Possible Bankruptcy with Delta Airlines??

[missmulan]

Just got a call from DH, he read over the 'net that Delta is seriously considering BK. What does that mean for my Skymiles and flights???

 

[Horace Horsecollar]

Just got a call from DH, he read over the 'net that Delta is seriously considering BK. What does that mean for my Skymiles and flights???

Delta, along with the other legacy carriers, is in financial trouble. Here's an AP article about Delta: http://www.businessweek.com/ap/financialnews/D8A0ECLG2.htm

So, yes, it's possible that Delta will need to seek protection from creditors by filing Chapter 11. That wouldn't mean that Delta would shut down, just that Delta would be able to take more drastic steps to cut costs and to renegotiate debt, in an effort to restructure back into a viable airline.

Currently, United Airlines and US Airways are both operating under Chapter 11. Continental and Ameica West are examples of airlines that successfully emerged from Chapter 11.

As far as Skymiles are concerned, I wouldn't worry. Although frequent flyer miles are a liability for airlines, having a strong base of loyal customers is also a significant asset (even if those customers are only loyal because of points). A court-appointed trustee would know that too.

As far as flights are concerned, Delta has already performed surgery on their schedule The biggest change was the significant cutback in service out of Dallas. However, in an effort to return to profitability, Delta will probably continue to pare underperforming routes, while adding new service with good potential, such as more international routes.

 

[poohbear2]

Can I assume that certain flights may get cancelled; and therefore flights will be combined?

 

[cruise-o-matic]

I'm concerned too since Delta flies N/S from GSO to MCO with several good flights to choose from. That being said, we are actually looking at flying out of RDU for our December trip b/c the tix are $52 cheaper R/T.

SW flies out of RDU, but we like Delta's times better and prefer the little jets.

 

[bicker]

No assumptions are safe, when it comes to bankruptcy.

Generally speaking, major airlines that enter Chapter 11 continue to operate with only minor changes. They may cancel flights, even terminate service between certain cities, just like airlines may do regardless of bankruptcy filings. In the case when flights are cancelled, the customer always has the option to get a refund. That might be small consolation if it happens a few months before your trip, and you cannot find another flight without paying a lot more money, but at least it is some recourse.

So far, no airline has terminated a frequent flier program on entering Chapter 11 bankruptcy. In the past, when airlines have terminated operations and liquidated (Chapter 9 bankruptcy), other airlines have purchased the customer list in return for honoring the frequent flier miles. It is widely believed that that will NOT happen with future liquidations -- that when the next airline fully goes under we frequent flier mile holders will simply lose-out.

 

[safetymom]

http://www.usatoday.com/travel/flights/2005-05-09-delta-usat_x.htm

You might want to read this article.

 

[Horace Horsecollar]

Can I assume that certain flights may get cancelled; and therefore flights will be combined?

If you're asking about schedule adjustments, especially for flights in the fairly distant future, that's always a possibility -- regardless of whether or not an airline is in Chapter 11. The legacy airlines, which book flights up to 330 days out, are always tuning their schedules. Finaincial problems might lead an airline to drop some destinations or to replace mainline service with regional jet service.

If you're asking about flights suddenly being cancelled and combined, I wouldn't worry about that. That can happen for mechanical or weather-related reasons, but Chapter 11 shouldn't be a factor, one way or the other.

 

[jenndisney]

My advise is to watch what they do. We were flying with Vanguard a few years ago and they closed up shop at midnight two days before our flight! We were stuck in California, had to pay full rack rate for three last minute tickets. yes, we finally got a partial refund, but that did not help us out at the time. I learned to watch what the different carriers are doing. I do not plan on getting caught again.

 

[bicker]

That's a good point. Everyone needs to decided whether they wish to spend a few extra dollars to ensure that they won't have to spend a lot of extra dollars if something unfortunate occurs. Americans, more than Europeans, seem to be averse to purchasing insurance protection -- yet at the same time seem to be very reticent to accept the losses that incur when they don't have such protection. It's almost psychotic, on a sociological scale!

I think travelers really have to make a conscious decision: Purchase insurance or self-insure, and if the latter, then they have to acknowledge, when something unfortunate occurs, like the liquidation of an airline, that indeed they have self-insured, and therefore the responsibility for the losses they incur is their own. That's the time to apply some personal accountability, and move speedily onto the recovery phase, booking alternative transportation and paying for it from the "underwriting fund" they based their self-insurance on (i.e., their personal savings).

And if you cannot purchase insurance on a specific set of travel arrangements, then perhaps you shouldn't purchase those travel arrangements, eh? From my standpoint, in those cases, it is clear to me that someone with control over far more money than I have has decided that it isn't worth the risk.

 

[CarolA]

I would not worry about Delta, USAir, United etc. right now. IF Delta joins the bankruptcy group I don't think you will see any immediate changes. United and USAir have been there a while and keep right on flying.

Vanguard and some of the others were much different situations. Smaller airlines that to be honest both the creditors and goverment were willing to let die since the overall economic impact would be small.

Was Vanguard a charter? I know one of the others (SouthEAST) that shut down this year was a charter. If charters go under, they do tend to just close and your options are very limited. If one of the majors quits flying the other airlines must honor your tickets on a standby basis so it's not like you would be trapped in Orlando for example.

Don't panic. If USAir has survived two bankruptcies in short order I don't think Delta is in danger of shutting down!

 

[CarolA]

Also, if you do buy insurance make sure you know what you are getting. Some insurances do NOT cover bankrupt airlines... So for example right now they might be excluding USAir.

 

[DebbieB]

I flew Delta on a business trip last week to Atlanta. My 3:45 flight to ATL was cancelled and I was put on the 6:45. In talking to a couple next to me, they said they were surprised how crowded it was considering their travel agent told them there was 84 empty seats on this flight. I then told them about the earlier flight cancellation and people being put on this flight. On the way home, I had a 6:08 flight, I noticed on the flight board that the 4:15 was cancelled and there were a bunch of standbys trying to get on my flight. It could be coincidence but I wonder if they were intentionally consolidating flights.

 

[gw_lit]

Was Vanguard a charter?

Nope, Vanguard provided regularly scheduled air service from their hub in Kansas City.

 

[bicker]

If USAir has survived two bankruptcies

US Airways has not survived two bankruptcies. They've survived only one.

 

[CarolA]

US Airways has not survived two bankruptcies. They've survived only one.

Well they seem to be surving bankruptcy number two right now. Coming out of it may be a long process, but thier planes are still in the air so filing didn't kill them.

 

[OKW Lover]

Just got a call from DH, he read over the 'net that Delta is seriously considering BK. What does that mean for my Skymiles and flights???

Same thing it meant for customers of USAir and United. None of them were affected (either for flights or miles) by their filing Chapter 11.

 

[bicker]

Well they seem to be surving bankruptcy number two right now. Coming out of it may be a long process, but thier planes are still in the air so filing didn't kill them.

Fewer aircraft than before, and still fewer coming in September -- assuming they survive even that logn.

 

[BigTigger]

I flew Delta on a business trip last week to Atlanta. My 3:45 flight to ATL was cancelled and I was put on the 6:45. In talking to a couple next to me, they said they were surprised how crowded it was considering their travel agent told them there was 84 empty seats on this flight. I then told them about the earlier flight cancellation and people being put on this flight. On the way home, I had a 6:08 flight, I noticed on the flight board that the 4:15 was cancelled and there were a bunch of standbys trying to get on my flight. It could be coincidence but I wonder if they were intentionally consolidating flights.

Delta has initiated an advance cancellation policy at Atlanta whereby they cancel and condense flights when weather delays are forecast. This happened to me last month on the domestic leg of a flight that started in London with an Atlanta connection to my final destination. Thankfully they have hourly flights to Boston, so they put me on the earlier flight which was blocked to my original ticketing due to Delta's minimum time policy between international and domestic connection flights. We arrived early and they had already re-ticketed me to the earlier flight. The ticket agent said that the change was due to weather delays expected in and out of Atlanta. It did seem to me like the net result was two full flights to Boston versus three planes less than full which benefits Delta's load factor more than the flier's "get me home now" factor