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DL Notifies EAS, May Drop up to 24 (PMNW) markets

DL Notifies EAS, May Drop up to 24 (PMNW) markets

Old Jul 15, 11, 9:03 pm
  #31  
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Originally Posted by mizzou miles View Post
EAS requires 2 daily flights min during the week. But even so, three flights a week would defeat the whole purpose - business travelers cant utilize flights that only operate a few days a week. Works fine for Allegiant Air to Vegas et al but not for these markets.
Even though EAS requires 2 daily flights, would it make sense for DL to keep operating them without EAS but maybe 1x daily or a few times weekly with a CRJ? Presumably there is some demand considering the loads are 0%, but they should be able to make at least a few of those profitable, even if seasonally.
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Old Jul 15, 11, 9:24 pm
  #32  
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Originally Posted by MSPeconomist View Post
Plus, the wonderful Chisholm Iron Range Call Center will need to drive several hours to Duluth to nonrev.
Chisholm is less than a 90 minute drive to DLH, so not overly difficult.

There are a few airline examples out there where the airline has res (or other functions) and no airport in that city - at US Airways, we have a rather large operation still in Winston-Salem and the nearest airport is 25-30 miles away in Greensboro.

Think AA has an example of that somewhere as well (or did until they recently closed that call center).
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Old Jul 15, 11, 9:48 pm
  #33  
 
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Originally Posted by mersk862 View Post
Chisholm is less than a 90 minute drive to DLH, so not overly difficult.

There are a few airline examples out there where the airline has res (or other functions) and no airport in that city - at US Airways, we have a rather large operation still in Winston-Salem and the nearest airport is 25-30 miles away in Greensboro.

Think AA has an example of that somewhere as well (or did until they recently closed that call center).
Um, the airport for Winston-Salem is, in fact, Greensboro. GSO is the Triad Airport and WS and Greensboro are two legs of the 3 legged stool.

That said, I dont think the presence of a res center or really anything else requires an airline to fly there. More and more call centers operate with home based agents that can sit anywhere. It isnt like the VP of DL res drops in on HIB on a monthly (yearly?) basis.
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Old Jul 15, 11, 10:00 pm
  #34  
 
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Originally Posted by simuflite View Post
Profitable.
That remains to be seen; have you looked at the stock price lately?
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Old Jul 15, 11, 11:47 pm
  #35  
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Originally Posted by RealHJ View Post
Look at the PR on this,
http://news.delta.com/index.php?s=43&item=1408



When it comes to announcing bad news, no one at Dullta has the backbone to say it, so it is "Delta said" instead of "said Joe Blow, VP of Route Cancellations at Delta."

That's low (and not to mention, unprofessional).
Would shooting the messenger make you feel better? If so, you can simply blame Richard Anderson. Seeking a PR rep to blame seems silly, when the CEO, if not the board would have final say on decisions that require disclosure by a public company. The name on the press release is irrelevant.

Originally Posted by hazelrah View Post
That remains to be seen; have you looked at the stock price lately?
Virtually all companies, profitable and unprofitable, see short-term swings in their stock price. Now, I'm not suggesting buying stock in DAL (or any airline), but the stock price is not a good indicator of profitability.

As to the question at hand. If these communities warrant service, then someone will pick it up. If nobody picks it up, then the communities should evaluate how much they value such service. If they value it, then I encourage them to pass the hat and guarantee revenue.
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Old Jul 15, 11, 11:56 pm
  #36  
 
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Originally Posted by hazelrah View Post
That remains to be seen; have you looked at the stock price lately?
In fact I have, but that's irrelevant. What is relevant, however, is the fact that Delta's business model is currently based on oil being $135 a barrel.
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Old Jul 16, 11, 4:32 am
  #37  
 
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Originally Posted by simuflite View Post
In fact I have, but that's irrelevant. What is relevant, however, is the fact that Delta's business model is currently based on oil being $135 a barrel.
It's a tell. Wall Street has its doubts.
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Old Jul 16, 11, 4:44 am
  #38  
 
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Originally Posted by pbarnette View Post
As to the question at hand. If these communities warrant service, then someone will pick it up. If nobody picks it up, then the communities should evaluate how much they value such service. If they value it, then I encourage them to pass the hat and guarantee revenue.
With all due respect, this is just a silly comment. Most of the these communities don't have the resources to "pass the hat and guarantee revenue" as you say. To be sure some do have small businesses that are vibrant, but not in a scale to provide a subsidy. Unfortunately no good alternatives (like rail that they have in Europe) exist.

I'll grant that things have changed in many ways since Delta acquired these markets, not the least of which is high cost of oil, still, Northwest made a go of it in these markets and Delta can't or won't. The issue is partially linked with the demise of the SAABs and Mesaba, a demise that was initiated under NW bankruptcy management and furthered by Delta.
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Old Jul 16, 11, 5:28 am
  #39  
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Originally Posted by hazelrah View Post
With all due respect, this is just a silly comment. Most of the these communities don't have the resources to "pass the hat and guarantee revenue" as you say. To be sure some do have small businesses that are vibrant, but not in a scale to provide a subsidy. Unfortunately no good alternatives (like rail that they have in Europe) exist.
Then they won't get service. Somebody has to provide the subsidy. If the community isn't willing to provide it, I see no reason why Delta should feel obligated to provide it. They are an airline, not a charity.

There are positives and negatives to living in big and small communities. Those in smaller communities have positives like lower costs of living, shorter commutes, lower crime rates, etc. Those that live in larger communities have better retail and transportation access.

Originally Posted by hazelrah View Post
I'll grant that things have changed in many ways since Delta acquired these markets, not the least of which is high cost of oil, still, Northwest made a go of it in these markets and Delta can't or won't. The issue is partially linked with the demise of the SAABs and Mesaba, a demise that was initiated under NW bankruptcy management and furthered by Delta.
Even beyond the increased cost of oil, we should be clear that Northwest likely did not make a "go of it" in these markets. Northwest was a money-losing enterprise, with no clear path to profitability. Of course, it is possible that their smaller markets were profitable (enough), and that it was other routes that were driving their losses, but then the profitability of these routes (and operation of the Saabs) should have led to these routes being saved by DL.

I'd be shocked if EAS service were profitable enough to be worth the effort for DL in more than a limited number of markets. These communities would almost certainly be better served by a carrier that caters to small markets, such as Great Lakes or Cape Air. They could likely attract such carriers with lower revenue guarantees, too.
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Old Jul 16, 11, 5:55 am
  #40  
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But MN is Closed Anyway

Originally Posted by DTWflyer View Post
We all knew this was coming with the pending Saab 340 retirement, and DL's lack of commitment to small markets.
http://finance.yahoo.com/news/Delta-....html?x=0&.v=1

There are a few shockers on the list:
http://news.delta.com/index.php?s=18&item=156

Thief River Falls, MN TVF EAS subsidized 12.0% load factor
Greenville, MS GLH EAS subsidized 27.6% load factor
Devils Lake, ND DVL EAS subsidized 30.3% load factor
Watertown, SD ATY EAS subsidized 35.0% load factor
Muscle Shoals, MS MSL EAS subsidized 35.7% load factor
Fort Dodge, IA FOD EAS subsidized 39.1% load factor
Hibbing, MN HIB EAS subsidized 39.2% load factor
Alpena, MI APN EAS subsidized 39.5% load factor
Tupelo, MS TUP EAS subsidized 41.0% load factor
Jamestown, ND JMS EAS subsidized 42.1% load factor
Mason City, IA MCW EAS subsidized 45.9% load factor
Pierre, SD PIR Not EAS subsidized 47.4% load factor
Iron Mountain, MI IMT EAS Subsidized 48.7% load factor
Sioux City, IA SUX Not EAS subsidized 51.4% load factor
International Falls, MN INL EAS subsidized 52.5% load factor
Brainerd, MD BRD Not EAS subsidized 52.6% load factor
Hattiesburg, MS PIB EAS subsidized 53.7% load factor
Escanaba MI ESC EAS subsidized 55.2% load factor
Aberdeen, SD ABR Not EAS subsidized 55.6% load factor
Pellston MI PLN Not EAS subsidized 58.5% load factor
Bemidji, MN BJI Not EAS subsidized 59.3% load factor
Sault Ste Marie MI CIU EAS subsidized 60.0% load factor
Waterloo, IA ALO Not EAS subsidized 61.4% load factor
Butte, MT BTM Not EAS subsidized 65.3% load factor
It is a same havingt small communities see service cuts. Re those places in MN, no problem there as the state has been closed for two weeks. Cannot land in a closed state.
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Old Jul 16, 11, 6:16 am
  #41  
 
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BTM surprises me though- but perhaps we can see Horizon return?
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Old Jul 16, 11, 10:55 am
  #42  
 
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Originally Posted by pbarnette View Post
I'd be shocked if EAS service were profitable enough to be worth the effort for DL in more than a limited number of markets. These communities would almost certainly be better served by a carrier that caters to small markets, such as Great Lakes or Cape Air. They could likely attract such carriers with lower revenue guarantees, too.
It's hard to make a go of things in EAS markets. I was reading the documentation on the DIK and ISN service Great Lakes provides from DEN, and the subsidy remains quite substantial even with high fares and a high load factor driven by the oil boom in Western ND.
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Old Jul 16, 11, 11:35 am
  #43  
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Aren't some of these markets ones that Great Lakes and Midwest Express' Skyway had difficulty serving before when the B1900s went out of service? I know ESC/IMT used to be IMT-ESC-MKE, for example. And before that, ORD-IMT used to operate out of gate F1 at O'Hare.

It appears that this hand-wringing happens every few years, and is a tactic to increase the subsidy payments.

ESC is 60 miles from MQT by car. At what point is a subsidy really not a viable issue?
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Old Jul 16, 11, 12:44 pm
  #44  
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Originally Posted by hazelrah View Post
It's a tell. Wall Street has its doubts.
The consensus of Wall Street analysts is that DL will be profitable in the 2nd quarter and for the full year.

For your information, the shares of airlines are generally correlated to the price of oil.
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Old Jul 16, 11, 12:45 pm
  #45  
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Originally Posted by belfordrocks View Post
BTM surprises me though- but perhaps we can see Horizon return?
I doubt Horizon would return. If anything, this would help support existing DL and QX service at HLN.
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