What do you want me to find??

 

you know......

 

For anyone who couldn't listen to the conference call yesterday. Seeking Alpha has a transcript here: Delta Air Lines Inc. Q4 2009 Earnings Call Transcript -- Seeking Alpha

Some interesting things about money, CVG and aircraft deliveries.

 

One of the "game changers" since the CRJ50, 700 and 900 were ordered is the price of fuel. I'm not just talking about the price today - it's the potential price. It looks like those planes became very unprofitable when the fuel price went above $100. Most of those planes were ordered prior to 2003 when oil was at $30 a barrel. The oil price back then, plus the low labor costs (across the board, not just the pilots) of operating them at DCI made them profitable.

When you double or triple the price of oil, I think they become unprofitable, no matter what the labor price. If I were Delta, I'd want to order aircraft that can generate a mainline RASM. I'm talking a first class, ability to have some sort of IFE with enough seats to spread the fuel cost around. Hopefully our MEC will insist that size aircraft be flown at mainline.

If Delta is going to fly a plane DFW-LGA, it's going to have to compete with AA or Jetblue who have (or will have) some sort of IFE/WiFi. I think Embraer has a good product - the CSeries isn't even made yet, so I don't know what that will be like.

It's interesting that you think Delta is going to have to start order/planning for narrow body aircraft. The company seems to be focused on the MD88/90 as having "many years of service". NWA made the DC9 last a long time - a lot longer than people though. Maybe refurbishing the MD88s will be out narrow body "order".

 

At the MEM base meeting when the 100 seat order was brought up they were quick to shot it down. Basically larger aircraft that are shrank don't make sense, as they cost about the same as the larger aircraft to fly with less avialable seats to sell. As for the EMB, they said they are way too expensive and their operating cost are still too high.

As for hiring, they said no plans, but if the economy continues to improve that could change. They did say there will be no hiring for the summer for sure, if they had wanted to, they have missed that window. Who we have on property is what we will have to make do with, basivally said very high ALV this summer.

 

Yeah well, your track record been pretty clear everywhere you've ever written anything. You and Carl...ambassadors of devisiveness where every attack on anything and anyone fDL is fair game and any defense will not be tolerated. Sorry bud, there's still a couple of us on here that'll stand up.

 

Agreed, and it is my opinion that for this reason alone they do not want to buy more of them. Ala they will get burned by fuel prices again. Same will hold true for any jet though, the difference with these jets is that pilot per seat cost is more, and the CASM is more than a mainline jet. When a CS-100 is close to the 76 seat jet the economic will follow the same path.
You see that announcement a few days ago about spending billions on upgrades? Of course you did. Just because it is DCI does not mean that they will not stick IFE's in the seats. If they can figure out a way to do it and no kill the product it will happen. They are adding FC seats to most of the jets that will remain as well. Notice that not all the 70's will be configured and we all know the 50's will be gone. Point is that the jets remaining will have extra weight avail to the MTOW for IFE's. Just sayin... They see DCI as a seamless to mainline and will do everything to marry the product.
See above. There is no price elasticity for IFE's Someday but currently people buy tickets on price and price alone. We are seeing a shift away from 50 seaters for many reasons, but the main one is CASM which effects CASM, not comfort. If it made money we would fly it as is.
My point is the MD-90 is a great Band-Aid. Problem is that as we move later in to this decade and in to the 20's the 9, 88, 90, 320, 757's 767's 744's and even the 73N's will be 30-60 years old. All of that metal combined with fuel prices, carbon offsets etc will make it necessary to refleet the airline.
Simple supply chain economics, and airline economics will not allow 50 aircraft deliveries a year to refleet in 10-15 years. If we did this the cost is unworkable.
The baseline point was that airlines generally should be refleeting at a rate of about 10-20 jets a year continually so that there is not a bulge. It holds true with staffing as well, but does not work out that way. Reference the retirement numbers in 8-18 years.
It is my opinion that if we wait until the next gen 737/320 arrives in 2022 or later we are going to be in a position where it will cost DAL hundreds of billions of dollars over a few short years. We will not have the option to wait a few years like we do with the 787. The aircraft are going to be at the point where the HAVE to be replaced, it will not be just the desirable option. Boeing and Airbus will see that and the price per jet will be a lot less elastic.

Of course we could buy all of the used 73N WN is getting rid of, but we would not be able to compete with a competitor that is using a jet that will be 20-25% cheaper to operate.

Make sense?

 

Time will tell on both accounts.

From reading the tea leaves and keeping my ears open I can tell you that there are plans for bodies. It will solidify later this year but for sure very very early in 2011.
I was told be careful what you bid, because you will get it.

 

oh good, i'll be sure to bid 320A

 

I was just reminded not to do anything stupid, because I would have to live with it.