Originally Posted by
Bill Lumberg
Who are "realistic" merger partners? HAL or AK? HAL got 3 more 717s for interisland flying and a few more A330s that will replace 767s eventually. AK just announced 2 new routes from SEA (PHL and FLL), but they are still avoiding DL routes other than a few Hawaii routes from the West Coast. Both are growing somewhat, but not huge numbers. I still don't see JB as a merger partner, and certainly not USAir. Both HAL and AK would fit well in our route structures, but again they are not expanding at a huge rate to make a big difference in any SLI. I don't think parts of AMR will become available either, all or nothing probably for USAir.
AS and HI are projected to hire a significant portion of their lists in the next couple years. While the total numbers may not seem earth shattering from the perspective of a 12,000+ pilot list (soon to be an 11,000+ pilot list) their percentages are pretty massive. Anything between a relative and a stovepipe/zipper SLI, even with fences, would be a windfall to them. What's worse is AS is doing flying in the code share that DL used to do as well as extremely high frequency and density flying that DL should be doing regardless. Even the "new market" stuff they are doing in terms of city pair to city pair is poaching off the connecting traffic we are doing/used to do. Some of this negatively impacts DCI, but much of it directly funnels pax off of DL metal and onto AS metal because of the code share abuse.
When you have thousands of seats a day between two massive markets and not one seat is on your metal, that's unacceptable. When the pilots doing that flying stand to gain a 20% or more seniority bonus just because of some quick hiring in the near term, well you may either be cool with that and/or think the threat is insignificant but I disagree.
HI has a small list so it doesn't take much to buff it by 20% or more. By the time a merger with them happens (if it does) we could possibly see longevity for widebody captains at mind blowing YOS compared to us, not to mention solid line holder narrowbody FO and every position in between. At least their potential windfall won't translate into that many actual numbers since their list is so small but I'm not willing to completely disregard the threat either.
I agree JB is less likely. There are many reasons why that merger wouldn't make much sense for us. But we're talking about stock grant and bonus mongering mercenary MBA hatchet men and hedge fund crackberry analcysts that don't always do the right thing for employees or even shareholders. Right now shrinking to profitability and merging are very much en vogue and our leadership has expressed a continued desire for more of both. They may want to take the hot cheerleader to the prom in Dad's Porsche but if all they can get is picking up the fat chick with the hairy mole in their rusted out blue Gremlin with a brown door they will settle for that. But the chances of us closing out this decade without another merger and/or fragmentation are slim, and it will probably happen sooner than that.
JB isn't a very good fit for DL at all. Horrible actually. The premium that would have to be paid, only to immediately have to divest large portions of it, just to get a no frills narrowbody terminal would be a ROI on par with the purchases of ASA and Comair or the underused terminal in BOS (that paves the way for JB to not only enter that market but to dominate it as well). But, IF it happens, and IF it is above the threshold that crosses the fine line between a large asset purchase and ends up in the realm of a full blown merger and goes to arbitration either because of the individual contracts at JB or, slightly more likely, the new untested federal "merger law", the relative seniority windfall that would represent would be staggering for DL pilots.
Throw in wild cards like VX and NK (Spirit) and you have a group of merger candidates, all of which are hiring and growing and drastically increasing their relative lists by an equivalent that would require DL to hire thousands of pilots a year. If ANY of those scenarios played out we would be hosed and could see relative new hires at any of those carriers senior to DL pilots hired 10 or 12 years ago. Pilots with even a couple years of longevity senior to DL pilots hired in the mid 90's and "senior captains" hired from between 4 to 10 years ago in some cases.
All while DL shrinks to profitability and reduces capacity that the other carriers simply grow into almost as fast as DL reduces in the first place. Heck, that's WHY they are able to be in endless growth mode while DL chooses tactical stagnation to drive short term quarterly reports and YOY numbers.
Even USAir is gearing up to be in hiring mode. Boy wouldn't that be fun.