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DL 2Q 2020 Earnings - $7B Loss

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Old Jul 15, 2020, 11:52 pm
  #31  
 
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Originally Posted by cmd320
The 73G was also one of if not the very last aircraft DL bought prior to merging with NW. My guess is had the merger news happened just a bit earlier they never would have even ended up in the DL fleet. They were always a bit of an oddball fleet IMO.
They were brought for thin, performance routes where the 757 was too much capacity at times. TGU, SNA, MEX, BOG, SAL, MDE. EYW wasn't planned initially but it was a pleasant surprise when they found out the 73G's could takeoff with a full load, even with summer thunderstorms requiring tankering additional fuel.

NW had nothing comparable. The 319's couldn't do the job the 73G was bought for.
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Old Jul 16, 2020, 5:23 am
  #32  
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I have watched Delta's response to this whole situation since March. They seemed to be the first to introduce strict cleaning standards, requiring masks and flexible changes/cancellations. I also noticed Delta slashed their schedule to the point where being based in Atlanta I could not get where I needed to be without inconvenient times and long connections. This has since improved.
Delta got a lot of praise for what they did. I suspect most of it was a PR move. It makes total sense, if people are scared of the risk of flying, lets show them they should be scared. Perhaps their planes are cleaner, but I don't think flying is a particularly safe thing to do during a pandemic so either I'm ok with that risk, or I just stay home.
Now I'm wondering if they are losing their share of the market due to remaining very conservative when it comes to the virus. It will be really interesting to which airline comes out on top after all of this is over.
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Old Jul 16, 2020, 7:02 am
  #33  
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Originally Posted by ATLflyer2017
I have watched Delta's response to this whole situation since March. They seemed to be the first to introduce strict cleaning standards, requiring masks and flexible changes/cancellations. I also noticed Delta slashed their schedule to the point where being based in Atlanta I could not get where I needed to be without inconvenient times and long connections. This has since improved.
Delta got a lot of praise for what they did. I suspect most of it was a PR move. It makes total sense, if people are scared of the risk of flying, lets show them they should be scared. Perhaps their planes are cleaner, but I don't think flying is a particularly safe thing to do during a pandemic so either I'm ok with that risk, or I just stay home.
Now I'm wondering if they are losing their share of the market due to remaining very conservative when it comes to the virus. It will be really interesting to which airline comes out on top after all of this is over.
Delta is claiming they have a higher NPS score now than they did last June and they are working off a pretty good base. They seem pretty confident in positioning themselves as the safest option in this time and feel like it's both working and aligned with their brand. At a minimum I think being conservative helps the brand and more importantly I think it keeps them out of the news. As opposed to AA where you see reports every couple days of packed planes and people ignoring the mask rules.

This is what Ed claimed on the earnings call re: this topic

We have received a lot of customer feedback that in fact I would say when we survey customers today about the reasons you're purchasing a ticket on Delta, the space onboard the plane, the blocked middle seats, has gone through the number one reason why customers are choosing Delta. They really – they see it consistent with our brand. Everyone appreciates it's not going to last forever, but in the face of a health crisis, that space onboard really matters and customers are telling us that. And we're seeing it in our Net Promoter Scores which have gone up considerably on a year-over-year basis, 20 points in the month of June over last June which last June was already a good number. And we hear it from our corporates, we hear it anecdotally from many of our travelers.
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Old Jul 16, 2020, 7:59 am
  #34  
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Originally Posted by Duke787
Delta is claiming they have a higher NPS score now than they did last June and they are working off a pretty good base. They seem pretty confident in positioning themselves as the safest option in this time and feel like it's both working and aligned with their brand. At a minimum I think being conservative helps the brand and more importantly I think it keeps them out of the news. As opposed to AA where you see reports every couple days of packed planes and people ignoring the mask rules.

This is what Ed claimed on the earnings call re: this topic
Right. It's a very smart move. I think everyone hating on AA for flying full planes is kind of silly. Distancing is near impossible on airplanes. When you bought a ticket on AA, you knew they weren't blocking middle seats and so the possibility of the plane being 100% full is there. If that is concerning to you, Delta is an option but you can also not fly. Not really sure how that is newsworthy. Delta did an amazing job, but I don't think its sustainable to fly planes at 60% capacity for long periods of time. We shall see.
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Old Jul 16, 2020, 8:16 am
  #35  
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I know multiple people who are booking and flying DL due to the advertised cleaning standards and capacity limits instead of the potential sardine can on AA or UA. So their marketing/PR is working from that respect. I think the point is to reduce cash burn (flying at 60% still loses money, but a lot less then parking planes) while trying to generate some goodwill from pax who are flying.

The issue is with business travelers since thats really where they make the money, and there is little to no sign of recovery there yet due to all of the various international limitations and growing domestic restrictions with some states. At this point I'm expecting the airlines to lobby the govt enough that they get an extension through end of the year on the funding support, especially it being an election year and it would be bad political optics to have massive airline layoffs a month prior to the election.
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Old Jul 16, 2020, 8:23 am
  #36  
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Originally Posted by Yellowjj
NW had nothing comparable. The 319's couldn't do the job the 73G was bought for.
Interesting, I always thought the A319 was pretty much interchangeable with the 73G.
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Old Jul 16, 2020, 12:11 pm
  #37  
 
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Originally Posted by rylan
I know multiple people who are booking and flying DL due to the advertised cleaning standards and capacity limits instead of the potential sardine can on AA or UA. So their marketing/PR is working from that respect.
That's pretty much what Ed said during the earnings call on Tuesday:

"....Delta Air Lines (DAL) on Tuesday said its policy of keeping the middle seat empty and allowing extra space onboard is the "No. 1 reason why customers are choosing" to fly on the airline...."

https://www.investors.com/news/delta...220&yptr=yahoo
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Old Jul 16, 2020, 1:09 pm
  #38  
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Originally Posted by ClipperDelta
That's pretty much what Ed said during the earnings call on Tuesday:

"....Delta Air Lines (DAL) on Tuesday said its policy of keeping the middle seat empty and allowing extra space onboard is the "No. 1 reason why customers are choosing" to fly on the airline...."

https://www.investors.com/news/delta...220&yptr=yahoo
Of course it is. If they had done it a year ago it would have been then too.
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Old Jul 16, 2020, 1:55 pm
  #39  
 
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Originally Posted by ethernal
EYW is a relatively premium route (at least by leisure destination standards) so I'd be surprised if they stuck a CRJ-700 on it. Same reason why HHH magically had an E-175 flying on it most days rather than a CRJ despite the fact that Delta saves all their nice jets for more competitive markets while Atlanta gets the dredges.
Also ASA is gone. (and they cancelled routes everywhere)
So even if it goes back to a CRJ, it probably wouldn't see any where near as many cancellations.
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Old Jul 16, 2020, 2:35 pm
  #40  
 
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Originally Posted by njf1003
Also ASA is gone. (and they cancelled routes everywhere)
So even if it goes back to a CRJ, it probably wouldn't see any where near as many cancellations.
It will be interesting to see how it plays out. When ASA used to fly the CRJ-700s into EYW pre-2010 (before DL mainline service with the 73Gs started), there was very little competition. ATL was the only nonstop destination outside of Florida. Airtran wasn't here yet. AA flew ATRs from here only to MIA, and UA didn't fly here at all. You had to take a Gulfstream 1900D to FLL, MCO or TBW and pickup UA or CO from there.

Now AA flies the E-175 to MIA and has a daily 319 to DFW. UA flies to ORD and IAD with 319s and 739s. DL could get away with the CRJ back in the day, but the hard product would not be competitive now.

Fingers crossed that the EYW 73G flights are replaced with the 220.
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Old Jul 16, 2020, 3:58 pm
  #41  
 
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Originally Posted by cmd320
Interesting, I always thought the A319 was pretty much interchangeable with the 73G.
Newer ones yes, though I believe the 73G has a slight advantage at max range. NW A319's main problem for the routes DL wanted were lower thrust, range and performance. DL's B73G's came equipped with higher thrust, winglets and the short field performance option. Direct quote from the DL musuem site.

"On December 18, the 737-700 opened new Delta route between Atlanta and Honduras capital of Tegucigalpa. It allowed Delta to add service to unique airports, such as Tegucigalpa's Toncontin International Airport, with short runways, extreme temperatures and high altitudes"
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Old Jul 18, 2020, 1:43 am
  #42  
 
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Originally Posted by rylan
I know multiple people who are booking and flying DL due to the advertised cleaning standards and capacity limits instead of the potential sardine can on AA or UA. So their marketing/PR is working from that respect. I think the point is to reduce cash burn (flying at 60% still loses money, but a lot less then parking planes) while trying to generate some goodwill from pax who are flying.

The issue is with business travelers since thats really where they make the money, and there is little to no sign of recovery there yet due to all of the various international limitations and growing domestic restrictions with some states. At this point I'm expecting the airlines to lobby the govt enough that they get an extension through end of the year on the funding support, especially it being an election year and it would be bad political optics to have massive airline layoffs a month prior to the election.
I wouldn't be surprised to see a large increase in intangible assets on the Q3 balance sheet.
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Old Jul 18, 2020, 8:51 am
  #43  
 
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Originally Posted by ekozie
I wouldn't be surprised to see a large increase in intangible assets on the Q3 balance sheet.
Are you implying that Delta will do an acquisition of another airline or company over book value? That's the only way intangible assets get created on a balance sheet. There is no magic line item called "Public Goodwill" that a company can adjust on their balance sheet because they've done good marketing.
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