Proposed Delta Merger and Delta777 & WorldTraveler

[IMisstheAladdinTrays]

Damn, how did i forget about "merger related" costs. I thought it was supposed to bring about "synergies", not costs.

The other thing I remember from Secretarial School...you have to spend some money, to make some money!

 

[Flufdriver]

Damn, how did i forget about "merger related" costs. I thought it was supposed to bring about "synergies", not costs.

Is that the "best" you could do?

 

[BoeingBoy]

LCC actually earned in the neighborhood of $507 million in 2006 before merger related costs

Actually, that was before special items, which include a lot more than merger related costs. Of course, you could say that US made about $3 billion before fuel costs or $2.5 billion before employee costs, but so what?

The bottom line is, well, the bottom line - revenue minus expenses = profit. Using that fundamental measure, CO had a larger profit than US.

Jim

 

[Flufdriver]

Actually, that was before special items, which include a lot more than merger related costs. Of course, you could say that US made about $3 billion before fuel costs or $2.5 billion before employee costs, but so what?

The bottom line is, well, the bottom line - revenue minus expenses = profit. Using that fundamental measure, CO had a larger profit than US.

Jim

Always "good" to hear from the retired expert!! Excuse me for being so wrong, shame on me!!! I hope when I retire I don't find myself surfing aviation message boards about my old employer!! There is alot better things to be doing.

 

[BoeingBoy]

There is alot better things to be doing.

And miss all the fun? I really get a laugh out of the US folks that just loved to stir the pot on the DL board for the last couple of months now want the DL folks to stay on their own turf. Sore losers, I guess - right Fluf.....

Jim

 

[USA320Pilot]

It is one thing to chat on each others board with an active merger proposal; however, I believe it is different when the deal is dead.

Regards,

USA320Pilot

 

[Barbell]

Hey, Clown, back off! :rant: Show a little respect to those who have graciously let us inheret a proud history. I, for one, enjoy Jim's thoughtful insight and challenges to "expert" opinion.

And Jim, I don't disagree with you that CO's profit was larger than US. However, I think it's important to take it in context.

The theory here is that if you have a "large global footprint" blah blah blah you are king of the skies and a company to be envied. We hear time and time again that airlines like UA offer a better product and service. We are told that DL is upgrading their service and has just undergone the largest international expansion in their history. Well golly gee, good for them.

These "improvements", we are told, is why US will be unsuccessful and, well I don't need to repeat it all, do I?

Here's the simple truth. If you have a vast international network, ala CO, and we are to believe what these Internet "experts" tell us, then their profit should have been far more than $43 million more than US's. Likewise UA's profit of $25 million, at more than double our size and with a vast global network, superior service, and catering to high-yield passengers should have proferred a net profit of at least double our measly $500 million. But it didn't.

Don't get me wrong, I think we have made plenty of missteps, I don't care what Spreadsheet says. However, this year proves that passengers are willing to pay for 1 thing, and it's not what CO, DL and UA are offering.

 

[Flufdriver]

And miss all the fun? I really get a laugh out of the US folks that just loved to stir the pot on the DL board for the last couple of months now want the DL folks to stay on their own turf. Sore losers, I guess - right Fluf.....

Jim

Jim, don't put words in my mouth...I'm glad it didn't happen. Sore loser, not me. Ive been partying ever since yesterday! Old stuff already!

 

[delta777]

Hey, Clown, back off! :rant: Show a little respect to those who have graciously let us inheret a proud history. I, for one, enjoy Jim's thoughtful insight and challenges to "expert" opinion.

And Jim, I don't disagree with you that CO's profit was larger than US. However, I think it's important to take it in context.

The theory here is that if you have a "large global footprint" blah blah blah you are king of the skies and a company to be envied. We hear time and time again that airlines like UA offer a better product and service. We are told that DL is upgrading their service and has just undergone the largest international expansion in their history. Well golly gee, good for them.

These "improvements", we are told, is why US will be unsuccessful and, well I don't need to repeat it all, do I?

Here's the simple truth. If you have a vast international network, ala CO, and we are to believe what these Internet "experts" tell us, then their profit should have been far more than $43 million more than US's. Likewise UA's profit of $25 million, at more than double our size and with a vast global network, superior service, and catering to high-yield passengers should have proferred a net profit of at least double our measly $500 million. But it didn't.

Don't get me wrong, I think we have made plenty of missteps, I don't care what Spreadsheet says. However, this year proves that passengers are willing to pay for 1 thing, and it's not what CO, DL and UA are offering.

You obviously aren't listening to your bread and butter passengers, the FF'ers. They're leaving in droves, just read some of their comments on this very forum!!!

 

[US1YFARE]

We hear time and time again that airlines like UA offer a better product and service.

They do.

 

[Barbell]

They do.

So why aren't they making more money? Because they should be...

 

[MMB]

However, this year proves that passengers are willing to pay for 1 thing, and it's not what CO, DL and UA are offering.

So why aren't they making more money? Because they should be...

What past years have shown is that most passengers don't willingly pay for anything beyond the Starbucks kiosk. Offer a meal, movie, and more seat/leg room on a 4 hour flight for another $20 and they opt for the cattle car and the cheaper fare.

 

[BoeingBoy]

Thanks, Barbell. I agree that context is important, by the way. Like the context of CO & AA are still making pension contributions, not having the benefit of a recent BK to ruthlessly shed costs, or the benefit of merger "synergies".

Once the industry settles down and the distorting effects of current/recent bankruptcies are out of the way, there'll be plenty of time to crow if US becomes "the most profitable legacy carrier". Until then, being happy with a nice profit is great but trying to rub anybody's face in it is asking for another course of crow down the road.

It is pretty funny watching some of those who just loved poking the DL people in the eye for the last couple of months, on the DL board, now crying foul....

Jim

 

[US1YFARE]

So why aren't they making more money? Because they should be...

You are assuming that they aren't making more money because of the service and amenities they provide, or at least that the service/amenities they provide cut deeply into their profit. You are ignoring all of the other factors involved in analysis, such as the costs of running a global carrier the size of UA. It doesn't mean that you aren't losing high fare paying customers. You are also assuming that LCC would have not made a profit had they improved, or rather refrained from degrading the FC product. All the powdered creamer in the world isn't going to cause you to make a profit.

You see, Barbell, you need to look at the WHOLE spreadsheet, not just one box. Just because each individual box shows that you will make more money, when you add them together, 1 and 1 doesn't always equal 2.

 

[Barbell]

You obviously aren't listening to your bread and butter passengers, the FF'ers. They're leaving in droves, just read some of their comments on this very forum!!!

And you obviously live in a fantasy world.

Look, delta777, I'm gonna break it down like a fraction for you so it can fit in your tiny little brain.

What goes on on this board and in the real world occurs in parallel universes. The second coming of Jesus Christ is not happening at the rate that people here believe.

And if our VFF's were "leaving in droves" then their lost, hefty revenue should be reflected in other balance sheets, load factors, and FF rolls, which, quite frankly, isn't happening.

But you've given me opportunity to quote myself, which I love to do:

Don't get me wrong, I think we have made plenty of missteps... However, this year proves that passengers are willing to pay for 1 thing, and it's not what CO, DL and UA are offering.