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Merging in the friendly skies

Posted Feb 22 2008, 04:32 PM by Matt Koppenheffer
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For a few weeks now, Delta Air Lines, the third-largest U.S. airline by traffic, and Northwest Airlines, the fifth largest, have been in talks to combine. The combination would create a new leader in U.S. air traffic and hopefully give the combined company significant synergies and economies of scale.

The negotiations have hit a bit of a snag though, as pilots have been unable to come to an agreement about how the seniority list of the new company would look. According to The Wall Street Journal, this list dictates everything from how much the pilots are paid, to what kinds of planes they fly and when they get time off. Though the hitch could be resolved, The Journal cited unnamed sources as saying the deal could be called off if an agreement isn't reached soon.

In The Motley Fool's CAPS community both stocks are rated one star out of five (the lowest), and most players don't believe the merger will change things much. CAPS All-Star dude59 said that "A merger of two companies that are both going [bankrupt] does not make this attractive if you can think." Meanwhile, fellow All-Star Radioman101 is more generally bearish on Delta's situation:

I just don't understand how big airlines keep resurrecting themselves from the dead and staying in business. I like and fly Delta as a customer but these guys aren't going to be digging themselves out of the hole anytime soon. Just run away screaming from this stock.


Want to share your thoughts on what this merger could mean? Or if it will happen at all? Head over to CAPS and join the other 83,000-plus investors already sharing their investing insights.

Comments

 

If the merger will benefit both companies saving them from bankruptcy it's a good move -- providing their customers do not get the shaft by way of the merger.

I have close to 100,000 miles built up in my frequent flyer account with Delta and would not like to be a loser.

I know one thing the people that do all of the work make nothing compared to what pilots make all they do is put the info into a computer take plane up and then it's on auto pilot unless they hit  turbulance.. they make an outrageous amout of money ... I would love to see them unload and reload a plane and clean and fuel the plane and see who should be making more money... the poor guys that do most of the work get the shaft th egusy that work on the ground are the ones who should make more money........ I fly Delta, I have never had any complaints with them ..always on time ......if this will help both companies just suck it up pilots from Northwest and grow up.. before your company goes into bankrupt and you lose everything.....

The pilots and stock holders should run away from this deal screaming.

Oh, computers fly the plane? What a misconception you have of pilots. This really disturbs me and I speak on behalf of all pilots. You have a malfunction, engine failure, dying passenger, cabin depressurization, system failure, weather, fire or anything you can come up with a “computer” cannot handle, it is all skill and decision making that is going to save everybody on that flight. The people on the ground, dispatcher, Air Traffic Control, Ramp Personnel, Management, Gate Agent, are all part of the same team, and not all those people play a role in the safety of the flight or don’t even care what happens. I have seen Ramp Personnel that are on a “smoke break” that are called out to park a plane, but will let the plane sit with engines running burning hundreds of dollars in fuel an hour just because they want to finish their cigarettes. Why? They don’t get paid enough? Where is their pride? A dispatcher’s only concern is completion of a flight. To be fair not all dispatchers are this way but, most are. That door closes and your new best friend is your crew. Not just the captain, but the first officer and flight attendant. People go see a doctor for some kind of major surgery, his knowledge and skills will hopefully save your life. You get on a 50 seat aircraft that costs around $35 million those pilots have your life in their hands. Can a doctor say that he or she has this much responsiblity at once. Not to mention that the education of a pilot cost upward of $100,000 plus. When they do manage to get that first airline job they are paid less than what someone would make at McDonalds full time in a year at 40 to 50 hours a week. And a pilot’s work day can be anywhere from 12 to 18 hours a day, 3 to 4 day trip in a hotel, away from family. Before you spout off, do your research our take the time to talk to a pilot and get their views. As far as this merger, well it is being orchestrated by labor attorneys. That is the position that the CEO of delta had at Northwest before going to delta. After bankruptcy all top management received bonuses for cutting pilot pay. Those bonuses equated to more than what the pilots sacrificed to keep the airline alive. So, “lene dee thats me” think before you speak! And I pray you never need that pilot to save your life, because as a pilot I make sure that all my passengers are going to have a safe flight and don’t rely on those you claim that work so hard and not get paid enough. I hope that God never tests the use of my skills that could jeopardize your life or any other passenger that gets on my aircraft that I am in command of!!!

In the army the joke was that Warrant Officer pilot's thought that they were the closest thing to God. ha ha ha Well the nut that holds the rotorhead, that holds the rotorblades, that enables the chopper to become and stay airborne is called the Jesus Nut. It's called that because if the mechanic installs it wrong or it shoud fail, start praying to Jesus! So let's give the people that repair and maintain aircraft proper respect and thanks. Pilot's are great, have learned skill, and I thank them for a safe flight, but if an aircraft doesn't have a skilled and caring maintance crew, all the best pilot training won't save squat!!!  By the way there's training involved too $$

I think the merger will help both with overseas markets. Delta now partners with Korean Air etc

One of the country's traditionally nastiest airlines, NW, is merging with one of the country's traditionally nicest Delta.  I guess we will get UA.  Until there is a change in hub and spoke system, flying will be a personal insult regardless of the company.

Lene Dee that me and acedoug are both correct.  The guy that do the work on the ground are very much under paid for the work they do.  I too would like to see the pilots have to do their job for 2 weeks and then they might respect them a little more for what they do.  I have a husband who has worked for one of the airlines for 35 years.  Our retirement sucks, I would like to see a pilots retirement plan for 35 years and see if they would be happy. It makes me sick also to know the CEO's getting bonus when the little people who really are the abck bone workers get shafted.  We all thay cuts in pay and they feast on a bonus. Where is justice.

With out the blue collar workers in either operation those plans would sit on the ground, unloaded & uncleaned. All you big CEO'S and upper management foonce in your life be fair.  If the merger would be just that then great but don't screw

one oirline to profit the other.  All the workers are equal and should be treated as so.

Amen, acedoug.  My son is on his way up the ladder to his "big" overpayed first officer job someday soon.  Not that he had 4 years at Embry Riddle which set him back over $100,000 in tuition, had a 4 month internship at ExpressJet, was away from home that whole time, countless tests, dheckrides for his ratings, now being a flight instructor working 12 - 13 hour days, lene dee thats me would rather put her money on all the untrained baggage handlers, cleaners, and others who don't have anything tied up in a job they really love.  I'm sure most are hard working, but lene dee thats me, like acedoug said, more investigation is needed on subjects you obviously don't know anything about.

Heres the Basic Job for a Pilot..........Glorified Bus Driver plain and simple! LOL

Pilots Attitudes are the worst in any proffession out there. They think they are the cream of the crop. They think they are on a higher level then anyone else thats why I dislike people like you. All you pilots out there are " Glorified Bus Drivers" Plain and simple!

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