Profit sharing for 2019
01-14-2020, 04:17 PM
#231
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Joined APC: Jul 2013
Posts: 10,033
Originally Posted by MasterOfPuppets
^^^yep they are a domestic airline with a JV world presence.
01-14-2020, 05:00 PM
#232
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Joined APC: Apr 2015
Posts: 2,426
Originally Posted by CBreezy
While I agree Delta has a JV problem, they are number one US carrier across the Atlantic. I don't know the stats across the Pacific but I'm sure they aren't nowhere as good. To say they don't have a world presence, however, is deceptive.
They have shrunk in the Pacific.... outside of JVs.
They don’t have have a large presence to Latin America outside of JVs......
01-14-2020, 06:27 PM
#234
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Joined APC: Dec 2007
Posts: 662
I was hired by delta and United in the same month several years ago. When I take my 777 pay rate and multiply it by 1.08%, it beats the 767 I could hold there multiplied at 1.16%, by $30/hour. Plus I have way more enjoyable jumpseat experiences on UA metal. Actually, any metal. And I don’t wear a hat...but that’s only because it was stolen from the bag room top rack.
01-14-2020, 06:47 PM
#235
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Posts: 3,123
Originally Posted by CBreezy
While I agree Delta has a JV problem, they are number one US carrier across the Atlantic. I don't know the stats across the Pacific but I'm sure they aren't nowhere as good. To say they don't have a world presence, however, is deceptive.
01-14-2020, 06:56 PM
#236
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Position: EWR 777 Captain
Posts: 1,715
Originally Posted by blizzue
I think in addition to all of this they simply have a better profit sharing calculation - but I don’t know. I’m not here to cry about our profit sharing, I’m happy with what I get. Just sharing the data point.
Originally Posted by DashTrash
I agree with you because their profit sharing is not based on profit margin. It’s solely based on total profit. Anything above $2.5 billion is paid at 20% I believe.
. . . on the question of Delta versus United profit sharing. Delta has the same formula EXCEPT they get 20% of the profit above $2.5 billion and United gets 20% of the profit above 6.9% of revenue. You can see this year we don't start getting 20% of the profit until a higher threshold of 6.9% x $43 billion or about $3 billion.
With that in mind if we had Delta's formula our profit sharing compared to above would be:
($0.250/$8.194)=3% + (($4.468-2.5)x0.20)/$8.194=4.8% = 7.8% (EDIT: this makes more sense if you look at this post - Profit sharing for 2019 )
so Delta's formula would increase our PS by 0.5%
The primary driver of Delta's higher PS checks is Delta's higher overall profit, NOT the formula,
BUT . . .
the question remains why did UAL ALPA agree to this. Answer - the Profit Sharing language at UAL is a carry over from the pre-merger days when UAL had annual revenues around $20 bil so at that time the threshold for 20% profit sharing was only 6.9% x $20 bil or about $1.5 billion. So it was a better Profit Sharing formula than Delta's when we negotiated it. If the negotiators knew that the clause would stick for more than a decade as revenues doubled maybe they'd have gone the Delta route, but who knew. I'm sure it's an item on the negotiators list.
Finally, Delta has major structural cost advantages that United can never achieve. Namely we are about 90% unionized and they are about 90% NOT unionized, and our hubs on average are more expensive on a per flight basis even considering the premium we get for operating out of the expensive hubs. Those 2 items alone give Delta about a $1 billion cost advantage. There is no way for United to lower costs to equal Delta in those categories. This is NOT saying our management can't do better, it's just saying Delta is starting each year with a $1 bil structural advantage.
01-14-2020, 09:42 PM
#237
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Joined APC: Dec 2018
Posts: 1,066
Originally Posted by Sunvox
This from another forum . . .
. . . on the question of Delta versus United profit sharing. Delta has the same formula EXCEPT they get 20% of the profit above $2.5 billion and United gets 20% of the profit above 6.9% of revenue. You can see this year we don't start getting 20% of the profit until a higher threshold of 6.9% x $43 billion or about $3 billion.
With that in mind if we had Delta's formula our profit sharing compared to above would be:
($0.250/$8.194)=3% + (($4.468-2.5)x0.20)/$8.194=4.8% = 7.8% (EDIT: this makes more sense if you look at this post - Profit sharing for 2019 )
so Delta's formula would increase our PS by 0.5%
The primary driver of Delta's higher PS checks is Delta's higher overall profit, NOT the formula,
BUT . . .
the question remains why did UAL ALPA agree to this. Answer - the Profit Sharing language at UAL is a carry over from the pre-merger days when UAL had annual revenues around $20 bil so at that time the threshold for 20% profit sharing was only 6.9% x $20 bil or about $1.5 billion. So it was a better Profit Sharing formula than Delta's when we negotiated it. If the negotiators knew that the clause would stick for more than a decade as revenues doubled maybe they'd have gone the Delta route, but who knew. I'm sure it's an item on the negotiators list.
Finally, Delta has major structural cost advantages that United can never achieve. Namely we are about 90% unionized and they are about 90% NOT unionized, and our hubs on average are more expensive on a per flight basis even considering the premium we get for operating out of the expensive hubs. Those 2 items alone give Delta about a $1 billion cost advantage. There is no way for United to lower costs to equal Delta in those categories. This is NOT saying our management can't do better, it's just saying Delta is starting each year with a $1 bil structural advantage.
. . . on the question of Delta versus United profit sharing. Delta has the same formula EXCEPT they get 20% of the profit above $2.5 billion and United gets 20% of the profit above 6.9% of revenue. You can see this year we don't start getting 20% of the profit until a higher threshold of 6.9% x $43 billion or about $3 billion.
With that in mind if we had Delta's formula our profit sharing compared to above would be:
($0.250/$8.194)=3% + (($4.468-2.5)x0.20)/$8.194=4.8% = 7.8% (EDIT: this makes more sense if you look at this post - Profit sharing for 2019 )
so Delta's formula would increase our PS by 0.5%
The primary driver of Delta's higher PS checks is Delta's higher overall profit, NOT the formula,
BUT . . .
the question remains why did UAL ALPA agree to this. Answer - the Profit Sharing language at UAL is a carry over from the pre-merger days when UAL had annual revenues around $20 bil so at that time the threshold for 20% profit sharing was only 6.9% x $20 bil or about $1.5 billion. So it was a better Profit Sharing formula than Delta's when we negotiated it. If the negotiators knew that the clause would stick for more than a decade as revenues doubled maybe they'd have gone the Delta route, but who knew. I'm sure it's an item on the negotiators list.
Finally, Delta has major structural cost advantages that United can never achieve. Namely we are about 90% unionized and they are about 90% NOT unionized, and our hubs on average are more expensive on a per flight basis even considering the premium we get for operating out of the expensive hubs. Those 2 items alone give Delta about a $1 billion cost advantage. There is no way for United to lower costs to equal Delta in those categories. This is NOT saying our management can't do better, it's just saying Delta is starting each year with a $1 bil structural advantage.
in addition, DL’s hubs are a lot less competitive than UAL’s - resulting in less pricing power and margin pressure.
ATL is another unmatched fortress hub - unique to DL.
And finally, DL is doing a better job of innovating and driving a premium product. That is something that UAL could and should match.
01-15-2020, 04:40 AM
#238
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Joined APC: Mar 2005
Posts: 392
Originally Posted by PilotGR
Does delta Reimburse for drying cleaning, crew meals, laundry during training...please add any others im missing.
They travel to training in coach.
Until recently, 117 extensions were assumed and scheduled. Not extending was a big deal.
Every airline has their positive and negatives. Their profit sharing sure is great, and our new hires don’t get it unless they work a full year. But I’m glad I’m at UAL.
You should go read their threads. It’s hilarious.
”Let’s not spend negotiating capital on new hire hotels!”
Lodging while in training at Delta!
Last edited by jumppilot; 01-15-2020 at 05:11 AM.
01-15-2020, 05:46 AM
#239
Super Moderator
Joined APC: Jul 2006
Posts: 5,544
Originally Posted by jumppilot
”Let’s not spend negotiating capital on new hire hotels!”
But seriously, yes we should be paying for their hotels.
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