Thanks. Agreed on 2012.

I think that we're seeing signs of added capacity in multiple markets. RA did indicate an AMR transaction should help make the industry more rational, but I noticed LCC added around 2% capacity in the last quarter (month?).

I wouldn't be surprised if the industry eventually starts drifting away from capacity discipline. As long as we're not the only airline reining in capacity, Delta pilots should benefit from discipline or the lack thereof.

As a side note, I did particularly like the fact that management is very publicly commiting to upgauging, not just directing that talk to the Delta pilots. They're married to the concept now.

Thanks for the clarification. I believe some of the 737-900's will be owned outright, correct?

If your numbers hold up it would give us a pre-tax margin for 2012 of just over 4%. By comparison, the pre-tax margin from 1996-2000 averaged over 10%. And we're doing better than just about everybody else domestically (Alaska a prominent exception) and many of the "legacy" international carriers.

We work in a stupid industry.:(

Delta buying regional jets?
 

BRIEF-Delta comments on demand, expected jet purchases

What's this at end of article about talks to buy regional jets?

For who to fly?

Those would likely be the coming horde of jumbo RJs. Expect 2:1 trades and similar at the regionals to get them.

I hear ya but the article implies delta is buying them. For who?

Was anyone able to find the catch phrase "capacity restraint?". I noticed a lack of that! (although capacity next year is very restrained)

LOL agreed, but they aren't "my numbers," they are from Delta's 2012 Q3 report and Delta's 2011 Q4 report

To date for 2012, Delta has already put away 309M in profit sharing expenses. Full year profit sharing expenses in 2011 were 264M.
For the 9 months of 2012, Delta is already 45M above the full year number for 2011 and only 4M lower than full year 2010 expenses.

Barring any "Black Swan" event, 2012 profits will well exceed anything in the last 5 years...

You do bring up an interesting point, and that is the 900lbs. Gorilla in the room...

As long as yield mitigates the increase in unit cost and Delta can find additional non-traditional avenues for revenue generation, capacity constraint can help improve the bottom line.
Unfortunately long term it is impossible to shrink a low margin business and expect increasingly better results.

Determining the optimum point when to shift gears is by far the biggest challenge going forward.

Cheers
george

Looking over the fence at the other players, it seems the consensus on "capacity constraint" is crumbling...

Watch for the "pivot"

Cheers
George

I think the article is based on the call, and the call didn't elaborate. They said (paraphrasing) that they're playing Bombardier against Embraer, that they should have a "better idea" by the end of the year. That they were allowed up to 70 per the TA, that the deal would be over some number less than that, and seemed to suggest it would involve some 50-seat returns.