A couple of the 149pax Maddogs are flying and three more are in work currently in ATL and MSP. Is this new config going to work? I personally think moving all the carts and trash to the front to ba a mistake. Now all the carts and trash will move through the first class cabin. How will our High Value customers like all that traffic?
Md88 Interior Mod
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WorldTraveler
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Given that many carriers do not isolate the premium cabin on domestic flights to the extent that DL once did, I don't think there will be that much traffic. Further, the MD88 is used on flights that are basically not long enough to have more than one beverage service - if even that much - which means each cart should go through just once.
I would agree that it isn't ideal but I have seen other carriers move carts through FC years ago. Remember that NW used carts IN FC - and they weren't alone.
The net addition of 7 seats to the aircraft will help economics by allowing more passengers at no incremental costs to DL which will drive down unit costs. Those 7 seats could translate into a 5% reduction in costs on the MD88 which is significant, esp. with increased competition from WN at ATL. Given that the MD88s are heavily used up and down the east coast, the equivalent of adding 6 more MD88s to the fleet without adding any costs is significant.
Given that the MD88s are heavily used up and down the east coast, the equivalent of adding 6 more MD88s to the fleet without adding any costs is significant.
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Without adding any costs?
Do you have any idea how many man-hours this takes?
Or how much the parts cost?
From my experience this is not a low cost endeavor.
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Without adding any costs?
Do you have any idea how many man-hours this takes?
Or how much the parts cost?
From my experience this is not a low cost endeavor.
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There are capital costs, not operational costs. Adding seats to an aircraft does not increase the cost of operating the aircraft which is where the opportunity to make money arises.
I am well aware of the billion dollars that DL is spending on the int'l fleet alone, let alone all the domestic mods. But all of this is being done to keep the product competitive - and in the case of the MD80s/90s and the 738s and the 757s - all of which are getting additional seats - are with the intention of driving down costs and increasing the revenue generating capabilities of the domestic fleet. And I believe there are also seat additions on the 319/320 fleet as well.
Since the addition of seats on the MD80s did not push the aircraft over the threshold for an additional FA as the MD90 and 738 seat additions do, there is no net increase in OPERATIONAL cost - other than the incremental additions of fuel necessary for a heavier load.
But again given that DL's network is so heavily focused on limited access major east coast airports, the addition of seats is extraordinarily important for DL to be able to continue growing revenue without the acquisition of new slots or gates.
And while other carriers are buying new airplanes, DL is doing this mod work for a fraction of the cost other carriers are spending on new aircraft... and given that the lease rates on the MD80s are so low because DL threatened to give them back in BK and the lease companies had no place to go to lease the planes, DL is able to operate the MD80 for total costs lower than what other carriers are paying for newer aircraft, even considering the increased fuel the MD80 burns. When you add in the MD90 which DL is picking up for a proverbial "song" even though it has fuel burn comparable to the 738 and 320 and which DL is well on the way to being the only airline flying them, the costs of operating the domestic fleet is going down - and that is good for you as a DL employee. (I presume you are)
Seriously? did you not read anything world traveler posted?
ummm more seats MEAN MORE paying passengers paying for baggage/fuel.
Think of how many more seats a day X how many a/c X how many flights a day.
equivalent to adding more a/c without purchasing said a/c. and as WT stated, lowering
cost per seat mile.
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It would be nice to think that there might actually be a few empty seats but since DL and most other network carriers are running 80% load factors even in the supposedly off-peak months like September for domestic travel, the chances are slim that there might be an increase in empty seats.
DL and other carriers are doing a very good job of revenue managing their capacity by having enough discount fares and good enough demand forecasts to be able to fill whatever seats might be available to selll... again, remember the US network carriers have been posting double digit increases in revenue per seat mile while loads are only going up a couple percent if at all - which means the airlines, DL included are getting more revenue per passenger.
It is at the top of the demand cycle - which we are in right now - that it makes sense to add seats to airplanes and it is far easier and faster to add more seats to existing aircraft than it is to buy new or used ones....
and if for no other reason, I am for the MD88 mods because it removes the rear galley which the way DL configured those a/c from the day they were delivered essentially turns the last 3 rows of the aircraft into a coffin since you can't see out the windows because of the engines and you can't see forward because of the galley which leaves you with nothing but lavatory traffic to connect you w/ the reason of the plane or the outside world.
and if for no other reason, I am for the MD88 mods because it removes the rear galley which the way DL configured those a/c from the day they were delivered essentially turns the last 3 rows of the aircraft into a coffin since you can't see out the windows because of the engines and you can't see forward because of the galley which leaves you with nothing but lavatory traffic to connect you w/ the reason of the plane or the outside world.
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The engines are still there,but now the overhead bins are filled with emergency equipment.
Gate check your bags,but now you can see more than 3 rows of the backs of peoples heads.
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The engines are still there,but now the overhead bins are filled with emergency equipment.
Gate check your bags,but now you can see more than 3 rows of the backs of peoples heads.
Hmm, meanwhile over on the AA threads your side supports the idea that AA workers should agree to lower wages so AA can invest in new aircraft (737s)and dump the MD-80s. AA is the largest operator of MD-80s.
If you are the only operator of a fleet it drives your costs up, not down. AA experienced that with the A-300s. If you operate a common aircraft you can maintain a much smaller parts inventory and borrow what you need from other carriers, so lets say you fly into a station where a competitor operates a fleet similar to yours, you can borrow what you need should your plane crap out, but if you are the only operator of a fleet you have to maintain parts everywhere it goes. Thats one of the reasons why SWA does so well, the 737 is the most common airliner there is, everyone has them, their ability to borrow when needed means that they can maintain a much smaller spare parts inventory.
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Bob,
I do hope you will let me know who is on “my side” so we can get on the same page… I hate to present a less-than-unified front.... but unfortunately, the notion that employees should reduce their wages so the company can buy new planes is not my idea, nor have I ever espoused it.
Acquiring and paying for property, plant, and equipment is the responsibility of management. They should not be buying new airplanes if there is not a compelling reason in terms of increased benefits from acquiring such new airplanes.
The fact that the 738s carry more people for less fuel, have greater performance and passenger amenities, and reduce maintenance expenses should be reason enough for AA mgmt to choose to buy the planes over the S80s.
The reasons why DL has not made the decision undoubtedly are because DL’s M88s are newer and DL was able to reduce lease payments in bankruptcy. Further, DL’s hubs are closer to one coast or the other and DL has more hubs so the range of the M88 is better used on DL’s network than the 738.
Still, employees at AA should not be expected to subsidize new aircraft purchases – and I never said they should.
There were many of us who wondered at the time why AA bought both the A300-600 and the 767-300ER when the 767 was more capable via greater range even if it might have carried slightly less cargo on shorter routes. It isn’t surprising that AA decided to get rid of the 300s as an orphan fleet type given that there is a lot of commonality between AA’s 757s and 767s and the 767s have full TATL range.
Thanks for clearing that up.
I would, based on your posts, consider you more on the side of FWAAA and Eoleson and not on the Labor side.
Do you know if AA pays more than DL for leased MD-80s than Delta? Are the newer Md-88 a lot better on fuel than the Md-83s? If so by how much on both counts?
AA was able to renegotiate lease payments as well, but they did it outside of BK, while BK may wipe out debts , I dont think the courts can impose new lease terms on the owners of those assetts (I think the courts can only steal from labor). Who is to say that even though Deltas lease payments may be lower than they were that AAs might not be even lower since AA never defaulted and the lessor doesnt have to recoup losses like they would at Delta? I know when AA got the MD-80s they got them for a song. I believe they used to own quite a few, they wouldnt have lease payments on those.
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I'll work on the AA vs DL MD80 lease/ownership costs. Data is available but I don't have it at my fingertips.
Fuel burn is pretty similar between the MD88s and MD82/3... the biggest factor in DL's decision to keep them is undoubtedly because DL's are newer and the maintenance costs are lower. DL did get good lease payments coming out of BK but the DC9/MD88 has a history of long life... but the MD80 may not deliver the same longevity that the DC9 has.
IN BK, the lessors recouped the losses they incurred from the reduced lease payments by becoming creditors which ultimately made them stockholders in the new company. They undoubtedly did not recover what they lost but that is the nature of BK. There isn't any indication that the BK process in the past resulted in any higher finance costs in the years later; CO was a preferred Boeing customer just like AA and DL and CO obtained financing for new aircraft at the same rates as AA and DL - before DL filed for BK.
BK is a one time event that the creditors don't like but the best equalizing factor is gaining stock in the new company - and it is better off for them to obtain stock in a reorganized company than to take their assets back. The reason why DL was able to lower MD88 costs so much was because no one else wanted the planes. DL found that the MD88 and now the MD90 with low ownership/lease costs are cheaper to operate than buying new 738s... but the decision for AA will not necessarily be the same based on differences in the age of AA's fleet, network, and other employee costs relative to DLs.
Remember also that DL's maintenance costs per ASM are 60% lower than AA's meaning DL can maintain some aircraft types profitably that other carriers could not.
The thing about maintenance cost is "You can pay me now or pay me later". Lets see what happens over the next few years with Deltas Maintenance costs. You cant put it off forever, eventually it catches up to you.
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Bob,
I found some data that will help answer your question. I'll note a few things here...
first, DL's total ownership costs for the MD88s and 90s is about 40% of the cost of AA. DL's M88s are newer so they have higher costs on their OWNED fleet but costs for their LEASED fleet are about 20% of the cost of AA's leases. Bankruptcy is a wicked sword but DL swung it at the leaseholders of the MD88s and received significant lease reductions. Also highlights that employees were far from the only group that got whacked in BK; DL said that about 1/3 of its restructuring benefits came from lease and balance sheet improvements similar to the amount that came from employees. The rest came from revenue improvements.
As for AA vs DL's MD88s, many cost items are similar... fuel, overall maintenance costs... but DL uses its MD88s on routes averaging just over 600 miles compared to nearly 900 for AA's so DL's M80s have higher CASM and higher fuel burn per hour along w/ more cycles per day... which also means that DL's maintenance costs per ASM for the M88 are higher than AA's M80 maintenance costs on an ASM basis. Also, as AA is phasing out its M80s they are probably not doing some heavy maintenance that DL has to do if it intends to keep that fleet (and if I recall most of DL's leases coming out of BK were 7 years long, meaning many planes will come up for lease renegotation about 2014). But there is no evidence that DL is doing any less maintenance than AA on any DL fleet type.
It's also noteworthy that ownership costs for DL are about 1/2 the cost of the 738... not surprisingly, DL and AA have similar costs on the 738 but DL is able to operate the M90 and 320 for ownership costs similar to what AA has on the M80... yet the M90 and A320 has fuel economics similar to the 738. The M90 has similar operational costs to the 738 but just doesn't have the range.
So you have DL's M80s which cost about 1/3 to own/lease as the 738, M90s at half the rate of the 738.
Given that there aren't alot of high quality 320s available, it isn't hard to see why DL is opting to acquire used M90s since that plane is an orphan fleet type even though it has good economics. It also is apparent that DL doesn't see benefits in acquiring new 738s compared to other narrowbody options right now.
For AA, which didn't have the power of BK to reduce M80 fleet costs to the same degree, the ownership equation is different. And of course AA's M80s are older meaning that waiting another 5 years isn't possible... on top of the fact that AA's M80 fleet is more than twice the size of DL's which means they have to start working on replacements now.
DL has said they might be interested in the enhanced 320 if Boeing doesn't move forward with an improvement package for the 738 in the next 5 years... DL probably can't wait another decade to start its narrowbody replacement program.
I found some data that will help answer your question. I'll note a few things here...
first, DL's total ownership costs for the MD88s and 90s is about 40% of the cost of AA. DL's M88s are newer so they have higher costs on their OWNED fleet but costs for their LEASED fleet are about 20% of the cost of AA's leases. Bankruptcy is a wicked sword but DL swung it at the leaseholders of the MD88s and received significant lease reductions. Also highlights that employees were far from the only group that got whacked in BK; DL said that about 1/3 of its restructuring benefits came from lease and balance sheet improvements similar to the amount that came from employees. The rest came from revenue improvements.
As for AA vs DL's MD88s, many cost items are similar... fuel, overall maintenance costs... but DL uses its MD88s on routes averaging just over 600 miles compared to nearly 900 for AA's so DL's M80s have higher CASM and higher fuel burn per hour along w/ more cycles per day... which also means that DL's maintenance costs per ASM for the M88 are higher than AA's M80 maintenance costs on an ASM basis. Also, as AA is phasing out its M80s they are probably not doing some heavy maintenance that DL has to do if it intends to keep that fleet (and if I recall most of DL's leases coming out of BK were 7 years long, meaning many planes will come up for lease renegotation about 2014). But there is no evidence that DL is doing any less maintenance than AA on any DL fleet type.
It's also noteworthy that ownership costs for DL are about 1/2 the cost of the 738... not surprisingly, DL and AA have similar costs on the 738 but DL is able to operate the M90 and 320 for ownership costs similar to what AA has on the M80... yet the M90 and A320 has fuel economics similar to the 738. The M90 has similar operational costs to the 738 but just doesn't have the range.
So you have DL's M80s which cost about 1/3 to own/lease as the 738, M90s at half the rate of the 738.
Given that there aren't alot of high quality 320s available, it isn't hard to see why DL is opting to acquire used M90s since that plane is an orphan fleet type even though it has good economics. It also is apparent that DL doesn't see benefits in acquiring new 738s compared to other narrowbody options right now.
For AA, which didn't have the power of BK to reduce M80 fleet costs to the same degree, the ownership equation is different. And of course AA's M80s are older meaning that waiting another 5 years isn't possible... on top of the fact that AA's M80 fleet is more than twice the size of DL's which means they have to start working on replacements now.
DL has said they might be interested in the enhanced 320 if Boeing doesn't move forward with an improvement package for the 738 in the next 5 years... DL probably can't wait another decade to start its narrowbody replacement program.
