Delta to reduce by 50%

"Executives at Atlanta-based Delta said in a memo to employees that the airline’s goal is to cut 2,000 frontline, administrative and management jobs through the voluntary program, attrition and other initiatives."

They are offering the severance package to 30,000 but only need 2,000 to accept the offer.
 
Note to anyone who qualifies: The first severance package is usually the best one.
 
This will be a tough one for us. Sue has 38+ years with Delta. Without Delta, though, I won't have health insurance. That's bad.
 
Ken Ibold said:
Eastern proved so well that an airline can shrink to profitability.
Click to expand...

Plenty of companies have proved that you can save your way to prosperity... :rolleyes:

I read the 8-K. There is only one mention of "customer" where they thank the employees for all they've done for the company and customers. The only mention of passengers is in terms of "passenger fees". Everything else is about cutting costs.

The spirits of Ron Allen and Leo Mullin are still alive at Delta......
 
Lance, what's your wife's magic number for retirement? At TWA it was 75 - age plus years of service. I retired at 50 with a number of 76. Got medical/dental and flight benefits. Wasn't able to draw retirement income till 55 but that was OK. Even with the buy out by AA still have medical/dental although we now pay some toward the cost. We even get flight benifits but have never used them. Check it out, it may work and there is nothing like retirement. :yes:
Ron
 
I wonder if this will have any effect on the NWA merger talks.

And WRT that, I gotta say I don't understand how anyone can say it's unfair to simply merge the two pilot seniority lists based solely on date of hire. Each group seems to think that a merger shouldn't affect any pilot negatively in whichever side they come from. That's certainly not the usual case with any other company merger.
 
lancefisher said:
I wonder if this will have any effect on the NWA merger talks.

And WRT that, I gotta say I don't understand how anyone can say it's unfair to simply merge the two pilot seniority lists based solely on date of hire. Each group seems to think that a merger shouldn't affect any pilot negatively in whichever side they come from. That's certainly not the usual case with any other company merger.
Click to expand...

My company is in the midst of merger problems. A little over a year ago we (a non-union company) were bought by Pinnacle (Northwest Airlink, a union company), but we weren't combined at all. Now that we're getting the DHC-8-Q400s on line, PCL pilots want to be able to fly it, even though it's on the Colgan side of the house, so they're starting to cry for an official merger (so they can fly the Q, but they don't want us to be able to take seats in their RJs). Everyone wants a fair deal, so long as it's a little more fair for their group. [/rant]
 
I believe the best seniority integration possible is one where NO one is happy.

Coming from someone who will probably have to go through it soon.
 
lancefisher said:
And WRT that, I gotta say I don't understand how anyone can say it's unfair to simply merge the two pilot seniority lists based solely on date of hire.
Click to expand...

Unfortunately it isn't that simple. There is an issue of career expectations to factor into the equation. Among other things.
 
I have thought long and hard, even done some limited research on the issue, and have concluded that there is no remotely simple solution to the seniority-merger issue (essentially, what Greg said...).

I had friends at NWA when they acquired RC (Republic), which in turn had a bunch of people who were still reeling from the not-too-much-earlier merger between Republic and Hughes Airwest. It was a foul and bloody thing, with the two camps bitterly opposed to each other.

Consider (for instance) if you had been at Ozark as the carrier grew rapidly (and profitably)- then they were acquired by TWA. Should the guys at Ozark, securely in the left seat because the carrier had been growing robustly, be happy with being bounced back down to FO slots, in equipment that they were not even qualified in, while TWA FOs were moving up into Captains' lines?

At the same time, many of the TWA guys were unhappy about the idea of having to shlub around in tacky ol' domestic milk-runs, when they had been flying across oceans in planes with "heavy" in the callsign, and they resented the DC-9 and turboprop guys wanting to get into wide-bodies across the briny blue.

What usually ends up happening is, the larger carrier's folks get to upgrade into the smaller carrier's equipment (thus downgrading many of the smaller carrier's pilots' working situation, both as to left vs. right seat, and as to ability to bid and hold a decent line), and the smaller carrier's pilots are precluded from upgrading into many of the larger carrier's prime equipment / runs for a more-extended period. Net result from representation by a union which, ultimately, will have to bend to the will of its voting constituent members- the larger group nearly always wins.

No simple answer, is there? I can see both sides, and I have no dog in the hunt; think how it must be for the folks stuck in the middle, facing (at best) embarrassing downgrades and explaining to the family that, "Yes, we were past all that commuting and basing at (insert name of incalculably undesireable crew base here), but now it starts all over."

The only merger (of substantial consequence) I ever heard of where there was little controversy (and I may have just not heard of it) was Delta - Western, but I heard that the cultures may have meshed fairly well. Could be full of it.

Pan Am - National, on the other hand- I knew some folks at National who were quite nearly suicidal over it, they felt sold down the river on the deal (and, indeed, it was a stunningly bad business deal on every level).

No easy answers. Now I think I will go and try to make a living for half a day.
 
Last edited:
lancefisher said:
I wonder if this will have any effect on the NWA merger talks.

And WRT that, I gotta say I don't understand how anyone can say it's unfair to simply merge the two pilot seniority lists based solely on date of hire. Each group seems to think that a merger shouldn't affect any pilot negatively in whichever side they come from. That's certainly not the usual case with any other company merger.
Click to expand...

Greg Bockelman said:
I believe the best seniority integration possible is one where NO one is happy.

Coming from someone who will probably have to go through it soon.
Click to expand...

I heard on the radio yesterday that the merger was off specifically because the pilots wouldn't approve it due to them hating the plan for the seniority list.

So, as is the wont, they'll fight over the jobs until they have no jobs to fight over.

Howcome when they make cuts they never cut the guys who get the huge bonuses and stock options?
 
Last edited:
mikea said:
I heard on the radio yesterday that the merger was off specifically because the pilots wouldn't approve it due to them hating the plan for the seniority list.

So, as is the wont, they'll fight over the jobs until they have no jobs to fight over.

Howcome when they make cuts they never cut the guys who get the huge bonuses and stock options?
Click to expand...
There was also a report that the merger could continue even without pilot approval. Making the workers mad is a core value of airline management so I could see them pushing the merger without the pilot's input.
 
smigaldi said:
There was also a report that the merger could continue even without pilot approval. Making the workers mad is a core value of airline management so I could see them pushing the merger without the pilot's input.
Click to expand...

Delta made it clear they would not proceed without worker agreement.

That's a very smart move because labor issues have seriously harmed other mergers. The hardest part of a deal is integrating the companies post-acquisition. And having a deal between pilots beforehand reduces the leverage that the labor force has on extracting additional benefits post-deal.

It's also smart because it removes the negotiation from the hands of management - and places is solely within the hands of the union. Push the potential problem onto others.

Management also sees that they have now pitted pilot-against-pilot and therefore, the airlines have placed the blame for "no deal" on the pilots. Management looks good to their own pilots.... and the outside world gets a message that the pilots skewered the deal.

Usually, the deal is done then these issues are considered. Ask Doug Parker.
 
This reminds me of a short conversation I had with some retired military/retired airline captains that I happened to camp next to at Sun n Fun a couple of years ago.

They were discussing the mergers they had gone through while working some of the "smaller" airlines. One of the old hands related a story where a young buck from the "acquiring airline" pointed out in the cockpit that he had over 2,000 hrs in a particular model to which the old hand from the "acquired airline" responded with "well, I have over 2,000 landings in that particular model."

My transcript here can not do his narration justice.

:)


SCCutler said:
I have thought long and hard, even done some limited research on the issue, and have concluded that there is no remotely simple solution to the seniority-merger issue (essentially, what Greg said...).

.
.
.
.
Click to expand...
 
Steve said:
One of the old hands related a story where a young buck from the "acquiring airline" pointed out in the cockpit that he had over 2,000 hrs in a particular model to which the old hand from the "acquired airline" responded with "well, I have over 2,000 landings in that particular model."
Click to expand...

Exactly my point. That is why straight date of hire isn't necessarily the most equitable way of seniority integration.
 
Also, note that Delta is offering to 30,000 in hopes of getting 2,000 to accept.

I wonder what will happen if a majority decide to accept the offer.
 
Greg Bockelman said:
Also, note that Delta is offering to 30,000 in hopes of getting 2,000 to accept.

I wonder what will happen if a majority decide to accept the offer.
Click to expand...

Probably the same type of "run" which occurred at Bear Stearns, and leaving Delta cash poor or broke.

HR
 
Greg Bockelman said:
Also, note that Delta is offering to 30,000 in hopes of getting 2,000 to accept.

I wonder what will happen if a majority decide to accept the offer.
Click to expand...

1) First you get rid of the pesky, expensive, unreasonable employees

2) Get rid of the pesky customers

3) PROFIT!!!

Then get recruited for the job doing the same at another company in a higher position.
 
Greg Bockelman said:
Unfortunately it isn't that simple. There is an issue of career expectations to factor into the equation. Among other things.
Click to expand...

You want to explain that one Greg. Everybody has "career expectations", but as I'm sure you're well aware few have "career guarantees".

I understand that if your position on the list at your company suggests that you're only 12 months away from being able to move up to higher paying equipment, you might be unhappy if that changed to 5 years after a merger, but it could change to 20 years after your company liquidates or the same 5 years if they pull a bunch of equipment off the line.
 
lancefisher said:
You want to explain that one Greg. Everybody has "career expectations", but as I'm sure you're well aware few have "career guarantees".
Click to expand...

That's an issue we're going through with our merger. The problem is, Colgan (CJC) is a turbo-prop only operation and Pinnacle (PCL) is a jet only operation. The PCL pilots want the merger to include a scope clause that would say something alone the lines of:

A) Staple CJC's seniority list to the bottom of PCL's. All planes with =<50 seats will be flown by CJC, all planes with >50 seats will be flown by PCL (this gives the PCL pilots the chance to bid into the Q-400, which right now is on the Colgan side of the house).
B) All planes can be bid by PCL pilots (within a certain time frame) then a "fence" clause puts the t-props on CJC and the jets on PCL. No CJC pilots can bid the jets though.
or
C) everybody can bid everything, but it's a 4:1 or 5:1 seniority integration (instead of being based solely on new hire date, the new seniority list has 5 PCL pilots for every 1 CJC pilot).


The Colgan argument against options A and B is the career expectation argument...when they got hired, the PCL pilots were hired to a jet operator with both 50 and 76 seat aircraft. CJC pilots were hired to a t-prop company (with a long history of only turboprop aircraft) so neither pilot had a reasonable expectation to fly the other type of aircraft. Basically, CJC pilots were hired expecting to fly a turbo-prop with a quick upgrade, not be forced into the right seat of a 50 seat RJ with a five to six year upgrade, so we should keep our t-props with no interference from PCL pilots.

The best thing for the Colgan pilots is a fence agreement putting the t-props on CJC, the jets on PCL, and no cross over...you want to fly a jet, you apply at PCL; you want to fly the Q-400 (or any other t-prop) you apply at CJC. Chances are some form of this is going to happen, but the fear is there won't be an absolute lockout of PCL pilots from getting into the t-props. And as much as we'd like to complain, we don't have union representation...Pinnacle does (we voted it down last July, 158 for vs. 4 against - falling just four votes shy of the 51% needed to bring on the representation).

The most fair option for Colgan is a 1:1 merger of lists with a fence clause. But that sucks for PCL. The most fair for PCL is a staple job and open bidding. But that really sucks for CJC. The most fair for everyone...well that remains to be seen (though it will probably be a little "more fair" for the PCL guys, since they have representation and we have a guy named Buddy Casey).
 
lancefisher said:
You want to explain that one Greg. Everybody has "career expectations", but as I'm sure you're well aware few have "career guarantees".
Click to expand...

See Spikes post #14. No pilot group should profit at the expense of another pilot group. Date of hire may or may not be an equitable solution.
 
Last edited:
I think I understand Lance's statement. In other industries when companies merge their employees usually cannot negotiate how they are going to be integrated with employees of the other company. They may all have career expectations which are not going to be met. However, since the pilots seem to have the power to do this, it's reasonable that they would try to work out the best deal for themselves. The bad part would be if they had the power to kill the deal which might cause both companies to struggle more and possible go under. Their career expectations would certainly not be met if that happened. The other problem I see is even if they successfully merge, the animosity between the two pilot groups would not seem like a good thing, especially if one side is seen as having gotten the better "deal".
 
Everskyward said:
In other industries when companies merge their employees usually cannot negotiate how they are going to be integrated with employees of the other company.
Click to expand...

The power of a union, good or bad.

The bad part would be if they had the power to kill the deal which might cause both companies to struggle more and possible go under.
Click to expand...

I don't think, ultimately, they do. I think Delta Management said they would not go forward without a deal between the pilots. But I think in the end, they will actually do the deal with or without pilot "co operation".

The other problem I see is even if they successfully merge, the animosity between the two pilot groups would not seem like a good thing, especially if one side is seen as having gotten the better "deal".
Click to expand...

Ain't that the truth? Lots of examples of that. Most recent, America West/USAirways.
 
Teller1900 said:
That's an issue we're going through with our merger. The problem is, Colgan (CJC) is a turbo-prop only operation and Pinnacle (PCL) is a jet only operation. The PCL pilots want the merger to include a scope clause that would say something alone the lines of:

A) Staple CJC's seniority list to the bottom of PCL's. All planes with =<50 seats will be flown by CJC, all planes with >50 seats will be flown by PCL (this gives the PCL pilots the chance to bid into the Q-400, which right now is on the Colgan side of the house).
B) All planes can be bid by PCL pilots (within a certain time frame) then a "fence" clause puts the t-props on CJC and the jets on PCL. No CJC pilots can bid the jets though.
or
C) everybody can bid everything, but it's a 4:1 or 5:1 seniority integration (instead of being based solely on new hire date, the new seniority list has 5 PCL pilots for every 1 CJC pilot).


The Colgan argument against options A and B is the career expectation argument...when they got hired, the PCL pilots were hired to a jet operator with both 50 and 76 seat aircraft. CJC pilots were hired to a t-prop company (with a long history of only turboprop aircraft) so neither pilot had a reasonable expectation to fly the other type of aircraft. Basically, CJC pilots were hired expecting to fly a turbo-prop with a quick upgrade, not be forced into the right seat of a 50 seat RJ with a five to six year upgrade, so we should keep our t-props with no interference from PCL pilots.

The best thing for the Colgan pilots is a fence agreement putting the t-props on CJC, the jets on PCL, and no cross over...you want to fly a jet, you apply at PCL; you want to fly the Q-400 (or any other t-prop) you apply at CJC. Chances are some form of this is going to happen, but the fear is there won't be an absolute lockout of PCL pilots from getting into the t-props. And as much as we'd like to complain, we don't have union representation...Pinnacle does (we voted it down last July, 158 for vs. 4 against - falling just four votes shy of the 51% needed to bring on the representation).

The most fair option for Colgan is a 1:1 merger of lists with a fence clause. But that sucks for PCL. The most fair for PCL is a staple job and open bidding. But that really sucks for CJC. The most fair for everyone...well that remains to be seen (though it will probably be a little "more fair" for the PCL guys, since they have representation and we have a guy named Buddy Casey).
Click to expand...

I don't work for PCL but I do work for a company that is losing flying to Colgan on a daily basis. The problem is that PCL already had this scope protection in their contract when the company purchased Colgan. Wasn't some arbitration recently completed over this issue? If so, what was the outcome? I really hate that you guys voted down ALPA, I think you would have had some more support from your peers, and you probably wouldn't seen CJC hiring street CA's into the Q.
 
Auburn_CFI said:
I don't work for PCL but I do work for a company that is losing flying to Colgan on a daily basis. The problem is that PCL already had this scope protection in their contract when the company purchased Colgan. Wasn't some arbitration recently completed over this issue? If so, what was the outcome? I really hate that you guys voted down ALPA, I think you would have had some more support from your peers, and you probably wouldn't seen CJC hiring street CA's into the Q.
Click to expand...

There was, and the ruling was that Pinnacle Corp, the parent company that owns both Pinnacle Airlines and Colgan Air, was in the wrong by not merging the two companies and defining some sort of scope or fence system. He didn't, however, say what the merger should look like or give any sort of timetable. Basically it was kicked back to the union and Pinnacle Corp to hash out. And now, in the last week or so, Pinnacle Corp has said that they're not bound by the decision of the MEC or the arbiter, so they're refusing to do anything. So we'll see. I think PCL pilots might have to call the Teamsters :).

I don't think ALPA could have stopped the street CAs from coming into the Q, but we could use them for so much more than that right now. My hire date made me eligible to vote in the election by four days...not that it helped much in the end. Hopefully next year the drive will work better (or we'll be combined under PCL's ALPA protection).
 
Teller1900 said:
There was, and the ruling was that Pinnacle Corp, the parent company that owns both Pinnacle Airlines and Colgan Air, was in the wrong by not merging the two companies and defining some sort of scope or fence system. He didn't, however, say what the merger should look like or give any sort of timetable. Basically it was kicked back to the union and Pinnacle Corp to hash out. And now, in the last week or so, Pinnacle Corp has said that they're not bound by the decision of the MEC or the arbiter, so they're refusing to do anything. So we'll see. I think PCL pilots might have to call the Teamsters :).

I don't think ALPA could have stopped the street CAs from coming into the Q, but we could use them for so much more than that right now. My hire date made me eligible to vote in the election by four days...not that it helped much in the end. Hopefully next year the drive will work better (or we'll be combined under PCL's ALPA protection).
Click to expand...


I hope you are right. I have learned that ALPA or at least Union Protection is a necessity in this business. I just read the release about the arbitration in my latest copy of FastRead.
 
How about a lottery system - everyone plays the wheel of chance! Sort of like throwing seniority numbers on the floor in a big game of 52-Card Pickup. Can't be any worse, can it??

I love how "expectations" are somehow supposed to matter in all this. It's a cruel world - one might have joined an airline expecting to be Captain of a 777 on the Miami-St. Tropez route with the Swedish Bikini Team serving as flight attendants. Doesn't mean expectations will coincide with reality. While the pilots are fiddling with "expectations" their airlines are preparing to go TU, thereby rendering the entire concept of seniority irrelevant.

BTW - I know we are talking about peoples' livelihoods here. I don't mean to sound flip, but let's face it, there are no guarantees in life. None. Zip. Nada.
 
flyersfan31 said:
While the pilots are fiddling with "expectations" their airlines are preparing to go TU, thereby rendering the entire concept of seniority irrelevant.
Click to expand...

The DAL/NWA proposed merger is less about keeping the two companies from going TU than it is about the two executive groups and the hedge funds making a huge amount of money on the deal. Don't even get me started on the whole "reducing capcity" myth.

The pilots at DAL are the only employee group (other than senior executives) who have the power to try and look out for their interests in this deal. They have every right to try for the best deal they can get.


Maddog
 
One other thing-

In the airline business, mergers rarely work. The industry does not suffer from over capacity, just poor management, and combining two marginal companies will not magically create one successful one. In the end, there is a ****heap of money spent on lawyers, accountants and consultants, none of whom contribute one thin dime to the productive enterprise of operating airplanes to transport people and stuff from place to place in exchange for money.
 
SCCutler said:
One other thing-

In the airline business, mergers rarely work. The industry does not suffer from over capacity, just poor management, and combining two marginal companies will not magically create one successful one. In the end, there is a ****heap of money spent on lawyers, accountants and consultants, none of whom contribute one thin dime to the productive enterprise of operating airplanes to transport people and stuff from place to place in exchange for money.
Click to expand...
You mean... two wrongs don't make a right?

I guess a couple poorly run airlines can't come up with a halfway decent airline without abolishing all the management that came from both sides. Actually, there could be something to that idea? :dunno:
 
SCCutler said:
The industry does not suffer from over capacity, just poor management, and combining two marginal companies will not magically create one successful one. In the end, there is a ****heap of money spent on lawyers, accountants and consultants, none of whom contribute one thin dime to the productive enterprise of operating airplanes to transport people and stuff from place to place in exchange for money.
Click to expand...

Ding ding ding! We have a winnah! :yes:
 
SCCutler said:
In the airline business, mergers rarely work....just poor management, and combining two marginal companies will not magically create one successful one. In the end, there is a ****heap of money spent on lawyers, accountants and consultants, none of whom contribute one thin dime to the productive enterprise of operating airplanes to transport people and stuff from place to place in exchange for money.
Click to expand...

On this we agree.

The industry does not suffer from over capacity,
Click to expand...

I tend to have a different view. The reason that the fares are so cheap, IMO, is that the airlines were flying around with a pot load of empty seats, so they started taking what they could for those seats. People were getting these seats at below cost and got addicted to them. If there weren't as many seats, then supply and demand would dictate higher prices, and the airlines could (in theory) be in a better financial position. (This is MY opinion, based on nothing more than my observations of how the industry works.)

It is also my opinion that every airline out there wants to be the ONLY one out there. Therefore, they will undercut each other trying to be the last one standing. At some point they run out of money and either go out of business or file bankruptcy and use those laws to further undercut the rest.

I am all for a free market place, but I think deregulation has not done anything for the health of the airlines. It HAS for the passengers, but holy cow, what a ride.
 
Greg, I sort-of agree with you and sort-of don't.

The persistent problem in the industry is and has been wretchedly poor management. With few exceptions (and you know who they are), you have companies with a pack of greedy bastards at the top, focused principally upon, at the same time, chiseling their employees and gouging their customers.

Note well: the most profitable carrier out there (and the only consistently-profitable one) is known as a "low fare" carrier, but their fares are rarely the lowest in any given market. They *are* consistently reasonable fares, though, making the decision to buy travel from them always a safe decision. And, in addition, when plans change (as they so often will), while you will be bumped up to a higher fare level than a discount fare you may have bought in advance, the money you spent before does not evaporate. This generates loyalty.

At the same time, this same outfit is paying what are now the industry-leading wages to its employees- and they actually ask for, listen to, and implement, employee suggestions for greater efficiency and customer service.

After 9/11, they laid off... no one.

Bottom line is, when an airline has the efficiency to run with rational fares (not dirt-cheap, note, just not offensively high) and business-reasonable conditions, and make money, and pay its people well, it is proof that an airline can be a good business.

There just are not many which have managed to do that, are there?

I completely agree that expectations of $200.00 cost-to-coast round-trips are ridiculous. But I am also offended when I am quoted a $750.00+ R/T fare on a 330NM trip.

Now, one place you might look for change is this: the barrier to entry for new carriers has often been unreasonably low, with under-capitalized operators entering the market, spoiling the pricing mix for a while, and leaving.

Think about this: hub and spoke is a failed business model. Discuss.

More later, gotta run!
 
WRT the hub and spoke being a failed business model: I completely agree Spike.

I can fly from BNA to Las Vegas on business and have two options; go direct on the "low cost airline" or connect via Atlanta on a "traditional airline". Let's see, flying direct is consistently less expensive than the connection AND allows for considerably less time in transit. Which one would any of us choose?

This is just one example of dozens I can offer.
 
You must log in or register to reply here.
Back
Top