Delta Air may file for bankruptcy

[zulaya]

Not trying to start a panic here, just doing a little FYI. On the Yahoo news, there's a story that Delta claims it may have to file bankruptcy if it doesn't get wage concessions from the pilots. The story doesn't say that they have definite plans to file for Chapter 11, but that it is "an option".

I know a lot of people on this board fly Delta or at least talk about it. here's the link to the whole story if you want to follow it.

http://story.news.yahoo.com/news?tm...6&u=/ap/20040510/ap_on_bi_ge/delta_bankruptcy

 

[TammyC]

Anybody have thoughts on what this might mean to travellers? I think United continued normal service throughout a recent bankrupcy filing, didn't they? I've got some Delta vouchers I need to use!

 

[lsyorke]

Good, give their space at at Newark to Jet Blue!!!!! Delta prices and schedules have been horrible!!!

 

[SB in KY]

Of course every major airline in America has decided it was on the verge of bankruptcy when it came time to renegotiate labor contracts over the last couple of years...I suspect their "fianancial position" will improve significantly soon after they get the concessions they are after.

I am sure their cash flow isn't good...but I also think they stand to gain a lot by making it sound worse than it actually is...

 

[DNSDisney]

According to an inside source, they are asking for the 30% cut in part because the Delta Pilots are 30% above any other airline pilot in the field. Yes they make 30% over what pilots for United, American and any other major airline. The rest of the employees have already taken there cuts, union or non union and the pilots are the only ones that refuse to take the cuts, so far.
According to my source if this happens it will be late July when they file, IF they file.
They will keep flying either way. Just with chapter 11 they can go in reorganize and force the pilots (thru the bankruptcy courts) to take the same cut they are asking them to take or even more. At this point they aren't asking the pilots to do anything the rest of the company hasn't already done.
You have to remember that everytime the price of our gas goes up so does the jet fuel they use on airliners too. Along with the effects 9-11 had on the airline industry, and the gov't crying wolf every few months after has caused some major problems for all airlines. We are lucky we still have any around!

 

[CarolA]

IF Delta files, it will just go right on flying. USAIr and United are still out there flying around. Eventually they might change schedules but at first you would notice nothing!

 

[Nebsky]

They will keep flying. Outside things wont change but internally things will be hopping.
Go to court to void contracts and get lower rates. (could happen to all of the contract employees...Pilots, FA's, Rampers, Dispatchers, etc) Regular employees without raises. (Most major airlines have not had pay increases since Jan 2001.)
Employee morale will plumet more.

The decline in business travel on majors brought on by the "low fare" carriers like Jet Blue, Southwest, etc started all of this. Then 9/11 happened and brought it out into the open quicker. Massive layoffs after 9/11 (something like 200k industry wide) have brought the airlines to a leaner workforce. Economy is picking up somewhat and some of those employees laid off are coming back to their old jobs, but with the price of crude oil at $40 a barrell it is pinching airlines even more. Just when things were picking up too.

The increase of jet fuel by 1 penny, increases the fuel cost for the year by $30 million dollars.

USAirways is out of bankruptcy right now, but they are getting ready to fall back in there.

United is talking about getting out by July, but they are still having issues.

 

[Jillpie]

I am ready to book with Song on Monday for our trip next April. Do you think that would be a good idea now? I am not the type to panic, but I wonder if thats a sound decision. I don't want to wait for Jetblue's fares to come out, I just like to know its all done, especially because we are going at a very popular week for the Northeast.

 

[CarolA]

While my crystal ball is broken, if it was my money I would go ahead and book on both Song and Delta. If you are really nervous use a credit card.

Delta is NOT going to shut down in the next 6 months and a lot of this may very well be a negoiation tool with the union. If the union does not come around, Delta declares bankruptcy, voids the contracts and starts over (see United and USAir)

Yes morale will go down. No don't take this the wrong way, but.... it is partially the flying publics fault. We all claim to want great service (not that the airlines actually provide that), but we only want to pay $200 a ticket. With gas prices what they are.... something gets squeezed and in this case it is going to be the employees.