Any "Latest & Greatest" about Delta?
10-06-2013, 05:53 AM
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Your analysis is kind of a worst case scenario, but your logic is sound.
One can ususally figure out where management is going by looking where there is money to be made. Japan is worse than most other places when it comes to legacy costs. As a new'ish LCC, Skymark's CASM is only about half of ANA and 2/3rds of JAL. This makes the tie up highly attractive and Delta can make money from codeshare by charging fees to facilitate the codeshare (Skymark lacks the IT infastructure and needs Delta's help) and commissions on sales (Delta is the much larger brand).
Still the question is "or else." Had we not modified our contract NRT's market would continue to do whatever it will continue to do. Delta will not operate it at a loss for long (and I understand it makes money and will continue). By structuring the LOA as they did we are much more broadly protected against worst case scenarios and we facilitate both overflights and continuing widebody Asia flying to connect.
The bigger question is what the market will do when Haneda opens further and how many of those slots we recieve.
One can ususally figure out where management is going by looking where there is money to be made. Japan is worse than most other places when it comes to legacy costs. As a new'ish LCC, Skymark's CASM is only about half of ANA and 2/3rds of JAL. This makes the tie up highly attractive and Delta can make money from codeshare by charging fees to facilitate the codeshare (Skymark lacks the IT infastructure and needs Delta's help) and commissions on sales (Delta is the much larger brand).
Still the question is "or else." Had we not modified our contract NRT's market would continue to do whatever it will continue to do. Delta will not operate it at a loss for long (and I understand it makes money and will continue). By structuring the LOA as they did we are much more broadly protected against worst case scenarios and we facilitate both overflights and continuing widebody Asia flying to connect.
The bigger question is what the market will do when Haneda opens further and how many of those slots we recieve.
Well the 'or else' is going to happen, LOA or no LOA. If I painted a rather dark picture, I didn't mean to. Asia is looking at huge growth, and we'll be a part of it. I just think it's a foregone conclusion that NRT won't, and as I said, I think ultimately we'd be happy if we can get flights to HND from our U.S. hubs at times we'd like. But as far as hubbing out of Japan, I don't think we'll see that happening in HND.
10-06-2013, 06:25 AM
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10-06-2013, 06:54 AM
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10-06-2013, 06:54 AM
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10-06-2013, 07:11 AM
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Question for ACL,
I just read the council 20 update on the PAC loa. There were a couple comments in there that got my radar up...again.
1. Council 20 guys wanted to have this loa go out for MEMRAT, but said they were in the minority. What is the general sense among reps and MEMRAT. IMO, it was improper that this loa not be a MEMRAT loa.
I just read the council 20 update on the PAC loa. There were a couple comments in there that got my radar up...again.
1. Council 20 guys wanted to have this loa go out for MEMRAT, but said they were in the minority. What is the general sense among reps and MEMRAT. IMO, it was improper that this loa not be a MEMRAT loa.
The People's Republic of China (i.e., Mainland China including Hong Kong)
The Republic of China (i.e., Taiwan)
The Republic of Korea
This improvement not only covers all of the current Fifth Freedom code share cities between Japan and Asia but also adds any potential code share to mainland China. This enhancement is in addition to the existing code share protections afforded in Section 1 E. 2. a. and b., which apply to all international code shares.
Personally, I thought both 80s explanation of how NRT slots were the "chicken" and Alfa's explanation of how block hours were the "egg" (or vice versa) was pretty acceptable for covering the range of pacific flying, there is now apparently a significant lack of language protecting us from a flex down in pacific flying.
Section 1 E. 2. e. has been added, to now read:
e. passenger seats on any Fifth Freedom flight segment between Japan and Asian cities beyond Japan unless the Company scheduled during the previous rolling 12 month period, measured at the end of each calendar quarter starting December 31st, 2013, the greater of:
1) 182,750 aircraft block hours of Pacific flying, or
2) 85 percent of the total aircraft block hours of Pacific flying in the previous measurement period.
Note: The Company will be excused from compliance with this provision in the event a circumstance over which the Company does not have control is the cause of such non-compliance.
Simply in the interest of debate, how was the language weakened? I see higher protections, with the protection expanding from just NRT to outside of NRT and into China as well. Considering the nuclear situation in Japan, and the forecasted increase in traffic for Asia in general, it looks like a very good move to me.
Last edited by johnso29; 10-06-2013 at 08:33 AM.
10-06-2013, 08:16 AM
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I hope ACL will chime in, but from what I have heard, not many were in support of MEMRAT. My understanding is the negotiators are very busy with this, FAR 117, and the upcoming Virgin Atlantic JV. Sending this LOA would cost money from roadshow expenses, and take time away from the negotiators when they need to be focusing on taking advantage of more upcoming opportunities. That's what I heard from a Rep.
LOA #13-03 also reduces the permitted average number of passengers per flight segment on foreign air carriers from 175 to 100 on Fifth Freedom flight segments between Japan and:
The People's Republic of China (i.e., Mainland China including Hong Kong)
The Republic of China (i.e., Taiwan)
The Republic of Korea
This improvement not only covers all of the current Fifth Freedom code share cities between Japan and Asia but also adds any potential code share to mainland China. This enhancement is in addition to the existing code share protections afforded in Section 1 E. 2. a. and b., which apply to all international code shares.
How many beach flights originated from NRT?
The 316 slots resulted in 116,400 block hours, or 54% of the Pacific flying block hours.
Section 1 E. 2. e. has been added, to now read:
e. passenger seats on any Fifth Freedom flight segment between Japan and Asian cities beyond Japan unless the Company scheduled during the previous rolling 12 month period, measured at the end of each calendar quarter starting December 31st, 2013, the greater of: 1) 182,750 aircraft block hours of Pacific flying, or
2) 85 percent of the total aircraft block hours of Pacific flying in the previous measurement period. Note: The Company will be excused from compliance with this provision in the event a circumstance over which the Company does not have control is the cause of such non-compliance.
Simply in the interest of debate, how was the language weakened? I see higher protections, with the protection expanding from just NRT to outside of NRT and into China as well. Considering the nuclear situation in Japan, and the forecasted increase in traffic for Asia in general, it looks like a very good move to me.
LOA #13-03 also reduces the permitted average number of passengers per flight segment on foreign air carriers from 175 to 100 on Fifth Freedom flight segments between Japan and:
The People's Republic of China (i.e., Mainland China including Hong Kong)
The Republic of China (i.e., Taiwan)
The Republic of Korea
This improvement not only covers all of the current Fifth Freedom code share cities between Japan and Asia but also adds any potential code share to mainland China. This enhancement is in addition to the existing code share protections afforded in Section 1 E. 2. a. and b., which apply to all international code shares.
How many beach flights originated from NRT?
The 316 slots resulted in 116,400 block hours, or 54% of the Pacific flying block hours.
Section 1 E. 2. e. has been added, to now read:
e. passenger seats on any Fifth Freedom flight segment between Japan and Asian cities beyond Japan unless the Company scheduled during the previous rolling 12 month period, measured at the end of each calendar quarter starting December 31st, 2013, the greater of: 1) 182,750 aircraft block hours of Pacific flying, or
2) 85 percent of the total aircraft block hours of Pacific flying in the previous measurement period. Note: The Company will be excused from compliance with this provision in the event a circumstance over which the Company does not have control is the cause of such non-compliance.
Simply in the interest of debate, how was the language weakened? I see higher protections, with the protection expanding from just NRT to outside of NRT and into China as well. Considering the nuclear situation in Japan, and the forecasted increase in traffic for Asia in general, it looks like a very good move to me.
My use of the word weaken was a paraphrase of how the council 20 letter read. Just my own choice of words for brevity, deferring to guys more in the know than me.
10-06-2013, 08:16 AM
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Where's Elvis?
10-06-2013, 08:32 AM
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10-06-2013, 08:57 AM
The Brown Dot +1
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Totally off topic...I've been considering buying a used porsche Carrera. I'm looking at 1999-2003 cabriolets. Anyone got one or experience with one that cares to chime in on quality, durability, negatives, etc. it will be a toy car.
10-06-2013, 09:10 AM
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