Originally Posted by
meesq
I believe that several of the DCI contracts contain a clause which requires the carrier to be the X-lowest cost carrier. That, in and of itself, would make a huge difference in who wins the contract. And it also perpetuates the race to the bottom. And that is why Delta would care if you were receiving pay as a 10 yr captain/FO vs a 2 year captain/FO.
[I have to do some more research on whose contracts actually contain such language.]
From the Skywest 8-K:
The Delta Connection Agreements also provide that, beginning with the fifth anniversary of the execution of the agreements (September 8, 2010), Delta has the right to require that certain contractual rates under those agreements shall not exceed the second lowest of all carriers within the Delta Connection program. During the fourth quarter of 2010, SkyWest Airlines and Atlantic Southeast reached an agreement with Delta on contractual rates satisfying the 2010 rate reset provision and the second-lowest rate provision and agreed to rates through December 31, 2015. Delta additionally waived its right to require that the contractual rates payable under the Delta Connection Agreements shall not exceed the second-lowest rates of all carriers within the Delta Connection program through December 31, 2015.
Waived until 2015 it looks like.