NuGuy

Heyas,

"Word" is to expect rejection initially from the DOJ lowbies, later to be overridden by upper DOJ wonks.

Nu

NuGuy

Just got mine in the mail. According to the document, the plan meets all current ERISA funding requirements and experienced an increase in value (AFTER subtracting liabilities) $314 million dollars. Total plan income was $550 million. Total plan assets are north of 3.5 billion (that's with a 'b').

Here's the kicker...you guys want to complain about how we can't prove that guys will retire at 60 (um, except our historical data, which shows that more than 50 percent do). But every guy that doesn't go at 60 makes the plan MORE solvent.

Pick one or the other...can't have both.

This was for 2007. Carl is right...this is the last report that NWA will release, assuming that the merger happens. Next year, it's all DALs wonks.

Nu

acl65pilot

Funny.
So are we going to have a joint "Holiday" party this year?????

slowplay

While it's comforting to know that as of October 1, 2007 that the NWA Plan had performed well, I think Pineapple's question was for 2008. I think the market may be just a tad lower (even after todays rally) than it was then.

Unless there is an incredible market rally, the required pension contributions will look a heck of a lot different next year than this year. That will be the new Delta's obligation to cover, so I hope the "super premium" flying you bring can pay for it.

acl65pilot

As it was explained to me by a very informed NWA individual, even if the market tanks, it will require no more than 3-4 million more next year.
I would love to get my hands on that data. He is a smart guy so I am sure he is correct.

Pineapple Guy

ACL,

I am very hesitant to challenge your contacts, so may I ask you to ask your "very informed NWA individual" the following:

1. Is NWA taking advantage of 17 year funding?
2. If so, are they using the 8.85% interest rate assumption (I think that goes hand in hand with 17 year funding, but I could be wrong).
3. Assuming they ARE using the 17 and 8.85%, how do they propose to make that return if only one of their 14 funds are invested in equities?

Something doesn't add up, and I'm just trying to understand.

PG

Kingbird87

I doubt that any of us at NWA or Delta have enjoyed the declines in our career earnings of the last few years. We both have taken a huge step backward and in all likelihood, we will never come close to the financial situations of those before us. Both airlines entered bankruptcy the same day, but that is about the only similarity of our restructuring. Part of NWA's restructuring was the freezing of the pensions and subsequent legislative initiative to allow the extended time frame to contribute to the frozen plan. I honestly wish Delta had gone about their pension problems in the same manner. Unfortunately, the senior pilots drained the plan so severely, the company did not make the effort. This is now an issue that should be addressed in the future. I would honestly think Delta pilots should look at this obligation as an opening to address their shortfall through creative measures to more ably provide a catch up plan so that all Delta pilots have some measure of a defined benefit plan. Any infighting over this issue will become a lose/lose proposition for all of us. This was the only positive element of our restructuring, and we earned this benefit through great sacrifice. Delta pilots deserve no less.

slowplay

Just as I'm sure he's not.

The NWA MEC put out that funding for the pension under the stretched out rules initially would cost $29 million per year. Your source is telling you that the market can be lower than it was when the original funding was $26 million, the plan have two years less to amortize its liabilities, and in 2009 would cost half of what it did at the peak of the market?

Sounds like a pilot investor!

For the NWA guys that don't read there own MEC's stuff, here's a couple of snippets from your "retirement transition update #1" dated June 25, 2007. I wish there was a way to attach the whole thing. For Carl, you might find that angel food cake is what you're serving....

Under PPA ’06, the Company is required to contribute the amount necessary to fully fund pilot frozen DB benefits over 17 years, using an interest rate of 8.85% to determine the present value of those benefits. Even with these changed rules, the Company still has to contribute a total of approximately $29 million to the DB program for plan year 2006. It will have to continue making contributions under PPA ’06 through 2023.

In the first place, our DB plan is significantly—over $2 billion—under funded on a termination basis.

But it will be the new Delta's obligation now....

acl65pilot

I will ask when he is in town. No he is fairly connected in MSP. I know nothing about your plan, so I would not even try to understand what is or is not a short fall.

tsquare

Thank you for the thought, but... no thanks. We've (DAL pilots) have seen how easily DB plans can fall apart, and I am sure I am not alone in my feelings that we are not remotely interested in going down this road again. As the guy in Jerry McGuire said... "Show me the money". I would much rather have a good DC plan and if we could ever get the federal gubmint to give a damn, maybe we could have those fully funded year after year, and we'll all be much better off. Especially the younger guys.