So WRT us, does this mean we will face more or less pressure to ship them some charity jobs program (i.e. more POS 380's to the US, etc).

A friend wrote to ask about our 8K filing and what it means for scope. His point was Delta reported 21% of it's revenues from "Contract Carrier Arrangements" totalling $6.4 Billion on expenses of roughly $5.5 Billion; meaning a little more than $900 million of our operating profit was the result of outsourced RJ flying.

If so, that challenges the notion that we're losing money on RJ flying and begs the question why our management sees this as somehow ancillary to our "real airline" flying.

Management will say their strategy of divesting flying is working. I'd ask our management, "How much more would we make if we were not paying extra shareholders, parasitic management, dispatch and maintenance organizations? How much more would we make if we kept our contractor's profits in house?" And, I want to ask them, "Just what is our core business ... yeah ... well then why do you outsource it to someone you deem operationally inferior?"

For ALPA, I would like to ask "How does it promote job security to outsource the most profitable component of our operation?"

This highlights the cost to "take it back" and suggests there really is a strong economic push to rationalize capacity between the 76 seat line and what is currently offered at mainline.

Management would be smart to bring this flying in house. It is core to our business. ALPA would be smart to DEMAND this flying be brought in house in the interest of job security.

But, I fear both will see the profits made by outsourced flying and say ... "good." The problem with that notion is that if what we have is "good" then more is "better." More is a 717, or C Series.

Not according to the guys I talked to. They said it matter of factly. I asked them for clarification a couple times. But, if you say so....

I feel much better now that you've clarified "significant". Is this like the MEC talking about "significant" contract improvements in our next contract? Or like the MEC stating that their policy of constructive engagement has led to "significant" improvements in our current contract?

This is a very significant post from you acl.

Carl

Pretty funny stuff right there!

Carl

Hold on a minute, just because DL doesn't have it doesn't mean it's a POS...I have read writeups on sites such as flyertalk about passengers now trying to book themselves on a 380 given a choice when it's convenient...after riding on it myself I must agree -- it is superior to everything else out there. Only the 787 might be able to compete in terms of cabin comfort.

DL needs to order some, or some 747-800s!

Spot on post, Bar.

Here's the 8K in case anyone questions the math.

EDGAR Pro

Contract Carrier arrangements brought in 21% of our revenues and delivered 47% of our profits. That pretty much explains why we've got DC9's and they've got E195's. That explains why our most prolific widebody is a type certified in 1978. How much more could mainline make if we would invest in a current generation fleet?

For almost my entire life, I've seen mainline managed in a fashion which most resembles a business liquidating it's core assets as they have been used up. We could use (and I do expect) a large airplane order this year.

On a much more positive note, what is the formula for figuring out how much we will be getting in profit sharing?

I totally get what you are saying with bringing the percentage of mainline airframes, seat miles, pilots, etc. way up from wherever it is now.

But what exactly does it mean to say that a contract carrier brought in a certain percentage of revenue or profits?

What I mean is -- a family buys a ticket on Delta.com to go from their home in Charleston, SC to visit relatives in Eastern Europe, Bucharest to be exact. After Pinnacle and Air France get them from CHS to OTP, a revenue and profit can be tallied. But how is that contract carrier's revenue tallied up?

Let's say the family paid $5,000 and their itinerary was:

CHS-JFK Pinnacle
JFK-CDG Air France
CDG-OTP Air France

OTP-AMS KLM
AMS-ATL Delta
ATL-CHS Delta

With only one leg being on a 'contract carrier', three legs being on an international codeshare, and two legs being on actual Delta, how is that one leg on the contract carrier accounted for in terms of revenue and profit?

A percentage of the total $5,000 airfare somehow...in miles? In what?