sinca3

Thanks Timbo....I'm depressed and I wasn't even here!! Just depressed this career isn't what I expected when I got into it and never got to even taste those good ole days.

DoubleTrouble

From memory but: When the pilot group was allocated the stock the price was in the mid/low teens. Initially the stock was not given to the individual pilot, but was controlled by ALPA, and could not be immediately sold due to restrictions negotiated by ALPA/DAL. When the trading window did open ALPA's broker was not successful at selling a desirable price. As the price of the stock declined, and with pilots expressing displeasure with the situation, ALPA turned the stock to the individual pilot at the stock price listed above. Even so, the performance from the teens to today has been positive.

sailingfun

There is not a single correct statement in this paragraph. You have even confused two different programs.

DoubleTrouble

Which two programs?

sailingfun

Timbo did leave a few things out of the retirement issue. He some how forgot the MPP plan, note money, claim money, DC plan going forward, merger stock ect.
He should if he did nothing more then turn it over to financial engines be in a excellent financial position for retirement and it's all in his name.
The biggest reason the plan failed was the massive increase in FAE from the mid nineties to 2004. Average FAE went from 180k to 350k plus. Combine that with a decline in investments and drawdowns from lump sums and the plan went from fully funded to a 4 billion deficit almost overnight.

Timbo

$165,000 of my note/claim money (about $400,000 total) went directly to the IRS, remember? There was no way to roll it over to an IRA/401K at the time so it was all considered taxable income, which put most of us into the highest tax bracket. Uncle Sam was the only one who made out, as usual.

This all happened about the same time my twins were starting college at an out of state university, that's where most of the rest of it went.

sailingfun

There have been two stock programs post chapter 11.
The first was the claim awarded in chapter 11. There was no set stock price for the claim because it was just that. A claim for ownership of part of the reorganized Delta. The stock price would be set by the market when the company exited chapter 11. The claim was controlled by DALPA before we exited bankruptcy. DALPA decided to try and sell the claim pre exit for those pilots who decided to go that route. Each pilot was given the option to participate in the claim sale or take possession of his portion of the stock on exit. The vast majority went with the claim sale. I believe the selling price was around 21 dollars a share. When the company exited chapter 11 the actual price ended up being quite a bit less and then quickly droppped to 3 dollars a share. Pilots who elected the claim sale did very well. Those who opted to keep the stock not so well but they had the choice.
The second program which is what most are talking about here was the merger stock awarded post merger with NWA. This was a concept from Lee Moak that had never happened before where DALPA pushed and was awarded a portion of stock from a company merger. In the past this was a benefit for the company elite only not employees. It has been widely copied since. That stock was placed in each pilots 401K account. He could sell or keep the stock as he saw or sees fit. I sold at 13 a share. In retrospect not so bright a move but the money went over to the market which has also done well.

Timbo

I hear you, but I think you'd have to go back to the 1960's-70's, prior to deregulation, to find any 'good ole days'. In 1985 we had the B scale, (and everyone back then started as a flight engineer, not a copilot, B scale engineer wages sucked!). The guys hired in 1991 got furloughed in 1993-1996. Then we got POS 96. Then Mo'Ron closed all the little bases. Then Leo started buying 600 RJ's and parking mainline jets. Then the terrorists attacks in 2001. If there were any good ole days in my career, pay wise, it was only from 2001-2004. But the Contract 2000 pay rates only lasted 4 years, and we gave it all back, and a lot more.

Two really good books every airline pilot needs to read; Flying the Line, Vol. 2 (covers deregulation, Frank Lorenzo, up to the year 2000) and the book; Hard Landing, which covers a lot of the industry since deregulation.

I have not found any good books that cover what's happened to this industry since the terrorist attacks of 2001, I got to live it instead, and as we have all seen, it was far worse than most of the stuff that happened in the 1960's-70's.

But the good ole days were never that good in the first place! This industry has been a roller coaster ride since it began. We are in an up cycle right now, it might last 5 years, if we are lucky, but that just means the next down cycle is coming...

orvil

Sailingfun said that this explanation was not correct. I respectfully disagree.

From my personal experience it's pretty much correct. We should have gotten our stock at around $12, that was the trade price at the time. We actually got personal control of it at $4.26. It was due to ALPA trying to sell it as a block. They got a little too cute for their own good.

sailingfun

Timbo, I am not sure why your note/claim ended up less then mine since I was junior to you. I think perhaps you are forgetting that there were several payouts and that DALPA managed over a 3 year period to shelter about 140 thousand or so in our retirement accounts. In addition you then had the option to roll it to a ROTH IRA or recover the tax via a conventional IRA. If you pulled the money out of the retirement account you paid a huge penalty. I also had two kids going to college during that period.