On Again? Delta - Northwest Merger [Archive]

delts145

04-10-2008, 12:25 PM

Delta-Northwest may merge soon - Soaring jet fuel prices add impetus to deal that needs pilots' side pact

Cox News Service
Article Last Updated: 04/09/2008 11:26:08 PM MDT

http://www.deseretnews.com/photos/midres/4817029.jpg
'Delta Air Lines' hub in Salt Lake city (Scott G. Winterton, Deseret Morning News)

Delta Air Lines and Northwest Airlines could roll out their long-delayed merger deal as early as next week if Delta works out a related agreement with its pilots union, according to one person familiar with the talks.
However, the situation appeared to be very fluid. Some with knowledge of the situation suggested that Delta and Northwest could go ahead with earlier merger plans whether they reach an agreement with pilots.
The carriers have been trying to revive their consolidation efforts, which seemed close to an announcement in February until a feud between the two carriers' pilots unions stalled the pact.
They want to do a deal quickly because they are feeling increasing pressure from investors, spooked over high fuel costs and growing signs of a recession. Three smaller airlines have filed bankruptcy and shut down in recent weeks. As if to underline the bleak outlook, the spot price of jet fuel shot to a record Wednesday, rising 13 cents per gallon, to $3.43. Each penny-per-gallon rise boosts Delta's annual fuel bill by roughly $25 million.
Executives at Delta and Northwest also hope to get a deal done soon because they believe it will have a better chance passing regulators' scrutiny this year, before a Democratic administration possibly takes office, said people familiar with the talks, who asked not to be identified because they were not authorized to speak on behalf of the carriers.
To get around an impasse that developed last month, Delta and its pilots union are trying to work out a separate side deal that would allow the merger agreement to move forward, while shelving an unfinished pact on how to blend the Delta and Northwest pilots' seniority lists.
Delta's pilots want to work out a separate agreement with the carrier to push the merger forward in hopes of receiving some incentives as part of the deal.
The Delta pilots are being offered pay raises, equity stakes and a seat of the board of directors of the merged carrier to agree to labor contract modifications to give the airlines more flexibility, people familiar with the talks said.
Such an agreement could also give Delta Chief Executive Richard Anderson a face-saving way to proceed with the deal after making an earlier commitment in a memorandum to employees to not do any transaction unless it preserves employees seniority. Richardson's commitment didn't extend to Northwest's pilots.
The Wall Street Journal said Wednesday that Delta and the pilots hope to reach a decision by the end of this week. Delta's board of directors met last week after Northwest broached the idea of going forward with their merger plans without a side deal between the two carriers' pilots unions on how to integrate their work groups.

Related development

The Transportation Department said Northwest and Delta should be allowed to share routes and revenue on flights across the Atlantic. Transportation officials say the agreement would basically allow the airlines to act as a single carrier for service between Europe and the United States.

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unusualfire

04-10-2008, 02:33 PM

If the merge they are going to be still paying the high fuel costs and even have to buy more if they combine.

Saddle Man

04-10-2008, 04:22 PM

Not this again.

Unity77

04-10-2008, 04:23 PM

With the way things are going in the airline industry this merger won't benefit anyone, but the executives representing both airlines. The newly merged airline will still suffer from high fuel costs, increased customer dissatisfaction, and will more than likely seek handouts from both MN and GA (hopefully MN tells them to shove it sideways). Sure the MN will be losing a Fortune 500 company, but NWA has screwed the state in several ways and has a such a negative image among its customers that they won't be missed. Good luck Delta. :D

IMO, the only positive outcome this merger would be bring is increased competition at MSP International.

dimondpark

04-10-2008, 04:25 PM

shouldnt this be in the transportation forum?

Rail Claimore

04-10-2008, 07:28 PM

:previous: I was about to say...

delts145

04-11-2008, 12:01 PM

Delta accord: Pilots' agreement paves way for Northwest deal

http://www.deseretnews.com/article/1,5143,695269298,00.html

http://www.deseretnews.com/photos/midres/5284721.jpg
Northwest Airlines plane and Delta Air Lines plane pass each other at Salt Lake International Airport. A merger would create world's largest carrier. (Jeffrey D. Allred, Deseret News)

Delta strikes tentative pilots deal that will let Northwest merger proceed

http://www.sltrib.com/business/ci_8885555

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nomarandlee

04-14-2008, 05:31 AM

http://www.chicagotribune.com/business/chi-mon_merger0414apr14,0,1319987.story

Northwest, Delta near merger deal
United, Continental waiting in wings if accord is reached
By Julie Johnsson | Tribune reporter
10:55 PM CDT, April 13, 2008

The airline industry is on the verge of a long-awaited consolidation, with Delta Air Lines Inc. and Northwest Airlines nearing a merger agreement that is expected to pave the way for a tie-up between Chicago-based United Airlines and Continental Airlines.

Delta and Northwest could announce a deal this week that would create the world's largest airline, provided they can resolve a handful of issues, including maintaining labor peace with their powerful pilot unions, people familiar with the talks said Sunday.

That would free Continental to pursue a merger with United to create an even larger airline because Northwest, by striking a deal of its own, would forfeit special stock that gives it effective veto power over a Continental transaction.

United and Continental, the nation's second- and fourth-largest airlines respectively, have laid the groundwork for a merger and are prepared to move quickly to wrap up a deal, said a person familiar with their talks. Their pilots' unions also have held extensive discussions, and merging the two labor groups is not likely to present a major stumbling block, said the person, who spoke on the condition of anonymity............................

BTinSF

04-14-2008, 06:10 AM

Delta Aims to Unveil Northwest Merger Pact
By SUSAN CAREY and PAULO PRADA
April 14, 2008; Page A1

Delta Air Lines Inc. and Northwest Airlines Corp. may unveil their long-delayed merger announcement as early as Tuesday, said people familiar with the matter, in the latest move by airlines to grapple with high fuel prices and a softening economy.

The deal could value Northwest at roughly $3 billion, these people said, though terms were still being negotiated. That would be well below Northwest's market value of more than $4.6 billion as of Feb. 1, reflecting the industry's worsening prospects in recent weeks.

http://s.wsj.net/public/resources/images/P1-AL175_DELTA_20080413190440.gif

Moving ahead with a deal risks a clash with the airlines' pilots, who don't have veto power but can complicate a merger. Delta and its roughly 6,000 unionized pilots remained in talks over the weekend on a new post-merger contract that would cover that group only.

It wasn't clear Sunday whether Delta, the nation's third-largest airline by traffic, and No. 5 Northwest would proceed with their merger without an accord. A spokeswoman for the Delta pilots' union declined to comment.

Northwest's 5,000 pilots, who previously signaled their unhappiness at being left out of the process, Sunday held a meeting of union leaders near Minneapolis. At the end, the pilots said they will evaluate whether Northwest has better prospects as an independent carrier. The group decided that any merger, "in order to avoid our vigorous opposition, must clearly be in the interests of NWA pilots, customers and employees," said Dave Stevens, chairman of the pilots' group.

Other factors could delay or derail a deal. They include some important deal terms reached earlier but now being reconsidered in light of the industry's deteriorating condition, said one person with knowledge of the situation. They will also face a lengthy federal antitrust review.

The high fuel prices and lack of credit hurting major sectors of the U.S. economy have been particularly tough on airlines. Several big carriers, including Delta and Northwest, have recently said they plan to shrink their domestic capacity and retire airplanes. Delta also announced plans last month to cut 2,000 jobs, or about 4% of its work force.

Four smaller carriers have filed for bankruptcy-court protection in the past few weeks, with three abruptly shutting down operations.

Soaring Fuel Costs

The cost of fuel, airlines' top expense, has surged as the price of a barrel of crude oil climbed from $90 a barrel in mid-January to more than $110 on Friday. Making matters worse, the cost of refining a barrel of crude into aviation fuel has risen significantly in recent months.

The credit crunch has made raising money more difficult and made financing jetliners more arduous and expensive. The softening economy, meanwhile, is expected to damp consumer demand, hurting the industry's ability to raise fares.

Analysts polled by Thomson First Call expect Delta to post a first-quarter loss of 37 cents a share and Northwest to post a loss of 29 cents a share. The two airlines had become profitable after they emerged from Chapter 11 bankruptcy-court protection last year, lifted by cost cuts and high demand.

Delta's shares finished Friday at $10.01 in New York Stock Exchange composite trading, compared with a 52-week high of $23.25 reached nearly a year ago. Also on the Big Board, Northwest finished at $10.96 a share, compared with a 52-week high of $26.50 reached in June.

Many industry executives and investors see mergers as a way of reducing the number of seats and operators in the air and giving the industry a measure of pricing power. Stitching together airline route networks also could raise revenue.

A deal could spark opposition from consumer advocates, other airline unions, small communities worried about a possible reduction of air service and powerful members of Congress, such as Rep. Jim Oberstar, the Minnesota Democrat who is chairman of the House Committee on Transportation and Infrastructure. Mr. Oberstar has said he opposes airline mergers.

If Delta and Northwest proceed and the transaction receives regulatory approval, the combined carrier would be the largest in the world by traffic. Such a merger, or even the prospect of one, is expected to set off a wave of consolidation, with UAL Corp.'s United Airlines and Continental Airlines Inc. seen as the next possible pairing. United has been an avid proponent of mergers. Continental has said it would like to remain independent but would act quickly if the competitive landscape changed.

Talks between Delta and its pilots broke down last week over financial terms. But negotiations picked up again over the weekend with the hope of reaching agreement as soon as Monday, said people familiar with the matter.

In February, Delta and Northwest were days away from moving ahead with a merger agreement. Their plans were derailed by their pilots' failure to reach accord on how to integrate their seniority systems. At the time, the deal terms included a share swap at near market rates, with Northwest holders getting a significant premium to Delta holders; a $750 million investment by European marketing partner Air France-KLM SA; and retention of the Delta name, headquarters and chief executive officer, Richard Anderson.

In recent days, the two carriers have wrangled over the size of the Northwest premium, said two people with knowledge of the matter, with Delta trying to reduce it and Northwest balking.

The Air France stake also is being revisited because the depressed prices of Delta and Northwest stock mean the $750 million investment would buy Air France a much larger stake in the combined entity than the U.S. airlines are prepared to cede. The two, which have $5.8 billion in cash combined, don't feel they need as much money from Air France to cement their existing marketing links, said one person, adding that it was expected that those issues would be resolved by the end of the weekend.

Originally, the airlines wanted to move ahead with their merger only after they had an accord with their pilots on a common contract covering all 11,000 aviators, and the pilots themselves had agreed on a way of integrating the two groups' seniority systems. The terms of the common contract were reached, but the pilots, represented by separate branches of the Air Line Pilots Association union, couldn't reach a deal.

Pilots' Seniority

Seniority is important because it dictates which kinds of planes pilots fly and whether they are captains or first officers, both determinants of pay and lifestyle. Northwest pilots tend to be more senior because hundreds of veteran Delta aviators quit before Delta filed for Chapter 11 in 2005.

Without an accord on seniority, Delta and Northwest wouldn't be able to reap the scheduling, fleet and operating efficiencies they had hoped for on deal consummation. Many in the industry point to the example set by US Airways Group Inc. and America West Airlines when they merged in late 2005. Only in recent days have some of the unions representing their ground workers been able to win common labor contracts with the combined carrier. The pilots still are fighting over seniority, which has kept US Airways from integrating the two fleets and the cockpit-crew roster, resulting in inefficiencies and lost savings.

Delta and Northwest decided they couldn't afford the significant costs of the joint pilot contract, which would have given raises to all the aviators, with large ones for the lesser-paid Northwest pilots. After a lull, Northwest late last month proposed to Delta that the two revive the plan but without a pilot agreement, leaving it to the employees to work out seniority issues later and then bargain for a new contract with the combined company. That is the way most merging airlines approach labor integration, but it's a difficult process that can take years.

Instead of jettisoning a labor-friendly approach altogether, Delta in recent days tried to forge a deal with its pilots alone, hoping that an agreement with them would undo some current contract language that would hinder the combined airline's flexibility in the first phase of the merger. Delta also wanted to insure harmonious relations with its only large unionized group.

A deal with the Delta pilots also was intended to give the Northwest group an incentive to quickly work out the seniority issue either through negotiation with the Delta pilots or via arbitration. In return, the Northwest pilots could look forward to a new contract of their own later that would raise their pay to Delta levels.

But talks between Delta and its pilots foundered last week over pay issues, said one person familiar with the situation. Because of the worrisome industry outlook, Delta suggested cutting back on the terms it had agreed to in February, which led to a breakdown in talks. Leaders of the Delta pilots' union were meeting in Atlanta over the weekend with Delta management in hopes of breaking the stalemate, said this person. As of Sunday, it appeared that the two sides were getting closer, this person said.

The Northwest pilots fear that in the initial phase of a merger, the combined airline would expand the Delta side of the operation and shrink the Northwest side. If the Northwest pilots believe a merger announcement is imminent, they could try to press Delta management to agree to expedited bargaining in return for the Northwest pilots not opposing the deal.

Write to Susan Carey at susan.carey@wsj.com4 and Paulo Prada at paulo.prada@wsj.com5
Source: http://online.wsj.com/article/SB120811358101510993.html

delts145

04-14-2008, 12:49 PM

Delta, Northwest airlines may announce merger soon - as early as tomorrow.

Delta in Salt Lake City:

-- Delta operates one of its three main hubs at Salt Lake International Airport.
-- The airline employs 3,500 Utahns and makes about 80 departures daily.
-- Along with regional contract carriers SkyWest Airlines and Atlantic Southeast Airlines, Delta flies to more than 100 national and international locations.

The Salt Lake Tribune news services
Article Last Updated: 04/14/2008 06:26:11 AM MDT

Posted: 6:20 AM- Delta Air Lines Inc. and Northwest Airlines Corp. may announce a merger to create the world's largest carrier as early as tomorrow, following a meeting of Northwest's board today, people familiar with the talks said.
Bloomberg News reports today that Delta Chief Executive Officer Richard Anderson met yesterday in Minneapolis with Northwest CEO Doug Steenland to discuss the merger plans, said two of the people, who didn't want to be identified because the discussions are private.
Delta, the third-largest U.S. carrier by traffic, is betting that a combination with No. 5 Northwest will boost revenue and lower costs after jet-fuel prices surged 77 percent in the past year. The merged company would surpass AMR Corp.'s American Airlines as the world's biggest carrier.
"They're going to be, by far, the largest, most dominant force in the industry," Michael Derchin, an analyst with FTN Midwest Research Securities Corp. in New York, said in an interview last week. "The cost-cutting has to happen with oil at $110 per barrel, and on the margin this helps you do it a little better."
Delta spokeswoman Betsy Talton and Northwest spokeswoman Tammy Lee declined to comment. Delta pilots spokeswoman Kelly Regus didn't return messages seeking comment.
Shares of Northwest trading in Frankfurt rose 4.1 percent to $11.41 as of 1:02 p.m.; Delta was up 2.5 percent, at $10.26. On April 11, Delta advanced 26 cents to $10.01 in New York Stock Exchange composite trading; Northwest gained 9 cents to $10.96.
The airlines are forging ahead after failing to get their pilots to draw up a combined seniority list before a merger.
Delta instead has focused on reaching an agreement with its 7,000 pilots. The airline and its pilot leaders came to a preliminary accord on most issues last week and are ironing out differences on the size of pay increases, two people said. Northwest's 5,000 pilots will be asked to join under a single contract later.
Northwest pilot leader Dave Stevens said yesterday in an e- mailed statement that any merger involving Northwest must be in the best interests of pilots, customers and employees in order to "avoid our vigorous opposition."
The Northwest pilot union's executive council met yesterday near Minneapolis for an update on the merger talks and a briefing on "changing economic circumstances" of the industry, Stevens said. Delta's pilot leaders convened in a special session in Atlanta on April 11, according to a memo union leaders sent to members.
Delta will keep its name and Atlanta headquarters, and Anderson will run the combined carrier, people familiar with the matter have said previously.
The merged airline would benefit from Delta's trans-Atlantic routes to Europe and its Latin American network, plus Eagan, Minnesota-based Northwest's Pacific routes, including access to the restricted Narita Airport in Tokyo.
The merger was threatened last month after pilot leaders at Delta and Northwest failed to agree on how to combine their seniority lists. The two sides differed over how younger pilots at Delta would move up the list as older Northwest pilots retired.
Seniority is crucial because it determines pay, type of aircraft and routes flown.
Delta management now plans to ask the Northwest pilots to join under a single contract instead, the people said. Negotiations for a combined seniority list may take months to complete, they said.
All of the pilots belong to the Air Line Pilots Association. It's the only major unionized group at Delta.
The merger accord may increase the pressure on other U.S. airlines to pursue their own tie-ups. Continental Airlines Inc., the fourth-largest U.S. carrier, has held talks with UAL Corp.'s United Airlines and American, a person with knowledge of the matter said on Feb. 15.

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Detroit5000

04-14-2008, 09:30 PM

Northwest, Delta poised to announce merger on Tuesday

Nathan Hurst / The Detroit News

Northwest Airlines Corp. board of directors is meeting today ahead of an expected announcement Tuesday that Northwest will be acquired by Delta Air Lines Inc., several sources close to negotiations have told The Detroit News.

The tie-up of Eagan, Minn.-based Northwest and Atlanta-based Delta follows months of on-again, off-again negotiations and would create the world's largest airline, surpassing AMR Corp.'s American Airlines.

It would be structured as a Delta acquisition of Northwest, with a premium paid to Northwest's shareholders. The company would retain Delta's name, Atlanta headquarters and CEO Richard Anderson.

The deal still faces some major hurdles, though.

The two companies are likely to move forward without agreement from their pilots, sources said, though Delta's management is still hoping to iron out final details of a contract revision that would give the merged airline more flexibility for cost-saving synergies from the outset. The broad strokes of that deal were mostly finished by late last week, though wrangling continued throughout the weekend.

It's expected Delta's pilots would receive pay raises and an equity stake in the new carrier in exchange for their contract concessions, though it was uncertain exactly what those incentives would be.

Meanwhile, Northwest's pilot union chapter held its own meeting near Minneapolis on Sunday to discuss the potential merger. In a statement, the chapter's leadership said it would evaluate any deal against Northwest's stand-alone business plan.

Leadership "unanimously decided that any merger involving Northwest Airlines, in order to avoid our vigorous opposition, must clearly be in the best interest of NWA pilots, its customers and employees," said Dave Stevens, chairman of the union chapter's master executive council.

Monty Montgomery, the group's vice chairman, said Northwest has "a stand-alone business plan based on a strong international and domestic route structure."

Sources said that without a combined labor contract in place, the Northwest pilots would be expected to negotiate a deal of their own with the new airline's management.

Northwest and Delta have been working toward a merger since January, and when they finished forging major terms of the deal by mid-February, they asked the Air Line Pilots Association -- the only labor group representing workers at both companies -- to devise a four-year combined contract that would streamline the merger process.

But talks between the two union chapters fell apart last month when the two sides couldn't agree on how to create a combined seniority list, which determines a pilot's pay, rank and work schedule, as well as what equipment and routes he or she can fly.

Had the pilots agreed on a combined labor contract, it would've been a historic first in the game of airline mergers, which have been plagued by labor problems like those seen in the 2005 combination of US Airways and America West Airlines. Though they now operate under one brand, workers at the Tempe, Ariz.-based carrier still toil under two separate sets of labor contracts which have prevented immediate realization of expected cost savings.

The lack of an accord between the Northwest and Delta pilots could make it harder for the new company to immediately realize full cost savings as well, though other economic pressures still make the deal worth it, sources say.

Sky-high oil prices have rocked the airline industry this year, with spot prices for jet fuel rising more than 70 percent over the past year. That's forced four carriers -- ATA, Aloha, Champion and Frontier -- into bankruptcy. Only Frontier will continue to fly.

Northwest and Delta have responded by cutting domestic capacity and raising fares to combat the record-high costs, which are now the airlines' biggest expense. But by combining Delta's strength in trans-Atlantic operations to Europe and Africa and its presence in Latin America with Northwest's industry-leading position in trans-Pacific flights to emerging Asian markets, the combined company would have a powerful worldwide network that would be well-positioned to lure high-revenue business travelers.

A number of industry analysts have said that if a Northwest-Delta deal does finally go through, a wave of other consolidation in the industry could be seen as well. Chicago-based United Airlines and Houston-based Continental are rumored to be next in line for a deal, though they've been waiting on the sidelines of the Northwest-Delta rumors before going forward with any plans to combine.

Experts have said Detroit Metropolitan Airport is expected to be a winner in the merger, given its strong presence as a premier gateway to Asia and modern, easy-to-navigate facilities. Northwest employs more than 9,000 people in Michigan, the majority of them stationed at Metro Airport, where the company operates its largest hub.

http://www.detnews.com/apps/pbcs.dll/article?AID=/20080414/BIZ/804140419

SouthSky

04-14-2008, 09:47 PM

Being from Mobile and Baton Rouge, I can only guess how this will affect air services in both of my local airports.

June schedules

MOB-
7x daily to ATL on DL
3x daily to MEM on NW

BTR
8x daily to ATL on DL
5x daily to MEM on NW

delts145

04-15-2008, 12:37 AM

Delta, Northwest directors sign off on airlines' combination

http://www.deseretnews.com/article/1,5143,695270428,00.html

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Trae

04-15-2008, 01:15 AM

Happened: http://www.chron.com/disp/story.mpl/front/5697457.html

Saddle Man

04-15-2008, 02:50 AM

Craptacular.

OhioGuy

04-15-2008, 03:09 AM

The new Delta - NWA website: http://www.newglobalairline.com/

MNMike

04-15-2008, 03:12 AM

All the headlines keep saying things like "done deal"...Its really far from a done deal. It likely will be eventually, but there are still many hurdles to jump. For one, the NW pilots union has already said they officially oppose the merger(right after the announcement)...not to mention they need to get the government approvals. Its certainly a big step closer though. I also read that apparently nothing will change for at least a year and a half.

PS, I think its lame that this "new" airline will be called Delta. An entirely new name or some combination would have been better if you ask me.

steel

04-15-2008, 03:22 AM

I hear Cinci and Memphis will not fare well in this merger

Rail Claimore

04-15-2008, 03:40 AM

:previous: If Delta takes NWA Cargo operations as well, don't expect MEM to lose out on this merger.

steel

04-15-2008, 03:48 AM

Word is those two cities would loose their hub status

OhioGuy

04-15-2008, 04:33 AM

Everything I've read has indicated the new combined Delta airlines will maintain all of the current hubs. The new website says that. An email from Northwest airlines to WorldPerk members that I received this evening said that. News articles have said that.

As a valued Northwest Airlines customer and WorldPerks® member, I wanted you to be among the first to hear that we have announced a merger with Delta Air Lines. Subject to regulatory review, our two airlines are joining forces to create America’s premier global airline which, upon closing of the merger, will be called Delta Air Lines.

By combining Northwest and Delta, we are building a stronger, more resilient airline that will be a leader in providing customer service and value. Our combined airline will offer unprecedented access to the world, enabling you to fly to more destinations, have more flight choices and more ways than ever to earn and redeem your WorldPerks miles.

You can be assured that your WorldPerks miles and Elite program status will be unaffected by this merger. In addition, you can continue to earn miles through use of partners like WorldPerks Visa®. And once the new Delta Air Lines emerges you can look forward to being a part of the world’s largest frequent flyer program with expanded benefits.

The combined Delta Air Lines will serve more U.S. communities and connect to more worldwide destinations than any global airline. Our hubs – both Delta’s and Northwest’s – will be retained and enhanced. We will be the only U.S. airline to offer direct service from the United States to all of the world’s major business centers in Asia, Latin America, Europe, Africa and around North America.

Both airlines bring tremendous strengths to this new partnership. Our complementary service networks form an end-to-end system that is truly greater than the sum of its parts. This is a merger by addition, not subtraction, which means all of our hubs – both Northwest’s and Delta’s – will be retained. In addition, building on both airlines’ proud, decades-long history of serving small communities, we plan to enhance global connections to small towns and cities across the U.S.

All of these positive benefits of our combination mean that we can:
Offer a true global network where our customers will be able to fly to more destinations, have more schedule options and more opportunities to earn and redeem frequent flyer miles in what will become the world’s best and most comprehensive frequent flyer program.
Continue to serve our current roster of destinations and to maintain our hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York, Salt Lake City, Amsterdam and Tokyo.
Improve our customers’ travel experience, through new products and services including enhanced self-service tools, better bag-tracking technology, more onboard services, including more meal options, new seats and refurbished cabins.
While we work to secure approval of our merger, which may take up to 6 to 8 months, it will be business-as-usual at both airlines. We will continue to operate as independent airlines and the people of Northwest will remain focused on providing you with the very best in safe, reliable and convenient air travel. At the same time, both airlines will be planning for a seamless integration of our two airlines, one that delivers to you the enhanced benefits that will earn – and retain – your preference.

As we work through this process, we will keep you informed at every step along the way. Thank you for your business and we look forward to serving you on your next Northwest flight.

Sincerely,

Bob Soukup
Managing Director, WorldPerks

Evergrey

04-15-2008, 04:48 AM

This merged entity could realize cost savings by dehubbing CVG.

ColDayMan

04-15-2008, 05:03 AM

CVG makes too much money for Delta to just "give up" on. It may lose some service to places but it'll still be a hub. The only place that should be worried is Memphis and even that will likely remain fine.

Rail Claimore

04-15-2008, 05:08 AM

MEM and CVG are convenient relievers for ATL and DTW, especially CVG. They're not going anywhere.

LAX was conveniently unmentioned as a "hub." Delta uses it as a focus city for Central America, and NWA already flies to Tokyo and several other Asian cities from there, so Delta will be sure to capitalize off that. Combining their operations effectively makes it a hub for Delta.

ChunkyMonkey

04-15-2008, 12:04 PM

Let's face it, they said that all the hubs should be maintained mainly to get government approval for the merger. Once the merger goes through, I think they will start reducing Memphis and Cincinnati. How else are they going to get synergies and do you really think they need 3 Midwest hubs. Cincinnati has very low O&D compared to Minneapolis and Detroit, so it will be the sacrificial lamb in the long run. You can argue about Memphis being a reliever to ATL, but it really depends on how much it really costs as MEM has even worst O&D than CVG.

delts145

04-15-2008, 01:14 PM

^^^
MEM could loose its hub status eventually after the merger is completed. It happened even to Dallas with Delta, for the same basic economic reasons pointed out above. I think CVB could be downsized some, but possibly not lose it's hub. In addition to Atlanta, the biggest benefactor with Delta will be Salt Lake City. Among many factors, it's geographic location as the Western-most hub for funneling traffic to the newly emphasized international business market, cannot be overstated. As far as Northwest is concerned, there's definately going to be a lot of shake-up as far as hubs go, but after the merger is approved.

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delts145

04-15-2008, 01:18 PM

Delta makes $17.7 billion deal
S.L.C. International
http://www.deseretnews.com/photos/midres/5376882.jpg
Danny Chan La, Deseret News

http://www.deseretnews.com/article/1,5143,695270566,00.html

Delta Air Lines timeline

Nov. 1, 2001: Lack of travel, caused by fear of terrorism and new airport security measures after the Sept. 11 attacks, forces Delta to cut 15 percent of its scheduled flights. In Salt Lake, daily flights are reduced from 132 to 125. Delta cuts 13,000 of 82,000 employees through early retirement, voluntary severance, involuntary furloughs and layoffs — including 700 Utah jobs.
• Jan. 31, 2002: Delta posts a net loss of $1.2 billion for 2001, the largest loss in its 78-year history, despite a federal government bailout of $288 million. In 2000, Delta had a net income of $815 million.

• Sept. 17, 2002: Delta announces another 8,000 job cuts, including 200 jobs in Salt Lake, through early retirement and layoffs. In all, 16,000 jobs are cut since 9/11.

• Sept. 8, 2004: Hoping to avoid bankruptcy, Delta drops Dallas/Fort Worth as a hub, cutting flights from 254 to 21. Delta adds 58 flights to the hub in Salt Lake City. Delta also announces the elimination of 7,000 jobs over the next 18 months.

• Nov. 11, 2004: After 15 months of negotiations, Delta and the pilots union agree to pay cuts of 32 1/2 percent, saving the airline more than $1 billion a year, in an attempt to avoid bankruptcy. The agreement helps the airline, with $20 billion in debt, secure $1 billion in financing from American Express and General Electric Co.

• September 2005: Delta stock falls below $1 amid the havoc of Hurricane Katrina, and the airline files for Chapter 11 bankruptcy protection. Bankruptcy allows the airline to cut 9,000 jobs, about 17 percent of the work force, and reduce its $28.3 billion in debts.

• Feb. 14, 2006: Delta posts a $3.84 billion loss in 2005, compared of a loss of $5.22 billion in 2004. Delta has now lost $12.3 billion since January 2001.

• June 1, 2006: Delta pilots receive a 14 percent pay cut through 2009, saving the company $280 million a year, after months of negotiations between the pilots union and company — averting a pilot strike.

• Jan. 31, 2007: US Airways drops its hostile $9.8 billion bid to purchase Delta when creditors throw support behind Delta's plan to emerge from bankruptcy.

• April 30, 2007: Delta emerges from bankruptcy after posting a $6.21 billion net loss for 2006. About 400 million shares of new stock are issued to creditors and traded on the New York Stock Exchange for $21.75 a share, pegging Delta's market value at $8.7 billion.

• Jan. 23, 2008: Delta reports $1.61 billion in earnings for 2007.

• April 14, 2008: Delta, the nation's third-largest carrier by traffic, and Northwest, the nation's fifth, announce a merger that will result in the world's largest airline.

Merger delights Utah officials

http://www.deseretnews.com/article/1,5143,695270549,00.html

"We're excited to keep the existing jobs here, and we look forward to working with Delta to look at the possibilities of expansion and bring new jobs and other opportunities and benefits to Utah."

http://extras.mnginteractive.com/live/media/site297/2008/0415/20080415__deltanw.jpg
S.L. Tribune
Union of struggling giants - Delta, Northwest airlines reach merger deal; await feds' approval

Directors of Delta and Northwest airlines struck a deal Monday to merge and create the world's biggest carrier, with an important passenger hub in Salt Lake City.
The new airline will be called Delta, and Salt Lake International Airport will be its primary gateway to the West and one of its primary centers of operation.
Delta CEO Richard Anderson will be chief executive officer of the combined company, which will retain all the hubs of both Delta and Northwest, with airlines executives saying in a statement that Salt Lake City will benefit from improved access to international destinations.
"It's fantastic news for Salt Lake. It will open up our markets for international flights," said Salt Lake County Mayor Peter Corroon.
The merged airline will continue to be based in Atlanta, but will have executive offices in Eagan, Minn., where Northwest has its headquarters.
"Delta and Northwest are an excellent strategic fit, with complementary and geographically distinct route systems," Delta President Ed Bastian said in a statement.
"Together, we will have a more robust platform for profitable international growth. Combining both carriers' international land domestic strengths, with our worldwide SkyTeam partners, we are well positioned to lead the industry and deliver value to our shareholders."
The deal, an all-stock transaction with a combined value of $17.7 billion, awaits approval by federal regulators and must overcome employee doubts.
It will create the biggest airline in the world in terms of passenger traffic, while preserving jobs, seniority protection and giving employees equity in the new carrier. The merger announcement said the consolidation would result in an unknown number of job losses among administrative employees but not front-line workers such as flight attendants.
Despite Delta's pledge of no involuntary layoffs, Delta flight attendant and union organizer Paul Tanner said he's worried the merger will prompt executives to outsource jobs to cheaper workers. That worry is based on Northwest's plan in 2005 to outsource some positions filled by senior flight attendants on its coveted international routes.
"That's a red flag in my mind," said Tanner. "It's a big question in this merger."
The deal was reached without a prearranged agreement from the unionized pilots of both airlines about how to integrate their seniority lists, but Delta pilots last week agreed in principle on a contract that would raise their pay and give them an equity stake.
The proposed merger comes against a backdrop of rapidly rising jet fuel prices, which have put all airlines under intense pressure to trim costs, and culminates weeks of discussions that began in January and at one time included talks between Delta and United Airlines.
Analysts have said a union of Delta and Northwest will likely receive antitrust approval from the U.S. Department of Justice because the nonstop routes of each airline have little overlap. The merger will combine Delta's strong East Coast operations centered on Atlanta and New York, and its rapidly expanding European network, with Northwest's strength serving Midwest and Asian markets.
In the midst of it all will be Delta's hub at the Salt Lake airport, which last year was deemed vulnerable in a proposed hostile bid for Delta mounted by US Airways that eventually failed.
"Amen and hallelujah! To have that presence shored up is a good sign for the future," said Scott Beck, CEO of the Salt Lake Convention and Visitors Bureau.
It's unclear exactly how Salt Lakes's airport will fit into the new company's plans to continue expanding internationally. But, perhaps significantly, Salt Lake City International will be the westernmost hub of the new Delta, and some pilots have speculated that a route to Northwest's hub in Tokyo is not out of the question.

http://extras.mnginteractive.com/live/media/site297/2008/0415/20080415_022924_Delta-Northwest-Operations.gif

"Today, we are announcing a transaction that is about addition, not subtraction, and combines . . . networks that open a world of opportunities for our customers and employees," Anderson said.
The agreement to unite comes almost a year after both airlines emerged from bankruptcy. Delta, the No. 3 airline in traffic, and No. 5 Northwest filed for Chapter 11 reorganization at almost the same moment on Sept. 14, 2005, citing record high fuel prices that were draining the airlines' cash and stiff competition from low-cost carriers that kept them from raising ticket prices to cover costs.
At the time, crude oil prices were under $60 a barrel. On Monday, crude closed at $111.76 a barrel.
If regulators approve the deal, the merged airline will have more than $35 billion in annual revenues, putting it ahead of American Airlines.

* FREQUENT FLIER POINTS: Details could change, but point balances should remain intact. The merged carrier will want to keep loyal customers, and a frequent-flier program is one of the best tools it has. Delta and Northwest are already partners in an alliance that allows passengers to earn and redeem points in either airline's program.
* FARES: Some analysts say a merger this big will reduce competition and the supply of seats, leading to higher fares. But capacity is already tight, and low-cost carriers such as Southwest and JetBlue remain a factor. In the end, fuel prices - carriers' biggest expense these days - will probably be a bigger factor than mergers.
* RESERVATIONS: All reservations should remain valid on both carriers, which will continue to operate separately until a deal closes. Even then, the two airlines might maintain separate brand names and reservation systems for a time until integration is worked out. Same goes for their respective Web sites, delta.com and nwa.com.
* CHECK-IN AND THE AIRPORT EXPERIENCE: Again, the two carriers will keep their current systems at least in the short run. But eventually the merger partners will have to combine systems, creating potential complications.
* SERVICE QUALITY: How the deal affects airport workers and flight crews - and how skillfully it is executed by management - could affect morale and thus service. The challenge is to meld complex operations and keep workers reasonably happy, while also dealing with smaller issues such as integrating meal and snack menus.

A year after emerging from bankruptcy, Delta and Northwest strike historic deal to become the world's biggest carrier.

What it means
For SLC passengersThey will have access to the domestic and international destinations of both airlines.

For Delta employees Delta said the agreement protects seniority for workers and offers more job security and an equity stake in the new company.

To Salt Lake City International Airport The airport remains a hub; it will continue to play a key role in the future of the carrier.

http://extras.mnginteractive.com/live/media/site297/2008/0415/20080415_022858_Delta-Northwest-merger.gif

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steel

04-15-2008, 06:18 PM

Looks like Minneapolis will be a big looser in this deal too. They showed some local and state officials throwing out a lot of heated rhetoric on the news last night.

MNMike

04-15-2008, 08:52 PM

It really depends on what they do with the job situation, as far as the airport goes, we probably don't stand to lose much at all...our airport was always #1 or 2 as far as money makers for NWA go...I doubt they will want to change that, and thats what most "experts" have said too. They say we may even gain some more international flirghts. We will lose the corporate HQ...but NWA is only the 9th largest company in the area, and there are 18 other fortune 500 companies, so its not like its something we can't recover from. We will see what happens....and also, this deal is far from done. It will be sad to see them go though.

Roy McDowell

04-15-2008, 09:55 PM

It's going to be strange to see a Delta logo on the side of 747. NWA has a fleet of them even though Delta doesn't. I wonder what effect this merger will have on the HJ expansion project regarding a new south terminal.

Delta merger will keep Atlanta dominant in global business

The Atlanta Journal-Constitution

Published on: 04/15/08

How lucky can we be.

The announced merger of Delta Air Lines and Northwest is the best news Atlanta has had in a long time.

MARIA SAPORTA

• E-mail Saporta
Recent columns

Given the recent twists and turns of the volatile airline industry, the outcome easily could have left Atlanta without its hometown airline. And Atlanta without Delta's headquarters would have been too devastating a blow to imagine.

That scenario came dangerously close to becoming reality. First, Delta entered into bankruptcy, exposing the financial vulnerabilities of both the airline and the industry.

Then, US Airways saw an opening and launched an intense effort to acquire Delta — a move that would have moved the airline's headquarters out of Atlanta.

Amazingly, Delta was able to maneuver itself out of bankruptcy. Delta also was able to launch its own counter-campaign to keep the airline independent and based in Atlanta.

But the threats did not disappear.

Several months ago, another nightmare scenario arose. The possibility of United Airlines acquiring Delta. Again, that would have meant the end of the Atlanta-based airline. United would have gobbled up the Delta name and moved the headquarters to Chicago.

Again, that would have shot a bullet through Atlanta's economic heart.

By contrast, the Delta-Northwest merger is the fairy-tale ending to a story that easily could have been woven into a tragedy.

In short, Atlanta wins. Atlanta wins big.

The headquarters of the largest airline in the world will be based in Atlanta, the home of the busiest airport in the world.

That guarantees Atlanta's dominance on the international stage and catapults the city's status as an economic powerhouse.

More so than ever, Atlanta will be the crossroads for business and pleasure travelers seeking easy access all over the United States and to every major international city.

For Sam Williams, president of the Metro Atlanta Chamber of Commerce, the merger represents a new plateau, just as significant as the 1996 Summer Olympic Games.

"That's how big this is for me," Williams said. "It's huge because it will assure Atlanta the global connectivity for international trade and tourism. And it will continue the dominant position of Atlanta as a nationwide center for companies that have employees that have to commute nationally and internationally for their daily business."

The merger also means that the triumvirate of Atlanta, Delta and Hartsfield-Jackson remains solid. Ever since Delta moved its headquarters from Monroe, La., to Atlanta in 1941, the growth of the airline, the city and the airport have been intertwined.

It's hard to envision how the continued growth of the city and the airport could have occurred without a home-based Delta linking Atlanta to the entire world.

Atlanta did beat the odds of keeping Delta intact.

Consider that Delta has not had a homegrown CEO since Ron Allen left the airline in 1997.

Consider that Richard Anderson, Delta's current CEO, had been CEO of Northwest and a big player in the Minneapolis community, Northwest's headquarters.

Consider that few of the directors on Delta's board have deep ties to Atlanta.

None of that boded well for Delta's future in Atlanta. Several leaders in the business community were clearly worried that Delta wouldn't remain as a stand-alone, Atlanta-based airline.

But Phil Kent, CEO of Turner Broadcasting System, remembered a dinner that Anderson had with key Atlanta business executives. "Richard Anderson told us all he was going to keep the headquarters here, and he was true to his word," said Kent, who said he was "thrilled."

Atlanta Mayor Shirley Franklin also recognized Anderson. "We give special thanks to Richard Anderson for being tenacious and smart and of being supportive of Atlanta," she said. "Kudos to the team, both the Delta and the Northwest teams, that put this together."

The Delta-Northwest merger also is reassuring on another level. In the past several years, Atlanta has lost the headquarters of some of its top corporate citizens — BellSouth, Georgia-Pacific, John H. Harland Co., and Scientific-Atlanta, among others. And there's constant paranoia that Atlanta-based SunTrust could be acquired by an out-of-state bank.

Losing another corporate headquarters, especially one as vital to the city's economy as Delta, would have been a debilitating blow to our ego.

After all, Atlanta is a business town. It's a city that was built by business leaders seeking to make it a welcoming place for commerce and development. And most of Atlanta's civic endeavors are initiated by the business community, working with local governments to give the city and the region a competitive edge.

So Atlanta is lucky that Delta is not going away. In fact, Delta is going to be bigger than ever, which only bodes well for the future.

"It's really important," Franklin said of the Delta-Northwest merger. "It's one of the most important things that could happen to Atlanta."

MNMike

04-15-2008, 10:05 PM

That article is silly...even if the HQ had left Atlanta, its not like anything would have really changed at that huge airport. It still would have stayed the busiest airport in the world I am sure.

"Atlanta without Delta's headquarters would have been too devastating a blow to imagine."

That line made me laugh... no one has even said that about NWA here in Minneapolis, where we are losing our "homegrown" airline. Such an over dramatization. Yes, Atlanta would have been abandoned clearly. lol

Roy McDowell

04-15-2008, 10:14 PM

If another airline had taken over Delta it would just be some loss of tax revenue for the area. Yeah, the airport is too important to move the established hub anywhere else. That's a lot of airtraffic. Same goes for Minn.

vertex

04-16-2008, 12:42 AM

Delta merger will keep Atlanta dominant in global business

The Atlanta Journal-Constitution

Published on: 04/15/08

How lucky can we be.

Pulp follows....

Wow, the gloat and desperation from this article is palpable...

Btw, if DAL stock keeps dropping the way it has since the announcement (over 12% since Monday), it sure as hell won't be out of the woods.

steel

04-16-2008, 12:53 AM

MNMike

04-16-2008, 01:51 AM

um yes, the hub status will stay. Every single "expert" interviewed has said the hub will stay. There are a lot of reasons for that, I don't even feel like listing them...perhaps someone else can. Also, devstating is too strong of a word.

The whole thing is irritating really though. Its not really a merger, as much as an acquisition. I mean what kind of "negotiations" end up with one of the parties keeping the name, ceo, and hq? Not much negotiating there. As far as the HQ goes...no corporation dare do anything for the good of a regions economy. Maybe evaluate which region will hurt more from the loss of an HQ? Nope, just keep moving all the business to the sunbelt. Luckily we aren't as bad off here as some other northern states.

Lastly, they are really trying to screw over the NWA pilots and other unions royally...and I don't usually side with any union.

urbanfan89

04-16-2008, 02:18 AM

Ladies and gentlemen, this is your captain speaking. Welcome aboard United Northwest Delta USAir Continental American Southwest JetBlue Flight 666 to LAX, via Salt Lake, Omaha, MSP, Detroit, and Pittsburgh. Total flying time is 12 hours and 35 minutes, and we expect to be departing whenever we goddamn feel like it. On board we will have a wide selection of snacks and meals, including rubber chicken and week-old sandwiches starting at $14.99. In-flight entertainment is not available, since we're too goddamn lazy to show movies you've all seen 13 times already.

What? You think we're screwing you over now that we have a monopoly over the whole country's air travel? Be glad we're still giving you those burnt peanuts! Okay, so we're abusing our position. So what?

Be grateful we're not as bad as Aeroflot in Soviet times! Enjoy your flight while you can!

delts145

04-16-2008, 02:19 AM

Much of what will happen with future air hubs, and how much traffic they will funnel in and out of their terminals, depends a great deal on who is merging with who, and very importantly if that hub functions efficiently as a 'physical geograpic spoke, at the center of a giant wheel.' Many current hubs, because of their physical placement, will become more like a spur, instead of the hub of a spoke.

matguy7070

04-16-2008, 02:31 AM

MNMike

04-16-2008, 02:49 AM

detroit and msp are not "small hubs".

matguy7070

04-16-2008, 02:58 AM

You're right, Minneapolis and Detroit are not small hubs - to NWA - to Delta they are. I said above - it will most likely eliminate teh smaller hubs and half the flights eventually in MSP.

This was from today's Press Conference:

Delta Chief: "Continue to serve our current roster of destinations and to maintain our hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York, Salt Lake City, Amsterdam and Tokyo."

This is from American Airlines News Conference on merge with TWA
Aired 2001

"I'm particularly pleased that our agreement to purchase substantially all of the assets of TWA means that TWA is going to be integrated into American with continued opportunity for TWA employees and a continued hub operation in St. Louis."

CNN: Don Carty -- is the chairman of American Airlines -- announces that American Airlines is now planning to merge with Trans World Airlines, TWA. It will mean the end of the name of TWA as you know it, but they're going to save the 20,000 jobs of the people who currently work for that airline.

Today, just 6 years later, STL is the 4th largest hub of AA and half of TWA's original flights from STL were cut within two years. Today, out of the 20,000 TWA employees at time of merge, less than 7,000 original TWA employees are still working with AA.

It's sad, but reality....:(

MNMike

04-16-2008, 03:19 AM

steel

04-16-2008, 04:02 AM

That reality check story is interesting. There is a lot said between the lines. The State's threats are empty. What are they going to do?... Oh if you don't keep your hub here we will make it more expensive for you to operate here? That threat will just make them leave faster.

Does that really make sense? Do they really think that Delta will keep 2 headquarters? The whole reason for merging is to unload duplicated staff. Guess what, the duplicated staff is in Minneapolis.

SpongeG

04-16-2008, 05:37 AM

Rail Claimore

04-16-2008, 07:50 AM

You're right, Minneapolis and Detroit are not small hubs - to NWA - to Delta they are. I said above - it will most likely eliminate teh smaller hubs and half the flights eventually in MSP.

The Detroit hub is not going anywhere. What airline wouldn't lick their chops at McNamara Terminal?

In fact, of all the NWA hubs, it makes out like a bandit and will leech everything from CVG in a few years time, if Delta goes that route. It's better positioned for cross-country routes and is in a convenient population center for the Upper Midwest. In fact, Delta would probably be cutting regional flights to that region from ATL and rerouting them to DTW just to free up more space for more international routes out of Hartsfield.

If this goes through, in 5 years Delta's major hubs after ATL will be DTW and SLC. SLC is slated for a huge 1980's-Hartsfield-like rebuild in the next few years. BOS, JFK, MCO, and LAX will be their major coastal secondary hubs and entry pionts.

ChunkyMonkey

04-16-2008, 08:08 AM

It will be interesting to see how this plays out. In the case if TWA, did they owe the state money like NWA does? If so, how did that play out?

This is the big issue with the state govt:

"Failing to keep its commitment carries a price for Northwest. Northwest must immediately pay back $245 million in loans from the Metropolitan Airports Commission. The airline will also forfeit $215 million in future rebates and concessions at the airport. "

http://wcco.com/realitycheck/nwa.reality.check.2.700535.html

When the state bailed them out they had to sign a contract saying they would keep a hub with a certain amount of traffic, and the HQ in Minnesota. Thats the commitment mentioned above.

It will be interesting to see how they plan on keeping the "spirit" of the contract. I'm sure they will try to find some loophole such as giving Minneapolis some sort of invented "headquarters" title and then slash the staff. It really depends on the specific details on the contract in terms of the definition of a "world headquarters".

delts145

04-16-2008, 10:04 AM

Delta, Northwest officials begin merger road show

Combined News Services
Article Last Updated: 04/15/2008 11:29:58 PM MDT

Delta and Northwest airline officials roamed the East Coast on Tuesday, trying to convince Wall Street-types, employees, politicians and reporters that creating the world's biggest airline and basing it in Atlanta is a good idea. The caravan will head west in coming days.
Their well-orchestrated road show courted Wall Street analysts and the national media in New York City, and Delta employees in Atlanta. And, in between, executives had politicians in Georgia, Minnesota and Washington on the other end of their cell phones.
''It's an important day for Delta. It's an important day for aviation in the United States,'' Delta CEO Richard Anderson announced to a gaggle of local reporters and cheering Delta employees at Atlanta's Hartsfield-Jackson International Airport.
Wall Street wasn't as merry. Delta shares fell nearly 13 percent, and Northwest dropped a little more than 8 percent on the first day of trading after the airlines announced plans to create a megacarrier called Delta with headquarters in Atlanta.
Before the merger can take place, stockholders and federal regulators would have to approve the union - hence the massive sales blitz that in coming weeks will make its way to Salt Lake City and other major hubs, as well as Washington, D.C.
Executives will visit with editors of local and national newspapers and chat with business talk show commentators across the nation. The carriers have set up a Web site, www.newglobalairline.com, that has information for employees, customers and communities affected by the proposed merger.
It will be an exhausting parade that could stretch nearly to the end of the year, when the companies expect their deal to close. On Tuesday alone, Anderson, Delta President Ed Bastian and Northwest CEO Doug Steenland showed up on CNN, the business network CNBC and the ''Today'' show.
But as the price of jet fuel rose to a record in response to oil prices that neared $114 a barrel, investors seemed skeptical. Most airline stocks dropped, although Delta and Northwest took the biggest dive.
At an afternoon news conference in Atlanta, Bastian told reporters that the companies' stocks probably fell because of fuel prices and because analysts wanted Delta and Northwest to announce hub closings. The carriers have said they will not close any hubs or lay off any front-line employees.
At about the same time in Washington, House Transportation Committee Chairman James Oberstar unleashed an attack, saying the merger would be ''the worst development in aviation history'' based on antitrust grounds. Congress does not have the power to stop a merger, but powerful members of Congress do have the power of persuasion.
Delta and Northwest say they expect the merger to produce about $1 billion annually in increased revenues or lower costs, resulting in a boost to earnings within the first year after the merger is approved. That forecast does not count at least $1 billion in cash costs from repainting planes and other merger-related costs.
The airlines also have to win over some opponents closer to home. Northwest's pilots union said its members will oppose the merger. Northwest pilots were not part of a tentative contract Delta forged with its 6,000 pilots; it offers them a 3.5 percent equity stake in exchange for contract changes that give the merged carriers more flexibility.
The carriers' executives said they hope to reach a similar deal with Northwest's pilots later this year, while the proposed merger is undergoing antitrust review by regulators in the United States and European Union.

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Evergrey

04-16-2008, 12:51 PM

Buckeye Native 001

04-16-2008, 06:02 PM

This has the potential to be a death knell for Cincinnati business. Oddly enough, I don't think the city has any idea what's about to hit them.

unusualfire

04-16-2008, 06:30 PM

^ How would you know that without working for either of the companies????

Buckeye Native 001

04-16-2008, 07:31 PM

unusualfire

04-16-2008, 08:02 PM

First of all you don't know what's going to happen and i don't know whats going to happen. And to see P & G is here only because of the airport. is a complete joke. Fact is P & G was here LONG before Delta was even around. Just today Delta announced(promised) It would keep the Cincinnati hub. It vital in it's network. That comes form the CEO.
Also if it was cheaper why haven't they jumped ship already??? You have no idea what kinda corporate taxes or how much P&G has made to the state of Ohio. If you do know show us facts instead of blabbing off at the mouth.

smArTaLlone

04-16-2008, 08:19 PM

That's funny!
I love it...

Northwest/Delta Merge Conference today... "We (Delta) 'vow' and are committed to NWA's hubs and employees"

Oh my goodness... isn't that the same thing AA said about and to TWA / St. Louis...

So Sad!

This is interesting too:

http://wcco.com/realitycheck/nwa.reality.check.2.700535.html

I give it two years, within that time, fuel prices will be out the window, competition will be out the window, overcosts and overheads will be out the window...

Delta will pull most smaller hubs - Cincy, Memphis, Detroit and Salt Lake and half the flights at Minneapolis (an airport plagued with over costs, bad weather in the winter and weary officials). Delta will combine back to Atlanta roots and most flights will center there as they always have.

I can almost take this to the bank!

What you're suggesting wouldn't make sense and is not even physically possible to funnel everything through what is already the largest hub in the world. The most that Atlanta will gain from this in terms of flights is more direct international routes.

Policy Wonk

04-16-2008, 08:55 PM

But by combining Delta's strength in trans-Atlantic operations to Europe and Africa and its presence in Latin America with Northwest's industry-leading position in trans-Pacific flights to emerging Asian markets, the combined company would have a powerful worldwide network that would be well-positioned to lure high-revenue business travelers.

An issue that will have to be addressed are the transferability of NWA's Asian rights on the asian end. In the eyes of the asian regulators this airline is going to be Delta - not NWA and thus NWA's rights might be void and Delta must secure their own. With some countries being highly protective of their flag carriers this would become an oppertunity to undermine the Americans.

Another issue that will come up is slots, it is pretty unlikely for instance that the combined carrier would be able to keep the slots allocated to both NWA and Delta at slot controlled airports in asia.

ColDayMan

04-17-2008, 03:07 AM

Why would I have to work for either Delta or Northwest to see this is bad for Cincinnati? The corporate kickbacks from that Delta hub are what's enabled big companies like P&G to stay in town instead of uprooting to someplace like Atlanta where it'd probably be cheaper to operate. With three hubs in the Midwest after this merger (Detroit, Minneapolis, Cincinnati), not to mention the proximity to either Memphis or Atlanta, one of those midwestern hubs has to go. Lets face it: Detroit and Minneapolis are far more important cities than Cincinnati.

What I find odd is the lack of news coverage/"The end of the world is coming!" bullshit rants from the Cincinnati Enquirer about this. You'd think the town would be a helluva lot more pissed off that they're going to eventually lose the only thing that made that airport nationally relevant (despite having the highest ticket prices in the nation)

Well, it's not really going to affect business as I can think of numerous cities that have large businesses that are not hub cities. The reason why the Enquirer isn't crying is that it shouldn't. Sure, some of the direct flights to places will be reduced but those blue chip companies like P&G are not going to cry about paying business class. Columbus companies aren't fleeing because AmericaWest left years ago. And keep in mind, P&G, Kroger, American Insurance, Cinergy, etc all have private fleets at Lunken Field.

Trae

04-17-2008, 03:55 AM

Anyone think Continental-United merger talks will start emerging soon?

delts145

04-17-2008, 11:27 AM

Delta, Northwest now await fed OK

cox news service

Last week, Delta and Northwest airlines got preliminary federal approval to essentially function as a single carrier to Europe. Now, Delta officials are hoping that antitrust immunity is a sign of things to come in getting its proposed merger with Northwest approved.
The Department of Transportation allowed the two airlines, in conjunction with Air France-KLM, Alitalia and Czech Airlines, to share routes and revenue for service between Europe and the United States.
The Department of Justice will now investigate whether the Delta-Northwest merger announced this week will limit consumer choices and lead to higher prices.
Delta CEO Richard Anderson mentioned the European arrangement Wednesday when talking about the upcoming push to get federal approval on what would be the world's largest airline.
The Transportation Department ''found that the merger of those four entities internationally were pro-competitive,'' Anderson said.
The upcoming Justice Department antitrust review of the merger would focus on domestic routes and pricing, but last week's ruling, Anderson said, might be a sign of things to come.
Delta officials are touting the merger as the combination of two carriers that have few routes in common. The earlier decision to allow Delta and Northwest to act in concert in Europe was in response to the ''Open Skies'' agreement. It allows American and European airlines to fly any route between any destination in the United States and any destination in Europe. Open Skies went into effect March 30.
For its part, the Justice Department said ''we will look at the competitive effects of the transaction and how it would affect consumers,'' spokeswoman Gina Talamona told The Associated Press.
Stuart Klaskin, a partner with KKC aviation consulting in Coral Gables, Fla., said ''in retrospect, the European arrangement looks like a litmus test. It was a positive sign for the merger.''

Other airline news

* United Airlines boosted ticket prices for the second time in a week, adding to its bet that customers will absorb an unrelenting rise in fuel costs. The move could pressure other carriers to follow suit, but it also runs the risk of driving customers away.
* US Airways CEO Doug Parker warned employees the airline will have to make ''dramatic changes'' as oil prices rise and the economy sours, though he wouldn't comment about speculation that his airline is in merger talks with other carriers.
* US Airways said it will begin charging passengers $5 extra for an aisle or window seat in the first several rows of coach on some of its planes.
* Beginning next month, airlines will be required to double the maximum compensation they pay passengers involuntarily bumped from oversold flights. Fliers will receive up to $400 if they are rescheduled to reach their destination within two hours of their original time and $800 if that time frame cannot be met.
* American Airlines said it may have lost about $75 million because of the cancellation of 3,300 flights last week after it was forced to ground nearly half of its fleet because of missed aircraft inspections.

delts145

04-17-2008, 03:20 PM

9-11 was the largest factor as to why the Airport hasn't been expanded yet. If I am not mistaken the orginal expansion plan called would have had us near completion at this time. As for the hub moving from Salt Lake City to either Vegas or Phoenix I don't expect either one of those to happen either. McCarren in Vegas has pretty much reach it's expansion capacity, there is no additional room for an additional runway and currently has Southwest as its major tenant. As for Phoenix, I wouldn't expect Delta to move a hub their either, with a US Airways hub. Most major airlines sign exclusive agreements with the cities where they have hubs and are not willing to allow another major carrier to be on equal footing with them. There are obviously airports with multiple carriers, but those are the exception. As was the case with Delta leaving Dallas. While Dallas is a large airport, they also have American which is based there. Delta would continue to be second fiddle to American. Delwest(Delta/northwest) is and can continue to be the 800 lbs gorilla on the block by retaining SLC as it's hub. They would play second fiddle to US in Phx and SW in LV, despite the fact that Delta is larger, because both already have the operation agreements in place.

Posted by SLCrising
I agree with this assessment. SLC will continue to be Delta's major Western hub. Now, like JFK, Delta has increased international capacity at LAX, but in no way could LAX (or PHX, DEN, LAS, etc.) become a replacement for the SLC hub. The fact remains, SLC is just too darned centrally located in the Western states and Utah-based Skywest will continue to be a major player connecting Bozeman (and many other smaller communities) in Montana and now The City of Lights. With this merger, I too have a few wishes:

My wish list remains the same and yes SLC will need to add new facilities in order to stay competitive. Do you know that JetBlue is incorporated in Utah? I'd like to see a new terminal for Delta so that JetBlue could pick up new gates and expand service out of it's future Western hub. JB has already added recent flights to S.F. and L.V. It could have a great future here if the airport would invest what is necessary.

1. Non stop service SLC to Tokyo (trim a daily trip from Detroit and/or MSP)
2. Non stop service SLC to South America (Brazil, Argentina, Chile)
3. New midfield SLC Concourse, there is no need to totally get rid of the current configuration. The midfield would be similar to those at DIA and allow larger, Intercontinental jets (777's) to manevuer better than in the traditional current arrangement. Midfield would need new customs area, use the current customs area in West Terminal 2 for expanded Skywest gates.
4. Connect midfield concourse with an underground transport system (I like the McCarran D Gates as an example), or again DIA.
5. Third parallel N-S runway, the longest one at SLC.
6. Entice either FedEx or UPS to open a western hub at SLC, their only hubs right now are back east. Ok, this one isn't related to the Delta merger, but it makes sense for these companies. Try sending a Fedex from say Seattle to Phoenix. How does it go, SEA>MEM>PHX??
7. Build announced Airport LTR and quickly. I HATE taking the UTA bus from Downtown to SLC.
8. Non stop SLC>Amsterdam, I had left this one off the list originally, but with Paris starting soon, another flight to the hub in Amsterdam makes perfect sense.
.

nomarandlee

04-17-2008, 03:34 PM

Anyone think Continental-United merger talks will start emerging soon?

Yes, they likely are already. I am guessing we will hear details of talks in the next few weeks.

ChunkyMonkey

04-17-2008, 06:58 PM

Posted by SLCrising
1. Non stop service SLC to Tokyo (trim a daily trip from Detroit and/or MSP)
2. Non stop service SLC to South America (Brazil, Argentina, Chile)
.

Sorry to burst your bubble but Salt Lake City probably has not a lot of O&D (origin and destination) passengers to either Tokyo or South America. Without O&D, the flights cannot be profitable. Simply relying on connections is a losing proposition. I would expect higher O&D cities such as Boston to get a Tokyo flight before SLC as it is one of the largest markets with no service to Asia. As for South America, there is no reason for anyone to connect through SLC when they could just as easily connect through Atlanta. So, I doubt you'll see that happen anytime soon. Europe is a much more developed market and an AMS flight from SLC is possible in the future if the Paris flight works really well.

delts145

04-18-2008, 12:53 PM

Airline mergers might pick up speed

Combined News Services

A combined Delta and Northwest would have the size and reach that almost guarantees some competitors will respond in kind.
United Airlines, Continental Airlines and American Airlines have already had preliminary discussions about possible combinations of their own, and some in the industry believe a United-Continental tie-up could come quickly, which would create another megacarrier such as Delta-Northwest.
That could mean the six major domestic airlines shrink to three within a year, if regulators consent. That domino effect ups the stakes considerably as the government reviews the Delta-Northwest proposal.
The airlines may have fortuitous timing in trying to sell giant combinations to regulators and passengers. Among the factors are the recent enactment of an ''open skies'' treaty, which significantly loosens U.S. access for foreign carriers. Many airline executives argue that mergers are needed to survive, though many industry observers dispute that notion. Soaring fuel prices have sent smaller carriers to bankruptcy this year, and overseas markets are becoming more competitive and deregulated.
The Delta-Northwest deal is expected to set a pattern for others in that it will call for few job cuts or route pairings - the traditional objections such combinations face in getting approval - and raise the promise of elevating service above its current, often dismal levels, which many passengers view as the equivalent of a bus ride at 35,000 feet.
''If you think the service today isn't very good and the planes are old, maybe the customer would be better off with a bigger company, arguably able to compete on a global scale, arguably more profitable,'' said airline analyst Patrick Murphy.
The open skies pact has set the clock ticking on U.S. carriers to improve service.
While their foreign rivals, from Europe to the Middle East to Asia, are ordering fleets of newer, more efficient jets, U.S. carriers have bought a relative handful of the newer planes. Northwest, for example, will be the first U.S. carrier to get a new Boeing Dreamliner, but it is still in the process of phasing out its fleet of DC-9s, which are among the oldest domestic planes still in service.
Mergers could be a way for major U.S. carriers to have deeper pockets for global competition and, at the same time, pare less-profitable domestic service.

.

Lexy

04-19-2008, 09:06 PM

This has the potential to be a death knell for Cincinnati business. Oddly enough, I don't think the city has any idea what's about to hit them.

They know. Go to the airports website and there is a Q & A with the Airport Director and the question of mergers and de-hubbing was brought up to him during that interview. Of course, he just gives lip service in it, but he's aware. If he's not and the leaders of Cincy & Northern KY cities are in the dark too, then non of them deserve the positions they are in.

sleepy

04-20-2008, 09:11 PM

This has the potential to be a death knell for Cincinnati business. Oddly enough, I don't think the city has any idea what's about to hit them.

While ease of air travel is certainly important to any city, I hardly think it would be the "death knell for Cincinnati business". It would obviously hurt businesses that are directly tied to air transportation, but aside from that I think that air travel is only one of many, many other factors that are involved.

DENrising

04-21-2008, 06:18 PM

flown in Canada lately :haha:

we only have one airline - Air Canada - the rest are charters or no frills - like west jet
This is going to happen, we like Canada will have one "National Airline" with no competition and high fares. I feel sorry for people that fly out of small markets, will the Anti-trust regulators care about them when they approve this merger and the next (Welcome UniCon)?

Trae

04-21-2008, 11:31 PM

Canada is not that large of a country either. Basically the population of California.

Lexy

04-22-2008, 12:52 AM

This is going to happen, we like Canada will have one "National Airline" with no competition and high fares. I feel sorry for people that fly out of small markets, will the Anti-trust regulators care about them when they approve this merger and the next (Welcome UniCon)?

Are you meaning the twelve routes that DL and NW overlap on?

delts145

04-22-2008, 01:41 PM

I think its very unlikely that the U.S. will have one national airline. Sure there will be several mergers, such as Delta/Northwest and United/Cont. The prevailing opinion of experts is that certain cities, such as Memphis will lose hub status, and Cincinnati and Detroit will probably lose more flights than they gain. My question right now would be, "what will the future bring for U.S. Airways?" I can't imagine them remaining in the status quo.

Latest Delta News:

Delta-Northwest merger: Combining seniority lists may end up in arbitration, The higher slots give pilots more perks, and they want to keep them

By Harry R. Weber
The Associated Press
Article Last Updated: 04/21/2008 11:42:41 PM MDT

ATLANTA - The head of Delta's pilots union suggested Monday that he is open to arbitration with Northwest pilots over how to merge their seniority lists. The two sides failed to reach a pact before their airlines agreed to combine last week.
In a letter to fellow pilots Monday, Lee Moak, the chairman of the executive committee at Delta's pilots union, said union leaders are committed to the idea that seniority integration should be accomplished after negotiation of a single joint contract and, if necessary, ''expedited arbitration to be completed before closing of a corporate transaction.''
The two carriers tried and failed to get a pilot seniority integration deal in advance of their combination announce- ment.
Before Delta's April 14 announcement that it was acquiring Northwest, Moak had said he opposed binding arbitration.
The Northwest pilots union has said repeatedly that it supports arbitration, though that was before Delta's pilots cut a deal with management days before the merger announcement to give them a voting board seat, future pay raises and an equity stake in the combined airline.
Delta's pilots union agreed to make changes to the pilot contract that give management more flexibility. Rank-and-file Delta pilots have yet to ratify the agreement.
That agreement does not cover Northwest pilots.
Seniority is important for pilots because those at the top of the list get first choice on vacations, the best routes and the bigger planes that they get paid more for flying. It's also the reason pilots don't often leave to go work for another airline.
The conventional wisdom has been that arbitration might not be desirable for Delta's pilots union because of concern that younger Delta pilots might lose the seniority they obtained after the mass exodus of older pilots ahead of Delta's bankruptcy filing in 2005. The airline emerged from Chapter 11 protection last April.
Moak also said in his letter that there have been a ''number of ugly rumors, innuendo and factually inaccurate stories'' that mischaracterize the Delta pilot leaders' motives in crafting the contract revision agreement with management.
Moak did not specify in his letter what reports he was talking about.

.

DENrising

04-22-2008, 02:18 PM

Yes Delts that is correct, of the major legacy carriers, we may have only a few of those remain after all is said and done, maybe I should'a specified on that. You know that since de-regulation of the 80's allowed discount carriers to enter the market and compete with the legacy's and they still have some ups and downs but all in all there are some good ones out there, Southwest, JetBlue, etc. With all the bad negative publicity of the US Airways/AMW merger and its resulting loss of customer service I can't see them being a major player. I've flown to Vegas on several occassions and they lost my bags both times! LOL. Viva la Delta!

delts145

04-22-2008, 02:22 PM

Agreed SLCrising, check out the local SLC development thread. There's a few questions for you over there, LOL.

delts145

04-23-2008, 01:17 PM

Delta exec warns of fare hike - He says prices may rise 20% because of soaring fuel costs

Combined News Services
Article Last Updated: 04/22/2008 11:31:32 PM MDT

http://extras.mnginteractive.com/live/media/site297/2008/0422/20080422__biz_delta_fares_0423~1_Gallery.jpg
Richard Anderson, left, CEO of Delta Air Lines, and Doug Steenland, CEO of Northwest Airlines, discuss the planned merger of the two companies. (Mark Lennihan/The Assoociated Press)

»Domestic airlines need to raise fares by 15 percent to 20 percent just to break even at current fuel prices, the chief executive of Delta Air Lines, which seeks to merge with Northwest Airlines, said Tuesday.
''An airline ticket has got to reflect the full cost of fuel,'' Delta's Richard Anderson told reporters, adding that such an increase was very likely to depress demand and prompt carriers to further trim flight schedules.
Since Dec. 20, carriers have raised fares nine times, according to BestFares.com, and a number of airlines in recent weeks have also raised fees for checking a second bag and other amenities.
Asked if a combined Delta-Northwest would be profitable in its first year, Anderson returned to a common theme: ''It will all be a product of fuel prices . . . and stay tuned for earnings tomorrow and you'll see what a dramatic effect it's had.''
United Airlines parent UAL Corp. on Tuesday became the third large carrier to report a first-quarter loss, largely because of soaring fuel costs, following American Airlines parent AMR Corp. and Continental Airlines Inc. The cost of jet fuel in New York last Tuesday was $3.73 a gallon, compared with about $2.06 a year earlier.
United also said it is cutting flights and 1,100 jobs, as its shares plunged 40 percent, the most ever in Nasdaq trading. United became the fourth major airline to announce this month that it was deepening cuts to capacity. Each $1 increase in a barrel of oil raises annual costs by $60 million at United, the world's second-biggest carrier.
JetBlue Airways Corp., which was started by former Utahn David Neeleman, said its first-quarter loss was smaller than analysts estimated as it flew more passengers. But rising fuel costs and a slowing economy prompted the discount carrier to scale back expansion plans.
Delta and Northwest report first-quarter results today, while US Airways Group Inc. reports Thursday. Southwest Airlines Co. is the only large carrier to have reported a profit.
Anderson and Northwest counterpart Doug Steenland were in Washington to meet with lawmakers on the two committees that will conduct hearings Thursday about their proposed combination. They told reporters they are confident the Justice Department will not require them to give up any gates or slots on the few routes where they do overlap because ample competition exists in those cities. The Transportation Department's final ruling is due April 30.
Delta's stock-swap deal to acquire Northwest, if approved by regulators and shareholders, would create the world's biggest carrier. But shares of both airlines are down sharply since the deal was announced on April 14, and the deal has lost $1.17 billion, or about 32 percent, of its value. Shares of Delta on Tuesday fell $1.40, or 17.1 percent, to $6.80, while Northwest dropped $1.59, or 17.6 percent, to $7.47.

.

Saddle Man

04-23-2008, 04:41 PM

http://www.chron.com/disp/story.mpl/front/5723419.html

$10.4 Billion is a lot of money.

delts145

04-25-2008, 10:34 AM

All's local in airline politics on the Hill - Delta, Northwest CEOs stress no hubs will close in merger

By Thomas Burr
The Salt Lake Tribune
04/24/2008 11:51 PM MDT

WASHINGTON - To Rep. Chris Cannon, R-Utah, the chief executives of Delta and Northwest airlines vowed the merger wouldn't hurt the Delta hub at Salt Lake City International Airport and might lead to flights to Europe and Asia.
To Rep. Stephen Cohen, D-Tenn., they talked about the importance of Memphis and how the merger may even boost traffic through the airport. To Rep. James Sensenbrenner, R-Wis., the executives said the new merger wouldn't harm the independence of Midwest Airlines, which is partly owned by Northwest.
All politics is local, and when airlines talk of merging, it's especially local to the members of Congress reviewing the details.
The top executives of Delta and Northwest appeared before two committees on Thursday, pitching the merger of their respective companies as a positive deal for stockholders, employees and travelers. And, under questioning by committee members, hyped the importance of the merger to their hometowns.
Representatives and senators whose states rely on the two airlines for flights, employment and tourist traffic - including Georgia, Utah, Minnesota, Tennessee, Wisconsin - showed up ready to quiz the executives.
"This is a matter of the highest importance to all of our states and, in particular, Utah," Sen. Orrin Hatch said in his opening remarks.
The most stressed point on Thursday: Hubs will remain.
"There are no hub closures," Delta Air Lines CEO Richard Anderson told the House Judiciary task force on antitrust matters.
In fact, Anderson said, the merger will boost service to small communities and will make the hub system even stronger. "Hubs get stronger when you have more traffic flow," he testified before the congressional panel. "When you combine unique cities, you create a stronger patchwork" for the system.
It wasn't all just local, though.
House Judiciary Committee Chairman John Conyers, D-Mich., focused his opening remarks on how the merger would affect the industry, and by extension, travelers.
"I'm concerned that if this merger is approved it will simply result in a cascade of other mergers: Continental- United, American and U.S. Airways," Conyers said. "We might end up in a situation of three major carriers" competing with smaller carriers.
But Hatch said he sees the merger as the reality of the airline industry and the two companies as complimentary to each other.
And assured Utah would be OK in the merger, Hatch took a few moments out of his questioning time to pose some questions for his Senate colleague, Chuck Grassley of IowaÂ. They were all about Iowa.

.

delts145

04-28-2008, 06:38 PM

DENrising

04-28-2008, 07:25 PM

Thanks for the update Delts,

Is this why Continental bailed out of talks? Seems like United just wants to gobble up whomever they can, without much regard for the flying public. Their prices are already highest in the industry (at least they are when I run an expedia search) along with one of the lowest customer satisfaction in the industry (USAirways that is).

I think I mentioned earlier on this thread that I have mileage with USAirways, but now refuse to fly them due to lost baggage and other issues connecting through Phoenix (they lost my bags twice thru Vegas). I certainly have not and have no plans to ever fly United.

Delta and JetBlue for me!!!!

delts145

04-29-2008, 10:04 AM

I have to admit SLCrising that I was a little surprised that United and U.S. are about to hook up. I guess it makes sense though. From what everyone, including yourself seems to be saying, it would appear that Continental wisely chose to stay away from a merger with United.

cabasse

04-29-2008, 01:42 PM

in a basic way, it makes me proud of my hometown to be able to lay claim to "world's biggest airline." i hope they're able to at a minimum maintain the improved levels of service they've been worthy of noting for since returning from bankruptcy. has anybody here dealt with nwa since it's emerged as well? people love to complain about their horrible experiences with airline x on this board, and it worries me a little to think that things might get worse for the combined airline.

on a side note, i think delta has the ugliest headquarters building of any airline out there. here's hoping the merger will push them to move to something more visible. (though with the way profits are heading downward, i don't foresee that happening)

http://www.americancompanies.com/images_big/delta.jpg

tdawg

04-29-2008, 05:39 PM

I can't fathom why United would want USAir, it's the worst airline by far.

DENrising

04-29-2008, 07:45 PM

I can't fathom why United would want USAir, it's the worst airline by far.
When America West acquired US Air, then changed to US Airways there was relatively little communication with pilots, fa's and other airline employees. The result was a vastly inferior airline product with the worst possible customer service.

Thankfully, Delta/northwest seems to discuss openly every detail of the merger and that will bring about a stronger airline.

United can have USAw

delts145

05-01-2008, 03:09 PM

Delta, Northwest to offer employees travel privilege

The Associated Press

As Delta Air Lines and Northwest Airlines try to woo regulators and shareholders to support their proposed combination, they are courting employees, too, with new travel privileges.
The companies said Tuesday that starting May 6, 100,000 employees and retirees of Delta and Northwest will get reciprocal access to both airlines' route systems for free, standby travel.
The privileges cover all employees of both airlines, as well as retirees who already have travel privileges.
Delta announced April 14 that it is buying Northwest in a stock-swap deal that would create the world's largest carrier.
Northwest shareholders still would have to vote whether to allow the acquisition of their company by Delta, while Delta shareholders would have to vote whether to issue new stock as part of the deal. The Justice Department also would have to sign off on the deal.
The two carriers have been trying to convince employees that the deal will be good for them in the long run, and in the short run some will get equity in the new company. Delta pilots stand to get raises and a voting board seat.
The proposed combination has already ruffled the feathers of some employees, particularly at Northwest. After the deal was announced, Northwest pilots and the union representing most of Northwest's ground workers immediately announced they would fight the combination.

.

Unity77

05-01-2008, 08:54 PM

delts145

05-02-2008, 04:53 AM

roadwarrior

05-02-2008, 05:11 AM

^ LOL!! Give 100,000 employees and retirees access to both airlines' route systems for free, standby travel. Now that makes perfect sense.

The chances of this merger/takeover happening look slimmer each day.

A friend of mine works for one of the major airlines. He and his girlfriend recently flew out to SF to visit me. For the entire weekend, he was micromanaging the load factors on all return flights, stressing that he wouldn't be able to get back home. I don't think this is exactly what I would call a "perk", if you can't get a relaxing getaway. No thanks!

Unity77

05-02-2008, 04:25 PM

But actually Unity77, isn't that pretty much standard procedure anyway? I think Delta is just telling the former eployees of the soon-to-be Northwest change that they will still be able to continue that benefit. :shrug:

What's the point of merging if they aren't going to change their ways? The execs. say they are going to keep all hubs, most routes, and apparently benefits such as free, stand by travel. If this merger happens, which I think is now 50/50, and the airline continues with old business practices, it will be filing for bankruptcy within 5 years.

Unity77

05-02-2008, 04:27 PM

A friend of mine works for one of the major airlines. He and his girlfriend recently flew out to SF to visit me. For the entire weekend, he was micromanaging the load factors on all return flights, stressing that he wouldn't be able to get back home. I don't think this is exactly what I would call a "perk", if you can't get a relaxing getaway. No thanks!

Yeah. I've heard plenty of stories from those who used to fly standby and you're right; it's not much of a perk.

delts145

05-02-2008, 05:58 PM

Yeah. I've heard plenty of stories from those who used to fly standby and you're right; it's not much of a perk.

I don't know however, I guess maybe it's a mixed bag. My nephew is a pilot for Skywest(Delta's connector) He and his wife absolutely love it!!! They lunch in Paris, London, take romantic getaways to Honolulu, Cancun and on and on. And it only costs them pennies on the dollar. I'm constantly harassing them for their jet-set excess. LOL.

urbanflyer

05-03-2008, 11:32 PM

^^
It's a great perk if you're not an idiot and try to travel during busy periods. Nothing like launching off to Europe or Asia for $130 in business class.

delts145

05-04-2008, 11:50 AM

Hey Urbanflyer, I say, if there's someone out there who doesn't want this perk, "I'll gladly take it off their hands." :yes:

delts145

05-04-2008, 11:56 AM

Northwest-Delta union to open gateway to Asia
- One airline owns coveted routes needed for growth

By Craig Simons
Cox NewsService

BEIJING - Take a look at this city's newest airport terminal and it will help you understand why Delta Air Lines wants to merge with Northwest Airlines.
When it opened in February, the $3.6 billion structure roughly doubled the number of passengers who can fly in and out of China's capital. By some accounts, sleek and spacious Terminal 3 at Beijing Capital International Airport is the world's largest building of its kind, with hallways of gates and shops and restaurants that stretch for two miles.
Its hulking size highlights China's massive population and rapid economic growth. Analysts expect it will become one of the world's five busiest air terminals in coming years. Officials already are drawing up plans for a second international airport in Beijing and another 96 airports throughout China in the next 12 years.
Multiply that kind of growth - and demand for air travel - across dozens of Asian cities and you get a sense of what's at stake in the region.
''Northwest's strong Asia routes were the most critical factor for Delta because they know that's where the growth is,'' said Michael Boyd, president of The Boyd Group, a Colorado-based consulting firm to the aviation industry. ''It was probably half the value of the whole deal.''
Michael Miller, CEO of Green Skies Inc., a consulting firm in Florida, said that Northwest's Asia routes were ''the single-largest
reason why Delta wanted to merge with Northwest.''
Although the number of air passengers worldwide is growing at roughly 5 percent annually, in Asia growth has been ''about 6 percent and will continue to outpace the world average for the next 10 or 20 years,'' said Nicholas Ionides, a Singapore-based journalist with aviation industry magazine Flight International.
Boeing, the aircraft manufacturer, estimated in a market analysis last year that demand for trans-Pacific flights would grow at an average annual rate of 6.2 percent until 2026, the highest rate of any major international route.
Northwest, the fifth-largest carrier in the United States, has the most extensive Asian route network of any American airline and is well positioned to tap that growth. (Delta's westernmost hub, at Salt Lake City International Airport, has been mentioned as a possible launching point for more trans-Pacific flights if the merger is completed.)
Northwest began flying to Asia after World War II and operates 220 weekly flights from Asian cities, including Bangkok, Manila and Singapore. Only it and United Airlines have the rights to fly from Tokyo to other cities in Asia.
Northwest also owns coveted rights to fly daily to China's three largest cities: Beijing, Shanghai and Guangzhou.
Delta, in contrast, offers only 18 weekly flights to three Asian destinations: Tokyo, Shanghai and Incheon, South Korea. But it operates the third-largest flight network in the United States and has deep links with Europe and Latin America, making the merged airlines strong globally, experts said.
If the merger were approved by federal regulators, the new carrier - which would be the world's largest airline - would benefit because Asian passengers flying to the United States could connect to more domestic destinations, while Americans flying to Asia would have ''ten times more choices,'' Miller said.
''Northwest has had an incomplete flow in the domestic service connecting to Asia, and Delta fills in every single hole that they had."
The new airline also would benefit from travel between Asia and Latin America. Roughly 80 percent of people flying from Central and South American nations to Asia connect through the United States. Because trade between the regions is ''growing in leaps and bounds'' the market is very important, said Bob Cortelyou, Delta's senior vice president for network planning.
Carriers also value international routes because they tend to be more profitable than domestic flights.
In the United States, older ''legacy'' airlines that include Delta and Northwest have lost domestic market share to discount carriers and have been forced to cut prices as customers use the Internet to find cheap fares.
As profitability has fallen, executives have reduced their domestic routes, while expanding their international business.
International routes tend to be more profitable because passengers are willing to pay premiums for long-haul business-class and first-class seating.
With Asia's economies surging, demand for luxury travel is likely to build.
Last month, Singapore Airlines announced that it would begin daily business-class-only flights between Asia and the United States, a development that Miller said ''shows how valuable business travel internationally is.''
Financial pressures and the proposed Delta-Northwest merger have prompted United Airlines and US Airways into merger talks.
Delta and Northwest now have to convince the Justice Department that its merger will not hurt American consumers by leading to higher prices or limiting choice.
.

delts145

05-15-2008, 11:53 AM

Delta pilots approve changes to contract

http://www.deseretnews.com/article/1,5143,700225949,00.html

delts145

06-04-2008, 02:34 PM

Bon voyage - Delta begins nonstop flights from Salt Lake to Paris

http://deseretnews.com/article/1,5143,700231276,00.html

http://deseretnews.com/photos/midres/5588080.jpg
(Geoffrey McAllister, Deseret News)

Delta and state economic development officials could not have hoped for more from the only nonstop service by a U.S. carrier between the western U.S. and Paris.

.

DallasTexan

06-05-2008, 10:39 PM

^^
It's a great perk if you're not an idiot and try to travel during busy periods. Nothing like launching off to Europe or Asia for $130 in business class.

Exactly. I just flew to Portland for $15.00.

Gotta love it :D

DENrising

06-10-2008, 08:51 PM

Exactly. I just flew to Portland for $15.00.

Gotta love it :D

I am very surprised airlines haven't cut back or changed the interline agreements by now due to the fuel costs. I bet it happens before long. But it's nice to be able to get those discounts.

delts145

06-11-2008, 01:51 PM

Pinnacle being dropped as a Delta Connection partner

By Harry R. Weber
The Associated Press

ATLANTA — Pinnacle Airlines Corp. shares fell nearly 25 percent Tuesday, after it disclosed that Delta Air Lines Inc. plans to cancel its flying contract with the regional carrier, citing poor on-time performance.
Northwest Airlines Corp., Pinnacle's biggest customer, has no current plans to change its relationship with Pinnacle. However, Delta is acquiring Northwest, worrying investors about what that might mean for Pinnacle's future if the contract termination sticks.

"We think today's news shows how a Delta-Northwest merger may hurt Pinnacle," Standard & Poor's airline analyst Jim Corridore said in a research note.

Pinnacle. based in Memphis, Tenn., called the move against it by Delta "wrongful," saying its on-time performance has been hurt by factors beyond its control. It said the operational schedule created by Delta is a key factor affecting on-time performance.

Pinnacle said it plans to pursue "appropriate remedies," though it wasn't more specific. The move by Delta would affect nearly 5 percent of the fleet maintained by Pinnacle Airlines Corp., which operates Pinnacle and Colgan Air. The Delta contract represents about $3.5 million in monthly revenue for Pinnacle, which recorded $787 million in annual revenue last year, Pinnacle spokesman Joe Williams said.

.

delts145

06-27-2008, 12:43 PM

Delta pilot leaders approve merger contract

http://www.deseretnews.com/photos/midres/5376882.jpg
Danny Chan La, Deseret News

Bloomberg News

Bloomberg News
Article Last Updated: 06/26/2008 11:35:51 PM MDT

Delta Air Lines Inc. pilot leaders have approved a tentative contract agreement with the third-largest U.S. carrier and their peers at merger partner Northwest Airlines Corp.
The accord includes a plan to create a single union seniority list, clearing a hurdle in a tie-up that will create the world's largest airline. Delta has said it expects to complete its all-stock purchase of Northwest by the end of 2008.
''This agreement represents an important milestone in the process of combining Delta and Northwest pilots into the largest unified pilot group in the world,'' Delta's union chairman, Lee Moak, said in a letter to members.
Leaders of Northwest's Air Line Pilots Association chapter also were considering the proposal. Delta's pilot leaders unanimously approved the accord, Moak wrote. It's the first time two airline pilot unions have negotiated a joint contract before the closing of a merger, he said.
Approval by Northwest's pilot leadership would send the accord to Delta's 7,300 pilots and their 5,000 counterparts at Northwest. If ratified, the contract would run through 2012.

.

delts145

08-12-2008, 11:34 AM

Northwest and Delta pilots agree- Collective bargaining pact will take effect when the two carriers merge

By Paul Beebe
The Slat Lake Tribune

Pilots at Delta Air Lines and Northwest Airlines have approved a joint collective bargaining agreement to take effect when the carriers merge, but still don't have a deal to combine their seniority lists.
The labor agreement covers roughly 10,600 pilots at the airlines. Of 6,231 eligible Delta pilots, 82 percent cast ballots and 62 percent voted in favor, Delta's pilot union said Monday.
"You've got to think that's a pretty good majority. The Delta pilots have gone through bankruptcy and gone through thwarting a hostile takeover by US Airways. I view this as a positive," said Mark Saltzman, a pilot for the carrier and head of the Air Line Pilots Association chapter representing 600 Salt Lake City-based Delta pilots.
At Northwest, 81 percent of 4,371 eligible pilots took part in the voting, with 87 percent of those casting ballots for the agreement.
The accord is an important step for the proposed stock-swap combination of the two airlines, announced April 14. Although pilots can't stop the merger, their pact is a step toward ensuring labor harmony after the deal closes later this year.
Although an accord to integrate seniority lists remains elusive, the agreement announced Monday establishes a procedure for reaching a settlement by Nov. 20. Negotiators for the pilot groups have given themselves a deadline of today to come to terms on seniority. If they can't, the sides will submit to binding arbitration.
"The big picture here is that Delta [and Northwest] pilots have done something that has never been done before in history - that is to have a joint contract and a seniority list negotiated before the date of corporate closing, That's hugely significant," said Delta pilot Ed Thiel, who is based in Salt Lake.
The combination of Delta, the No. 3 U.S. carrier by passenger numbers, and No. 5 Northwest is still subject to approval by U.S. regulators and shareholders of both airlines. European regulators approved the merger last week.
The joint contract agreement gives pilots compounded raises totaling 18 percent over four years.
Delta aviators will receive a 5 percent increase next year, followed by 4 percent raises in each of the following three years, Thiel said.
Northwest pilots, whose wages are about 10 percent below those of their Delta counterparts, will get a 15 percent raise after the merger. They will receive 4 percent wage increases in each of the following years, Thiel said.
The contract agreement also calls for Northwest pilots to receive a 2.38 percent equity stake in the new Delta. Delta pilots, whose numbers are larger, will get a 3.5 percent stake.
"The good thing is this will allow Delta to be very successful in the coming years and will lead to a much better contract in the future," Thiel said.
pbeebe@sltrib.com

Related developments
* Because of cost-cutting,, Delta Air Lines, United Airlines and four more of the largest U.S. carriers could post profits in 2009 should oil prices remain around $115 a barrel, Morgan Stanley analyst William Greene said. His profit outlook runs counter to most analysts' loss projections.
* The union representing pilots at United Airlines, angry that pilots have not received additional compensation, urged CEO Glenn Tilton to resign, accusing him of steering the No. 2 carrier down a path to poor customer service, employee morale and financial performance.

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DrumCorpsAlum

08-12-2008, 10:13 PM

I booked a flight on Delta and they stuck me on a NWA jet. I wasn't happy about that. There were no snacks.

delts145

08-20-2008, 11:40 AM

Delta-Northwest merger looks likely soon

http://www.deseretnews.com/article/1,5143,700252137,00.html

...With no more congressional reviews planned, conventional wisdom now holds that the proposed merger of Delta Air Lines and Northwest Airlines will be completed this year without any major new political objections...

...Frank Werner, a Fordham University professor who has been studying the proposed merger, said politics is playing a role in the merger's timing. "They are hustling to get this done before the Bush administration leaves," he said.
The airlines "chose to announce this merger in 2008 in part because of their belief that the Bush administration has been very pro-management," Werner said. "Historically, Democrats have been more critical of mergers," and even a White House under Republican John McCain may be more skeptical of the benefits of a reduced number of major carriers, he said.

...Werner said that given how fares have risen and routes reduced this year, "I'm a little bit surprised there hasn't been more outcry from the public," he said. But the answer may be that fuel prices have risen so high consumers actually have sympathy for the carriers, rather than resentment, he said.

"Every individual is hurting too," he said. "So maybe the merger is an easier sell for the airlines."

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delts145

09-26-2008, 01:33 PM

Delta, Northwest shareholders approve combining the airlines

http://deseretnews.com/photos/midres/6056089.jpg
(pic by Danny Chan, Deseret News) Two Northwest and Delta Air Lines planes taxi to a departure runway before taking off from Salt Lake City International, which will soon become North America's Western Hub for the world's largest airline.

By Joshua Freed and Harry R. Weber
The Associate Press

Delta Air Lines Inc. and Northwest Airlines Corp. shareholders gave the go-ahead Thursday to a combination that would create the world's biggest carrier, decidingÂ that in their volatile industry they like their chances better together than on their own.
The stock-swap deal announced April 14 still requires Justice Department approval. One other potential hurdle is a federal court lawsuit seeking to block the deal that is set for trial Nov. 5 in San Francisco.
Delta Chief Executive Richard Anderson, who will keep his position after the combination, would not discuss the lawsuit, but he indicated the carrier maintains its goal of completing the deal by the end of the year.
''We are still focused on that timeline and believe we can accomplish the timeline as stated,'' Anderson told reporters after the Delta shareholder vote.
At a Delta meeting near Atlanta, 99 percent of shares voted were in favor of issuing new stock as part of the transaction. Earlier in the day, at a meeting in New York, 98 percent of Northwest shares voted were in favor of Delta acquiring Northwest.
Delta has said that after the merger it will maintain its hub in Salt Lake City where it employs 3,500 people, including 600 pilots.
The deal was not trumpeted by everyone. A few retired Delta pilots complained that current employees will get equity when the deal is completed, but retired pilots won't. They suggested Delta consider reinstating the defined benefit pension plan for pilots that the airline terminated while the carrier was under bankruptcy protection.
Anderson said he understood the retired pilots' concerns, but he was firm that the pension termination was final.
''I think we've been clear we're not going to reopen that issue,'' Anderson said.
Northwest shareholders will get 1.25 shares of Delta stock for each share they own if the combination is completed. That values Northwest at roughly $2.8 billion, based on Delta's current stock price and the 277 million Northwest shares outstanding or still to be issued as part of its bankruptcy reorganization plan. That's about $800 million less than the value when the deal was announced.
The combined airline would be called Delta and keep its Atlanta headquarters. Northwest would become a wholly owned subsidiary of Delta during the integration process. Delta hopes to obtain a single Federal Aviation Administration operating certificate in 15 to 18 months.

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delts145

10-10-2008, 01:02 PM

:banana: :banana: "Domo Arigatou Gozaimasu" - Salt Lake City Direct to Tokyo? - It worked with Paris. Maybe it will work with Tokyo

http://www.deseretnews.com/article/1,5143,700265368,00.html

http://www.wired.com/images/slideshow/magazine/1506/st_tokyo_f.jpg
wired.com

Friday, October 10, 2008 — Last update: 1:21 a.m.

:tup: :tup: It worked with Paris. Maybe it will work with Tokyo.

That was the thinking of a state board that committed money Thursday to help get Delta Air Lines to start direct flights between Salt Lake City International Airport and Tokyo in mid-2009.

The Governor's Office of Economic Development committed $250,000 in Industrial Assistance Fund money, which will be part of a pool of $2 million in cash and marketing help from GOED...

The idea is to help promote the flights, making it economically attractive for Delta to start that service.

"This is incredibly important to the business community," said Jerry Oldroyd, chairman of the board's incentives committee. He said Tokyo flights could open up Korean, Chinese and other Asian markets for Utah businesses, as well as opportunities for businesses there to expand into Utah.

The state money would be paid after the first flight. Salt Lake is Delta's second-largest U.S. hub, with 373 flights daily to 114 destinations. GOED board documents indicate that Delta has estimated that the new service could have an overall economic impact of $90 million for Utah and could lead to the creation of 1,100 local jobs.

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delts145

10-14-2008, 12:11 PM

Delta to add direct route from Salt Lake City-to-Tokyo?

By Paul Beebe

Delta Air Lines is beginning to look past its successful Salt Lake City-to-Paris route and is contemplating a second international destination, possibly Tokyo.
On Thursday, the board of the Governor's Office of Economic Development agreed to give Delta $250,000 after the airline broached the idea of starting a route from its Salt Lake City hub to Japan's capital, GOED Executive Director Jason Perry said.
The money would be added to a $2 million incentive package being assembled by an alliance of public and private groups, including Salt Lake City International Airport and Salt Lake County, Perry said.
"Should the incentive be accepted by them, I would expect an announcement of their intent to start this flight in the very near future, with the flight to actually begin some time next year," he said.
Delta spokesman Anthony Black said the Paris route launched last June has been a hit with travelers. Because the route proved itself, the Atlanta-based carrier now is "interested in exploring additional international opportunities," he said.
Black refused to say where Delta may fly to next, but he said any route "likely would focus on other hubs where we either have a partner there or have a natural system to feed flights in or out of."
GOED's readiness to help Delta comes as the Atlanta-based carrier is about to consummate its proposed merger with Northwest Airlines. The combination would create the world's biggest carrier and give Delta a toehold at Tokyo's Narita International Airport, where Northwest has a hub.
Earlier this year, Delta executives said more international flights might be possible if the Paris route made a tidy profit for the airline. While the airline isn't publicly saying it will fly to Tokyo, it apparently is serious. Companies don't usually approach GOED unless they are close to making a decision.
In April, Delta President Ed Bastian said Amsterdam, where Northwest also has a hub, might be a candidate. A month later, Glen Hauenstein, executive vice president of network planning and revenue management, said the airline might be flying to Tokyo in 2011.
On Thursday, another possibility emerged: London.
"We are still discussing the possibilities, and this is one," said airport spokeswoman Barbara Gann.
Gann said the airport's part of the Tokyo incentive package is $1.4 million, including fee waivers and marketing support. The airport presented its offer to Delta on Oct. 1, she said.
Perry said passengers are snapping up seats on the daily flights between Salt Lake and Charles de Gaulle International Airport in Paris.
In its request to GOED, Delta said a Tokyo flight would make other Asian markets including South Korea and China more accessible to Utah businesses. Delta said the economic impact of the route would exceed $90 million a year and would potentially create at least 1,100 jobs in Utah's economy.
"This Tokyo flight shows the [Delta-Northwest] merger will be a good thing for the state of Utah, and that Salt Lake City is an important hub to Delta," Perry said. [/B]

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