Any "Latest & Greatest" about Delta?
01-29-2010, 08:31 AM
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So Carl, is industry leading SWA or FDX or UPS?
01-29-2010, 08:32 AM
Can't abide NAI
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Bar's really going to "stir the pudding" now
Contract 2000 helped put Delta Air Lines into bankruptcy. There, I said it.
It was an unlikely set of circumstances that resulted in the outlier contract to begin with. For starters, Delta's Board picked a management team who was inexperienced in the business, unrealistic and who lost its own moral legitimacy with "legal" replacing "the right thing to do." Contract 2000 was in many ways payback for failing to correct Contract 96 when the relationship with pilots could have been best preserved. McKinsey and Co. consulting was mostly running the decision making (at least the modeling) both at Delta and United. This modeling has Mullin, Reid and Burns giving speeches about "new cost paradigms" and believing Delta could not spend enough money because our competitors would try to match us and they would run out of liquidity before we did.
With this philosophy, they set about burning the furniture, steadfast in the belief that it was OK to waste because others would bleed out first.
Part of the McKinsey modeling was outsourcing a huge amount of Delta flying ... a plan ALPA was happy to play along with. This plan required a cheap operator to outsource to, but there was the hitch. Comair pilots had become wary of ALPA National's leadership and the pilot group increasing motivated by what they felt was unfair treatment as a subsidiary of Delta and being prostrate to "mainline" ALPA. Having observed ASA's precedent setting contract in 99 which was obtained by throwing ALPA National out of the room and threatening Delta, the Comair leadership correctly reasoned that they could get the first "mainline" contract at a regional by going for the short hairs ... and they did, at a high cost to Delta (around $660,000,000 or over $300,000.00 per pilot). Both Delta and ALPA proved their resolve (and lack of leadership) during the Comair strike.
The next headlines in April 2001 were: "Delta Air Lines reached a surprising tentative contract agreement yesterday with the union representing its pilots, averting a strike deadline set for next week." No one talks about Comair's involvement in this (and maybe they were not involved, but I believe Delta's inexperienced managers were scared out of their wits as they witnessed the incredible cash burn of a strike involving less than 12% of their operation - they realized a strike at mainline was such an immediate risk to the Company that even with George Bush's assurances that he would halt a strike - they had to fold.)
Contract 2000 was a Pyrrhic victory for D-ALPA. It was a political victory in a time devoid of common sense in the industry. Contract 2000 was also in many ways United plus 1%. United went into bankruptcy before Delta and it needs to be noted the financial condition of the entire industry was showing clearly negative cyclical trends PRIOR to the tragedy of September 11th.
The psychological importance of Contract 2000 pay rates as a benchmark is a powerful political force within our Delta pilot ranks. However, it was unsustainable in the marketplace then and is even more unsustainable now. It was the antonym of POS96 but, as we have learned pilots are much more tied to their employers than their managers are.
This one post is probably enough to ensure I'll never run for office at D-ALPA, but still we should be evaluating our contract goals very pragmatically. If we are smart we will remember our Company is some 24 Billion dollars in debt and that our competitors do not carry this drag on their balance sheets. This debt keeps us from buying new airplanes, being able to compete and growing.
Our current DALPA leadership and our Company leadership have been commendably intelligent in finding ways to improve our bankruptcy contract outside of Section 6, when opportunities arise. It has been a very mature and rational partnership. We will continue to do well if management resists Mullins, Reid and Burns era corruption and D ALPA continues it's reasoned push for seizing every advantage through partnership rather than brinkmanship.
In setting our goals for Contract 2012, we need to remain good students of economics, comparative rates at our competitors and history. I have every confidence our Representation will do just that.
It was an unlikely set of circumstances that resulted in the outlier contract to begin with. For starters, Delta's Board picked a management team who was inexperienced in the business, unrealistic and who lost its own moral legitimacy with "legal" replacing "the right thing to do." Contract 2000 was in many ways payback for failing to correct Contract 96 when the relationship with pilots could have been best preserved. McKinsey and Co. consulting was mostly running the decision making (at least the modeling) both at Delta and United. This modeling has Mullin, Reid and Burns giving speeches about "new cost paradigms" and believing Delta could not spend enough money because our competitors would try to match us and they would run out of liquidity before we did.
With this philosophy, they set about burning the furniture, steadfast in the belief that it was OK to waste because others would bleed out first.
Part of the McKinsey modeling was outsourcing a huge amount of Delta flying ... a plan ALPA was happy to play along with. This plan required a cheap operator to outsource to, but there was the hitch. Comair pilots had become wary of ALPA National's leadership and the pilot group increasing motivated by what they felt was unfair treatment as a subsidiary of Delta and being prostrate to "mainline" ALPA. Having observed ASA's precedent setting contract in 99 which was obtained by throwing ALPA National out of the room and threatening Delta, the Comair leadership correctly reasoned that they could get the first "mainline" contract at a regional by going for the short hairs ... and they did, at a high cost to Delta (around $660,000,000 or over $300,000.00 per pilot). Both Delta and ALPA proved their resolve (and lack of leadership) during the Comair strike.
The next headlines in April 2001 were: "Delta Air Lines reached a surprising tentative contract agreement yesterday with the union representing its pilots, averting a strike deadline set for next week." No one talks about Comair's involvement in this (and maybe they were not involved, but I believe Delta's inexperienced managers were scared out of their wits as they witnessed the incredible cash burn of a strike involving less than 12% of their operation - they realized a strike at mainline was such an immediate risk to the Company that even with George Bush's assurances that he would halt a strike - they had to fold.)
Contract 2000 was a Pyrrhic victory for D-ALPA. It was a political victory in a time devoid of common sense in the industry. Contract 2000 was also in many ways United plus 1%. United went into bankruptcy before Delta and it needs to be noted the financial condition of the entire industry was showing clearly negative cyclical trends PRIOR to the tragedy of September 11th.
The psychological importance of Contract 2000 pay rates as a benchmark is a powerful political force within our Delta pilot ranks. However, it was unsustainable in the marketplace then and is even more unsustainable now. It was the antonym of POS96 but, as we have learned pilots are much more tied to their employers than their managers are.
This one post is probably enough to ensure I'll never run for office at D-ALPA, but still we should be evaluating our contract goals very pragmatically. If we are smart we will remember our Company is some 24 Billion dollars in debt and that our competitors do not carry this drag on their balance sheets. This debt keeps us from buying new airplanes, being able to compete and growing.
Our current DALPA leadership and our Company leadership have been commendably intelligent in finding ways to improve our bankruptcy contract outside of Section 6, when opportunities arise. It has been a very mature and rational partnership. We will continue to do well if management resists Mullins, Reid and Burns era corruption and D ALPA continues it's reasoned push for seizing every advantage through partnership rather than brinkmanship.
In setting our goals for Contract 2012, we need to remain good students of economics, comparative rates at our competitors and history. I have every confidence our Representation will do just that.
Last edited by Bucking Bar; 01-29-2010 at 08:50 AM.
01-29-2010, 08:40 AM
Happy to be here
Joined APC: Jun 2006
Position: A-320A
Posts: 18,563
Contract 2000 helped put Delta Air Lines into bankruptcy. There, I said it.
It was an unlikely set of circumstances that resulted in the outlier contract to begin with. For starters, Delta's Board picked a management team who was inexperienced in the business, unrealistic and who lost its own moral legitimacy with "legal" replacing "the right thing to do." Contract 2000 was in many ways payback for failing to correct Contract 96 when the relationship with pilots could have been best preserved. McKinsey and Co. consulting was mostly running the decision making (at least the modeling) both at Delta and United. This modeling has Mullin, Reid and Burns giving speeches about "new cost paradigms" and believing Delta could not spend enough money because our competitors would try to match us and they would run out of liquidity before we did.
With this philosophy, they set about burning the furniture, steadfast in the belief that it was OK to waste because others would bleed out first.
Part of the McKinsey modeling was outsourcing a huge amount of Delta flying ... a plan ALPA was happy to play along with. This plan required a cheap operator to outsource to, but there was the hitch. Comair pilots had become wary of ALPA National's leadership and the pilot group increasing motivated by what they felt was unfair treatment as a subsidiary of Delta and being prostrate to "mainline" ALPA. Having observed ASA's precedent setting contract in 99 which was obtained by throwing ALPA National out of the room and threatening Delta, the Comair leadership correctly reasoned that they could get the first "mainline" contract at a regional by going for the short hairs ... and they did, at a high cost to Delta (around $660,000,000 or over $300,000.00 per pilot). Both Delta and ALPA proved their resolve (and lack of leadership) during the Comair strike.
The next headlines in April 2001 were: "Delta Air Lines reached a surprising tentative contract agreement yesterday with the union representing its pilots, averting a strike deadline set for next week." No one talks about Comair's involvement in this (and maybe they were not involved, but I believe Delta's inexperienced managers were scared out of their wits as they witnessed the incredible cash burn of a strike involving less than 12% of their operation - they realized a strike at mainline was such an immediate risk to the Company that even with George Bush's assurances that he would halt a strike - they had to fold.)
Contract 2000 was a Pyrrhic victory for D-ALPA. It was a political victory in a time devoid of common sense in the industry. Contract 2000 was also in many ways United plus 1%. United went into bankruptcy before Delta and it needs to be noted the financial condition of the entire industry was showing clearly negative cyclical trends PRIOR to the tragedy of September 11th.
The psychological importance of Contract 2000 pay rates as a benchmark is a very power political force within our Delta pilot ranks. However, it was unsustainable in the marketplace then and is even more unsustainable now. It was the antonym of POS96 but, as we have learned pilots are much more tied to their employers than their managers are.
This one post is probably enough to ensure I'll never run for office at D-ALPA, but still we should be evaluating our contract goals very pragmatically. If we are smart we will remember our Company is some 24 Billion dollars in debt and that our competitors do not carry this drag on their balance sheets. This debt keeps us from buying new airplanes, being able to compete and growing.
Our current DALPA leadership and our Company leadership have been commendably intelligent in finding ways to improve our bankruptcy contract outside of Section 6, when opportunities arise. It has been a very mature and rational partnership. We will continue to do well if management resists Mullins, Reid and Burns era corruption and D ALPA continues it's reasoned push for seizing every advantage through partnership rather than brinkmanship.
In setting our goals for Contract 2012, we need to remain good students of economics, comparative rates at our competitors and history. I have every confidence our Representation will do just that.
It was an unlikely set of circumstances that resulted in the outlier contract to begin with. For starters, Delta's Board picked a management team who was inexperienced in the business, unrealistic and who lost its own moral legitimacy with "legal" replacing "the right thing to do." Contract 2000 was in many ways payback for failing to correct Contract 96 when the relationship with pilots could have been best preserved. McKinsey and Co. consulting was mostly running the decision making (at least the modeling) both at Delta and United. This modeling has Mullin, Reid and Burns giving speeches about "new cost paradigms" and believing Delta could not spend enough money because our competitors would try to match us and they would run out of liquidity before we did.
With this philosophy, they set about burning the furniture, steadfast in the belief that it was OK to waste because others would bleed out first.
Part of the McKinsey modeling was outsourcing a huge amount of Delta flying ... a plan ALPA was happy to play along with. This plan required a cheap operator to outsource to, but there was the hitch. Comair pilots had become wary of ALPA National's leadership and the pilot group increasing motivated by what they felt was unfair treatment as a subsidiary of Delta and being prostrate to "mainline" ALPA. Having observed ASA's precedent setting contract in 99 which was obtained by throwing ALPA National out of the room and threatening Delta, the Comair leadership correctly reasoned that they could get the first "mainline" contract at a regional by going for the short hairs ... and they did, at a high cost to Delta (around $660,000,000 or over $300,000.00 per pilot). Both Delta and ALPA proved their resolve (and lack of leadership) during the Comair strike.
The next headlines in April 2001 were: "Delta Air Lines reached a surprising tentative contract agreement yesterday with the union representing its pilots, averting a strike deadline set for next week." No one talks about Comair's involvement in this (and maybe they were not involved, but I believe Delta's inexperienced managers were scared out of their wits as they witnessed the incredible cash burn of a strike involving less than 12% of their operation - they realized a strike at mainline was such an immediate risk to the Company that even with George Bush's assurances that he would halt a strike - they had to fold.)
Contract 2000 was a Pyrrhic victory for D-ALPA. It was a political victory in a time devoid of common sense in the industry. Contract 2000 was also in many ways United plus 1%. United went into bankruptcy before Delta and it needs to be noted the financial condition of the entire industry was showing clearly negative cyclical trends PRIOR to the tragedy of September 11th.
The psychological importance of Contract 2000 pay rates as a benchmark is a very power political force within our Delta pilot ranks. However, it was unsustainable in the marketplace then and is even more unsustainable now. It was the antonym of POS96 but, as we have learned pilots are much more tied to their employers than their managers are.
This one post is probably enough to ensure I'll never run for office at D-ALPA, but still we should be evaluating our contract goals very pragmatically. If we are smart we will remember our Company is some 24 Billion dollars in debt and that our competitors do not carry this drag on their balance sheets. This debt keeps us from buying new airplanes, being able to compete and growing.
Our current DALPA leadership and our Company leadership have been commendably intelligent in finding ways to improve our bankruptcy contract outside of Section 6, when opportunities arise. It has been a very mature and rational partnership. We will continue to do well if management resists Mullins, Reid and Burns era corruption and D ALPA continues it's reasoned push for seizing every advantage through partnership rather than brinkmanship.
In setting our goals for Contract 2012, we need to remain good students of economics, comparative rates at our competitors and history. I have every confidence our Representation will do just that.
I had a long winded comparison of C2K written up yesterday. It took two or three postings because of its length, but the essence was:
C2K= Oil at 147 per bbl
PWA after LOA 51 = oil at 30 per bbl
JPWA= oil at 40-50 a bbl.
C2012 should equate to rational economics and about 75-85 a bbl.
01-29-2010, 08:41 AM
Back on TDY
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Position: 747-400 Captain
Posts: 12,487
01-29-2010, 08:41 AM
Can't abide NAI
Joined APC: Jun 2007
Position: Douglas Aerospace post production Flight Test & Work Around Engineering bulletin dissembler
Posts: 12,014
UPS is a trucking Company with airplanes. FDX is a small package, high margin delivery company (can you imagine if we charged $12 to $44 a pound one way for pax? How about a $250 bag fee? ) and SWA is a way too expensive bus line.
Our competitive set is (ugh) American, (cough) United, and US Air. We should also consider AirFrance, Virgin and maybe Emirates, Singapore and British Airways.
To get our pay rates up we need better hegemony within ALPA and leadership at the international level. Lee Moak for ALPA President makes sense for us.
Apologies for the link to the US management meeting at Parker's house.
Our competitive set is (ugh) American, (cough) United, and US Air. We should also consider AirFrance, Virgin and maybe Emirates, Singapore and British Airways.
To get our pay rates up we need better hegemony within ALPA and leadership at the international level. Lee Moak for ALPA President makes sense for us.
Apologies for the link to the US management meeting at Parker's house.
01-29-2010, 08:47 AM
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Position: A-320A
Posts: 18,563
Also Bar, I will add something to your statement if you do not mind.
C2K was not the reason for 1113 it just guaranteed it. With the business model in place putting that added cost in the form of a non-variable over four plus years (life of the contract) resulted in an heavily debt burdened company to plunge faster in to the abyss.
I can equate that to the oil run up last year an a rudimentary level. In effect 147 dollar a barrel oil did not cause the economic collapse, it just helped fuel it.
C2K was not the reason for 1113 it just guaranteed it. With the business model in place putting that added cost in the form of a non-variable over four plus years (life of the contract) resulted in an heavily debt burdened company to plunge faster in to the abyss.
I can equate that to the oil run up last year an a rudimentary level. In effect 147 dollar a barrel oil did not cause the economic collapse, it just helped fuel it.
01-29-2010, 08:48 AM
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Posts: 18,563
In regards to my question I agree to a point. Margins are way better at FDX and UPS. Return to those margins or our historic ones then we may have a similar comparison.
01-29-2010, 08:48 AM
Back on TDY
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Position: 747-400 Captain
Posts: 12,487
Contract 2000 helped put Delta Air Lines into bankruptcy. There, I said it.
It was an unlikely set of circumstances that resulted in the outlier contract to begin with. For starters, Delta's Board picked a management team who was inexperienced in the business, unrealistic and who lost its own moral legitimacy with "legal" replacing "the right thing to do." Contract 2000 was in many ways payback for failing to correct Contract 96 when the relationship with pilots could have been best preserved. McKinsey and Co. consulting was mostly running the decision making (at least the modeling) both at Delta and United. This modeling has Mullin, Reid and Burns giving speeches about "new cost paradigms" and believing Delta could not spend enough money because our competitors would try to match us and they would run out of liquidity before we did.
With this philosophy, they set about burning the furniture, steadfast in the belief that it was OK to waste because others would bleed out first.
Part of the McKinsey modeling was outsourcing a huge amount of Delta flying ... a plan ALPA was happy to play along with. This plan required a cheap operator to outsource to, but there was the hitch. Comair pilots had become wary of ALPA National's leadership and the pilot group increasing motivated by what they felt was unfair treatment as a subsidiary of Delta and being prostrate to "mainline" ALPA. Having observed ASA's precedent setting contract in 99 which was obtained by throwing ALPA National out of the room and threatening Delta, the Comair leadership correctly reasoned that they could get the first "mainline" contract at a regional by going for the short hairs ... and they did, at a high cost to Delta (around $660,000,000 or over $300,000.00 per pilot). Both Delta and ALPA proved their resolve (and lack of leadership) during the Comair strike.
The next headlines in April 2001 were: "Delta Air Lines reached a surprising tentative contract agreement yesterday with the union representing its pilots, averting a strike deadline set for next week." No one talks about Comair's involvement in this (and maybe they were not involved, but I believe Delta's inexperienced managers were scared out of their wits as they witnessed the incredible cash burn of a strike involving less than 12% of their operation - they realized a strike at mainline was such an immediate risk to the Company that even with George Bush's assurances that he would halt a strike - they had to fold.)
Contract 2000 was a Pyrrhic victory for D-ALPA. It was a political victory in a time devoid of common sense in the industry. Contract 2000 was also in many ways United plus 1%. United went into bankruptcy before Delta and it needs to be noted the financial condition of the entire industry was showing clearly negative cyclical trends PRIOR to the tragedy of September 11th.
The psychological importance of Contract 2000 pay rates as a benchmark is a very power political force within our Delta pilot ranks. However, it was unsustainable in the marketplace then and is even more unsustainable now. It was the antonym of POS96 but, as we have learned pilots are much more tied to their employers than their managers are.
This one post is probably enough to ensure I'll never run for office at D-ALPA, but still we should be evaluating our contract goals very pragmatically. If we are smart we will remember our Company is some 24 Billion dollars in debt and that our competitors do not carry this drag on their balance sheets. This debt keeps us from buying new airplanes, being able to compete and growing.
Our current DALPA leadership and our Company leadership have been commendably intelligent in finding ways to improve our bankruptcy contract outside of Section 6, when opportunities arise. It has been a very mature and rational partnership. We will continue to do well if management resists Mullins, Reid and Burns era corruption and D ALPA continues it's reasoned push for seizing every advantage through partnership rather than brinkmanship.
In setting our goals for Contract 2012, we need to remain good students of economics, comparative rates at our competitors and history. I have every confidence our Representation will do just that.
It was an unlikely set of circumstances that resulted in the outlier contract to begin with. For starters, Delta's Board picked a management team who was inexperienced in the business, unrealistic and who lost its own moral legitimacy with "legal" replacing "the right thing to do." Contract 2000 was in many ways payback for failing to correct Contract 96 when the relationship with pilots could have been best preserved. McKinsey and Co. consulting was mostly running the decision making (at least the modeling) both at Delta and United. This modeling has Mullin, Reid and Burns giving speeches about "new cost paradigms" and believing Delta could not spend enough money because our competitors would try to match us and they would run out of liquidity before we did.
With this philosophy, they set about burning the furniture, steadfast in the belief that it was OK to waste because others would bleed out first.
Part of the McKinsey modeling was outsourcing a huge amount of Delta flying ... a plan ALPA was happy to play along with. This plan required a cheap operator to outsource to, but there was the hitch. Comair pilots had become wary of ALPA National's leadership and the pilot group increasing motivated by what they felt was unfair treatment as a subsidiary of Delta and being prostrate to "mainline" ALPA. Having observed ASA's precedent setting contract in 99 which was obtained by throwing ALPA National out of the room and threatening Delta, the Comair leadership correctly reasoned that they could get the first "mainline" contract at a regional by going for the short hairs ... and they did, at a high cost to Delta (around $660,000,000 or over $300,000.00 per pilot). Both Delta and ALPA proved their resolve (and lack of leadership) during the Comair strike.
The next headlines in April 2001 were: "Delta Air Lines reached a surprising tentative contract agreement yesterday with the union representing its pilots, averting a strike deadline set for next week." No one talks about Comair's involvement in this (and maybe they were not involved, but I believe Delta's inexperienced managers were scared out of their wits as they witnessed the incredible cash burn of a strike involving less than 12% of their operation - they realized a strike at mainline was such an immediate risk to the Company that even with George Bush's assurances that he would halt a strike - they had to fold.)
Contract 2000 was a Pyrrhic victory for D-ALPA. It was a political victory in a time devoid of common sense in the industry. Contract 2000 was also in many ways United plus 1%. United went into bankruptcy before Delta and it needs to be noted the financial condition of the entire industry was showing clearly negative cyclical trends PRIOR to the tragedy of September 11th.
The psychological importance of Contract 2000 pay rates as a benchmark is a very power political force within our Delta pilot ranks. However, it was unsustainable in the marketplace then and is even more unsustainable now. It was the antonym of POS96 but, as we have learned pilots are much more tied to their employers than their managers are.
This one post is probably enough to ensure I'll never run for office at D-ALPA, but still we should be evaluating our contract goals very pragmatically. If we are smart we will remember our Company is some 24 Billion dollars in debt and that our competitors do not carry this drag on their balance sheets. This debt keeps us from buying new airplanes, being able to compete and growing.
Our current DALPA leadership and our Company leadership have been commendably intelligent in finding ways to improve our bankruptcy contract outside of Section 6, when opportunities arise. It has been a very mature and rational partnership. We will continue to do well if management resists Mullins, Reid and Burns era corruption and D ALPA continues it's reasoned push for seizing every advantage through partnership rather than brinkmanship.
In setting our goals for Contract 2012, we need to remain good students of economics, comparative rates at our competitors and history. I have every confidence our Representation will do just that.
Please don't buy into the BS that the rates at DAL, UAL, and to a smaller extent NWA, had anything to do with their troubles. They didn't. But management would love for you and everyone to continue believing that.
Carl
01-29-2010, 08:49 AM
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Joined APC: Jun 2006
Position: A-320A
Posts: 18,563
Carl Read my above post, does that add clarity to the position.
I agree we were not the reason, just the final straw.
I agree we were not the reason, just the final straw.
01-29-2010, 08:58 AM
Can't abide NAI
Joined APC: Jun 2007
Position: Douglas Aerospace post production Flight Test & Work Around Engineering bulletin dissembler
Posts: 12,014
It is simply an incorrect premise Bar. You place far too much emphasis on pilot cost in regards to the profit equation. Other posts have illustrated how small a fare increase would be required to return us to Contract 2000.
Please don't buy into the BS that the rates at DAL, UAL, and to a smaller extent NWA, had anything to do with their troubles. They didn't. But management would love for you and everyone to continue believing that.
Carl
Please don't buy into the BS that the rates at DAL, UAL, and to a smaller extent NWA, had anything to do with their troubles. They didn't. But management would love for you and everyone to continue believing that.
Carl
I do not disagree with your premise that "pilots don't buy airplanes." But you can't compare the status quo with a couple of bucks per ticket. A better comparison is with our dysfunctional neighbor only 240 miles East in Charlotte.
Right now we are not making money. We need to make money .. lots of it .. to service our debt and equip for the future. Some don't care about that, some figure they will be out of here in a couple of years and just want to take what they can before they go.
If US Air and American ever get to our Contract 2000, THEN we can talk about C2K+30. Until then such talk is a useless waste of chest beating that would be better served impressing female Orangutans.
It is not a linear equation. Those who do this stuff for a living are fighting penny by penny for listings at the top of search engines and trying to collect revenues on ancillaries. It is not the way we would run an airline but thank goodness we are not tasked with that job.
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