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chriselliott
09-13-2005, 04:49 PM
Looks as if Delta AND Northwest are about the file for bankruptcy. So, are you tired of it all? Fatigued by Chapter 11 filings? Bored by bankruptcies? Let's hear it. (I'm working on a story, so email me your comments at [email protected], too!)

jfrenaye
09-13-2005, 06:31 PM
No more posturing. The LCCs have taken over the domestic skies and it is their turn to rule (flashbacks to the Lion King when the hyenas took over the Pride Land). The legacy carriers will need to adapt to the post 9-11 world just as their passengers have. It is time for one and probably two to simply hang it up and liquidate---

My vote goes for Delta first.

grgtravel
09-13-2005, 09:56 PM
bankruptcy is the art of passing money from hand to hand until it finally disappears.


;)

stephen_s
09-14-2005, 12:07 AM
I think one of the biggest problems is the upper management salaries. Sure they may have gotten a pay cut, but the problem is it's not enough. They don't seem to realize that those workers in the trenches are suffering with the pay cuts, loss of pension, and whatever else they have to put up with.

I agree with you, John, when you said in another post, that the legacy carriers need to take a hard look at Southwest and jetBlue and see what they're doing right.

Like John also said, put Song and Ted in the back burner or get rid of them all together.

chriselliott
09-14-2005, 04:56 AM
Interesting story from Joel Widzer that is somewhat related to this discussion

http://www.tripso.com/archives/2005/09/why_you_should.html

jfrenaye
09-14-2005, 05:41 AM
Maybe someone can offer an op-ed to Joel's comments. I for one disagree.

BMGRAHAM
09-14-2005, 06:05 AM
Please add another option to the vote - that it's necessary in order to eliminate those badly run airlines to fade away, leaving the few strong ones intact to learn from the lessons of their former rivals.

tvl counts
09-14-2005, 08:21 AM
After nearly 20 years in the travel industry, bankruptcy seems ho-hum on the surface...except it seems to allow the same mis-management and ignorance to continue.........over and over and over. It has always been difficult for me to understand how an airline could have failed to be profitable in the 90s....think back....prices were at a good level and everybody was traveling. Everybody else in the travel industry has had to rethink and remodel their business plan to survive...everybody, it seems, but the legacy carriers. Because I live in a rural area I do see the value that the big guys bring in accessibility, but they gave nothing in return except lousy service, bad attitudes and poor management. I do think labor costs have paid a huge role, but then, haven't we all had to find a way to survive AND pay our employees? Why couldn't they and why couldn't the unions see the handwriting on the wall.

I for one pay no attention to any of this except for the impact on my customers...my job is to choose carefully to ensure as best I can that my clients receive the service they pay for...and this is a full-time job!!!!!!!

Tommie Imbernino
09-14-2005, 10:02 AM
When Pres. Carter deregulated the airline industry I knew this would be disastrous. Unfortunately it did. We travel agents watched with disdain as our commissions were eliminated while the excessive CEO's salary was going up.
The airlines told the government this additional money received from commission would make them profitable. If you give the airlines an inch they take a mile.
Bankruptcy, like taking our commission away, is only the finger in the dyke.

NW CTC
09-14-2005, 10:11 AM
Having read Joel's column I've got to say that I disagree with about 92% of what he says, and could spend the rest of the day commenting on it but time does not permit that luxury at the moment. I've got travels to plan for clients - well-educated, computer savvy, well-travelled (and sometimes not so well-travelled) people who willingly pay me for my hard-earned expertise. Of course, my work is not made any easier by the arcane and dysfunctional system foisted on all of us by the airlines!

purpleeagl
09-14-2005, 11:06 AM
I agree with less than half of Joel's commentary. I think the idea of being loyal to a major is also a function of where you live and if you are in one of their hub cities. This basically forces you to be loyal since they control the market.

I do think that the herd needs to be thinned. If DL goes first, I think then next merger may be NW and CO. It would be interesting to see if any bookmakers are giving odds on this. ;)

Bert oconnor
09-14-2005, 11:08 AM
Originally posted by Tommie Imbernino@Sep 14 2005, 10:02 AM
When Pres. Carter deregulated the airline industry I knew this would be disastrous.* Unfortunately it did.* We travel agents watched with disdain as our commissions were eliminated while the excessive CEO's salary was going up.*
The airlines told the government this additional money received from commission would make them profitable.* If you give the airlines an inch they take a mile.
Bankruptcy, like taking our commission away, is only the finger in the dyke.
9252


Deregulation has been a disaster for all transportation. How many airlines have gone bust? What bus service? Train, a congress funded JOKE? If you live in a truly rural area you have nothing except the low income bus that comes by to take Ma and Pa Kettle to the government run senior center, the medicare doctor or to the Walmart 75 miles away. God forbid someone under sixty lives in town. Without a pickup truck, car, suv or Semi you are stuck. Much like the industrial revolution deregulation has forced people into bigger and bigger towns. Thanks to deregulation you can fly across the country for $99.00. It is at least $200.00 to cross the state of Nebraska (via Denver). Such a deal. Three people from Lincoln to MSP is over $750.00 no wonder we will drive 8 hours each way, Do that a couple of times and make your car payment back.
Then Lets talk about airline managment. Back in olden times I moved in different circles, A member of United's Apollo management told me" The airlines would be fools to let every Tom Dick and Harry into their data bases, who would buy the expensive tickets if they could see everything. It is bad enough that travel agents are not loyal to one airline." Two things stood out in this conversation. The airlines are not the friends of travel agents and the airlines praticed bait and switch sales. In the long view(20/20 hindsite) how right they were. The more travel agents became consumer advocates they more the airlines didn't want them. Why pay someone who is working against your best interests? (ie commissions) As an advocate for the client the tavel agents became a mill stone around the neck of unscrupulous rules and practices. The advent of low fare airlines opening up their databases exposed the multi fare rip off of the established carriers. Simple pricing, only profitable routes and fair rules exposed established carriers to rising expections and customer exodus.
That said: Regulation brought service to areas that will never see transportation again. Without EAS monies Nebraska would not have air service outside Omaha/Lincoln that is proven over and over even with local govenment paying airlines to fly. Without regulated prices, profit could not be maintained. With out profit service goes away. It goes on and on I feel like I have written too much for now so will quit.
Bert O'Connor
Kearney Nebraska
Far away from every where.

Woodsey Not Owl
09-14-2005, 11:25 AM
I don't think Joel is an "expert". There are many things he overlooks and some conclusions are well document in other stories too, but they are often not accurate or complete.

I too can not coment on all of what he says as it would take all day and I do not get paid for that.

The airlines are getting what they deserve. If 9/11 had not HELPED the airlines so much, all this would have happed much sooner and in a much more AMERICAN way!

Airline CFO's took home millions each while outsourcing our jobs.

The airlines said they could sell travel better and cheaper than travel agents at 10%. Well I think we have proven that they can not. In order to try they had to hire untrained people outside America where they pay 10% of the salaries they pay their own employees.

Hey airlines, you had that with travel agents, 40,000 plus accross the U.S. alone!!

Now travel agents don't care about airlines, or making airline sales. Why spend an hour or more trying to talk someone into flying when so much is wrong with the industry. In the past we would help sell the airline and explain things like strikes and if it was safe to travel on certian carriers. Today, most agencies won't spend the time it takes to make those sales as there is zero profit, and anything that the airline does wrong, they will tell the traveler ..."Well, Your Travel Agent made the/a Mistake!" I've had them say it to me, when I point out that my name matches the name of the booking agency, they suddenly will figure out how to help me. Then attempt to screw the next person in line I'm SURE!!!

There is SO MUCH wrong in this industry that it can not be put into words without a two week time frame!!!!

I sure wish SOMEONE (congress) would fix it again, like they did 25 years ago!!!!!

Then we could all make some money, and fly on much safer carriers that treated us like people instead of cargo.

David Wood

Kairho
09-14-2005, 11:54 AM
OMG, Widzer really believes that flying on Southwest is unpatriotic?

This guy gets only one thing right: labor costs. Everything else is apparently viewed from the moon. He says to support the airline industry but apparently he only wants people to fly the legacy carriers. Innovation, creativity and good ol' American capitalism exhibited by the Southwests and JetBlues are apparently Bad things and to be avoided. Market forces are Bad things. The industry is completely screwed up and he's promoting the worst screwups of all! I don't believe Mr Widzer really understands how this country works yet.

I love the contradiction posed by his book, "traveling in high style at budget-friendly prices."

makfan
09-14-2005, 05:48 PM
Boy, do I have mixed feelings about all this. I have tried to fly the "legacy" carriers, because I want a higher level of service than what Southwest offers.

For example, when I am flying transcon or midcon, I want to be served a meal on the plane so that I can stay at the office as long as possible and waste as little time at the airport as possible. Assuming I don't get an upgrade, if I am flying American or Alaska, I might get a meal if my flight lands in a designated window. On American I will have to pay for that meal. If I have to change planes in Dallas or Chicago to cross the country, I won't even get a real meal on either flight, I will get offered snack boxes which are full of empty calories. If I am going to have to buy my own dinner at the airport, where is the advantage over Southwest? Many of the larger carrier routes have been downgraded to regional jets. Wouldn't you rather have DirectTV on Jet Blue than a cramped regional jet for a 1-2 hour flight?

Alaska gives "complementary" upgrades to its MVP fliers on any fare within x hours of departure. That seems like a nice perk, but it has led to continuous cuts in service. Now when you depart at 11:44 am and arrive at 2:06 pm, you get crackers and onion dip in first class. Who would pay full fare first class for that?

I feel like everybody is responsible: passengers for being willing to give up everything to save a few bucks, managers for incompetence and employees for not cooperating to bring the cost structure down faster. Flying is rapidly becoming Greyhound in the sky, and I don't like it one bit. I have not flown Southwest or Jet Blue in nearly 5 years, but the net result is that the things I used to like about flying are all being taken away, bit by bit. Explain to me again why I shouldn't just choose the cheapest fare or the most convenient departure time??

The Free Market
09-14-2005, 08:33 PM
Originally posted by Bert oconnor@Sep 14 2005, 11:08 AM
Far away from every where.
9261

If you don't like, it, MOVE. Flying is not a right and I, for one, am a staunch advocate of the free market - even if it means that tiny little airports don't see many flights or are cut out entirely. If there is a demand then somebody will find a way to meet that demand. Regulation makes it more expensive for all - provided that the market can be entered.
Let the airlines sink or fly on their own merits. End all subsidies, tax breaks and handouts and make them actually work for their pay. Make the executives and the union bosses personally liable for stupid, untenable contacts and you will see an instant and immediate end to such foolishness.

bakerman2033
09-15-2005, 06:06 AM
Maybe Congress would like to impose a law on the maximum salary that a CEO can earn per year and a cap on the number of shares of stock. Maybe then they'd get someone who really is an honest "joe" to run operations, one who cares about his company, employees, customers, one who knows the definition of integrity.
.
That might be too much for Congress to do, it might come back to kick em in the behind on what they get in salaries, bonuses, medical, perks, and would interfere with being able to determine their own annual salary increase.
,
I for one an sick of bailing them out with our taxdollars. I'm with those who also are fed up with it. There doesn't seem to be much of a long term return on bailing them out. It's a short term fix that will inevitably be a money loser for all of us... Let's give what we would have given to bail the two of them out (Delta and Northwestern) and put it into the stronger airlines for use in upgrading the seats in coach! :D

stephen_s
09-15-2005, 07:39 AM
I agree with you, bakerman. Like I told Chris, maybe the airline industry needs to have price controls also. Have some kind of floor for the prices.

silver cloud
09-15-2005, 08:24 AM
Deregulating the airlines - bah humbug. Sure it lowered prices but you know what? You get what you pay for. We are getting old, old, OLD aircrafts, bancruptcy, all perks gone, etc.

Federal regulatory agencies thought it would put the power to the airlines for better competition, lower prices, etc. That often had harmful effects for public and consumer interests. In fact, the airlines were against deregulations figuring that the regulated agencies would benefit more than big corporations, airlines and the consumer.

The big oil and natural gas companies that whined about how regulations were deterring exploration and thus contributing to fuel shortages and the price gouging initiated by OPEC in 1973.

You have to remember that this was during Vietnman and President Nixon had all but dissolved the nations confidence in government. Unfortunately, it (to me) was all downhill from there.

Just my two cents kids!

blakej
09-15-2005, 09:24 AM
Here we go again. I am so fed up with these Airlines worming their way out of debt. I would like to see the CEO's all take several 100,000 pay cuts and do some work for a change like the people who fly their planes.

Arnie Mensch
09-15-2005, 09:50 AM
Originally posted by chriselliott@Sep 14 2005, 04:56 AM
Interesting story from Joel Widzer that is somewhat related to this discussion

http://www.tripso.com/archives/2005/09/why_you_should.html
9230


Surely you jest! If I understand your logic it is my patriotic duty to buy an inferior product at an inflated price ... and this at a time when I can buy an AMERICAN product that is both superior and cheaper, i.e., Jet Blue, Southwest, America West.

Using your logic we should refuse to buy any foreign-made cars, and resurrect those great names from the past ... DeSoto? Willys? Packard? The same could be said for the American television industry, or many other manufacturing industries that didn't keep up with the times or invest the R&D $ to stay cutting edge.

The legacy carriers that are failing today seem to have been woefully mismanaged. (Yes, oil prices are sky high. But economic tragedies hit every industry ... the companies that can adapt, such as America West, will survive. Those that don't ... won't.)

stewart502002
09-15-2005, 11:27 AM
without regulation, you get cowboys.......but maybe the cowboys have been there all along!..
as soon as chapter 11 is filed or threatened, the CEO & senior mgmt should have thier pay, pensions & assets used as the first call for cash. That oughta concentrate the corporate mind, eh? ;-) I'm sick of these weasels getting paid for failure!

Bert oconnor
09-15-2005, 12:45 PM
Originally posted by The Free Market@Sep 14 2005, 08:33 PM
If you don't like, it, MOVE.* Flying is not a right and I, for one, am a staunch advocate of the free market - even if it means that tiny little airports don't see many flights or are cut out entirely.* If there is a demand then somebody will find a way to meet that demand.* Regulation makes it more expensive for all - provided that the market can be entered.
Let the airlines sink or fly on their own merits.* End all subsidies, tax breaks and handouts and make them actually work for their pay.* Make the executives and the union bosses personally liable for stupid, untenable contacts and you will see an instant and immediate end to such foolishness.
9305


I agree if this were a free market! Remember airports have hugh subsidies built into the ticket system. Roads are tax built some byuser fees but often by general funds. There is no nor will there be a level playing field in transportion. That said the general welfare would demand some type of means of getting from a to b. I believe that the general urban population sees the mid states and the western states as fly over non entities. With that view the country will soon be eating very little. But hey, I've lived in the big city, I will gladly drive 3 to 8 hours to avoid living there. What I worry about is the lack of working population. This Airline Problem is one of many forcing people to move to large urban areas. I see in the near future walfare ridden inner cities ringed by middle class paper pushing sub urbs, surrrounded by 10 guys running farm implements and stoop labor provided by poverty stricken aliens. Some one will have to develop a reasonable system of moving people and goods. I do not see it happening.
Bert

Bert oconnor
09-15-2005, 12:47 PM
Originally posted by stewart502002@Sep 15 2005, 11:27 AM
without regulation, you get cowboys.......but maybe the cowboys have been there all along!..
as soon as chapter 11 is filed or threatened, the CEO & senior mgmt should have thier pay, pensions & assets used as the first call for cash. That oughta concentrate the corporate mind, eh? ;-) I'm sick of these weasels getting paid for failure!
9365



Cowboys are the good guys. They have to bring the herd in to get paid. Failure is dead cows.
Bert

Love2snorkel
09-15-2005, 04:00 PM
Dear Lynne, (letter from NWA)

As you may already have heard in media reports, Northwest Airlines® has voluntarily filed for bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code. The bankruptcy process will enable Northwest to continue its transformation into a new-era carrier in keeping with the permanent changes that have affected the airline industry, such as rising labor costs and a doubling of fuel prices over the past two years.

Because we value your business and proven loyalty, I am writing to assure you that there will be no impact on the WorldPerks® program as a result of the filing. Frequent flyer mileage accrual, redemption, and Elite benefits will remain unchanged. Members will continue to earn and redeem miles according to the current WorldPerks program guidelines.

The bankruptcy filing will not impact Northwest’s day-to-day business operations. We remain committed to serving customers, honoring tickets, flying a competitive schedule safely and reliably, maintaining our WorldClubs® lounge program, and all other programs and services.

All bookings will be honored, and ticketing policies remain unchanged. Our existing marketing relationships with other airlines remain in place.

The decision to file for bankruptcy protection is not related to the current strike by members of the Aircraft Mechanics Fraternal Association (AMFA). Our operation continues to run well and we have experienced no adverse impact on our operational performance as a result of the work stoppage.

Customers can continue to book travel on Northwest Airlines with confidence. Although bankruptcy is never a first choice option, it does provide the most prudent means for a restructuring that will ensure the transformation of Northwest into a new-era carrier that is able to compete in the near term and well into the future.

Thank you for your continued support of Northwest Airlines. For more information about Northwest’s transformation, please visit nwa.com®.

We look forward to continuing to earn your business by providing the outstanding service you deserve.

Sincerely,


Doug Steenland
President and CEO
Northwest Airlines, Inc.

silver cloud
09-16-2005, 07:41 AM
I got a "dear mary" letter as well from nwa. I trashed it. uck. They tick me off!

I'm with Stewart - let the COO, CEO, CFO give up a big cut of what they're going steal anyway to keep the company afloat. Pirates! That's what they are.
And while I love to see Pirate Johnny Depp (ar!) Doug Steenland doesn't do the same thing for me. :lol: :lol:

mary




Originally posted by Love2snorkel@Sep 15 2005, 04:00 PM
Dear Lynne, (letter from NWA)
*
As you may already have heard in media reports, Northwest Airlines® has voluntarily filed for bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code. The bankruptcy process will enable Northwest to continue its transformation into a new-era carrier in keeping with the permanent changes that have affected the airline industry, such as rising labor costs and a doubling of fuel prices over the past two years.

Because we value your business and proven loyalty, I am writing to assure you that there will be no impact on the WorldPerks® program as a result of the filing. Frequent flyer mileage accrual, redemption, and Elite benefits will remain unchanged. Members will continue to earn and redeem miles according to the current WorldPerks program guidelines.

The bankruptcy filing will not impact Northwest’s day-to-day business operations. We remain committed to serving customers, honoring tickets, flying a competitive schedule safely and reliably, maintaining our WorldClubs® lounge program, and all other programs and services.

All bookings will be honored, and ticketing policies remain unchanged. Our existing marketing relationships with other airlines remain in place.

The decision to file for bankruptcy protection is not related to the current strike by members of the Aircraft Mechanics Fraternal Association (AMFA). Our operation continues to run well and we have experienced no adverse impact on our operational performance as a result of the work stoppage.

Customers can continue to book travel on Northwest Airlines with confidence. Although bankruptcy is never a first choice option, it does provide the most prudent means for a restructuring that will ensure the transformation of Northwest into a new-era carrier that is able to compete in the near term and well into the future.

Thank you for your continued support of Northwest Airlines. For more information about Northwest’s transformation, please visit nwa.com®.

We look forward to continuing to earn your business by providing the outstanding service you deserve.

Sincerely,
Doug Steenland
President and CEO
Northwest Airlines, Inc.
9398

EcuadorMan
09-17-2005, 07:08 PM
It's sad in one way. I never like to see any company go under. But the truth is, I've had much better service and better on-time flights with some of the low fare airlines. They are obviously doing something right and maybe it's time the old guard went back to the basics.

I think in the long run we will see fewer airlines. Let's only hope we might see better service! B)

susie margaret
09-19-2005, 01:00 PM
Originally posted by chriselliott@Sep 13 2005, 04:49 PM
Looks as if Delta AND Northwest are about to file for bankruptcy. So, are you tired of it all? Fatigued by Chapter 11 filings? Bored by bankruptcies? Let's hear it.
9201


hi -- the only labor costs i am interested in decreasing are those of the head guys, i.e., the ones who have already run the airline into the ground. then they get to leave with a golden parachute. i notice, again and again, that it is always the bottom-of-the-hierarchy workers who are asked/required to take pay cuts and forfeit the pensions they were promised. if these promises can be "revised" (or are "no longer operative," as nixon comrade ron ziegler would say in justifying one lie after another), why is it that the head guys' salaries or exit packages cannot be "revised" as well?

last week, i flew to phoenix and back (from nashville) on southwest. i had a nonstop flight (available with no other airline), the planes left on time, they arrived early, the desk agents and cabin attendants were friendly, and the seat constraints were no worse than i've had on the so-called "major" airlines. so tell me again why i should be loyal to the so-called "majors"?

thanks for letting me vent -- susie margaret