The future of Comair? Shut down???

[PA44Jockey]

Decision expected next week from Delta merger. Speculated this morning during the closing bell.

"Ladies and Gentlemen, Please remain seated with your seatbelts securely fastened until Delta has turned off the Free to Jump light. Thank You."

 

[~~~^~~~]

There are other ways this can play out.

Typically Delta' planners have backfilled mainline operations with RJ's. To the extent that Comair can depend on CVG's orgin and destination traffic, they will continue & grow operations. Remember that when mainline retreated from DFW, Connection grew there rapidly. CVG, unlike DFW, doesn't have a huge competitor like American and can support higher higher revenue sales.

The branded carriers will likely return to a "at risk" flying model. If Delta mainline retreats from the CVG hub it will have an effect similar to turning back the clock to a model more like Comair's business before the Delta purchase.

I expect a DAL/NWA tie up to put more pressure on Delta to outsource (relieving pressure that they have contracted for too many RJ's already). The two forces might cancel each other out, but neither NWA, or Delta, wants to buy a 100 seat jet until the next generation of these aircraft are built. CRJ700/900's are popular in the interim.

Parking airplanes that you have to make payments on anyway is a very difficult decision. Remember how these airplanes were "self financing?" Well. they have to fly to finance themselves....

I would not consider the regionals truly in trouble until Boeing rolls out a 100 seat jet with the new geared turbofans AND ALPA finds its way on scope. Those events are still at least 5 years down the road.

---- and Delta has been hiring Comair pilots (and ASA pilots, and CAL, Jet Blue, Air Force, Navy, Marine, Army too...when you hire 800 in two years all good applicants are getting consideration)

 

[~~~^~~~]

I see four possibilities, one is the operation is shut down, two is spun off(sold/ipo),three is merged and four is status quo with fewer 50s and more 70/76 seaters.

Shutting it down doesn't make much sense to me...

Spinning off the airline in a sale ...

Merger is another possibility. ....The new operation could also fetch a healthy price if it were sold off.

Status quo, is also a possibility. It might just make more sense to keep it as a WO feeder and adjust the fleet mix. .....

I just don't see much value from shutting CMR down versus the other three options. JMHO

Yep, he wrote it a week ago.

 

[John Pennekamp]

Like PIT when USAir moved out? Did Southwest add a lot of flights there? How about Jetblue? CVG has no O&D traffic, and is only used as a connections hub. Do you think a lot of people ask "hey honey, do you want to spend the weekend in Cincinatti? We could get NASTY..?" Doubtful anyone would go in there and add a large hub even close to the number of current departures. Sad, but true. At least they built that new runway, and that new DHL sorting facility......


Bye Bye--General Lee

So how do you explain SWA hubs like BNA? Oh, and lol on gettin' nasty in Cincinnati.

 

[John Pennekamp]

I hate to see bad things happen up at Comair as well. I do believe that somewhere in this garbage, this arrogant windbag has a poiint........ Why the hell did Comair refuse to let furloughed DAL pilots work there? What was the harm in that idea? I think Comair's union did a huge disservice to themselves and their pilots by refusing to hire these guys in thier time of need. We had tons of them working at ASA, and were very happy to help.

FWIW, the MEC made that decision because they felt there was a quid pro quo. They saw an opportunity to get something they'd wanted for a long time now that the Mighty Delta Pilots finally needed something from them. Essentially, they took the furloughees hostage.

I agree it was a stupid idea. I distinctly recall the meeting and dinner when we on the ASA MEC tried to convince them to give the DAL pilots jobs with no strings attached. They claimed CMR management didn't want to do it, and they would have to "waste capitol" negotiating to get it.
Unfortunately, they had a couple of young cocky firebrands on the MEC (remember BV), and two apathetic captain reps that went along. And of course JC , who had no love for the Delta boys to begin with. So the CMR MEC decided to not fight CMR management on the issue.

 

[~~~^~~~]

The question was asked during this morning's 4th QTR DAL conference call at 44:50

"Comair will remain an important part of the Delta family no matter how that contract gets structured"

 

[John Pennekamp]

The question was asked during this morning's 4th QTR DAL conference call at 44:50

"Comair will remain an important part of the Delta family no matter how that contract gets structured"

And Anderson said just a few months ago that no mergers were in the works.

 

[Otto]

Should''ve had those 70's

Loving it? I don't think so. It has been a huge fall since the days when Comair thought it was invincible, though. Lawson really thought he was large and incharge when asking for more 70 seaters when our furloughed pilots needed help. Regardless, it will be interesting to see what happens.

Bye Bye--General Lee

Lawson wasn't asking for more 70's...Comair and DELTA wanted more 70 seaters because there was a legitimate market need. The number was capped by scope so Delta settled for more 50 seaters because it was the best they could do. Fast forward five years and Delta has wasted millions on airplanes they don't need and never really wanted in the first place. On top of that, bankruptcy loosened scope and now all of those 70 AND 90 seaters are here anyway, being flown mostly by contract carriers. Scope neither protected jobs (as DCI is now bigger then ever) and caused a huge hit to YOUR balance sheet. You shot yourself in the foot and don't even know it.
I understand trying to protect your job but manipulating the market is ALWAYS ineffective. I don't even know why I waste my time here...I'm sure you'll say something to the effect that if Delta had just put a 777 between CVG and Grand Rapids, everything would be just peachy.

 

[russtgol]

Obviously Comair would not immediately shut down with a merger, but unless some miracle plan evolved like escaping Delta or being able to bid on other flying not involving 50s, Comair will close the doors within a few years. Delta and the Kremlin have completely ruined what was once a proud and upstanding company.

In addition, I would be very wary of what comes out of S.B.'s mouth. Probably gearing up for another round of concessions to save the company. Fortunately this time, the words are bouncing off a deaf wall.

Don't blame Delta and the Kremlin, blame ALPA and ASA for flying there routes....

 

[IronCityBlue]

I think CVG is gone with United or Northwest. Either way ORD and DTW are the trumps. Good news for everyone in the tristate area wishing for their low-cost alternative. Southwest, JetBlue or whoever will enjoy a very uncongested airport.

If that happened, I doubt it would be JB who goes in. SWA needs to grow desperately and this would be their opening. They would poach some pax from SDF, IND and CMH, but they are running out of markets in this country. They are already the largest domestic airline in the nation (world?) and desperately need ATL and CVG to continue to force growth into their system. No airline stagnates or shrinks it way to prosperity. Airlines almost always either grow or die.

JB is absolutely terrified of any mid sized midwestern market and will likely NOT even attempt it for years. Once we feel ready to, it will be too late, as SWA, AT and others will have already established themselves there and we will be too afraid of stepping on their toes.

ALl that said, I don't think its necessarilly a given that CVG will close for Delta if they merge. CVG is the nation's golden yield machine and Delta owns it from head to toe. They would likely divert some connection traffic to other hubs, but CVG would stay. We all like to look at dots on a map from a mission oriented perspective and act like hubs have to be far apart from eachother. That is not true. The best hub/focus city/whatever JB ever added was BOS, almost driveable from NYC. But it has the traffic to support it so who cares about dots on a map? If DAL/UAL goes down, JFK and IAD would both survive and thrive as they are close dots on a map but entirely different markets with massive O&D and that's the key.

The distance from ATL to CVG is similar to DTW to MSP, and both DAL and NWA operated their own "geographically redundant" hubs for decades. SWA has many focus cities/hubs where they are very big out of, all near eachother. Just because airlines merge does not mean all hub dots need to be a certain distance away from each other. That kind of "logic" may be good enough for an Aviation Management 101 term paper, but has little impact on real world operations.