Delta defers 100 seat RFP
08-25-2011 | 10:12 AM
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From: Douglas Aerospace post production Flight Test & Work Around Engineering bulletin dissembler
Delta defers 100 seat RFP
Delta decided to defer its small jet order ... .
What we will need to be careful about, if the doom & gloom economic prognostications come to pass, is a combination of concessionary bargaining, retirement driven hiring, and an RFP happening simultaneously.
Back channel static is that the small jet RFP failed on an inability to reach a deal with ALPA. ALPA sources internal and back channel all state that no negotiations took place what so ever and management never even brought up the subject. Thus far, ALPA's more credible than the "unofficial" sources.
A semi educated guess is that the C Series needs to go further along before anyone really can make a huge commitment for that airplane. The E-190 is not ideal either.
Delta Said to Defer Order for 100 Small Jets By Mary Jane Credeur and Jose Sergio Osse - Aug 25, 2011
Delta Air Lines Inc. (DAL) deferred an order of 100 small narrow-body jets until 2012, delaying talks with planemakers such as Embraer SA (EMBR3), as it prepares to buy 100 Boeing Co. (BA) 737s, a person familiar with the matter said.
Discussions with Embraer and competitor Bombardier Inc. advanced this year while Atlanta-based Delta negotiated with Boeing and Airbus SAS for the larger planes, said the person, who wasn’t authorized to speak publicly. The Boeing deal was described this week by people familiar with that purchase.
Embraer and Bombardier are trying to create a niche for jets smaller than those from Airbus and Boeing. Single-aisle planes from Sao Jose Dos Campos, Brazil-based Embraer or Bombardier would complement Delta’s mainline fleet of Boeing and Airbus narrow-bodies.
“After talks with Delta, Embraer expects that Delta’s decision whether to buy its planes or equivalents from competitors will only be made next year,” Embraer Executive Vice President Paulo Cesar de Souza e Silva said yesterday in an e-mailed statement.
Embraer hasn’t decided whether to build a new plane or a version of its largest regional jet with new engines to compete with Montreal-based Bombardier’s CSeries. Bombardier targets a 2013 debut for that plane, which has a list price of $58.3 million for the CS100 model and $66.6 million for the CS300.
Trebor Banstetter, a spokesman for Delta, and Bombardier’s John Arnone declined to comment.
No Timeline
People familiar with the matter had said on Aug. 22 that Delta had delayed a decision beyond this week on buying smaller narrow-body aircraft, without giving the size of the planned purchase or a new timetable.
Delta’s plan to order Boeing 737-900ERs would have a list value of about $8.58 billion, based on list prices. Airlines typically buy planes at a discount.
The 737-900ER is the largest variant of Chicago-based Boeing’s 737 family, the world’s most widely flown jetliner, and seats about 200 passengers. Bombardier has targeted the CSeries as a rival to planes with 100 to 149 seats.
Early customers for the CSeries include Korean Air Lines, which ordered 10 CS300 jets in June at the Paris Air Show. The CSeries has a 20 percent fuel advantage over similar planes, according to Bombardier.
Delta had said in January that it planned to buy 100 to 200 narrow-body jets and seek options for 200 more, with deliveries starting as soon as 2013. The company said it would consider small, medium and large single-aisle aircraft.
To contact the reporters on this story: Mary Jane Credeur in Atlanta at [email protected]; Jose Sergio Osse in Sao Paulo at [email protected]
To contact the editors responsible for this story: Ed Dufner at [email protected]; Francisco Marcelino at [email protected]
Delta Air Lines Inc. (DAL) deferred an order of 100 small narrow-body jets until 2012, delaying talks with planemakers such as Embraer SA (EMBR3), as it prepares to buy 100 Boeing Co. (BA) 737s, a person familiar with the matter said.
Discussions with Embraer and competitor Bombardier Inc. advanced this year while Atlanta-based Delta negotiated with Boeing and Airbus SAS for the larger planes, said the person, who wasn’t authorized to speak publicly. The Boeing deal was described this week by people familiar with that purchase.
Embraer and Bombardier are trying to create a niche for jets smaller than those from Airbus and Boeing. Single-aisle planes from Sao Jose Dos Campos, Brazil-based Embraer or Bombardier would complement Delta’s mainline fleet of Boeing and Airbus narrow-bodies.
“After talks with Delta, Embraer expects that Delta’s decision whether to buy its planes or equivalents from competitors will only be made next year,” Embraer Executive Vice President Paulo Cesar de Souza e Silva said yesterday in an e-mailed statement.
Embraer hasn’t decided whether to build a new plane or a version of its largest regional jet with new engines to compete with Montreal-based Bombardier’s CSeries. Bombardier targets a 2013 debut for that plane, which has a list price of $58.3 million for the CS100 model and $66.6 million for the CS300.
Trebor Banstetter, a spokesman for Delta, and Bombardier’s John Arnone declined to comment.
No Timeline
People familiar with the matter had said on Aug. 22 that Delta had delayed a decision beyond this week on buying smaller narrow-body aircraft, without giving the size of the planned purchase or a new timetable.
Delta’s plan to order Boeing 737-900ERs would have a list value of about $8.58 billion, based on list prices. Airlines typically buy planes at a discount.
The 737-900ER is the largest variant of Chicago-based Boeing’s 737 family, the world’s most widely flown jetliner, and seats about 200 passengers. Bombardier has targeted the CSeries as a rival to planes with 100 to 149 seats.
Early customers for the CSeries include Korean Air Lines, which ordered 10 CS300 jets in June at the Paris Air Show. The CSeries has a 20 percent fuel advantage over similar planes, according to Bombardier.
Delta had said in January that it planned to buy 100 to 200 narrow-body jets and seek options for 200 more, with deliveries starting as soon as 2013. The company said it would consider small, medium and large single-aisle aircraft.
To contact the reporters on this story: Mary Jane Credeur in Atlanta at [email protected]; Jose Sergio Osse in Sao Paulo at [email protected]
To contact the editors responsible for this story: Ed Dufner at [email protected]; Francisco Marcelino at [email protected]
Back channel static is that the small jet RFP failed on an inability to reach a deal with ALPA. ALPA sources internal and back channel all state that no negotiations took place what so ever and management never even brought up the subject. Thus far, ALPA's more credible than the "unofficial" sources.
A semi educated guess is that the C Series needs to go further along before anyone really can make a huge commitment for that airplane. The E-190 is not ideal either.
Last edited by Bucking Bar; 08-25-2011 at 10:29 AM.
08-25-2011 | 10:36 AM
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From: Light Chop
Delta decided to defer its small jet order ... .
What we will need to be careful about, if the doom & gloom economic prognostications come to pass, is a combination of concessionary bargaining, retirement driven hiring, and an RFP happening simultaneously.
Back channel static is that the small jet RFP failed on an inability to reach a deal with ALPA. ALPA sources internal and back channel all state that no negotiations took place what so ever and management never even brought up the subject. Thus far, ALPA's more credible than the "unofficial" sources.
A semi educated guess is that the C Series needs to go further along before anyone really can make a huge commitment for that airplane. The E-190 is not ideal either.
What we will need to be careful about, if the doom & gloom economic prognostications come to pass, is a combination of concessionary bargaining, retirement driven hiring, and an RFP happening simultaneously.
Back channel static is that the small jet RFP failed on an inability to reach a deal with ALPA. ALPA sources internal and back channel all state that no negotiations took place what so ever and management never even brought up the subject. Thus far, ALPA's more credible than the "unofficial" sources.
A semi educated guess is that the C Series needs to go further along before anyone really can make a huge commitment for that airplane. The E-190 is not ideal either.
The one thing I find interesting is we're ordering 739s because they're just a 738 with more seating (not really but close enough).
So sure the E190 doesn't work here. Doesn't achieve whatever the goal is. But ironically we have a lot of E175s at Delta Con that are smaller than, I would presume, have higher CASMs than the E190. Why doesn't the same economies of scale work there?
Or does it? What doesn't work is E190s here and E175s there, right oh mighty one of the BTA data?
08-25-2011 | 10:40 AM
#3
Gets Weekends Off
Joined: Jan 2007
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From: CRJ
I would say delta is already counting on scope relief.......
http://www.airlinepilotforums.com/re...reds-jets.html
http://www.airlinepilotforums.com/re...reds-jets.html
08-25-2011 | 10:42 AM
#4
veut gagner à la loterie
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From: Light Chop
I would say delta is already counting on scope relief.......
http://www.airlinepilotforums.com/re...reds-jets.html
http://www.airlinepilotforums.com/re...reds-jets.html
Bar, didn't you say we needed to update our resumes?
08-25-2011 | 11:07 AM
#6
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From: Douglas Aerospace post production Flight Test & Work Around Engineering bulletin dissembler
FTB,
If (big IF) unions were to agree to outsource this jet, it would be during a time when rosy predictions provide assurance that no one would be harmed by the deal. Attrition provides some wiggle room there.
It is not in an union's interest to predict a lousy economy, so by nature, union predictions tend to be "best case" scenarios. Unfortunately unions' rosy predictions fail to contemplate the sort of downturn that provides a real world stress test on contractual labor protective provisions. Hence the "oops, we did not see that coming and it is not our fault" cycle. I for one, hope that cycle has been broken.
The outsider cognoscenti are about evenly split on what unions will do with this decision. About half of us think the union learned a lesson from the last decade (and is in fear of being voted off the property if they trade away another job) about half feel that the economic insistence on higher pay will push the union to explore what kind of deals it might make to satisfy that need.
The numbers tell us there just is not the revenue in the airline business that there needs to be for significant cost increases to be absorbed without risking the viability of the business. I'm not even sure there's any cost savings with outsourcing (even with outfits like GoJets). The margins are getting so tight on the regional flying that my crystal ball gets cloudy, particularly if Delta can get these jets on the property as "cash flow accretive."
Make no mistake about it. Pilots are a cost that management (all of them) want to reduce. Delta management "loves us" because they respect our bargaining agent. Without that "love" there is scant little difference in the way the bean counters look at us, or GoJets pilots. We're just the meat servo that moves the metal.
If (big IF) unions were to agree to outsource this jet, it would be during a time when rosy predictions provide assurance that no one would be harmed by the deal. Attrition provides some wiggle room there.
It is not in an union's interest to predict a lousy economy, so by nature, union predictions tend to be "best case" scenarios. Unfortunately unions' rosy predictions fail to contemplate the sort of downturn that provides a real world stress test on contractual labor protective provisions. Hence the "oops, we did not see that coming and it is not our fault" cycle. I for one, hope that cycle has been broken.
The outsider cognoscenti are about evenly split on what unions will do with this decision. About half of us think the union learned a lesson from the last decade (and is in fear of being voted off the property if they trade away another job) about half feel that the economic insistence on higher pay will push the union to explore what kind of deals it might make to satisfy that need.
The numbers tell us there just is not the revenue in the airline business that there needs to be for significant cost increases to be absorbed without risking the viability of the business. I'm not even sure there's any cost savings with outsourcing (even with outfits like GoJets). The margins are getting so tight on the regional flying that my crystal ball gets cloudy, particularly if Delta can get these jets on the property as "cash flow accretive."
Make no mistake about it. Pilots are a cost that management (all of them) want to reduce. Delta management "loves us" because they respect our bargaining agent. Without that "love" there is scant little difference in the way the bean counters look at us, or GoJets pilots. We're just the meat servo that moves the metal.
08-25-2011 | 11:12 AM
#7
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I would say delta is already counting on scope relief.......
http://www.airlinepilotforums.com/re...reds-jets.html
http://www.airlinepilotforums.com/re...reds-jets.html
I think it really lacks forward thinking for our management to try and secure up the 100 seaters at the regionals. If its a negotiating tactic then I get it. But the 100 seater are going to be a big part of our flying. In the late part of the decade when hiring picks up due to retirements who do you think is going to have trouble staffing an airline. It's not going to be the majors. The regionals are never going to pay enough to keep people there long term if given a choice. Eventually I see majors hiring guys without PIC time which would void the only carrot regionals have...a quick upgrade. So if management really whats to risk ruining the airline further they will continue down this path. Otherwise it's a strategic negotiating tactic that unfortunately will probably work.
08-25-2011 | 11:15 AM
#8
Underboob King
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From: Guppy Commander
I would say delta is already counting on scope relief.......
http://www.airlinepilotforums.com/re...reds-jets.html
http://www.airlinepilotforums.com/re...reds-jets.html
FTB, even if cal "loses" the scope battle, unlikely IMHO, they'd likely just put a freeze on what they've got. Also let's say that the cal express side switches from 50's to 70's their scope would still be on par with our bloated scope. So a win, isn't a win compared to us.
Those guys at cal are ready to fight for scope though and so should we.
08-25-2011 | 11:21 AM
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From: CRJ Captain
you guys at american delta and united have 3 of the biggest contract votes in the history of our industry coming your way. TO quote airplane "good luck we are all counting on you" Skywest announces this thing how they are going to buy hundreds of replacement planes and incase people didnt know Trans States Holding Co also has signed intent to buy that mitsubishi regional jet. These are bold moves by CEO's of regionals that think that you guys are going to cave and give in on scope. Pinnacle also has a lot of options on the q 400 as well and they are making a stretch 90 seat version of that so dont count that plane out of scope either. A lot of us regional guys are pulling for you in this battle. We fly the planes we are told to fly. Don't let us fly anything bigger unless I am swinging gear for you (which i am pretty good at i might add)
08-25-2011 | 11:22 AM
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From: B757/767
I would say delta is already counting on scope relief.......
http://www.airlinepilotforums.com/re...reds-jets.html
http://www.airlinepilotforums.com/re...reds-jets.html
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