Sink r8

You said it perfectly. Some are obsessed with what other airlines make, particularly SW. I have no idea how SW will fare over time, but I don't want to be tied to their fortunes: I want to be rewarded to my contribution to my company's success. Ours have been immense.

Our contributions > our company's success > our company's ability to pay > our returns on contributions.

Timbo

If you want to slide your vacation, you have to bid it in PBS, just like bidding your trips. So are you talking about sliding your NOV vacation, or one coming up in Oct? It's too late to slide an Oct. vacation.

scambo1

I thought PDs proposals were actually quite reasonable.

Please show your math on the 200%

Scottyr6

Trying a vac move up to feb but don't want sun to sat. If I get the move up how do I slide it to tue to mon?

Elliot

Timbo,

Honest question. (Zero antagonism) How do you propose asking the company to pay a 12yr (737) Capt. $400+/hr. at the end of your three year contract.
GJ

scambo1

Those rates are pretty well in line with Air France and KLM. However, at Air France, the upgrade time to 777A was running at 10 years for awhile. So, you really wouldn't be looking at a 6 year M88 pay rate for long. As I'm sure you are aware, those airlines are JV partners of ours and sell tickets on us and we sell tickets on them.

Timbo

The company thought nothing of DEMANDING a 42% pay cut, and FLUSHING over $4 Billion of our DB money, in one fell swoop. We should be DEMANDING full restoration, NOW!

The first $1 Billion in profits came right out of our paychecks.

Oh, and Richard just got a 42% raise, from $8 Million to over $12 Million.

I think a 25% raise, per year, for the ones who SAVED Delta from liquidation is not at all unreasonable.

Columbia

The United-Delta Grudge Match Escalates (DAL, UAL)

The United-Delta Grudge Match Escalates

The competition between the two largest global airlines, United Continental (NYSE: UAL ) and Delta Air Lines (NYSE: DAL ) , has escalated rapidly this year. Delta has enjoyed record profitability recently, and now it is starting to invade United's turf. Many of the flights Delta has added in 2013 have targeted markets where United is the dominant carrier.


Delta Air Lines is aggressively growing in several of United's hub markets.

It seems clear that Delta is looking to exploit United's merger integration woes to gain market share. Yet United is not willing to accept a diminished status within the airline industry. The carrier has been emphasizing its business travel amenities all year. Now, it's going one step further and adding flights into Delta's strongholds. If anything, this strategy will put even more pressure on United's unit revenue next year.

Delta moves in
This spring, Delta worked to improve its presence in New York, where it competes extensively with United. The carrier opened a new modern wing for its international flights at JFK Airport's Terminal 4. It also began nonstop flights between Newark Airport (a large hub for United) and Paris in June.

In Los Angeles -- one of United's smaller hubs -- Delta is growing very aggressively. It has expanded capacity in Los Angeles twice this year. Most gallingly, it brought its popular Delta Shuttle product to the West Coast last month. In the eastern U.S., the Delta Shuttle provides hourly flights from New York to Boston, Washington, D.C., and Chicago. Its new West Coast shuttle operates 14 daily round-trips between San Francisco and Los Angeles, both of which are United hubs.

Just last week, Delta announced even more new flights into United hubs. Next spring, it will start service between San Francisco and Seattle and increase its capacity between Los Angeles and Seattle. It is building a major international gateway in Seattle, and these new flights will give the carrier a chance to pull traffic away from United's trans-Pacific hubs in San Francisco and Los Angeles.

In other words, where Delta is expanding, it is attempting to do so at United's expense. Clearly, its executives see United's recent customer service struggles as a big opportunity. As Delta grows its presence in key United hubs, it will be able to compete more effectively for lucrative corporate contracts in those markets.

United strikes back
This week, United made it clear that it's not going to go down without a fight. On Monday, the carrier announced two new routes that will begin on April 1. First, it will fly two daily round-trips between its San Francisco hub and Atlanta, where Delta operates the largest airline hub in the world. Second, United will introduce two daily round-trips between Los Angeles and Minneapolis-St. Paul, another large Delta hub.

Additionally, United announced that it will upgrade its service between San Francisco and Seattle in April by adding one daily round-trip and moving to all-mainline service. This will increase its capacity on the route by more than 50%. This is clearly a competitive response to Delta's recent announcement that it will start flying that route on March 29.

A sign of desperation
United's move into key Delta markets looks more like a desperate move than a show of strength. Rather than solidifying United's financial position, these new flights are likely to lose money.

For instance, United will operate its flights between Los Angeles and Minneapolis-St. Paul with regional jets, whereas Delta offers frequent mainline service on that route. As a result, United will face higher unit costs. Delta's strong presence in the Twin Cities and its growth in L.A. will make it hard for United to achieve a revenue premium to offset these higher costs.

United's new San Francisco-Seattle service could be equally problematic for the bottom line. With Delta adding six daily round-trips to the market, United's decision to increase capacity by more than 50% seems dubious at best. United will have to drop fares dramatically to fill this extra capacity, especially as Delta's new international flights from Seattle will reduce the number of passengers connecting from Seattle to United's international flights in San Francisco.

There's a clear winner
United may edge out Delta for the title of world's largest airline, but Delta is clearly the top dog in today's airline industry. That's why Delta's market cap is nearly double that of United. Delta is now using its margin advantage to move in for the kill by adding numerous routes into United's hubs.

United is attempting to counter Delta's aggression by invading Delta's turf. However, this move is likely to backfire, as United does not have a competitive advantage that would entice many travelers to choose it over Delta. Instead, United will need to cut ticket prices to fill its planes, keeping its profit margin well below the industry average.

Elliot

Example: 12yr narrow body Capt. (737), in 2015 = $217/hr. (Rounded to nearest dollar for ease of math.)

Assuming your percentage increases if 25%/year, or Purple's which equal about the same anyway, the same 737 Capt. would make $420+/hr at the end of said contract.

2016 - 25% pay raise - $271/hr. (25% of 217 = 54.25. $217/hr plus 54.25 = 271.25)

2017 - 25% raise - $339/hr. (25% of 271 = 67.75. $271/hr plus 67.75 = $339/hr)

2018 - 25% raise - $423/hr. (25% of $339 = 84.75. $339/hr. plus 84.75 = $423/hr)

You're suggesting that a Captain in 2015 making $217/hr, gets a pay raise of $206/hr in three years?

GJ

Columbia

Gee, how do we compete with us air and American and their rates?