Originally Posted by
gloopy
The 88 is the most profitable narrow body (not sure if the 757-300 counts as a narrowbody for that or not) and its by a nice margin. Even $150 oil wouldn't wreck the 88's numbers much. Its not that much less efficient. 10% or so compared to the average 150ish seat narrowbody but you're not paying the note on a $60=100+ million dollar plane with full coverage insurance either.
They're getting an aero kit that will make them about 3% more efficient, and whatever GPS solution they get will probably add the equivalent of another percent bringing it in line with modern nav.
Paid for. Reliable. Not really that much less efficient. Highly profitable and (believe it or not) highest customer feedback scores (fewest middle seat ratio).
Plus they're Boeings now too.
Before this rumor spins out of control, you should go back and listen to what he said again. He was pointing out that Delta, and the industry, are different than in the past and should be thought of as reliable long term investments and not momentum trades.
Someone asked him what Delta would do if there was a sharp economic downturn like 2008. He said they have many mitigation strategies including:
- Setting down aircraft that are fully depreciated and fully paid off, like the MD-88's
- Using the 40% of part time employees less
- Bringing back heavy maintenance (currently outsourced) back in house
- Turning of the pilot hiring spigot and letting attrition bring down pilot numbers
His point was that the company is set up to weather the storms that routinely hit the airline industry. This is NOT the plan moving forward. This is the QRH response to "ECONOMIC MELTDOWN - WIDESPREAD". Delta's stated plan was to grow domestic capacity while getting rid of many additional regional jets. This means more mainline domestic growth and they cannot set down the MD-88's and complete this plan.