What's new
By:

Analysts - AA to benefit most for oil drop, DL least

again, read what was said.

I never said AA won't have a hedge advantage.

all I have said is that AA will have a currency hedge loss at some point that will likely be as large as the hedge losses that other carriers will have to take.
 
  • Again staff ban WT from any board but Delta's he has ruined your website!!! A entire website devoted to WT and his love of Delta is boring as all hell!!!!!
 
The silence was deafening regarding the lack of fuel guidance from DL last month, but now Hunter's picked up on it.

This is the second straight month that Delta didn’t update fuel guidance, which is not customary. It’s hard to know where Delta’s fuel costs are going to shake out, because Delta changes its hedge portfolio every day. A review of the most recent 10-Q (noting that these numbers have probably changed materially since the filing) shows that a 20% decline in jet fuel prices (which has happened) would result in an $850M gross hedge loss and a required posting of $800M in hedge margin posted to counterparties (e.g. banks) with the hedges that span through the end of 2015…
Click to expand...
 
Doesn't AA have multiple advantages over DL with new aircraft? Lower maintenance costs, lower fuel costs, and higher MX reliability? We are cutting MD80s and DL is adding more older used aircraft. Non-standard configurations drives costs up as well for MX.
 
Overspeed said:
Doesn't AA have multiple advantages over DL with new aircraft? Lower maintenance costs, lower fuel costs, and higher MX reliability? We are cutting MD80s and DL is adding more older used aircraft. Non-standard configurations drives costs up as well for MX.
Click to expand...
No, and WT will be by shortly to tell you why!
 
The silence was deafening regarding the lack of fuel guidance from DL last month, but now Hunter's picked up on it.
Click to expand...
it probably has to do with the fact that other airlines, including AA and UA don't provide fuel price guidance so DL is not going to provide monthly information that other carriers don't provide.

RASM is not consistently reported on a monthly basis... don't be surprised if it too becomes no longer a monthly reported item
 
 
Doesn't AA have multiple advantages over DL with new aircraft? Lower maintenance costs, lower fuel costs, and higher MX reliability? We are cutting MD80s and DL is adding more older used aircraft. Non-standard configurations drives costs up as well for MX.
Click to expand...
I have never said that AA didn't have fuel efficiency advantages... I have said that those new aircraft cost money. A couple years or more of lower fuel prices eliminates part of the advantage which is better fuel efficiency. low fuel prices are a good incentive to hold onto a less efficient car or airplane.

AA does gain a maintenance holiday on new aircraft and lower maintenance costs but at the cost of higher debt.

yet, DL's MD80s aren't that much older than AA's and yet DL has no plans to get rid of theirs. Honestly, why is DL able to keep its M80s flying and reliable but AA feels they need to be retired?

No one here also seems to grasp that new airplanes cost money. AA is the most indebted airline in the US and also has the greatest number of new aircraft on order.

that extra debt is going to have to be paid somewhere that other airlines are not paying. You can guess where but you might want to consider that AA's lower labor costs compared to DL and UA might end up helping to fund increased debt service costs. (interest payments)
 
AANOTOK said:
No, and WT will be by shortly to tell you why!
Click to expand...
DING DING DING...I win the prize!!
 
WT talking and the end result! 
 
https://www.youtube.com/watch?v=ss2hULhXf04
 
So DL is never going to buy new planes? Their new business model is to buy up used fuel inefficient aircraft? Is that giving the customers what they value? I thought DL was providing a superior product?
 
where did you ever come up with that idea? DL had 100 739ERs on order for several years, added the 10 333s plus 30 321s, and followed up with the most recent order for 50 359s and 339s.

the difference is that DL buys used aircraft when they can - and you might consider that WN has done the same for years and UA says they are doing it now as well - and DL refurbishes the cabins of aircraft it intends to keep.

customers don't know and shouldn't what DL aircraft are 20 years old and which ones are fresh off the factory line.

DL's entire widebody int'l fleet has been refurbished and has as good of a product as any US carrier offers while the narrowbody refurbs are taking place now.

tell me what cabin refurbs AA is doing...
 
WorldTraveler said:
where did you ever come up with that idea? DL had 100 739ERs on order for several years, added the 10 333s plus 30 321s, and followed up with the most recent order for 50 359s and 339s.the difference is that DL buys used aircraft when they can - and you might consider that WN has done the same for years and UA says they are doing it now as well - and DL refurbishes the cabins of aircraft it intends to keep.customers don't know and shouldn't what DL aircraft are 20 years old and which ones are fresh off the factory line.DL's entire widebody int'l fleet has been refurbished and has as good of a product as any US carrier offers while the narrowbody refurbs are taking place now.tell me what cabin refurbs AA is doing...
Click to expand...
The 777-200s are currently being refurbed.

You continue to poo poo the fuel savings coupled with maintenance savings and increased reliability of newer aircraft.
When fuel is your #1 line item cost and it can be reduced 20-30%, along with the other savings listed, it would seem to make sense to make that move.

All the aircraft DL has on order, are they getting those for free? Or will they also be adding to their debt?

I forgot, DLs aircraft use no fuel and never break and they magically cost much less than everybody else's.

On Trainer, at the time, it looked like a shark move, with advent of plentiful and lower oil prices, it's certainly doubtful they make the same move in this environment, but you would never admit that.
At the end of the day, DLs money is helping all the other airlines that didn't have to spend a penny on it, so thanks.
 
Overspeed said:
Doesn't AA have multiple advantages over DL with new aircraft? Lower maintenance costs, lower fuel costs, and higher MX reliability?
Click to expand...
 
It depends (i.e. what is the narrative).
There is a thread on the DL board where WT is writing a thesis how DL will be at an advantage with their new Airbus WB aircraft it has on order, where on the other hand, UA and AA will be at a serious disadvantage as they continue to operate their dilapidated B777s
http://www.airlineforums.com/topic/57924-msp-gains-dl-hnl-flights/?p=1134358
 
I hope you enjoy your hyperbole because that is the only way it can be described.


I have never said that DL will have a singular advantage - just that DL's smaller 777 and current longer haul fleet will provide them with a larger advantage sooner while AA and UA will have to get rid of a lot of older aircraft.

CMH_GSE said:
The 777-200s are currently being refurbed.

You continue to poo poo the fuel savings coupled with maintenance savings and increased reliability of newer aircraft.
When fuel is your #1 line item cost and it can be reduced 20-30%, along with the other savings listed, it would seem to make sense to make that move.

All the aircraft DL has on order, are they getting those for free? Or will they also be adding to their debt?

I forgot, DLs aircraft use no fuel and never break and they magically cost much less than everybody else's.

On Trainer, at the time, it looked like a shark move, with advent of plentiful and lower oil prices, it's certainly doubtful they make the same move in this environment, but you would never admit that.
At the end of the day, DLs money is helping all the other airlines that didn't have to spend a penny on it, so thanks.
Click to expand...
see above plus....

no, again, DL pays for aircraft like everyone else... they just happen to spend less money on new aircraft and also mix in used aircraft - remember the M90 uses one of the same engines available on the 320. It is not a fuel inefficient aircraft. The 717 is on par with current technology aircraft in terms of fuel burn

I'm glad that AA is refurbishing their 772s... my question is still how AA is going to use as many aircraft as the combined AA/US have in service - besides the relatively few that are leaving.

and we've been thru the whole fuel vs. new aircraft vs. maintenance debate a million times.

without raw numbers, I'm not sure anyone is going to be convinced.

DL obviously decided that new 339s and 359s are worth it compared to used aircraft.

Nowhere have I ever said that AA is wrong in buying new aircraft... but I do have concerns about the amount of debt that AA is taking on as part of its fleet renewal... and given that every other US airline of size has much less leverage than AA, it is a factor that should not be quickly discarded.
 
All new 737-800s are coming with new Apollo cabin (video and powerports in every seat), all non-ER 757s are being retired with all remaining 757s having coach and first updated or converted to IFS cabin in first along with coach update, 767-300s are being updated to new J cabin, 777-200s being converted to new J and Y cabin with powerports in every seat. New 319s and 321s will all have video and power ports in all cabins as will 787-8s and 787-9s. Within two years AA should have all cabins updated except for the remaining MD80s that are being parked.
 
You must log in or register to reply here.

Similar threads

WorldTraveler
Why many analysts got the refinery deal wrong
Replies
10
Views
4K
WorldTraveler
WorldTraveler

Latest posts

Back
Top