Jay5150

read above

Eric Stratton

nwa's parking weren't causing furloughs either. under utlilizing the 9's.

they also had orders if boeing can stop the delays.

Carl Spackler

I am amused at some of the comments from Delta people about how the NWA pilot's leverage evaporated. As if to infer that the loss of leverage had something to do with negotiating prowess on the Delta side or stupidity on the NWA side. This is very, very simple. The two companies decided that Delta would be the acquiring carrier. Once that occured, all that the Delta MEC needed to do was curry favor with management - which they did with scope language changes that allow NWA the ability to continue flying big iron internationally where most of the money is made. If NWA had been the acquiring company, the exact same thing could have been done by the NWA MEC. In fact we would have had to relax scope as well in order for DAL wide bodies to continue flying.

The offensive part of this for NWA folks is that the DAL scope change was required to keep NWA planes in the air and making a ton of money for the new Delta. But the DAL MEC thought they alone should get the money for this change that affected NWA. The classy thing to do would have been to escrow the monies collected after the triggering events allowed Delta pilots to actually receive the pay raises. In that way, the bar for everyone would have been raised for the new combined contract, and the Delta pilots would have acknowledged the huge value of NWA continuing to fly big iron international helping both balance sheets. That of course did not happen and I think NWA pilots were/are shocked at the treatment.

Carl

FIIGMO

...........

Jay5150

Here you go again...

I didn't say orders. I wasn't referring to some future order book for a plane that hasn't flown yet. I said taking deliveries. As in now, right now, this year with real airplanes. 2 777's which have just been delivered and 10 737's that start arriving in June.

Jay5150

Sorry Carl, I ain't buying it. If the NWA contract had such language then what difference does it make who's the aquiring carrier. It's my understanding that no such language exists in the NWA contract (or at the very least not to the extent of DAL's) and that's why DALPA was approached. I don't have your contract to read but how would DAL being the "aquiring" carrier make any part of your contract void?

Carl Spackler

Your understanding is incorrect. We have very strong scope with regard to international wide body flying. I don't know your contract but from what I hear you folks talk about, it sounds very similar to ours. If we had been the acquiring carrier, our scope would have had to be modified as we are already at the limit of code share for wide body international flying. Where we are weak (in my opinion) is under 100 seat scope language. I know our guys tried their best, but it wasn't enough.

As far as why DALPA was approached, it was because one of the very first announcements about this was that Delta would be the acquiring carrier. Why on Earth would NWALPA be approached by the acquiring carrier?? I'm fairly certain that happened because Anderson is a much better CEO than Steenland and EVERYONE knows it. Steenland and the NWA board were smart enough to realize it, and agree to be acquired by DAL. Now, if the Japanese were to balk at allowing the 5th freedom rights to be transferred to another company, then NWA may have to be the acquiring company after all. But all these things are unknowable at this early stage.

Carl

Jay5150

So...Is this an aquisition and not a merger?

Scoop

Carl,
Are you sure about that? How much did NW make last quarter? It seems the more any airline flies these days the more money they lose.
Scoop

Carl Spackler

My understanding is that it is an acquisition based on a "no cash" stock swap where NWA shares will be replaced by DAL shares at a ratio that values the transaction at just under 4 billion dollars for NWA

Carl