All it would take is (hypothetically) Warren Buffett to go buy B6 and hand it over to AA, (WT, don't forget AA = BA, JL, and Qantas) then go and pick up as many 777-200LR's that DL has now, then PRESTO, DL is relegated back to the LESS than # 1 spot.

Moral of the story.
BEWARE the wounded Lion, who's getting "born again" in BK court !!!!!!!!!!!!

 

[WorldTraveler]

Tom,
With all the AA BK threads going, most of which have elements of how AA will end up strategically, I'm not sure why you want to add one more to the list... but....

we know how BK is supposed to work... but in your zeal to see the newly rejuvenated, you seem to gloss over the fact that I long ago predicted that AMR's BK would result in deeper cuts and far greater competitive exposure and attacks than any other airline has endured - and of course a greater chance that other carriers will succeed at accomplishing their strategic intentions at AA's expense. You also gloss over the fact that no airline has emerged from BK with the huge competitive advantage that you think AA will have - it takes years of disciplined taking advantage of everything that AA gained in BK to make it all work... and it also presupposes that everyone else will just sit by and allow AA to implement its strategic wishlist (do you really think DL, UA, and WN will have no competitive responses to AA's plans to grow in NYC, CHI, and LAX - or even Dallas/Ft. Worth) AND that other carriers have lost the competitive advantages they gained in BK?
No, other carriers won't sit still, it will take years for AA to achieve what it wants to do, those carriers have not lost their own strategic advantages, and AA will remain in the position of having to rebuild its business while competing against stronger competitors than the industry has ever seen - both in terms of size and finances.
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It also is noteworthy that while AA has the strategic advantage in Latin America and LHR but other carries do manage to make their presences work in those regions - and notably, DL's financial performance in Latin America and LHR is more on par with the industry average than AA's is to continental Europe and Asia, regions where AA is at a significant disadvantage to the industry.
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It still remains that DL and UA are generating profits and have their own strategic wishlists which they might well choose to start working on....
whether that includes an AA or US acquisition is far from certain but AA joins US as being too small to control its destiny relative to the two megacarriers and not strong enough financially to protect itself from strategic and tactical attacks from carriers both larger and smaller.