I think a lot of people are confused here. Oh well

 

Delta doesn't pay for staffing, other than station staffing. All flight crew expenses are on ASA.

The 80% in flying covers both SkyWest and ASA flying out of Atlanta. This used to be ASA, but was renegotiated when Delta took over the ASA ramp operation in ATL.

Speaking of Delta taking over the ramp, rumor has it that all current ASA outstations have their station ops out for bid. I'd imagine Comair would snap all of these up given their push into ground service operations.

Also, ASA's contract for Delta covers 151 aircraft. This was in the current Among Friends. It is a hard aircraft number, not a block hour number. So, the way I see it, after the ATRs leave we are in breach of contract unless Delta awards us more aircraft. Also, Delta can't easily take their 30 or so 200s back unless they are replaced due to the contract that they signed.

I would imagine that for the purposes of "second lowest costs" that SkyWest and ASA are considered the same airline. Remember that JA himself said that SkyWest bids one price to Delta and decides internally who to award the aircraft to (there's no decision, it's always SkyWest...) So to Delta, it is one entity, so why determine the cost structure separately?

We have until 5 years from the date of purchase to be second lowest cost. A lot can happen in 2 years (just look at the way things were around here 2 years ago). The only reason SkyWest is a much lower cost structure that ASA is because they have about 1000 additional pilots, as well as 100 or so more aircraft to spread their costs over. You switch places with ASA and SkyWest and ASA would be every bit of the lower cost machine that SkyWest is. After all, Jerry gave the SkyWest pilots the ASA payscale after we signed our deal, and our workrules are identical. Keep in mind that when SkyWest bought ASA, we were the low cost machine!

So, the sky is not falling. ASA is in decent shape. The trend with DCI carriers may be to the wholly owneds, but we all heard that story in 1999. Things can and do change.

 

100% of operating costs pass through to Delta, so I'm not sure what you're talking about.


And it will be renegotiated again. The 80% WILL be gone. Delta has no other choice.

See the above. Delta is holding a gun to ASA's head right now and saying "let's negotiate".


So let me get this straight. ASA's outstation operations are now up for bid to be outsourced? But the sky is not falling? Sounds to me like ASA is being chopped up one limb at a time. We are being prepared to be phased out. We flipped off JA and won the battle, but lost the war. We will now slowly be replaced by SkyWest.

 

100% fuel cost yes... never heard that 100% of our operating cost gets pushed to D.

 

It's true. Delta buys every seat on our planes, and in return covers all associated costs plus a small profit margin. The only thing ASA (SkyWest Inc) actually has to pay for is outstation personnel.

 

So let me get this straight. Delta buys every seat on ASA's planes from Delta who are the ones that sell the seats. That doesn't quite sound right. I know that Delta pays ASA to fly the routes and covers the fuel, but all the other operating costs just doesn't make sense.

 

It doesn't make sense because this JP character seems to be mistaken (or just a kook). No fee-for-departure airline would have an incentive to keep costs down if their mainline partner wrote a blank check to cover expenses.

 

I thought this was common knowledge, since it was among the first things explained to me when I first came into the company a little over a year ago. This explains why we may occasionally fly a route with little or no pax, because it makes no difference, since all seats have already been bought and paid for by Big-D. We only provide the end service, with big-D doing all the marketing, booking, and all the other things associated with filling seats.

Earlier this year I took 3 hour maintenance delay, they end up moving our pax over to next scheduled flight, but we still flew our originally scheduled flight, be it with an empty airplane, only 15 minutes apart from the other flight. One may think this makes no sense, except when you consider our primary goal too D is driven by completion factor, not pax loads.

 

I don't think the confusion lies in the fact that the mainline partner pays a fee for each departure (hence fee-for-departure airlines) regardless of load factor. The controversy is over the fact that this JP character is saying that it isn't a set fee per departure but that the fee varies depending on variable costs at the FFD airline.

 

Zayo – Your right, I apologize for jumping the gun with my quick reply. Your point being over ‘set fees’ verses ‘varying fees’ and JP’s remarks referring to ‘covering all cost except outstation personnel.’ I’m not sure if anyone would have a clear answer for that, except an airline accountant, even then, it might require interpretation.