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Old April 3rd, 2006, 03:49 PM   #201
Cloudship
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Originally Posted by hkskyline
Having less people deliver an even better product is key.
But are all these cutbacks going to actually make people more productive? Unfortunately that again is a numbers game that the business operations folks like to play that doesn't really reflect reality. Numerically you can say that fewer people doing the same work is more efficient. But in fact the fewer people you have, the worse job they do, the unhappier they are, the worse job they do, the more stress they are under, the less productive the become. What ends up happening is that corners get cut and what was uacceptable before becomes passable now. It's a story that repeats itself throught the whole economy - companies start downsizing and cutting back, and they end up digging themselves even further into a hole.

Let's put it this way. You have a choice to fly Delta or Jet Blue. Now, the fact is you can go to four different websites, and get four completely different fares. But they are all in the same $20 ballpark. You can choose to lfy Jet Blue, where you know you are going to get a little more legroom you know you are not going to get bumped, your flight will be direct, they keep a good standard of flight service, and it's a simple process flying on them. Or you can fly Delta, which you don't know what kind of service you will get, the employees are unhappy and it shoiws in the service they deliver, you may or may not get bumped, you end up making a connection and don't know whether your flight will even make that connection, you seat and plane could be nice, could be dumpy and cramped... So who are you going to choose?

It's not that Delta (or ANY of the majors, at this point) is not better than the LCs, it's that the LC's are actually better than the majors!
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Old April 3rd, 2006, 04:48 PM   #202
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I know in the UK that companies who use Indian call centres are finding it annoys their customers more than it helps cut costs.

I can't stand being routed to India, so I switched my bank to one that only uses UK call centres.
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Old April 3rd, 2006, 05:36 PM   #203
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Quote:
Originally Posted by Cloudship
But are all these cutbacks going to actually make people more productive? Unfortunately that again is a numbers game that the business operations folks like to play that doesn't really reflect reality. Numerically you can say that fewer people doing the same work is more efficient. But in fact the fewer people you have, the worse job they do, the unhappier they are, the worse job they do, the more stress they are under, the less productive the become. What ends up happening is that corners get cut and what was uacceptable before becomes passable now. It's a story that repeats itself throught the whole economy - companies start downsizing and cutting back, and they end up digging themselves even further into a hole.
There is no such thing as a job for life anymore. Management is in a constant struggle to reduce headcount and show efficiency gains while claiming they need to maximize shareholder value. While layoffs will affect morale and performance, in the long-run, having a reduced workforce will be beneficial. If the remaining employees cannot adapt and be more productive, they'll just need to be let go in the next restructuring.

The HR perspective should not override the need to improve productivity. Otherwise today's economy's will still be using all the excess labour from the workforce of a hundred years ago. I think the problem is not with the restructuring concept itself, but rather the employees' acceptance. Once they realize there's no turning back and there is not likely to be another round of cuts coming soon, they'll accept reality and get back to work.

The reason why people choose the cheap carriers like JetBlue or Southwest is because their prices are good. I doubt the Delta vs. JetBlue difference is just a few bucks. Maybe during an extraordinary seat sale. I just randomy looked up an IAD - BOS flight for April 10-17 and Delta costs more than double that of JetBlue.

Delta : IAD - CVG, CVG - BOS $492.50 including taxes
JetBlue : IAD - BOS $230.60 including taxes

Does JetBlue have a strong union influence and a legacy pension system that is crippling? Both of these are major contributors to cost overruns.
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Old April 3rd, 2006, 10:38 PM   #204
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Quote:
Originally Posted by hkskyline
having a reduced workforce will be beneficial. If the remaining employees cannot adapt and be more productive, they'll just need to be let go in the next restructuring.
We are starting to get into business philosophy here more than talking about the airlines, but this is not an really accurate statement. Unfortunately it already starting to happen that companies are realizing that people will not, CAN NOT, provide an endless supply of work. There comes a limit. While on paper it looked like you were accomplishing the same with fewer people, what was happening in reality is that less was being done - more corners were cut, and the quality of work got worse and worse. people became less satisfied with their job, and they started to only think about taking advantage of the company instead of helping it. Why would you put any real effort or drive into a job that you thought was more than likely to dissapear in a few years anyway? You start looking out for yourself not the company.

Delta at one time had no unions. When they first hit problems, the employess got together and bought the airline a new jet! That is not the type of effort you are going to find from them nowadays.


As far as fares go, if you look at advanced fares at normal times, you will find very few differences. Yes you can do the overnight or late flights on Jet Blue, but those are the vacationers who they don't make much money off of anyway. Jet Blue does offer lower fares much closer to the day of flight than Delta does - that's not a function of cost but of pricing strategy.

Seriously, have you ever talked with Jet Blue regular passengers? Ever read up on the reviews of the airlines? People right now hate the majors, while Jet Blue is scoring big on service. There was a report released just yesterday or this morning on this.
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Old April 4th, 2006, 11:03 PM   #205
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Well, I guess I will be the first to post this news. I guess we will get to see what happens.

Delta Pilots Vote to Authorize Strike
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Old April 15th, 2006, 09:16 PM   #206
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The potential for a strike by the pilots seems to be very slim now that Delta's management and the pilots' union have agreed to not strike next week. Now the leadership of the pilots' union will review the offer and if they support it then it goes to the whole union (6000 pilots) for a vote. But for now, a strike is not planned.
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Old July 2nd, 2006, 09:14 PM   #207
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Here are the two highlights from the monthly operations statement that Delta has to file with the US bankruptcy court.

- Delta's May 2006 net loss was $16 million.
- May 2006 net income before reorganization items was $8 million.

Thus Delta paid $24 million in reorganization costs in May, which reduced their net income from $8 million to a net loss of $16 million.
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Old July 16th, 2006, 06:13 AM   #208
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Delta lawyers, consultants seek another $32 million
By HARRY R. WEBER
14 July 2006

ATLANTA (AP) - Lawyers and consultants involved in Delta Air Lines Inc.'s bankruptcy case are asking for another $32.8 million in fees and expenses primarily covering four months of work.

A hearing on the requests by 23 different firms and individuals is scheduled for Aug. 22. If approved, it would bring the total amount of professional compensation allowed so far in the case to $74.2 million.

That total doesn't include money requested by certain firms that have not yet been paid and money held back from Delta's auditor on a previous pay request.

Atlanta-based Delta, the nation's third-largest carrier, filed for Chapter 11 in New York in September 2005. It has said it expects to emerge from bankruptcy within the first half of 2007, which would mean before the end of June.

The latest compensation requests, filed this week, primarily cover the period from Feb. 1 to May 31. However, some requests go back further, depending on when the firm was hired and for what purpose.

The largest fee requested in the latest round is by Delta's chief bankruptcy firm, Davis Polk & Wardwell, which is asking for a fee of $8.8 million and expenses of $380,530 for the four-month period. Former New York Mayor Rudolph Giuliani's consulting firm is asking for a fee of $1.4 million and expenses of $61,443 for the four-month period.

Big fees are common in large bankruptcy cases, and Delta's lawyers have defended the compensation as necessary, based on the amount of work being done.

The company has yet to file its reorganization plan. It has requested and received two extensions.

Delta now has until Nov. 8 to exclusively file a plan of reorganization before creditors can weigh in and until Jan. 8 to solicit acceptances of the plan.
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Old August 1st, 2006, 06:50 AM   #209
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Delta buys NY-London route rights for $21 mln

NEW YORK, July 31 (Reuters) - Delta Air Lines Inc. is buying rights to fly between New York and London from rival United Airlines, a unit of UAL Corp. , for up to $21 million, a Delta spokeswoman said on Monday.

Delta plans up to three flights a day between New York's John F. Kennedy International Airport and London's Gatwick Airport, with the first expected to start in the fall, spokeswoman Betsy Talton said.

It plans to add up to two more flights a day next year, Talton said.

Atlanta-based Delta, which is operating under bankruptcy protection, would pay $13 million to United Airlines once the deal closed, with additional payments of $2 million per year, unless an "Open Skies" agreement were reached.

The United States and Europe have been in talks aimed at eliminating restrictions on service and routes between them under a so-called open skies agreement.

The Delta deal is subject to U.S. Department of Transportation approval and other closing conditions. United will discontinue its service between New York and London's Heathrow Airport at the end of October.
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Old August 1st, 2006, 07:06 AM   #210
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Quote:
Originally Posted by hkskyline
Delta buys NY-London route rights for $21 mln
United will discontinue its service between New York and London's Heathrow Airport at the end of October.
If you have United stock, SELL NOW!
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Old August 3rd, 2006, 10:44 PM   #211
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Delta July Traffic Dips
Thursday August 3, 3:32 pm ET

ATLANTA (AP) -- Delta Air Lines Inc. said Thursday its July traffic fell less than 1 percent, as capacity declined 2.1 percent.

The airline, which is restructuring under Chapter 11 bankruptcy protection, said traffic fell 0.6 percent to 11.76 billion revenue passenger miles, an industry unit measuring one paying passenger flown one mile. Capacity fell to 13.77 billion available seat miles.

Occupancy improved 1.3 percentage points to 85.4 percent from 84.1 percent in the month.

Delta said traffic in the year to date is down 4.8 percent on a 6.8 percent decline in capacity. Occupancy is up 1.7 percentage points to 79.2 percent.

Delta shares rose 2 cents, or 2.8 percent, to 73 cents in over-the-counter trading.
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Old August 4th, 2006, 03:19 AM   #212
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Quote:
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If you have United stock, SELL NOW!
Not at all!! United had a very profitable second quarter making USD$119 million net profit. All this route sale represents is a realignment of United's system. JFK is not a United hub and shouldn't be. UA's east coast hub is at Washington, D.C.'s Dulles airport.

United has some very lucrative routes to East Asia and that is where they are focusing their expansion. Here is an informative article:

CHICAGO - United Airlines said Friday that it will add 40 weekly flights to Asia over the next nine months and no longer will fly from New York to London and Tokyo.

United also plans to add more cargo capacity as it seeks to strengthen its bottom line in the face of record fuel prices that have slowed its recovery after a three-year bankruptcy restructuring.

The nation's second-largest carrier agreed to sell its New York-London route authority to No. 3 Delta Air Lines for $21 million, dropping a hotly contested but unprofitable route to focus more on transpacific flights where its broad international network gives it an advantage.

United said it will move its Tokyo service from New York's John F. Kennedy International Airport to Washington Dulles International Airport.

The schedule changes will reinstate United's daily San Francisco-Taipei flights, expand its San Francisco-Seoul service from seasonal to year-round and add three weekly flights between San Francisco and Hong Kong.
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Old August 4th, 2006, 03:24 AM   #213
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Old August 4th, 2006, 06:22 AM   #214
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The JFK Delta flight to London is a very valuable addition to Delta's NYC sales. Airlines offer large businesses in their hub cities decent mark downs if the business agrees to use a particular airline for their travel needs. As NYC is an enourmous business market, Delta's sales force has always had to explain that they could fly a company's employees to all major cities in Europe, except London which is the largest business destination from NYC. Now that Delta will have access to London, even though it is Gatwick and not Heathrow, they will now be able to sell a much more complete package to NYC corporations than it could before. This will prove to be a very lucrative addition to Delta's international destination portfolio out of NYC.
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Old August 4th, 2006, 03:43 PM   #215
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Gatwick isn't a bad airport to use. There is an express train to Victoria that takes only 35 minutes. The slower and cheaper commuter train takes 50 minutes. It's not as cheap as the Underground but it's still easy to get to.
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Old August 4th, 2006, 11:05 PM   #216
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The Gatwick Express is 30 minutes, and the Capital Connect service takes only 5 minutes longer actually! It's not worth the two quid or so IMO. For people who live in the South and East, it's a lot more convenient to get to Gatwick than Heathrow. It's not as attractive as Heathrow though. It makes more sense for Delta to have flights to London, it being one of their hubs. For United, it's a lot less connections that it could've made from JFK to the rest of the continent.
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Old August 5th, 2006, 05:48 AM   #217
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Among business travelers Heathrow is just preferred to Gatwick, even if there is no connection to be made. I would guess that the average non-business flyer doesn't even care what airport they land in, unless they are flying into London on BA with a connection to make. When they make an inconvenient transfer from Gatwick to Heathrow they'll learn that they landed at the wrong airport. For those whose destination is London, I'm sure that the Gatwick Express into central London is just fine.
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Old August 6th, 2006, 05:20 AM   #218
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Delta Seeks to End Pilots' Pension Plan
By HARRY R. WEBER
5 August 2006

ATLANTA (AP) - Delta Air Lines Inc. filed a formal request with bankruptcy court late Friday to terminate its pilots' pension plan, as President Bush prepared to sign a bill aimed in part at helping the struggling carrier save its other employees' pensions.

If the court in New York approves Delta's request to cancel its pilots' pensions effective Sept. 2, the government's pension insurer would take over the plan and pay pilots a reduced benefit based on when they retire and other factors. A hearing on the request is set for Sept. 1.

The 6,000 pilots, as part of a $280 million concessions agreement with the company first reached in April, have agreed not to oppose the pension termination request, though other groups may oppose it. Atlanta-based Delta notified the Pension Benefit Guaranty Corp. in June of its intent to seek termination of the plan.

"Unless the pilot plan is terminated, Delta will very soon face an operational and financial crisis that will prevent it from emerging from Chapter 11," the airline said in its filing.

The bankruptcy court request comes just a day after the Senate approved a pension bill that provides special relief for Delta and Eagan, Minn.-based Northwest Airlines Corp., allowing them to have 17 years to fully fund their pension plans.

Delta, the nation's third-largest carrier, had lobbied hard for the bill, arguing it was essential to help them avoid terminating the pension covering its ground workers and flight attendants. Bush said Friday he planned to sign the bill into law soon.

Delta's effort to terminate its pilots pension plan, which is significantly underfunded, had been expected, as the company seeks to emerge from Chapter 11 by the middle of 2007 a leaner airline. UAL Corp.'s United Airlines, the nation's No. 2 carrier, terminated its pilots' pension when it was in bankruptcy protection.

Delta has promised its pilots a $650 million note in the event the pension is terminated. Delta also has promised the pilots a $2.1 billion unsecured claim. The PBGC has argued that money belongs to the agency, a claim the company has rejected.

Once the plan is terminated, the company's pilots won't be entitled to the hefty lump sum payments under the existing pension plan, which allows pilots to retire at 50 and receive half their benefits in a one-time payout and the rest in an annuity later.

The lure of that lump sum prompted many pilots to put in for retirement before Delta filed for bankruptcy protection last September. But a shortfall in the pension fund has prevented pilots from cashing in their lump sums since Oct. 1.

"If the pilot plan is not terminated and the lump sum door reopens, Delta will immediately face a huge wave of pilot early retirements by its most senior pilots," Delta said in its filing Friday.

Delta said it would have to cancel thousands of flights if that happened.

"Delta likely could not survive an operational disruption of this magnitude," the airline said.

Delta said that if Bush signs the relief legislation it believes it can emerge from Chapter 11 without terminating its non-pilot pension plan, because that plan does not have a lump sum feature.
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Old August 15th, 2006, 06:13 AM   #219
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Delta plans new routes from LA to Central America
14 August 2006

LOS ANGELES (AP) - Delta Air Lines Inc. announced Monday it was adding 11 nonstop flights from Los Angeles International Airport to Central America amid growing demand in one of the nation's largest Hispanic travel markets.

The expansion, scheduled to begin in December and finish in March, includes destinations in Mexico, Costa Rica and Guatemala. The Atlanta-based airline also plans to add 5 connecting flights between LAX and airports in Las Vegas and major northern California cities -- where the company said many Hispanic customers prefer to travel.

The company said the additional flights were expected to make Delta the second-largest U.S. carrier in the Mexican market by March 2007 for destinations served.

"Los Angeles is at the heart of Hispanic culture in the United States and we are pleased to expand our service to meet the needs of our customers in this growing West Coast market," said Glen Hauenstein, a Delta executive vice president.

The new routes will serve La Paz, Acapulco, Loreto, Mazatlan, Culiacan, Manzanillo, Zacatecas, Hermosillo and Torreon in Mexico; Liberia in Costa Rica; Guatemala City in Guatemala; and San Francisco, Sacramento, Oakland, San Jose and Las Vegas.

All but one of the international routes -- Acapulco -- were still subject to foreign government approval.

Delta, which is reorganizing under Chapter 11 bankruptcy protection, announced in November that it planned to fly new routes to Mexico as part of its recovery plan, which includes boosting international capacity.
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Old August 17th, 2006, 01:04 AM   #220
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Judge gives Delta's London route deal with United the green light
16 August 2006

ATLANTA (AP) - A U.S. Bankruptcy Court judge has approved Delta Air Lines Inc.'s deal worth up to $21 million to buy from UAL Corp.'s United Airlines the authority to provide nonstop service from New York's John F. Kennedy International Airport to London.

The deal, which is also subject to U.S. Department of Transportation approval, calls for Delta to pay United $13 million at closing and $2 million a year for four years, according to Delta, which says the subsequent payments will stop if an open skies agreement allowing greater access by airlines to destinations in other countries is reached.

The judge's approval was dated Tuesday and entered Wednesday.

Atlanta-based Delta has been trying for a decade to get authority to operate flights to London from JFK.

Delta, which filed for bankruptcy protection in New York last September, has said it plans its first daily round-trip flight between JFK and London's Gatwick Airport later this year with a second flight beginning in spring 2007.

Delta also wants to serve London's Heathrow Airport. It has said it supports an open skies agreement between the United States and Europe that would allow it to do that.
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