12 replies to this topic

[Scalpel4]

http://www.nytimes.c....html?th&emc=th

Any thoughts? Good time to spark a discussion.

[RmTrice]

Just get those freaking fuel prices down and get rid of the greedy CEOs. COUGH: Doug Steenlend :COUGH I believe NW is going to face the same fate as Delta, only DAL may be worse off because of its size.

[Scalpel4]

I agree. I forsee bad things for Delta, but I honestly think NWA will come out in better long run shape. My last two international flights were mostly on NWA (DFW to DET to KIX? to TPE to KHH). LONG route, but wow those new World Class seats are amazing!

[Yesthatsme]

yeah i know

[miller22 (inactive)]

One year too late. They should have done it last year.

That being said, there really is no way Delta can avoid BK. Expect it before the bankruptcy law changes in October.

[Syrami764]

I don't think Delta is worse off than NW. NW is having major problems with their unions right now and Delta doesn't have any unions aside from the pilots (I think). I'm not saying Delta is flying high or anything. Just saying why they may be better off than NW.

Miller- One year too late? I don't think it's late I think it was bad business, but many people didn't think oil would be almost $70 a barrel

[Scalpel4]

Delta Asks Pilots' Union for Second Round of Cuts in Wages and Benefits

By MICHELINE MAYNARD, NY Times
Published: September 13, 2005

Delta Air Lines, which is said to be on the brink of filing for bankruptcy protection, asked its pilots for a second round of wage and benefit cuts late yesterday, according to the Air Line Pilots Association.

The move came as Northwest Airlines, which is seeking more cuts from employees to try to fend off its own bankruptcy filing, considered giving permanent jobs to some substitute mechanics starting today.

Delta's request for cuts was disclosed in a message the pilots' union put on its phone line, addressed to its 6,500 members. It said negotiators for the airline and the union met yesterday at Delta's request. "The company presented the negotiators with a comprehensive, deeply concessionary contract proposal," the message said.

The message did not disclose the size of the cuts sought by Delta, which obtained $1 billion in wage and benefit concessions a year ago, including about a one-third cut in pay. Delta also did not give details. But in a statement, the airline said it had made proposals that were "necessary to address the severe financial problems that the company and its people are facing."

People who have been briefed on the proposal said it would cut pilots' wages and benefits to roughly the levels of their counterparts at low-fare airlines. But pilots at those airlines, like Southwest and JetBlue, receive bonuses and other compensation because their companies are profitable. Delta, by contrast, has lost nearly $10 billion this decade.

The pilots' message said leaders would meet next Monday to discuss whether to hold formal negotiations. But that may come after a bankruptcy filing, which could occur this week, according to people with direct knowledge of Delta's plans. Delta shares fell 25 cents, to 85 cents.

Delta is close to arranging the financing that it would need to operate under bankruptcy protection. Many of its assets were pledged last year to arrange financing from GE Corporate Finance and American Express. Cooperation from those companies, and other lenders, would be needed for the airline to retain its assets.

Companies operating under bankruptcy protection are allowed to petition a judge to set aside contracts and impose wage and benefit cuts, if no agreement is reached. By disclosing its cuts to the pilots' union, Delta is apparently giving the pilots a sneak preview of what could be in store, if it files for protection.

Northwest, meanwhile, had given members of the Aircraft Mechanics Fraternal Association until today to reach an agreement; otherwise they could see their jobs given away.

The union struck Northwest on Aug. 20, over the airline's demand for $176 million in cuts, including the elimination of 2,000 jobs.

Northwest replaced 4,430 union members with 1,900 substitutes, including supervisors, contractors and 1,200 licensed mechanics. The airline has not said how many permanent workers it planned to hire. Under the Railway Labor Act, Northwest would not have to give the jobs back to striking mechanics, even if it reaches a deal with the union.

That appeared unlikely anytime soon. Late last week, union leaders told members that Northwest increased its demand for cuts to $203 million. The airline told the union it would need to fill about 1,080 positions, roughly 3,100 fewer than members held before the strike.

Union bargainers walked away from talks early Sunday and none have been held since. In a memo to union members, negotiators said they had offered cuts valued at $203 million and had accepted Northwest's lower job levels.

But the union wanted 20 weeks of severance pay for laid-off workers, while Northwest would agree to only 16 weeks, union leaders told members. By contrast, the union had demanded 32 weeks of severance before the strike, while Northwest had offered 26 weeks.

Yesterday, the union insisted that Northwest would have a difficult time persuading substitute workers to take permanent jobs.

The cuts originally sought by Northwest were part of its effort to obtain $1.1 billion in wage and benefit concessions, which it said it needed to avoid a bankruptcy filing. This weekend, Northwest increased that demand to $1.4 billion, union officials said.

All airlines have been hit hard by the spike in the price of jet fuel since Hurricane Katrina damaged oil operations on the Gulf Coast. Even before that, airlines had spent 50 percent more this year on jet fuel than they spent a year ago.

[g-w-r]

delta are going... going... gone they have left this problew way to late. they will be bankrupt before the end of the year. they really gotta get rid of the ceo's thats whats killing them

[piercey]

Delta's screwed, sry CVG, SLC, and ATL.

Northwest once it's done with all the union BS could pull out of it, but they better seriously consider a DC-9 replacement because if one of those things go down, they are screwed.

[Syrami764]

It's Chapter 11 no different from what United and USair is in right now. They're in trouble yes but not screwed, then again what company that files chpt. 11 in the first place isn't in trouble?

[piercey]

Yes, but United recovered (after a few repos later) and US got bought out. Unless Delta gets bought out, they are done for with their current management.

(note, UA biased )

[airline55]

Hate to tell you piercey, but both companies (DL and NW) seem to be pointing to a bankruptcy filing on wed.

sad, after all NW has been through, they still have to go to chap. 11. Oh well, so much for a good record. BK has seemed to help UA well enough.

Now, this next part is purely speculation: People on A.net are saying that since they are going to file on the same day, this could be the start of a merger. Now, their fleets don't seem to make any sense. However, they are both in Sky Team and Northwest lacks a hub in the southeastern U.S. so we shall see.

[Syrami764]

Originally posted by piercey
Yes, but United recovered (after a few repos later) and US got bought out. Unless Delta gets bought out, they are done for with their current management.

(note, UA biased )

That's based on what? Delta won't just up and dissapear. The management team Delta has in there right now is trying to right all the wrongs the previous management teams made. They have done a decent job don't criticize them. The previous m management teams screwed this company over not them. I really would like you to know why Delta in your opinion is going chapter 7. Delta's new management is the team they want to lead them through the toughest time in their history and they can do it, they have done much for Delta since they've been incharged. It's all been cancelled out by rising oil prices.

P.S Your beloved United has taken their jolly ol' time in Chpt. 11, give any airline the time United had to recover and I'm sure they'd eventually recover.

[Edited on 9/14/2005 by Syrami764]