DAL to recall all furloughed pilots

[BoilerUP]

2auburn,

Since I'm a youngin' trying to learn a little about this industry, why don't you educate me on how it works. I sympathize with your position as a furlough, but I don't see anything in jarhead's post that flies in the face of good common sense business practices. DAL may have the same passenger loads as before Sept. 11th, but with lower fares, they are pulling in less revenue.

You are right, a contract is a contract, and you DO have a right to be recalled. However, every single DAL stockholder should be asking the same question that jarhead did - can the company afford this, even if its contractually required? I guess we'll soon find out.

I'm glad the 1060 are coming back. I hope DALPA and mgmt can work out an agreement soon, otherwise all the 1060 may have to return to is a Chapter 11 proceeding.

 

[jarhead]

Sorry 2auburn, but you have no idea of what my "qualifications" are to post on this forum. Which of my posts upset you so much? The one that had three CEO's of large airlines commenting on the airline industry, or the ones that call on my background in business, where I state that a business can't continue to take huge loses, and not reverse it and go bankrupt.

I'm afraid you're the one who has no idea of what's going on, or you just choose to be the ostrich, and bury your head in the sand, and scream "a contract is a contract" Without modifications to that contract, you'll all be on permanent furlough, as your employer will go the way of Braniff, Eastern, Pan Am, et. al, and just cease to exist.

 

[JJJ]

If Delta didn't want this recall to happen, they could have stopped it. If they had raised ticket prices so the pax traffic remained below pre 9/11 levels, they could have avoided this situation.

NWA is recalling
Delta is recalling
who's next?

 

[jarhead]

JJJ

You are probably correct with that logic, but it wouldn't do much for gaining market share from the LCC competion out there. I could use the same logic in reverse. Reduce every fare to 10 bucks round trip to anywhere in the country. EVERYONE would fly Delta, and you'd have the market cornered. You'd need to quadruple the size of the fleet, and hire 25,000 more pilots to work at Delta. Problem is, (obviously), wages would be less than a beggars, no one would sell fuel to the company, and you'd be hard pressed to lease any aircraft and hire mx to maintain them.

The company must be able balance cost with revenue available, and somehow, the customer must be made to feel he's getting something extra from Delta vs JetBlu to spend the extra money for a ticket. That's the challenge.

 

[FDJ2]

Without modifications to that contract, you'll all be on permanent furlough, as your employer will go the way of Braniff, Eastern, Pan Am, et. al, and just cease to exist.

Funny thing, all those carriers kept getting massive concessions from labor and they still were liquidated. As it turns out, poor management decisions are far more costly than labor. Modifications to labor contracts ultimately seem to play a small part in an airlines long term survival.

DAL's pilot costs are about $1.5B out of a total cost structure of about $14B. You could cut pilot costs in half and save about 6% in overall costs, or you can increase revenue. In this cyclical industry that seems to be happening today. CAL just reported an increased RASM of about 4.5% on just over a 13% increase in capacity for April. If DAL manages to increase it's capacity and simultateously increase it's revenue per available seat mile like CAL did than perhaps things are beginning to turn around.

Just as a side note, DAL's 1st quarter results did show over a 4% increase year over year in revenue, a reduction in unit costs of about 3.5% and DAL finished the quarter with $300M more in unrestricted cash than they had last year. DAL still posted a loss for the quarter, in large part due to voluntarily prefunding non pilot pensions to the tune of $325M, but overall the performance year over year is moving in the right direction. Most analyst are not predicting CH11 for DAL anytime soon, but obviuosly DAL isn't out of the woods yet.

 

[jarhead]

FDJ2

Taking your statements at face value, and for the sake of discussion, assume everything you state is valid.

The 'problem' being mainly caused by bad management, how does the company get rid of the inept management? Where would the company go to find management that makes good decisions? Is it the stockholders who have elected incompetent people to sit on the BOD? And has the BOD, who was put in place by the stock holders, put poor people on executive row?

My recollection of history shows me an awful large percentage of people who have run airlines (CEO's) have been scoundrels and opportunists. I am wondering why such a disproportionate percentage of airline executives seem to be such 'bad seeds' Any thoughts about that?

 

[SoBeFlyer]

"No one person is an airline. An airline is a team. It must be friendly, courteous, cooperative, efficient, and bound as closely as a devoted family."

"The quality of Delta's service...will determine who gets the business."

- C. E. Woolman, Delta Air Lines Founder, President, & Chairman




... of course he was management, and you're not supposed to trust management and what they say, right?

 

[bafanguy]

I doubt C. E. Woolman ever envisioned what has become of the airline industry in the last 20 years or so. His understanding and wisdom are more suited to a time we'll never see again. I wish it could be as simple as when he ran things.

P.S. Dave Garrett was the last one you could "trust".

 

[FDJ2]

Re: FDJ2

My recollection of history shows me an awful large percentage of people who have run airlines (CEO's) have been scoundrels and opportunists. I am wondering why such a disproportionate percentage of airline executives seem to be such 'bad seeds' Any thoughts about that?

Two quotes from the book "Hard Landings" the epic contest for power and profits that plunged the airlines into chaos might shed some light on the airline CEO.

" The men who run the airlines of America are an extreme type; calling them men of ego would be like calling Mount McKinley a rise in the landscape. Airlines demand a single strategic vision, lest the delicate choreography of airplanes, people, timetables, and finance breakdown. The airlines attract and promote executives obsessed with control, who flourish at the center of all decision making."

"the same overweening ambition that drives so many executives to the top also assures their failure; that when executives form emotional attachments in business, whether to people, markets, or machinery, they deprive themselves of their best business judgment; that those who know an an industry best are the most likely to take for granted, and ultimately ignore, its most inviolate principles; that although the rebuke may be slow in coming, greed , in the end, is almost always punished; that economics, in short, overpowers ego."

My take on this is that it takes a certain personality type to rise to the top of the executive suite of such a fiercely competitive industry. In an ironic twist, the ambition, greed, ego and singleminded determination to win that so many top executives possess in this industry both lead to their success and may ultimately lead to their failure.

 

[2auburn]

to jarhead and boilerup

we as pilots have almost no control over management..... to make smart business decisions i.e. yield control, marketing, executive bonus, etc.

all we can do is hold them to the contract we both signed, which will in turn motivate them to make smart business decisions, return to profitibilty, and please the shareholders

if we do not hold them to a set standard all accountabilty will be lost, and the profession will never be restored!!!!!

we are just trying to protect what others have worked hard to create for me, you, or anyone else who wants a career as a MAJOR airline pilot