Delta to Pinnacle: Concessions or shutdown
11-30-2012 | 05:05 PM
#121
Gets Weekends Off
Joined: Jan 2008
Posts: 2,244
Likes: 0
From: CL-65 captain
If its not done in Mecca (MSP) it's not done right. Too much fun when a guy tells you his seniority number was lower than my age at 5:00am CT. Some don't realize that certain training events must be done in certain locals due to FAA certification.
And yes, that got fun quick. Southern's get up early to have fun. We are all hosed but some are still splittin hairs with gunpowder in the background.
And yes, that got fun quick. Southern's get up early to have fun. We are all hosed but some are still splittin hairs with gunpowder in the background.
11-30-2012 | 06:16 PM
#122
Moderator
Joined: Oct 2006
Posts: 13,088
Likes: 0
From: B757/767
11-30-2012 | 08:59 PM
#125
Gets Weekends Off
Joined: Jan 2008
Posts: 4,629
Likes: 15
From: blueJet
Shawn Anderson, Delta’s Vice President of Delta Connection, gave this testimony in his November 1, 2006 trial Declaration:
- 16 -
"Moreover, Delta may place into service additional large 70-seat regional jets–and even larger RJs with up to 76 seats. Delta would have to consider placing these new aircraft at Comair’s competitors and “grow” the competitors instead of placing such valuable assets at Comair where they would produce less profit."
". . . If Comair does not obtain the labor cost reductions it seeks, then its cost structure will not be competitive with the other Delta Connection carriers. In this industry, and at this time, having an uncompetitive cost structure will mean that Comair will have no opportunity for growth, and, indeed, will mean that Comair cannot survive as a viable regional airline. Simply put, unless Comair can reduce its controllable costs to competitive levels, it does not make business sense to continue Comair flying for Delta."
". . . If Comair can restructure itself so that its controllable costs are competitive, Delta should be able to increase, rather than decrease, the flying it contracts to Comair. This would mean that Comair would have an opportunity to grow, rather than shrink. With growth would come new job opportunities, and reduced unit costs, as more junior employees are added, and reduced unit overhead
costs as the same facilities and overhead could be used to perform more flying."
". . . I am familiar with Comair’s restructuring plans, including its plan to reduce its controllable costs–both labor and non-labor. If Comair is able to restructure in accordance with its restructuring plans, I believe that Comair will be able to perform Delta Connection flying at a competitive price."
"Accordingly, I believe that the labor cost reductions in Comair’s business plan are necessary–indeed, essential–to Comair’s successful restructuring."
". . . If Comair does not obtain the labor cost reductions it seeks, then its cost structure will not be competitive with the other Delta Connection carriers. In this industry, and at this time, having an uncompetitive cost structure will mean that Comair will have no opportunity for growth, and, indeed, will mean that Comair cannot survive as a viable regional airline. Simply put, unless Comair can reduce its controllable costs to competitive levels, it does not make business sense to continue Comair flying for Delta."
". . . If Comair can restructure itself so that its controllable costs are competitive, Delta should be able to increase, rather than decrease, the flying it contracts to Comair. This would mean that Comair would have an opportunity to grow, rather than shrink. With growth would come new job opportunities, and reduced unit costs, as more junior employees are added, and reduced unit overhead
costs as the same facilities and overhead could be used to perform more flying."
". . . I am familiar with Comair’s restructuring plans, including its plan to reduce its controllable costs–both labor and non-labor. If Comair is able to restructure in accordance with its restructuring plans, I believe that Comair will be able to perform Delta Connection flying at a competitive price."
"Accordingly, I believe that the labor cost reductions in Comair’s business plan are necessary–indeed, essential–to Comair’s successful restructuring."
http://www.nysb.uscourts.gov/opinion...64_opinion.pdf
11-30-2012 | 09:41 PM
#126
Gets Weekends Off
Joined: Oct 2007
Posts: 389
Likes: 0
And remember this lie my pants off under oath a$$clown:
Shawn Anderson, Delta’s Vice President of Delta Connection, gave this testimony in his November 1, 2006 trial Declaration:
http://www.nysb.uscourts.gov/opinion...64_opinion.pdf
Shawn Anderson, Delta’s Vice President of Delta Connection, gave this testimony in his November 1, 2006 trial Declaration:
- 16 -
"Moreover, Delta may place into service additional large 70-seat regional jets–and even larger RJs with up to 76 seats. Delta would have to consider placing these new aircraft at Comair’s competitors and “grow” the competitors instead of placing such valuable assets at Comair where they would produce less profit."
". . . If Comair does not obtain the labor cost reductions it seeks, then its cost structure will not be competitive with the other Delta Connection carriers. In this industry, and at this time, having an uncompetitive cost structure will mean that Comair will have no opportunity for growth, and, indeed, will mean that Comair cannot survive as a viable regional airline. Simply put, unless Comair can reduce its controllable costs to competitive levels, it does not make business sense to continue Comair flying for Delta."
". . . If Comair can restructure itself so that its controllable costs are competitive, Delta should be able to increase, rather than decrease, the flying it contracts to Comair. This would mean that Comair would have an opportunity to grow, rather than shrink. With growth would come new job opportunities, and reduced unit costs, as more junior employees are added, and reduced unit overhead
costs as the same facilities and overhead could be used to perform more flying."
". . . I am familiar with Comair’s restructuring plans, including its plan to reduce its controllable costs–both labor and non-labor. If Comair is able to restructure in accordance with its restructuring plans, I believe that Comair will be able to perform Delta Connection flying at a competitive price."
"Accordingly, I believe that the labor cost reductions in Comair’s business plan are necessary–indeed, essential–to Comair’s successful restructuring."
". . . If Comair does not obtain the labor cost reductions it seeks, then its cost structure will not be competitive with the other Delta Connection carriers. In this industry, and at this time, having an uncompetitive cost structure will mean that Comair will have no opportunity for growth, and, indeed, will mean that Comair cannot survive as a viable regional airline. Simply put, unless Comair can reduce its controllable costs to competitive levels, it does not make business sense to continue Comair flying for Delta."
". . . If Comair can restructure itself so that its controllable costs are competitive, Delta should be able to increase, rather than decrease, the flying it contracts to Comair. This would mean that Comair would have an opportunity to grow, rather than shrink. With growth would come new job opportunities, and reduced unit costs, as more junior employees are added, and reduced unit overhead
costs as the same facilities and overhead could be used to perform more flying."
". . . I am familiar with Comair’s restructuring plans, including its plan to reduce its controllable costs–both labor and non-labor. If Comair is able to restructure in accordance with its restructuring plans, I believe that Comair will be able to perform Delta Connection flying at a competitive price."
"Accordingly, I believe that the labor cost reductions in Comair’s business plan are necessary–indeed, essential–to Comair’s successful restructuring."
http://www.nysb.uscourts.gov/opinion...64_opinion.pdf
11-30-2012 | 11:00 PM
#128
Gets Weekends Off
Joined: Jan 2008
Posts: 4,629
Likes: 15
From: blueJet
Just when you thought your costs were finally competitive...
http://usatoday30.usatoday.com/money/industries/travel/2010-09-01-delta-comair-cuts_N.htm
Delta subsidiary Comair slashing fleet, jobs
Updated 9/2/2010 .addthis_button_email span {display: none;} .addthis_button_print span {display: none;}
...Comair is one of the most profitable regional carriers in the business, at least according to data the airline submitted to the federal Transportation Department earlier this year. In the first quarter of 2010, Comair made about $9 million in operating profit, with an 8.4% operating margin – tops among large regional carriers.
But company officials have long said the federal data can be misleading because they do not include debt payments and that Comair does not make its money from ticket revenues but rather from its contract with parent Delta based on how many hours it flies. Comair also had a loss in the fourth quarter of 2009, although it did have an operational profit margin of 16.2% in the second quarter of 2009.
Bendoraitis said in the memo, however, that the airline is not competitive with costs that he said are 20% higher than its competitors.
"Our current cost structure … does not enable us to be competitive in the current industry environment," he wrote. "To secure our future, we need to demonstrate our ability to operate as a standalone entity. We must be able to earn a profit while reducing our operating costs to what the market is willing to pay for our services."
The planes that are being removed by Delta are less efficient 50-seaters, and the cuts will leave Comair with about 44 planes total – mostly 70- and 76-seaters. The planes will be retired and perhaps sold for parts or to other airlines, or returned to their owners if they are on a lease arrangement.
So, to review the DCI playbook:
http://usatoday30.usatoday.com/money/industries/travel/2010-09-01-delta-comair-cuts_N.htm
Delta subsidiary Comair slashing fleet, jobs
Updated 9/2/2010 .addthis_button_email span {display: none;} .addthis_button_print span {display: none;}
...Comair is one of the most profitable regional carriers in the business, at least according to data the airline submitted to the federal Transportation Department earlier this year. In the first quarter of 2010, Comair made about $9 million in operating profit, with an 8.4% operating margin – tops among large regional carriers.
But company officials have long said the federal data can be misleading because they do not include debt payments and that Comair does not make its money from ticket revenues but rather from its contract with parent Delta based on how many hours it flies. Comair also had a loss in the fourth quarter of 2009, although it did have an operational profit margin of 16.2% in the second quarter of 2009.
Bendoraitis said in the memo, however, that the airline is not competitive with costs that he said are 20% higher than its competitors.
"Our current cost structure … does not enable us to be competitive in the current industry environment," he wrote. "To secure our future, we need to demonstrate our ability to operate as a standalone entity. We must be able to earn a profit while reducing our operating costs to what the market is willing to pay for our services."
The planes that are being removed by Delta are less efficient 50-seaters, and the cuts will leave Comair with about 44 planes total – mostly 70- and 76-seaters. The planes will be retired and perhaps sold for parts or to other airlines, or returned to their owners if they are on a lease arrangement.
So, to review the DCI playbook:
- Park 50s, saying they're inefficient
- Ask employees for concessions to "keep remainder of fleet intact"
- When 50s are gone, discover that 70/76-seat fleet is "too small" to be economically feasible
- Redistribute 70/76-seat aircraft to other carriers in exchange for parking 50s.
11-30-2012 | 11:32 PM
#129
Day puke
Joined: Feb 2006
Posts: 3,865
Likes: 0
From: Out.
So, to review the DCI playbook:
- Park 50s, saying they're inefficient
- Ask employees for concessions to "keep remainder of fleet intact"
- When 50s are gone, discover that 70/76-seat fleet is "too small" to be economically feasible
- Redistribute 70/76-seat aircraft to other carriers in exchange for parking 50s.
Let us die with our boots on.
12-01-2012 | 02:09 PM
#130
Gets Weekends Off
Joined: Sep 2008
Posts: 239
Likes: 0
The Colgan and Mesaba purchases are going to go down in history as some of the stupidest transactions in history. However, this is looking at from our own narrow view as employees. I suspect that there was more going on below the surface, and DAL has been in on this for a long time. I am not angry, because I realize that it's business and you have to be dispassionate as a CEO in order to discharge your duties to the shareholders.
The bottom-line for the airlines is transitioning from the current business model and onto another one that is profitable. Unfortunately, we find ourselves in the painful transition period and the handwriting is on the wall about what and how many jobs (of high pay/QOL) will be left when the dust finally settles.
It is reasonable to assume that what the airlines look like in 5 years is going to be much different than it is today. I think we will see an overall reduction in capacity and airframes at the regional level, more flying of larger airplanes, but less total airframes at the legacy carriers. This is going to translate into more full airplanes flying to less cities and less often. EAS is going to be eliminated as a line item in the federal budget and this will open the door for some entrepreneurs to come in and serve markets with the right airplane, frequency and price.
I am not saying that any of the above is good for the overall health of the piloting career, but it is just a theory. The next evolution is going to be development of a man-monitored UAV grid for air transportation. This is also going to be painful, but how many of you have ever had a ride on a train with no one driving?
The bottom-line for the airlines is transitioning from the current business model and onto another one that is profitable. Unfortunately, we find ourselves in the painful transition period and the handwriting is on the wall about what and how many jobs (of high pay/QOL) will be left when the dust finally settles.
It is reasonable to assume that what the airlines look like in 5 years is going to be much different than it is today. I think we will see an overall reduction in capacity and airframes at the regional level, more flying of larger airplanes, but less total airframes at the legacy carriers. This is going to translate into more full airplanes flying to less cities and less often. EAS is going to be eliminated as a line item in the federal budget and this will open the door for some entrepreneurs to come in and serve markets with the right airplane, frequency and price.
I am not saying that any of the above is good for the overall health of the piloting career, but it is just a theory. The next evolution is going to be development of a man-monitored UAV grid for air transportation. This is also going to be painful, but how many of you have ever had a ride on a train with no one driving?
Thread
Thread Starter
Forum
Replies
Last Post
