Originally Posted by
georgetg
I doubt there are many here who "don't want Delta to make money"
Let me see if I can paraphrase:
By having Alaska pilots fly the Delta code, Delta is able to be in markets it would otherwise be less or not profitable. As a result Delta is effectively offering more seatmiles without the associated overhead of flying it in-house.
The employees benefit because as the company is more profitable it is able to pay its employees more money.
Fast forward to 2025 (Hypothetical)
Delta is the largest airline in the world with the most seatmiles of any airline out there. Delta flies an all wide-body fleet, and has contracts with various lift providers around the world to feed the operation. There are 5000 pilots on the seniority list and for the last 18 years not one pilot was furloughed. Captains pay is between $275-300/hour and FO pay is between $205-230.
By comparison Southwest airlines, now also a global carrier, ranks number two to Delta in seat-miles. The two companies are equally profitable, but Southwest chose to grow organically after a disastrous merger with Airtran in 2011. Southwest flies a mix of widebodies and narrowbodies on all of it's own routes. Southwest has 12000 pilots on its seniority list. At Southwest Captains pay is between $240-295/hour and FO pay is between $190-225.
Considering the above scenario:
- Were we successful as a pilot group?
- Were we successful as a labor group?
Cheers
George
Delta's code share with Alaska is a pro rate code share, meaning each carrier only makes money when a passenger is on one of their airplanes. Delta does not want to have all their passengers fly on Alaska flights because they don't get any revenue from those passengers. They want to have a bigger footprint in the market so more of their routes are profitable by attracting high fare travelers. Without proper feed in Seattle we would be unable to fly all those Trans-Pac routes. So if we eliminated the code share with Alaska, you have to ask yourself what is more likely:
1. Alaska pulls out of Seattle and opens the market up to Delta
2. Delta finds the billions of dollars it would take to build up the infrastructure in Seattle and conduct a market share war with Alaska
3. Delta would abandon those Trans-Pac routes in Seattle
My guess is 3. 1 is almost impossible to imagine and 2 is a throwback to the old industry that led us all to bankruptcy. Oil has skyrocketed this year and the industry and Delta will be profitable and I will get a profit sharing check, again. The industry is in a new operating model and these alliances both domestic and international are key parts of this model. I don't want to go back to the old model, it sucked.
The key to these alliances is to make sure that we get our fair share of flying. Our code share with Alaska has a set of metrics that ensure that each side gets their share of the flying. The pro rate agreement gives incentive to management to fly as much code as possible on their own metal as that is the only way to produce revenue. The only aircraft Delta is adding right now is the MD-90, so the future as an all wide body smaller airline doesn't seem to fit your hypothetical. They also have an RFP for 100-200 narrow body aircraft.