DL posts solid profit; DOT data shows strategies working

Split hairs over the numbers?

They are what they are. You can either accurately attribute them, or you can do what you chose to do.

And your condescension over whether I understand financial statements and DOT data is dripping.

You will not find any reputable analyst call 31.6% "almost 40%" in the table 1a DOT data.

Since I have no clue on how you arrived at your conclusion, I will post the link to the table data and we can let everyone else decide how you arrived at your number.

http://www.dot.gov/s...012 Table1a.xls

People will need to scroll down to the LGA-MIA market data to see for themselves.

Maybe you can guide them from here since I am clearly lost...

GQ--

It never ceases to amaze me that so many corporate mandarins think that wearing a uniform to work = ignorance.

Thanks for posting the table, BTW.
 
GQ--

It never ceases to amaze me that so many corporate mandarins think that wearing a uniform to work = ignorance.

Thanks for posting the table, BTW.
Thanks Kev.

FWIW, I stopped wearing a uniform to work the day after I went on strike at NWA.

I have worn a tie ever since. I also knew then how to read financials and other airline market data as did many of my fellow employees at NWA.

As a side note, I think that one of the biggest reasons we went on strike was because a very large percentage of NWA mechanics had done so well in the stock market and had worked so much overtime that they had paid off all their homes and owned all the toys they wanted. Going to work at NWA had become a way to maintain health benefits (and because we loved working on airplanes).

Sorry for the thread drift.

I will say again that I commend Delta for their performance. I think they are well suited to succeed into the next 5+ years. As long as their plan to keep the older aircraft works out, they will be great. When we decided to keep the DC-9 and do the major mods, I was always worried that if we had a major structural failure of a DC-9, that would devastate the business plan. If at any point, the DC-9 had suffered a 787 like grounding due to structural issues, the airline would have not recovered. We were so reliant on that aircraft back then. It was a tribute to us that we were able to keep those in the air.

I also think that AA has not seen its best years yet. Post BK, they may come out a force to reckoned. It does not look that way right now, but they can turn it around with a few bold moves. Remember how bad Continental was?
 
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Hey Q,
if you and your PMNW mechanic buds were doing no more than mooching off of NW's health care benefits, then it is no wonder that The Brutal Red Axe decided it was time to let you all go.... since you would like to nitpick over numbers, let me remind you that the stock market crash began well before the mid-90s when you were deemed to be an oversized anchor to the operation. If you were doing so well in the stockmarket by that time, then you should most certainly be independently wealthy, retired, and rolling in the cash. Most of the rest of us didn't do quite so well with the stock market of the early and mid 2000s and we still have to work, sigh.

K,
apparently in your version of word association anyone that posts good numbers or an opinion about your employer who has managed to stop your dreams of a world full of unions is your enemy - and a "corporate mandarin?"
How were you taken to be ignorant if you didn't even know where the table was?

And let's back up and note once again that I acknowledged to FWA that the original share number I mentioned was a composite of LGA and JFK data... there is a difference of at best a couple percent between his numbers and mine that are attributable to other components of the data that are not shown in the simple data you are looking at.
But, let's drop the exact numbers and acknowledge that DL has gained even 30% of the market share in LGA-MIA and over 40% in JFK-MIA which is absolutely accurate with the data that FWA posted. Just like the question about the example of a non-union that has ditched seniority for non-union employees who are represented at other airlines (remains unanswered), the question for you as it is for FWA and G what difference does it really make if DL has only obtained 30% of one of your largest markets and done it in less than six weeks. I can also tell you that the number will continue to grow in the quarters to come because the effects of the AA operational issues had not largely occurred when these numbers were measured.

I can also tell you that I was dead right about the performance of DL relative to other carriers in the industry, including WRT profit sharing now that all carriers are reporting. DL employees did bring home the largest profit sharing in the history of US aviation. DL's financial performance far exceeded that of UA's who had an absolutely horrid 2012. WN is making solid progress in adjusting to its new world but continues to walk away from DL, US is showing solid profits on the backs of low paid labor, while AA and UA both continue to throw one blow after another at each other and both continue to underperform DL and other carriers in the industry.

And the greatest source of consternation to you is clearly that your desire to see DL further unionized falls flat precisely because the employees who are really interested in their own economic well-being instead of a money-losing ideology that will cost them are not about to walk away from supporting the company that is treating them better than any legacy airline has treated its employees this side of deregulation, and perhaps ever.

You call 'em "corporate mandarins" if you will... I'll continue to post the "bad news" for your unionization efforts and the great news for everyone else that is affiliated w/ DL. I am, after all, celebrating the best in commercial aviation.

Q,
lots of people would like to think that AA can turn it around... but you find an example of when an airline has emerged from BK continuing to lose revenue in its key markets and unable to gain a cost advantage that is necessary to protect its markets and then we can talk about the future of AA and UA, both of which continue to be nothing but a source of key revenue for other airlines to poach just like they have been for much of deregulation.
 
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mooching refers to the part about staying there for the health benefits.

There is nothing wrong w/ winning in the stock market or doing your job well... that IS what we all want our children to grow up capable of doing.

But there were a number of airline employees who have worked for their employer only as much as necessary to gain benefits, including health insurance. Most carriers have imposed minimum hours that must be actually worked in order to retain benefits or prohibit the practice of engaging in shift swaps that don't involve a true swap - so that the total hours worked for both employees remain the same.

American business is no longer in the position of providing benefits for employees who are not willing to work the required hours necessary to obtain those benefits.

I'm not sure whether NW allowed its mechanics to swap hours away or if that is what Q was referring to but DL doesn't allow it now and didn't before the merger - even when health care costs were a whole lot less.

It doesn't change that DL employees are now some of the best compensated among network carriers and brought home the best profit sharing in the industry in 2012 and have a good chance to repeat it in 2013.

BTW, the time cited in the post above should be six months, not six weeks
 
Thanks Kev.

FWIW, I stopped wearing a uniform to work the day after I went on strike at NWA.

I have worn a tie ever since. I also knew then how to read financials and other airline market data as did many of my fellow employees at NWA.

As did many of mine. And for those that didn't, a lot of the uber-senioir guys in my first station were all too happy to help. I've always felt it important for labor to be able to read/interpret them when dealing with the company.

As a side note, I think that one of the biggest reasons we went on strike was because a very large percentage of NWA mechanics had done so well in the stock market and had worked so much overtime that they had paid off all their homes and owned all the toys they wanted. Going to work at NWA had become a way to maintain health benefits (and because we loved working on airplanes).

I certainly wouldn't doubt it. In my experience, those that had their "house in order" were always more willing to act strategically, as opposed to making fear-based decisions.

Did well in the stock market, worked overtime, enjoy working on airplanes = mooching?

Who knew? :rolleyes:
 
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while the emotionally driven pile-on may seem fun, it rarely addresses the root issues of the conversation... I went right to these comments

FWIW, I stopped wearing a uniform to work the day after I went on strike at NWA.

I have worn a tie ever since. I also knew then how to read financials and other airline market data as did many of my fellow employees at NWA.

As a side note, I think that one of the biggest reasons we went on strike was because a very large percentage of NWA mechanics had done so well in the stock market and had worked so much overtime that they had paid off all their homes and owned all the toys they wanted. Going to work at NWA had become a way to maintain health benefits (and because we loved working on airplanes).
I have no idea what all Glenn is saying in this post - whether it means he and other NW mechanics had no skin in the game at NW so they were willing to take the risk of walking off the job, whether he was one of the many airline employees who worked at the airline just enough to get benefits, or something else... but my point remains that if any of the two above are the case - and perhaps others, then it is no surprise that NW management threw down the gauntlet and knocked thousands of union members off the rolls and handed DL a maintenance operation that will most likely never be threatened by a union vote since PMDL mechanics have shown no interest in unionizing, even in a profession that is highly unionized elsewhere in the airline industry.

that wasn't supposed to be the heart of the conversation but might well turn into a key focus of this thread after all.

As to the question of labor understanding finances, I wholeheartedly support doing so and am thrilled that Q not only reads them but apparently knows how to use them.
I have repeatedly helped labor leaders on this board understand the detailed financial information that is available in the airline industry - and would be more than happy to post the e-mails I have sent to some of them to show that I have not only encouraged them to use the information but have sent the information to them. Let me know when you want me to provide those emails.... which clearly show I have never treated anyone here as ignorant or incapable of understanding the data.

I have also repeatedly encouraged labor to make the commitment to walk away from companies to hold onto their commitments to labor - bur I have rarely seen airline employees be willing to do that.... and specific to DL, most of the labor leaders who pushed the organizing campaigns are still at work at DL - which not only shows that the company hasn't punished them as some here have asserted but that the "terms of employment" at DL aren't as onerous as some would like to argue. Perhaps the greatest tip of the hat goes to those people who are willing to accept the situation they are faced with or walk away from the situation - financial benefit or not - if they can't agree w/ the principles of that situation.

In fact, the simple reality is that DL employees - including PMNW employees are not only more happy w/ their employment experience at DL than they have been in decades but the notion that they are going to walk away from what they have including 6.67% profit sharing checks and growing salaries in order to engage in the combative relationship w/ mgmt that typifies most airline labor relationships is just downright silly.

Finally, while in typical forums fashion, we have a knock down drag out over a couple relatively minor disputes about market specific data while there is still no ability or willingness to address the repercussions and implications of those numbers - even if they are 20% off. The simple reality is that labor shouldn't care whether DL succeeds in LGA-MIA or not... that level of detail is mgmt.'s responsibility. If labor can understand those details, more power to them. Knowledge is power - all knowledge is all power. Labor, however, should be well aware of the overall finances of the company and how labor benefits or is at risk because of those finances.

The clear overall trend from DL's performance vs. that of its peers is that DL is doing very well financially relative to its peers and continues to improve its financial performance, to the BENEFIT of its employees. In contrast, UA has committed to the first round of pay increases as part of the merger even though they are a long ways from integrating the companies, two years into the merger. UA's costs have soared while their revenue is flat - unchanged - against higher costs. UA is DL's largest competitor. You could go down the list of airlines but no US airline employees are better positioned for increased pay than are DL employees driven precisely because the company's performance in LGA-MIA isn't an anomaly but is part of a much larger trend to very aggressively grow its revenues, often at the expense of its competitors.

Understanding those guiding principles ensures that DL employees - all of them - are anything but ignorant.

 
What it meant WT was that many were financially able to withstand a prolonged strike because we had our house in order.

To say anyone was "mooching" because we chose to go to work everyday to do what we loved doing is a stretch...even for you. We had the added bonus of having a good wage, great work rules, and very good health benefits. By the way, those were negotiated. You do know that a CBA is signed by two parties. Did you consider yourself "mooching" when you drew your paycheck from Delta?

By the way, I am surprised that you do not know that one can do well in bear markets as well as bulls. Most made the bulk of their money during the tech boom as day traders, then rode the roller coaster after that. NWA was paying huge amounts of overtime in the late 90's and most mechanics (especially in DTW) were working 7 days a week, 12-16 hours a day.

Yep, moochers...

Back on topic. I do think you are underestimating what the future holds for AA. I think they will make some very bold moves within the next 2 years. I also think there will be someone else come in and make them. We will see.

Delta has a solid business plan and have made some very smart, strategic moves. I was wrong about the refinery.
 
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you know, Glenn, we have done more to understand each other in this thread than perhaps in any previous thread.


I have never doubted that you did your job well... I have never doubted that NW employees ran a good airline. I have said that repeatedly.
You addressed in your statement that you felt that NW mechanics were financially well off enough to endure a painful strike... and I absolutely am glad you that you came out on top personally as a result of how NW handled the situation. I can tell you that you - perhaps collectively as NW mechanics - are not representative of most airline workers who can endure a financial setback and keep going. most Americans, in fact, are not that well prepared.
But it still comes down to that you took a stand for your own personal principles and I commend you for doing that. To be clear, though, it cost the labor movement a whole lot and perhaps contributed to the inability of other PMNW unions to win at DL. Hard to know for sure but maintenance is one of the historically easiest groups to unionize behind pilots for clear economic reasons.

If my words "mooching" were offensive and inaccurate as a description of your relationship to NW, then I apologize. Your post above clarifies that you were financially prepared to accept the ramifications of standing on your principles, not that you weren't fully invested in the airline. Thank you for taking the time to clarify.

No mooching does not mean doing your job in return for a salary. The only context in this discussion which mooching is appropriate would have been if you were working for NW a minimum amount in order to gain benefits - which you said you didn't do.... presumably if it was allowed, there were people who did it since that happens at just about every airline that allows the practice.

I do actually know that people gain on the downside as well as the upside but few personal investors are capable of knowing how to do that well... institutional investors are usually more capable of winning at the expense of small investors. Again, I have no qualms if you succeeded in that environment.

If you don't mind saying, what type of work do you do now?

As for your assessment of AA, we most certainly will see - but I don't share your optimism that AA can defend itself. The DOT data which I cited shows that AA's network advantages have either been matched or overtaken by other airlines w/ the exception of Latin America. If you need examples since you have the DOT data, look at every one of AA's Pacific routes except for DFW-NRT and you will see that UA and/or DL outperforms AA in every market. Even in Europe, AA has no clear financial advantage and the whole point of even mentioning AA's performance in NYC is because AA is losing their advantage in NYC - and perhaps has already lost it.

As much as you and others want to believe otherwise, there is no evidence in US airline history of a legacy airline regaining market share that it has lost to another carrier to any significant degree. DL has gained what it has in NYC because AA had huge amounts of revenue that was/is loyal to AA and DL has been systematically winning that revenue over to DL. Even in Chicago and on the west coast despite their own merger related problems, UA has increased its share of revenue at the expense of AA.

Given that AA is now either a standalone or in the position of doing a merger - any combination - with a carrier that will not be as large as DL or UA, it is very hard to realistically believe that AA can grow their revenues sufficiently to compete w/ DL and UA. And it still doesn't change that DL has gained very healthy shares of key AA NYC markets and DL has virtually no history of giving up local revenue to other carriers except for losing about 6% of the local market back to AA when it closed its DFW hub. Given that DL then turned around and redeployed assets to NYC where DL gained far more revenue and share, the decision for DL to give up that local revenue in DFW was valid.

AA has to regain revenue from DL and other carriers in key markets plus grow its revenue far more than what AA has even right now... that is a very tall order - and there are no signs that other competitors are walking away from their strategies to poach (mooch if you like) key revenue from AA.

As w/ all things, we will see and I am happy to be shown to be wrong if I am.

thank you for telling me about more about yourself... I have a newfound and appropriate appreciation for your capabilities.
I would add that discussing financial aspects of the industry will help establish that you are in your "comfort zone" instead of some of the other interactions that have characterized our discussions on this forum.
 
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It is amazing how clear headed one is when they're financial house is in order.

It is maddening how many people aren't yet there, and continue to make fear-based decisions.
absolutely, sir.

Americans are becoming soft in their ideals because they don't have the financial resources to take the risks that are necessary to stand up for their principles.
It is not easy to walk away from the comfort of what one knows to walk into something else unknown - knowing only that there will be sacrifices - of an unknown type and magnitude.

Next week we as a country will celebrate the 148th anniversary of one of the most significant moments in human history as the US Congress decided that the pain of the Civil War and the associated issues required a determined response. Our President took a stand and it cost him his life - but the world was changed because of his commitment to an ideal in which he believed.

May each of us today be as committed to pursuing the ideals in which we believe, even if it comes at great economic cost. Many times, though, the right decision will lead to prosperity for all.

The success that DL employees are enjoying stems directly from their belief in an ideal that doesn't look like the rest of the airline industry but has helped make Delta and its employees successful - and provided a platform from which the company can continue to ensure the success of all Delta stakeholders.

Doing the right thing may be costly up front but almost always results in the right reward at the right time.

Too few people, however, fail to see beyond the here and now.
 
DL posted a solid 4th quarter and full year profit of $238M and $1.6B respectively. 4th quarter special items included fleet/facilities restructuring and debt extinguishment

.http://news.delta.co...?s=43&item=1848

Other items:
Sandy cost DL $100M including delaying ramp up of the refinery which lost money in the quarter.
DL outperformed the industry on unit revenues….for the year DL’s mainline capacity was flat while regional carrier capacity was down 8.5%.

DL’s CASM in the 4[sup]th[/sup] quarter increased but remained lower AA, the only other network carriers that has reported their 4[sup]th[/sup] quarter financials.

DL’s RASM is also higher than AA’s for the year to date and DL's RASM growth outperformed the industry.


DL will pay out almost $375M in employee profit sharing or 6 2/3% of employee salaries, perhaps the highest level of profit sharing in the airline industry.

DOT data for the 3[sup]rd[/sup] quarter has also recently been released and shows that DL’s strategies for 2012, which predominantly focused on NYC are delivering solid results.

DL is now the largest domestic airline from the 3 NYC major airports, has almost a 40% market share at LGA, and is the largest revenue carrier at both LGA and JFK.

After the slot deal, DL now has almost 40% of the local market in LGA-MIA, almost half in LGA-PIT, and has increased its share of the LGA-ORD local market to 19%. DL’s schedule post slot deal includes service to every airline hub that a competitor serves from LGA and DL has reached a 15% or more share of the local market in each of those hub markets.

Outside of NYC, DL’s strongest int’l performance was to/from Japan, including HND where its LAX-HND flight is nearing fare levels comparable to its LAX-NRT which is it the US industry’s top flights for revenue per seat.

DL’s presence at ATL, MSP, DTW, and SLC remained consistent relative to its competitors but DL gave up a couple points of market share in both CVG and MEM.

Other industry highlights show that AA continues to lose market share in NYC, ORD, and DFW while MIA is growing due to Latin America growth. US’ share of DCA grew as a result of the slot swap while CLT and PHX are stable. UA is gaining ground on AA at ORD and has been successful in slowing low fare carrier growth in ORD; UA is regaining share from F9 at DEN although WN is now the largest carrier at DEN in terms of passengers boarded.

Still, and forever will, be the ' Bridesmaid ' from JFK/LHR + JFK/LAX JFK/South America !

Northern Virginia is expanding by 'leaps and bounds', so DCA will play an ever bigger role, and EVEN BIGGER if US gets swallowed up .

I just get the feeling.. W T .... that given DL's Enormous overhead (A zillion hubs/different a/c types)..that the BIG-D has to work HARDER for thier profits, than other airlines.
HELLL, Imagine if DL were unionized (which I think the Below-wing Will Be, next go-around).
 
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just a slight tangeant but NW's much more unionized workforce had an identical labor CASM as DL did on the date of the merger.

DL's CASM is right now the lowest of the big 3 and DL says they will take out about 1 billion dollars in costs over the next year - which amounts to about a 3-4% reduction in CASM.

DL's growth in high revenue key industry markets has already been discussed.... given that the airline industry is driven by mass, DL is clearly striving to be able to serve as many of the top industry markets as possible, esp. where adding new routes translates into the ability to grow corporate and contract revenue.
 
just a slight tangeant but NW's much more unionized workforce had an identical labor CASM as DL did on the date of the merger.

DL's CASM is right now the lowest of the big 3 and DL says they will take out about 1 billion dollars in costs over the next year - which amounts to about a 3-4% reduction in CASM.

DL's growth in high revenue key industry markets has already been discussed.... given that the airline industry is driven by mass, DL is clearly striving to be able to serve as many of the top industry markets as possible, esp. where adding new routes translates into the ability to grow corporate and contract revenue.

'Interesting, (to say the least) how you characterize as "Slight Tangeants" as the Most Prime (airline) Real estate of JFK/LHR....JFK/LAX, and South America, where Every Airline in the World (save Lan Chile)would sell thier "First Born" to have a Niche !
" INTERESTING " !
 

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