Delta Sells Compass and Mesaba
 

NEW YORK (AP) -- Delta Air Lines Inc. said Thursday it sold two of its regional carriers that operate as Delta Connection for a total of $82.5 million.
Delta, world's largest airline, said the move is part of its plan to streamline its regional operations to save money.
Delta sold Mesaba Airlines to Pinnacle Airlines Corp. for $62 million and Compass Airlines to Trans States Holdings Inc. for $20.5 million. Pinnacle is one of the largest of Delta's nine regional carriers.
Delta inherited Mesaba and [edit:Compass] when it bought Northwest Airlines two years ago.
Mesaba and Compass will continue to operate Delta flights through agreements ranging from seven to 12 years. Both Mesaba and Compass will keep their home base in the Minneapolis-St. Paul area and retain their top executives.
Pinnacle Airlines Corp. is the parent company of Pinnacle Airlines and Colgan Air Inc. Colgan, which flies as Continental Connection, United Express and US Airways Express, operated the plane that crashed in Buffalo, N.Y., last year, killing 50 people.
Trans States Holdings Inc. is the parent company of regional airlines Trans States Airlines and GoJet Airlines. It operates as United Express and US Airways Express.
On Wednesday, the Federal Aviation Administration said it wants to fine Trans States and GoJet for violating maintenance procedures and operating nine jets on 320 flights when the planes were not in compliance with safety regulations.Trans States and GoJet have 30 days to respond. The carriers said in statements they are confident they will be able to show the FAA is incorrect in their allegations.Delta Connection carriers fly a combined 3,600 commuter flights to more than 260 cities. The unit was created in 1984.Major carriers are handing over more of their flights to regional operators because it's a cheaper way to fly. By selling the units, the airlines can maintain the benefits of the less-expensive operations without having to run them directly. It's also a way for airlines to maneuver around tight labor deals at their main operations.
American Airlines earlier this month reiterated its plan to find a suitor for its American Eagle subsidiary.

And Lee Moak's motivation to divest us from the DAL MEC becomes apparent. From today's Q&A to Compass employees, management is claiming the ability to cancel the flow up provision without affecting the flow down or reducing the number of 76 seaters. :eek::mad:

Ah, yes, selling yourself into profitability. That hasn't been tried before.:rolleyes:

Interesting to see what you MEC's response to that is. My response is that you need to read the LOA's and not to allow parties to play in to the emotional side of this. Do not let them divide you against us. This is trick 101.

Yeah it sounded that way to me too. That is not how I understand the contract however. ALPA better be all over this to ensure it is done correctly. :(

I just hope we get some support from the other side of the fence to keep the flow....however when there isn't much chance of needing the flowback in the near future I definately predict we wont see many DAL pilots wanting to keep this thing around. We have already heard a lot of noise to get rid of it. :(

Ahh well I guess we will see.

The timing of this announcement is interesting, but not surprising given recent discussion regarding an up-tick in hiring at Delta.

So, are they talking about doing away with the flow-up, or are they cancelling it all together?

I'm sure you would have been really happy if Delta had decided to sell CPZ while you were "represented" by a Delta MEC appointed Compass Coordinator. Then you could have folks that weren't on your seniority list negotiating with your new owners for your next contract. No risk there.

You think the representation change to an independent MEC is what got you sold or even made it easier? Right.....:rolleyes:

The contract says the flow UP can be terminated for compass new hires. Anyone on the property now should be protected by the agreement.

No. Allows LM & Co the ability to wash their hands and look the other way when we get raped. "Not our problem, what happens at the regional level doesn't affect us!" Same song, different verse.

I'm curious about your take on a potential scenario where the flow up is terminated but the flow-down remains in effect, and the current CPS pilots who've been living under the threat of a flowdown/furlough scenario for the last two years have the agreement terminated when on the verge of flowing up. Do you see the DAL MEC expending any effort whatsoever to prevent such a scenario from happening? I would hope so but as someone else posted, rather doubt they'll spent the postage to send us a condolence letter.

What's the difference?:confused::confused:

Read the whole LOA, new hires within its context appears to refer to anyone at CPS who was not a flowdown. Given how management worded the Q&A today, that appears to be their view.

How do the markets look? See a sell off? See a double dip that all of us have been fearful about possible coming to roost. Do not be to quick on your assertions.

Jungle-
Unfortunately, the language of the flow-through LOA seems to support that "claim".
In fact, that's exactly what it says.

Let me see. Threat of a DFR if you were on our MEC? Yep, because no matter what Lee did he would get sued. (Not just him as a person but the DAL MEC and the simple fact is that the DAL MEC wanted to represent the DAL pilots interest solely and not play to two masters) Seems to mean that your MEC represents you and ours represents us.

Just food for though. Now is the last time you want to start throwing grenades at the DAL MEC.

I may not have liked what we did with the CPS Question, but Pratter sent the question to DALPA and we gave a suggestion. National Acted upon it. Those are the facts, and the facts are that given the fact that DALPA was representing a pilot group that had a separate PWA from ours and would be in section six talks at the same time, it would have made a DFR case a certainty if we wanted to take back scope or even talk about it.

Whether or not I agreed at the time, their points held legal and representation merit. It did nothing for unity, but it fulfilled the DALPA MEC's primary obligation to represent the best interest of ALL Delta pilots not just the bottom 400.

The negotiator's notes and intended meaning will come in to play I am sure. That is unless all parties agree to end it.

Yeah, that's why LM & Co went to the effort to establish the Delta Connection Pilot Alliance and conducted a DCI combined MEC meeting in March. Sheez.

The rest I've deleted in the interest of harmony...

UGH. Here we go again. :(

Call your former MEC Chair at home and ask how putting the interests of Mesaba pilots ahead of Compass pilots is working out for her & her hubby.

I think we all just need to let the news of today wash over us. Especially the compass guys. We aren't exactly excited about being owned by TSH. With that said I think there will be support from all sides to allow the current seniority list to flow.

I heard PR say that Compass interview is no substitute to Delta's. People just flowing through without Delta's selection process just didn't sit right for him.

Maybe that was the last straw in the decision to sell off?

Absolutely it did. From a Representational standpoint, they were "Delta pilots" represented by the Delta MEC. It is easy to sell a subsidiary. Much more difficult to sell your own pilots.

It was a freight train who's momentum would not be deterred, but we could have at least analyzed it to determine what it was worth to enable the flexibility management desired.

Now we are a little behind, but we still need to evaluate what the cancellation of the flow is worth. If the flow was an effective furlough deterrent, then the cancellation of the flow should be worth at least a no furlough guarantee for everyone on the property now. Further, since the E175 was specifically a mainline jet replacement, pilots from the 737 down should be pay protected seat & BASE!

Delta says we're growing, so it should be easy to get better protection than a flow down to Go Jets.

I really hope your right.

Not at all. The best way to "take back their flying" was to staple them & make them Delta pilots. No DFR violation in unity Bro.

No, it allows the Compass pilots to represent their own best interests without any other outside parties interfering. Can you imagine the representational problems that would occur with Compass being represented by pilots of another company with no affiliation with Compass other than a flow through and a marketing agreement? If you can't understand how screwed up that would be then you just aren't thinking about it.

What if Compass is merged with Trans States. Your merger committee would be Delta pilots and your expenses would have to be paid by an assessment by Delta pilots. What if that assessment fails? Who is going to pay your lawyers? What if Delta wants to add 90 seat jets at Trans States/Compass? How should the Delta MEC vote on that issue?

I am sorry, but the representational structure that the NWA MEC set up was the most idiotic arrangement you could ever imagine, and it took some outside viewpoint to realize that and do the right thing. I imagine that every one of the fNWA reps that voted to keep the old structure are breathing a sigh of relief now that they realize how stupid the old representational structure was. This is the perfect example.

Nobody "cut you loose", you are given the same representational structure as any other carrier in ALPA. Time to put the big boy pants on and represent yourselves.

Alpha,

I'm sure you are typing a post ripping me a new one. So I'm reserving this spot while I edit :)

...

First you are correct. The structure of CPZ was dumb. They sold the junior guys to get credits they applied to saving pensions for a few more favored pilots. CPZ was political eyewash covering a scope sale. I'm not sure that the f-NWA reference to Visine is, but I think it is eyewash and they were the purveyors of this particular brand. But now we Delta guys take on yet another gaping loophole in our scope. As they say, the ingestion of Visine causes diarrhea and other localized pains in the butt.

Given the history of Go Jets and the NMB ruling which set the precedent that alter ego structures are legitimate even for the sole purpose of side stepping a scope clause, the hope for a Compass merger is remote. One likely scenario is that they switch rather than fight and end up joining the ranks of Teamsters. After all their first Representative was more concerned with Mesaba than Compass pilots and then D-ALPA unceremoniously booted them at the earliest opportunity. ALPA has not been a very pleasant experience.

The wisdom of booting them is apparent. But, we could have just as easily fought to make them Delta pilots and recaptured some of our flying. As a union, that is the course we should have taken. It is the course we need to take to be relevant.

And just how were you going to accomplish that in the real world?

Absolutely...this would have been the best for all parties...well maybe not management but i can't believe this didn't get unilateral support from everyone.....still dissapointed about that as well. :(

Could you tell me what our contract language says about fragmentation? Couldn't Delta sell the entire MEM or CVG base tomorrow? Couldn't Delta sell the MD-88 or the A-320 fleet tomorrow? Aren't these all Delta pilots?

The Compass transaction would not have even been big enough to trigger a fragmentation protection in our contract. It could have been a neutron bomb sale, all the metal survives but the pilots get dumped.

While you are working out those seat and BASE protections, could you work it out for the CVG 7ER category. I would like to get paid for sitting at home.

I think most on each side would agree that there vote should be NO...You think as a CP pilot i want 90 seat jets why?

Awright, rather than get in a peeing match with alfa and slow et al and saying something I'll regret later, I'm gonna shut up and take a "look and see" approach. I sincerely DALPA works with our MEC to ensure that the CPS pilots who were hired under the promise of a flowthrough are treated fairly. In the crew room now on a 4 hr "productivity break," and the mood is very, very bleak.

/sigh

Guys, stop kidding yourselves, there will be no flow.

Delta hated the idea and I doubt the MEC will fight to keep it.

I do not argue that at all. From their perspective they want everyone hired here to go though their process, not one the mimics their.

We do not argue that point at all. It came down to the will of the pilots and frankly there was not support and it then went the way it did. Another lesson learned.

At one point management wanted out of the flow. We could have offered a solution based on unity.

But, at the end of the day we might just have to undo what created Compass in the first place. Our predecessors traded jobs for credits which were applied to saving pensions. Perhaps the pension money needs to be taken back and applied to jobs. I know that earned me a turd in the flight case, but how fair is it to trade one pilot's career progression for another pilot's retirement? This cross subsidization of favored pilots at the expense of others has got to stop somewhere.

Besides as we trade away more and more jobs, ALPA as a union becomes less and less powerful. We become less and less relevant. That harms our ability to negotiate for 767 Captains and DC9 FO's alike.

It is a matter of priorities. Once we put a for sale sign on member's jobs the discussion then becomes, who do we sell? About anything can be justified based on economics.

We fail to think ahead to the next round of negotiations. Once traded away, scope is gone. So a scope sale benefits us for exactly one round. It harms our interest in the next round. The result is that scope is a leading indicator for contractual results in other areas. Sell scope = harder to get leverage in the next negotiation = continued negative trend line in pay and benefits.

I believe that it was signed or understood that flow rights are not right until you actually flow. Express Jet had this set up to avoid the lawsuits and I am sure that CPS and Mesaba put those protections in the new hire and or flow agreement somewhere too.

Suffice to say, update that app, and talk to you reps.

Our pilots are mostly uninformed. Those who read our scope publications were misinformed. They had a blast and made a ton of money flying for Express, but they have no clue as to why you would want that same opportunity.

Your mission, if you choose to accept it ... 'splain basic representation to folks who don't understand what it means when a RJ has a lower CASM and better range than a 737.

A strong moral compass is a heck of a burden.

haven't they been saying at all the roadshows the rough numbers for the flow from each company and how that would affect the number of off the street hires? Seems like a well coordinated case of to-your-face lying if not true.

I have not reread the LOA's today, but the stipulation on the flows and our PWA as I recall them is that it triggers a pullback to 85 76 seat jets if the flow becomes unavailable, but it does not stipulate by what means. It also does not define a flow up or down. So at the end of the day if it is ended this trigger may still hold a ton of leverage/water.

Brotta I do it on almost every leg. As you know I like to talk. :D

There are so many things in play, and the motto of"
A measure of a person is what how he/she treats someone he/she has nothing to gain from.

If DAL hires the flow does very little for me as a person, but it does not mean that I do not want to honor it for the guys that until today planed their futures on it.