Myfingershurt

It would cover total expenses for 2-3 months. They were trying to act like it was for them to use on whatever they want. However the grants are specifically earmarked to cover payroll through sept. Delta is hoping their employees are ignorant and don’t watch the news.

Humboldt

From the town hall, I noticed that they are taking the grants but looking into other options for loans. My father sent me an email from his financial advisor with many bullets of positive news during this time. Bullet # 2 was the fact that corporate CEOs in the US are currently buying their own stock shares at levels not seen since 2009. This indicates that CEOs are confident that their companies will rebound. Dell Technologies CEO Micheal Dell just bought bought $26.3 million of his own stock last week.

That would be one good reason not to take the government loans and perhaps why leadership is looking at other revenue streams to avoid the government loans.

Opsmgrguy

We haven’t flown 50k since Sunday. Since then it’s dropped (as you’d expect for midweek). Even if we counted every working crew member today 2x on all flights we wouldn’t hit 50k. 25% load factor today too....and that’s only figuring what we’re operating. If we were still offering the same seats/day as we did 2 months ago, we’d be just under 10% load factor. 😧☹️

Still flying, just not very much. I’d hate to see a total shutdown unless it was fed directed. No one wants to be first....a restart would take weeks.

Buck Rogers

Supposedly, 2 days ago our revenue was 3M dollars for the day, compared to a typical day of 130M. That is only a paltry 127M $$$$ shortfall for 1 day.

Let's not talk revenue, let's talk expenses. I'll even narrow it down to pilot expenses. Avg pilot salary 20K a month 14500 pilots equals about 1B for the quarter. No problem....plenty of money to pay the pilots. Other employees? Other obligations? Eff that!

People have asked "why don't we renegotiate leases"? Previously(2005), prior to going into bankruptcy, we had our most onerous MD88 leases at about 240,000$$$ a month. Tried to renegotiate...lessor said tough tata's, no dice. After we declared bankruptcy, Delta told the creditors to come pick 'em up. They wound up getting new leases on those MD88's at 30,000$$$ a month. Not sure renegotiating would result in any different outcome this time around.

I'm a short timer. Good luck to all you guys that have a long career ahead. It may well prove to be a gut wrentching time with tough decisions to be made by mgt, by the union and by the pilots.

gloopy

Interesting perspective. Did he (or the article he mentioned) say anything about DL or other airline execs doing so at this time?

As for other revenue, great, although I'm not seeing a lot right now except for cargo, which also requires at least some domestic flying footprint beyond the initial delivery hub.

I'm just as concerned with our ability to participate in the recovery later. If all we do is shrink to profitability, we'll be absolutely creamed by the existing and future start up LCCs and be lucky to beat back cabotage attempts. Thats one reason why IMO we need a strategy to ramp up quickly and why furloughing to the bones of the optimizer will absolutely screw us later, far negating any savings in the medium term. That doesn't mean its a binary choice (internet porn version of 7K furloughs versus zero) but if we do it has to be significantly less than current or immediately forcast demand or we'll be hosed on the other side of this. Yet another reason why "work less not for less" should be the battle plan when the time comes.

gloopy

This is different because there is zero market anyone on the planet for current leases at anywhere near prevailing rates right now. We already have terms which include sending them back if we don't pay. Time to make some calls. Not to renegotiate for decades, but for the next couple quarters at least. If they won't accept reasonable terms, stop paying and let them come get them. Not all the planes of course, but what we know we won't need for as long as it would take to get replacements.

Call their bluff. They have zero leverage and won't nuke their own balance sheet over a few month's payment differentials. Offer them interest only for next quarter and interest plus a third of principle (or equivalent) for 2 quarters after that then going back to normal, and if they balk call their bluff and let them eat the full cost with zero income.

Buck Rogers

Hadn't heard that. As simple as dont pay, no penalty? Doesnt pass the smell test, but I'm not saying you are wrong. If true, great for us and the creditor is more ignorant than I would have ever dreamed possible.

Buck Rogers

Oops dup post

gloopy

The penalty is they repo. Who cares. Obviously not the whole fleet, but time to get congress involved in this as well. Hedge funds spooled up in leasing companies who flip the depreciation into tax shelters etc while hundreds of thousands of working American's jobs and our economic engine/infrastructure is at risk, including the travelling public on the other side of this, and including local and state government's tax revenues which are already plummeting, all so lease holders get to "eat first" without any adjustment as if the boom times were going on uninterrupted? Nah. Call their bluff and let them choke on their worthless collateral with a side of PR disaster if they won't offer temporary relief.

Buck Rogers

Ok, if you say so. Still won't surprise me if there is more to the story. Even landlords get 1st month, last month, security deposit etc as some protection.