Originally Posted by
kop84
I think why DL can be more on time comes down to a seemingly unrelated thing.
DL has a much lower debt ratio as well as net debt.
So DL for the most part owns their planes outright where UA is still making payments.
It's a lot cheaper to park a fully paid for plane as a spare than one that you're still making payments on. So more fully paid planes = equal more spares = better OT/completion.
Obviously it's a bigger commitment by DL than just parking spare planes but that can be a lynch pin in the strategy that makes the other investments like parts and crews more financially palatable.
While I agree with parts of your premise, I think you've reached an incorrect conclusion.
The encumbrance of airplanes does impact fleet decisions. Airplanes with a lower-cost of ownership (e.g. owned, older-vintage airplanes) can provide variable capacity with more airplanes parked during off-peak days and seasons. Leased airplanes have high fixed costs and do not provide efficient variable capacity. Owned airplanes, levered or not, provide more efficient variable capacity. Spare airplanes should be viewed more of an opportunity cost. Many spares are cycling in or out of maintenance and would be unable to otherwise operate a full schedule. Some airlines maintain hot spares, dedicated aircraft parked and ready to go into service. Deciding to keep a hot spare is not as much about the cost (debt service is relatively minimal), but the opportunity cost of not generating revenue.
I would point out that when comparing the impact of leverage on fleet strategy, the total amount of debt is less relevant than how the debt amortizes and must be paid back. Delta and United's debt service is comparable: $1.3B/year for United vs. $1.2B/year for Delta. United does have more aircraft on lease than Delta (in part a function of how its regional fleet is structured). Ultimately, the number of leased aircraft in United (or Delta's) fleet is quite small and the cost of the leases doesn't materially impact the decision to keep spare airplanes.
On-time performance is more impacted by the different crew contracts, philosophies on fleet deployment and operating airports.