Tag Archives: Delta Air Lines

Business, Finance, Occupation & Industry

Delta, Virgin Atlantic Seek Antitrust Immunity to Boost U.S.-U.K. Flights

April 9, 2013 Bartle Doo Leave a comment

Seeking to become more effective competitors on routes between North America and the United Kingdom, Delta Air Lines and Virgin Atlantic Airways have filed an application with the U.S. Transportation Department seeking antitrust immunity for their new joint venture.

The companies said in a Monday press release announcing the filing that because 60% of the slots at London Heathrow Airport are currently controlled by a joint venture of AMR‘s American Airlines and British Airways, they dominate air travel between the U.S. and the U.K. Those two airlines previously received antitrust immunity allowing allowed them to coordinate their schedules and fares.

Combining Virgin’s Heathrow slots with Delta’s U.S. network will offer significant competition in the market and serve consumers on both sides of the Atlantic, the companies argue. Delta in December announced it is buying a 49% stake in Virgin from Singapore Airlines, with Virgin founder Richard Branson retaining a 51% ownership position.

Delta President Ed Bastian said in Monday’s press release that “Approval of antitrust immunity would allow travelers to take full advantage of all the aspects of the Delta-Virgin joint venture and enjoy the benefits of increased competition, particularly on flights to and from London Heathrow Airport.”

Under the proposed joint venture, Delta and Virgin Atlantic would coordinate schedules, network planning, pricing, and revenue management functions, sales, and other aspects of their services between North America and the U.K.

The airlines are also seeking antitrust immunity for five-way coordination on U.K.-to-North America traffic among Delta, Virgin Atlantic, Air France, KLM, and Alitalia. Delta already operates a joint venture with the other three European airlines.

link

The article Delta, Virgin Atlantic Seek Antitrust Immunity to Boost U.S.-U.K. Flights originally appeared on Fool.com.

Fool contributor Rich Duprey has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

"The World's Leading Airline" Is Actually the Worst in the U.S.

April 9, 2013 Bartle Doo Leave a comment

By Adam Levine-Weinberg, The Motley Fool

Filed under: Investing

United Continental CEO Jeff Smisek has been marketing United as “the world’s leading airline” for the past year. At an industry conference last month, Smisek stated that he wasn’t worried about American Airlines taking the title of the world’s largest airline following the latter’s merger with US Airways . Instead he was focused on the goal of being the world’s leading airline. This entails having the best route network to get people where they need to go, and providing strong customer service along the way.

Unfortunately for United and its customers, reality doesn’t quite live up to Smisek’s vision. The 2013 Airline Quality Rating survey (an annual study of various quality of service metrics for the U.S. airline industry) put United at the bottom of the list (No. 14). Furthermore, the No. 12 and No. 13 airlines — SkyWest subsidiaries SkyWest Airlines and ExpressJet Airlines — are regional carriers doing most of their flying for United. United’s poor service quality will make it difficult for the airline to sustain its historical revenue premium. As a result, I believe the market is overestimating United’s ability to bounce back quickly from its disappointing 2012 earnings performance.

Survey says!
The Airline Quality Rating survey (link opens a PDF) takes into account four criteria: on-time performance, denied boarding frequency (aka “getting bumped”), mishandled baggage, and customer complaints. For 2012, United and its regional partners were near the bottom of the pile in terms of on-time performance and mishandled baggage, and were by far the worst offenders in terms of denied boardings and customer complaints. United’s overall score of -2.18 was far worse than the scores for its major competitors:

Airline	Rating (smaller negative number is better)
American Airlines	-1.11
Delta Air Lines	-0.58
Southwest Airlines	-0.81
United Airlines	-2.18
US Airways	-0.87

Data from 2013 Airline Quality Rating survey

United Continental‘s performance significantly deteriorated compared to 2011, when United scored -1.45 and Continental scored -1.41. Much of this drop can be attributed to the difficult merger integration process, particularly a number of IT system problems that disrupted flight schedules and hurt customer service. Nevertheless, even if the company had maintained its 2011 rating, that still would have placed it significantly behind all of its major competitors.

Why it matters
Despite its poor service compared to peers and unit revenue growth near the bottom of the industry for 2012, United still maintains a modest revenue premium over competitors. This is partially the result of having hubs in many of the biggest and wealthiest cities in the country. However, it its also partially a legacy of Continental Airlines‘ reputation for superior service. As recently as 2009, Continental was the top-ranked network carrier in the AQR survey. However, United Continental has lost that customer service advantage to Delta, and it should not be surprising that Delta …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Innovative Solutions & Support, Inc. receives Delta Air Lines, Inc. Award for NextGen Flat Panel Dis

April 4, 2013 Bartle Doo Leave a comment

By Business Wirevia The Motley Fool

Filed under: Investing

Innovative Solutions & Support, Inc. receives Delta Air Lines, Inc. Award for NextGen Flat Panel Display System and Flight Management System Turnkey Upgrade to its MD-88 and MD-90 Aircraft Fleet

Upgrade to reduce MD-88/-90 fleet CO ₂ emissions by 80 million pounds annually and noise footprint by more than 50%

EXTON, Pa.–(BUSINESS WIRE)– Delta Air Lines, Inc. (Delta) placed an order today for more than $60 million with Innovative Solutions & Support, Inc. (NAS: ISSC) for a complete Systems Integration, Dual GPS Navigation and Cockpit Avionics upgrade of Delta’s MD88 and MD90 aircraft. IS&S will supply all the equipment and installation kits. Specially trained IS&S installation teams will remove existing equipment and install all the LRUs, on site, and prepare the aircraft for return to service. It is anticipated that this turnkey modification will take fewer than six days

IS&S Flat Panel Display System for Delta MD-88 (Photo: Innovative Solutions & Support, Inc.)

This Delta Air Lines order for a fleet wide retrofit of MD-88/-90 aircraft will provide those aircraft with full RNP, RTA, and GPS (Required Navigational Performance, Required Time of Arrival, and Global Positioning System) capabilities with similar efficiency and performance to the newest production aircraft. In addition, the flight deck integration eliminates legacy CRT and Flight Management avionics, leverages recently developed advanced technology, and provides the flexibility to install future upgrades. The ISSC system includes an advanced flight management system, an integrated standby system, and primary flight displays. The system implements Data Link and ADS-B capabilities.

“I am very pleased with the opportunity to work with Delta on this important program. This advanced system is an important milestone that confirms and endorses our 5 year development efforts of a Next Generation Flight Management System,” said Geoffrey Hedrick, Chairman and CEO of Innovative Solutions & Support.

IS&S’s advanced Flight Management System and Global Positioning System Receivers have been selected in all three market segments of Air Transport, Military and Business Aviation. IS&S supplies Flight Management solutions to the commercial market for B-737, MD-80, MD-88 and MD-90. IS&S supplies the military market for C-130, L-100 and the Business market for the Eclipse E500 and E550 aircraft. These flight management systems are amongst the industries most advanced aircraft performance and navigation solutions. The dual IS&S precision Beta 3 GPS navigation system provides three-dimensional position and velocity information accurate to 10 feet. The IS&S dual redundant, RNP …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Airline Stocks: Is It the End of the Party?

April 4, 2013 Bartle Doo Leave a comment

By Adam Levine-Weinberg, The Motley Fool

Filed under: Investing

After finishing 2012 with a strong December, airline stocks went on a tear in the first quarter of 2013. Of the five largest U.S. carriers (excluding American Airlines, which is in bankruptcy), the worst performer was JetBlue , which still gained a solid 17% for the quarter, outperforming the S&P 500 by nearly 10%.

Airline Q1 2013 Stock Performance vs. S&P 500, data by YCharts

However, in the past week, airline stocks have been buffeted by one piece of bad news after another. In just three days, a number of airline stocks have lost 10% or more of their value.

Airline 1 Week Stock Performance vs. S&P 500, data by YCharts

This quick reversal implies that we have probably reached the end of the airline rally. However, that does not mean that long-term investors should necessarily avoid the sector altogether. If you pick your spots carefully, you should still be able to earn some nice returns in airline stocks.

The rally
Last quarter’s massive airline rally was primarily driven by speculation about a potential merger between American Airlines and US Airways , followed by enthusiasm about the potential benefits for the industry, after the merger agreement was announced. Moderating oil prices also helped give airline stocks a boost. It seemed to me that the merger’s potential benefits were already priced in by the time the agreement was announced in mid-February, but investors continued to push airline stocks higher. Most notably, Jim Cramer came out as bullish on US Airways in early March, reversing a long-held aversion to airline stocks.

The main rationale for buying airline stocks based on the American-US Airways merger was the idea that consolidation would lead to capacity discipline, boosting pricing power. Continued unit revenue gains at the major airlines in January and February added to this hope. However, consolidation is not particularly new for the airline industry. In the past five years, Delta Air Lines merged with Northwest, United and Continental merged to form United Continental , and Southwest Airlines purchased AirTran. Most of the benefits of tamer — not to mention saner — competition have already been achieved.

The reality check
In the past week, airline investors have faced a major reality check. First, United Continental published an investor update before the long weekend in which it announced that non-fuel unit costs would increase by 11.4%-12.4% in the first quarter, far worse than its original projection of an 8%-9% increase. As a result, various analysts cut their Q1 estimates for United, anticipating an even larger loss than previously expected. Nevertheless, analysts were encouraged to see that United expects unit revenue to increase 5.4%-6.4% for the full quarter (implying a gain of roughly 7% in March).

However, if United’s report led investors to believe that the revenue environment is strong, Delta and US Airways proceeded to dump cold water on that notion. On Tuesday, Delta reported unit revenue growth of …read more

Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Coming Soon to Washington: Cheap Flights?

April 2, 2013 Bartle Doo Leave a comment

By Adam Levine-Weinberg, The Motley Fool

Filed under: Investing

Ever since American Airlines and US Airways announced their intention to merge in February, investors and industry observers have been wondering what effect the merger will have on competition. For the most part, American and US Airways have complementary route networks: They only overlap on 12 routes out of a total of 900. As a result, the two companies’ management teams have recently stressed that the merger should not raise antitrust concerns.

There’s always a but!
However, JetBlue Airways CEO Dave Barger recently squared off against US Airways CEO Doug Parker about the “new American’s” dominant position at Reagan National Airport, just outside of Washington, D.C. Reagan National is one of several U.S. airports covered by slot restrictions, where the number of flights is capped. As a result, airlines can only add flights by acquiring slots from carriers that already serve the airport, which can be very difficult to accomplish. JetBlue has had trouble growing its presence at Reagan National because of the unavailability of slots.

US Airways is already by far the largest carrier at Reagan National. Last year, the company completed a “slot swap” with Delta Air Lines , whereby Delta received 132 slot pairs at New York’s LaGuardia Airport in return for 42 slot pairs at Reagan National Airport. To win regulatory approval for that transaction, the two carriers had to divest eight slot pairs at Reagan National, leaving US Airways with 55% of the slots there. (JetBlue purchased those slots at auction for $40 million.) Based on current schedules, American Airlines appears to hold approximately 50 of the remaining slot pairs. As a result, if the merger goes through with no slot divestitures, the combined carrier would hold approximately two-thirds of the slots at Reagan National Airport.

US Airways and American only compete on two routes from National Airport: Nashville and Raleigh-Durham. Thus, a merger would only directly impact competition on those two routes. However, American’s potential stranglehold on slots at National Airport would give the company a massive competitive advantage in the D.C. region.

National is the key to D.C.
Doug Parker argued last week that holding two-thirds of the slots at Reagan National would not violate antitrust laws for two reasons. First, US Airways utilizes many smaller regional jets and turboprops there, so the combined carrier would only control about half of the seats, even though it would have two-thirds of the slots. Second, the D.C. area is also served by Washington Dulles Airport, where United Continental operates a hub, and Baltimore-Washington International Airport, which is the third-largest focus city for Southwest Airlines (including flights by its AirTran subsidiary). Between those three airports, American would only operate 25% of flights.

However, National is by far the closest airport to downtown D.C. and has its own stop on the Metro system. This makes it the preferred airport for most travelers in the region. While Dulles Airport will be connected to the Metro …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Delta Hits Turbulence on Sequester Cuts

April 2, 2013 Bartle Doo Leave a comment

By Travis Hoium, The Motley Fool

Filed under: Investing

Delta Air Lines stock is languishing on a generally upbeat day for the markets, down more than 7% late in the trading session. Delta had expected March to show a big improvement in revenue per seat-mile flown — a key metric for airlines — but sequester cuts and technical problems left the result short of forecasts. Revenue per seat-mile did grow 2% in March from a year earlier, but less than a month ago company officials had said they expected 4.5% to 5.5% growth.

One of the issues cited in today’s announcement was a decline in last-minute bookings by government employees, which Delta thinks owes to the sequester. Expensive airline tickets are an easy item to cut, and with across-the-board spending cuts taking effect March 1, Delta took a hit this month.

But that wasn’t Delta’s only problem in March. The company pointed to “temporary inefficiencies” in determining what to charge for flights, which had customers grabbing either cheaper tickets from competitors or inexpensive tickets from Delta. The company may be able to gain some of this revenue back in coming months, so this is the least concerning point.

Good for competitors?
The question is whether Delta’s loss is competitors’ gain. Today, investors don’t think so, judging by the decline in airline stocks. One analyst downgraded United Continental just yesterday because he thought higher costs would hurt the airline. The stock is down 4.3% today.

The merger of US Airways and American Airlines was supposed to lead to less competition and higher prices, but the latest data point doesn’t seem to be supporting that thesis. U.S. Airways is down 4.6% as of the time of writing.

Investors should keep an eye on trends in revenue per seat mile over the next few months. Sequester pressure will subside, but long-term challenges that have always faced the airline industry, such as fuel costs and fierce price competition, will remain.

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The article Delta Hits Turbulence on Sequester Cuts originally appeared on Fool.com.

Fool contributor Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Business, Finance, Occupation & Industry

Are William Shatner and Cheap Plane Tickets Gone Forever?

March 30, 2013 Bartle Doo Leave a comment

By Adam Levine-Weinberg, The Motley Fool

Filed under: Investing

The recent announcement that American Airlines and US Airways plan to merge has sparked fears that consolidation will lead to less competition and higher airfares. Assuming the merger is approved, more than 80% of domestic capacity will be controlled by just four airlines: the new American, United Continental , Delta Air Lines , and Southwest Airlines . All four will have been created by mergers within the past five years. Delta started the most recent round of consolidation by merging with Northwest, followed several years later by the merger of United and Continental and Southwest’s acquisition of AirTran.

This history of airline consolidation means we have a substantial amount of evidence about the effects of airline mergers on airfares. The days of so-cheap-you-can’t-believe-it airfares are probably gone. However, that’s a good thing, because irrationally priced airfares have resulted in trips to bankruptcy court by numerous airlines over the past three decades. Yet surprisingly, airfares have been quite stable in the face of rising oil prices since 2000. Airline mergers (and bankruptcies) have generated significant cost savings over time, allowing airlines to become profitable without raising fares beyond historical inflation-adjusted levels.

Stability in a sea of change
Since 1995, the average domestic airfare has risen from $288 to $367. The increase hasn’t been linear: Airfares spiked from 1996 until 2000, before dropping off for much of the next decade. Since 2009, airfares have been on the rise again.

Source: U.S. Department of Transportation

However, if we adjust for inflation, it turns out that airfares have declined since 1995. Q3 2012 airfares averaged just $243 in 1995 dollars, down more than 15% since 1995 and down more than 18% from the inflation-adjusted peak in 2000.

There is a catch, though. Department of Transportation statistics include only the base airfare. Non-ticket charges such as baggage fees aren’t included. Since airlines have been charging baggage fees for only about five years, the DOT statistics understate the increase in airline prices. On the other hand, the DOT also provides statistics on the percentage of airline revenue derived from ticket sales. Working backwards from this information, it appears that the average ticket price last summer including new fees was $294 in 1995 dollars, implying that fees for checked baggage, seat selection, and the like average around $50 — roughly the cost of checking one bag for a round-trip flight on most airlines.

At $294, the average inflation-adjusted airfare is still slightly below the 2000 peak of $297, but slightly higher than the 1995 level of $288. Given the turmoil that has shaken the industry in the past decade, the long-term stability of inflation-adjusted airfares is surprising.

Rising oil: no problem
It’s particularly remarkable to look at the trajectory of average airfares from 2007 to 2012. The average price of Brent crude skyrocketed over that period, from $72.44 in 2007 to $111.63 in 2012 (with a violent dip in 2009). Since jet fuel is the biggest cost item for …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

GOL Linhas Earnings: An Early Look

March 22, 2013 Bartle Doo Leave a comment

By Dan Caplinger, The Motley Fool

Filed under: Investing

Earnings season is just about over, with almost all companies already having reported their quarterly results. But there are still a few companies left to report, and GOL Linhas is about to release its quarterly earnings report. The key to making smart investment decisions with stocks releasing their quarter reports is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Brazil has been a fast-growing economy in recent years, and as the No. 2 airline serving Brazil and the rest of Latin America, GOL has participated in that growth. Given how well U.S. airlines have done recently, has GOL seen the same success? Let’s take an early look at what’s been happening with GOL Linhas over the past quarter and what we’re likely to see in its quarterly report on Monday.

Stats on GOL Linhas

Analyst EPS Estimate	($0.21)
Year-Ago EPS	$0.19
Revenue Estimate	$1.63 billion
Change From Year-Ago Revenue	32%
Earnings Beats in Past 4 Quarters	1

Source: Yahoo! Finance.

Will GOL Linhas fly higher this quarter?
Over the past few months, analysts have gotten less optimistic about GOL Linhas. Loss estimates for the just-ended quarter have more than doubled, and analysts have also pushed down full-year 2013 earnings calls by $0.04 per share. Yet the shares have risen by nearly 20% since mid-December.

GOL Linhas has emerged as a major force in the Brazilian growth story. Filling a low-cost/low-fare niche in the market, GOL Linhas connects cities within Brazil and throughout Latin America and the Caribbean.

Yet recently, its traffic has suffered somewhat. In February, GOL Linhas said that its primary measure of passenger revenue fell almost 18% from a year ago, while available capacity dropped more than 15%. Load factors fell, and its domestic Brazilian segment was particularly weak. By contrast, its international figures improved sharply, with expansion of flights to Miami and Orlando having a big impact on international growth.

Back in December, GOL Linhas got a big jump on news that it might do an initial public offering of its mileage points program, and the company moved forward with a filing for the IPO last month. With nearly 9 million members in the “Smiles” program, GOL Linhas could reap substantial proceeds from the offering, with the program having grown by about 10% over the past year. Discussions of the possibility that United Continental and Delta Air Lines might do IPOs of their respective frequent-flyer programs several years ago didn’t go anywhere, but in GOL‘s home market, rival TAM, which is now part of LATAM Airlines , successfully offered shares of its “Multiplus” program.

In its quarterly report, watch for news of how GOL‘s Smiles IPO is …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Has Delta Air Lines Become the Perfect Stock?

March 22, 2013 Bartle Doo Leave a comment

By Dan Caplinger, The Motley Fool

Filed under: Investing

Every investor would love to stumble upon the perfect stock. But will you ever really find a stock that provides everything you could possibly want?

One thing’s for sure: You’ll never discover truly great investments unless you actively look for them. Let’s discuss the ideal qualities of a perfect stock, then decide if Delta Air Lines fits the bill.

The quest for perfection
Stocks that look great based on one factor may prove horrible elsewhere, making due diligence a crucial part of your investing research. The best stocks excel in many different areas, including these important factors:

Growth. Expanding businesses show healthy revenue growth. While past growth is no guarantee that revenue will keep rising, it’s certainly a better sign than a stagnant top line.
Margins. Higher sales mean nothing if a company can’t produce profits from them. Strong margins ensure that company can turn revenue into profit.
Balance sheet. At debt-laden companies, banks and bondholders compete with shareholders for management’s attention. Companies with strong balance sheets don’t have to worry about the distraction of debt.
Money-making opportunities. Return on equity helps measure how well a company is finding opportunities to turn its resources into profitable business endeavors.
Valuation. You can’t afford to pay too much for even the best companies. By using normalized figures, you can see how a stock‘s simple earnings multiple fits into a longer-term context.
Dividends. For tangible proof of profits, a check to shareholders every three months can’t be beat. Companies with solid dividends and strong commitments to increasing payouts treat shareholders well.

With those factors in mind, let’s take a closer look at Delta Air Lines.

Factor	What We Want to See	Actual	Pass or Fail?
Growth	5-year annual revenue growth > 15%	13.9%	Fail
	1-year revenue growth > 12%	4.4%	Fail
Margins	Gross margin > 35%	20.0%	Fail
	Net margin > 15%	2.8%	Fail
Balance sheet	Debt to equity < 50%	NM	NM
	Current ratio > 1.3	0.62	Fail
Opportunities	Return on equity > 15%	NM	NM
Valuation	Normalized P/E < 20	14.61	Pass
Dividends	Current yield > 2%	0.0%	Fail
	5-year dividend growth > 10%	0.0%	Fail

	Total score		1 out of 8

Source: S&P Capital IQ. NM = not meaningful due to negative shareholder equity. Total score = number of passes.

Since we looked at Delta Air Lines last year, the company hasn’t been able to regain the two points it lost from 2011 to 2012. Yet despite continuing to have negative shareholder equity, the stock has soared 75% over the past year.

Delta has ridden the wave of extremely strong performance among airline stocks in general. …read more
Source: FULL ARTICLE at DailyFinance

News, Politics, Government

Idaho businessman pleads not guilty to slapping toddler; was traveling to take child off life support, lawyer says

March 21, 2013 Bartle Doo Leave a comment

A man accused of slapping a toddler on an Atlanta-bound flight and using a racial slur has pleaded not guilty to assault in federal court.

Joe Rickey Hundley, of Hayden, Idaho, appeared in court Wednesday. Authorities say he used racial slur when telling a fellow passenger to quiet her baby and slapped the child. The incident unfolded Feb. 8 aboard a Delta Air Lines flight from Minneapolis.

Hundley’s attorney, Marcia Shein, says the 60-year-old man has admitted to using the racial slur. She told the Atlanta Journal-Constitution Hundley was traveling to Atlanta to take his only child off of life support after his son overdosed on insulin. She says Hundley was distraught during the flight.

“On that flight he was upset stressed and grieving and made comments to Mrs. Bennett he should never had made and is very apologetic for having said what he did and he hopes for everyone’s sake that she will heal and forgive him,” Shein said.

While acknowledging Hundley made a racial remark, His attorney maintains he never slapped the toddler, MyFoxAtlanta.com reported.

“We believe that what happened that night was an accident or inadvertent, where the child was injured, but it wasn’t because Mr. Hundley intentionally or in fact did strike the child in any way,” Shein said.

The toddler’s mother, Jessica Bennett, told authorities her son started to cry and that’s when handle reportedly used a racial slur and slapped the child in the face, the station reported.

Hundley is scheduled to appear again in court April 9.

Business, Finance, Occupation & Industry

Delta in Talks to Buy Jets from Boeing, Airbus, Sources Say

March 21, 2013 Bartle Doo Leave a comment

By Reuters

Filed under: Aerospace & Defense, Manufacturing, Transportation & Logistics, Travel Industry, Stocks

Ted S. Warren/AP Workers assemble a next-generation 737 airplane at Boeing Co.’s assembly facility in Renton, Wash.

Delta Air Lines is in talks to purchase small and wide-body jets from Airbus and Boeing in deals potentially worth about $6 billion at list prices, two people familiar with the matter said.

Potential orders involve about 20 each of the planemakers’ most popular families of jets — the Airbus A320 or Boeing 737 in the medium-haul, narrow-body class and the Airbus A330 or Boeing 777 in the long-range, wide-body category, the people said.

None of the parties involved agreed to comment.

The sources confirmed a Bloomberg News report that Delta Air Lines Inc. (DAL) was considering buying planes including 10 to 20 of the A330 or the 777 wide-body aircraft worth $4.3 billion.

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Delta told an investor conference on March 4 that it needed to evaluate its needs for wide-body jets, but played down the possibility of a large order because of recent investments in its relatively young fleet.

The airline said it saw “opportunities in the marketplace” to add selectively to its wide-body fleet and would be talking, for example, to Airbus. Airlines typically engage both major aircraft makers in any discussion to seek the best prices.

Delta already operates all four of the aircraft types involved in the talks at both ends of the spectrum, making it possible for the plane-makers to offer aircraft without having to shoulder the heavy costs of helping the airline switch suppliers.

The talks come on the heels of an exceptionally busy two weeks for aircraft orders as airlines chase fuel savings while trying to grow or replace their fleets. Industry body IATA earlier edged up its forecast for airline profits this year.

On Tuesday, budget Irish airline Ryanair handed Boeing Co. (BA) its largest European order ever, a deal for 175 Boeing 737 jets worth $16 billion at list prices. The deal came a day after Indonesia’s Lion Air on Monday picked European rival Airbus for a $24 billion order.

Lion Air had been an exclusively Boeing customer for jets.

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News, Politics, Government

Man pleads not guilty to slapping toddler on airplane

March 21, 2013 Bartle Doo Leave a comment

A man accused of slapping a toddler on an Atlanta-bound flight and using a racial slur has pleaded not guilty to assault in federal court.

Joe Rickey Hundley, of Hayden, Idaho, appeared in court Wednesday after authorities say he used racial slur when telling a fellow passenger to quiet her baby and slapped the child. The incident unfolded aboard a Delta Air Lines flight from Minneapolis Feb. 8.

Hundley’s attorney, Marcia Shein, says the 60-year-old man has admitted to using the racial slur. She told the Atlanta Journal-Constitution Hundley was traveling to Atlanta to take his only child off of life support after he overdosed on insulin and was distraught during the flight.

Hundley is scheduled to appear again in court April 9.

Business, Finance, Occupation & Industry

Hawaiian Airlines Goes Global: Why It Matters

March 20, 2013 Bartle Doo Leave a comment

By Adam Levine-Weinberg, The Motley Fool

Filed under: Investing

Last week, Hawaiian Holdings subsidiary Hawaiian Airlines added yet another new international route from its Honolulu hub: Auckland, New Zealand. Auckland is the seventh new international destination Hawaiian has added in the last two-and-a-half years, following Tokyo, Osaka, Fukuoka, and Sapporo (all in Japan), Seoul, South Korea, and Brisbane, Australia. Hawaiian will also begin service from Honolulu to Sendai, Japan, in June (as part of a triangle route with Sapporo), and plans to begin service to Taipei, Taiwan, in July.

Revenue diversification
By July, Hawaiian will fly to 13 destinations in Asia and Oceania, up from just four in 2010. Adding these international flights has provided significant revenue diversification for Hawaiian; international routes account for 32% of Hawaiian’s revenue, and that percentage is growing. Most recently, Hawaiian has been focusing its growth on markets where there is little or no competition. It is the only carrier on the Sapporo and Brisbane to Honolulu routes, and will be the only carrier on its upcoming routes to Sendai and Taipei. Hawaiian is also the only American carrier serving Auckland, and competes only with Air New Zealand on the Auckland-Honolulu route.

Adding routes with no competition has an obvious benefit: It creates pricing power for Hawaiian. Most of the company’s new destinations have significant untapped demand for travel to Hawaii, and Hawaiian Airlines should see rising traffic as residents become aware of the new service. Furthermore, Hawaiian’s growing international network creates possibilities for connecting passengers traveling between the U.S. mainland and international destinations via the Honolulu hub.

Merger in the future?
Hawaiian’s strong and growing international presence makes the company an intriguing merger candidate. American Airlines has been historically weak in Asia; as of this summer it will have just eight routes to four Asian cities (Tokyo, Shanghai, Beijing, and Seoul). Merger partner US Airways brings nothing to the table: It has never served Asia. Neither of the two carriers have any flights to Oceania, either. As such, Hawaiian could be a future merger target for American. Honolulu is ideally located for connecting traffic between North America and Oceania. While it is not as convenient for connecting traffic between North America and Asia — for most itineraries it is at least 1000 miles out of the way — offering free overnight layovers in Honolulu could attract passengers. Moreover, with a market capitalization of approximately $325 million, Hawaiian would be a relatively cheap acquisition.

Alaska Air could be another suitor, though this scenario is somewhat less likely, and could run into regulatory issues since the two are the leading carriers from the West Coast to Hawaii. Alaska does not have any international presence, although it has a partnership with Delta Air Lines that gives its customers access to Asia. A combination with Hawaiian would give Alaska a launching pad to introduce its own international service to Asia, the fastest-growing aviation market in the world.

Conclusion
Hawaiian Airlines‘ increasing international footprint is a key …read more
Source: FULL ARTICLE at DailyFinance

News, Politics, Government

TSA stands by plan to allow small knives on planes

March 14, 2013 Bartle Doo Leave a comment

The head of the Transportation Security Administration told lawmakers Thursday he stands by his plan to allow passengers to carry small knives onto planes despite a growing backlash against the proposal.

It’s unlikely in these days of hardened cockpit doors and other preventative measures that the small folding knives could be used by terrorists to take over a plane, TSA Administrator John Pistole told a hearing of the House Homeland Security Committee.

On the other hand, searching for the knives on passengers or in their carry-on bags is time consuming, Pistole said. TSA screeners confiscate about 2,000 such knives every day, with each incident chewing up about two to three minutes, he said.

“I think the decision is solid and it stands and we plan to move forward,” Pistole said.

The policy, which goes into effect April 25, has sparked strong opposition from flight attendants, federal air marshals, some pilot unions, and even aviation insurers. In the hands of the wrong passengers, the knives can be used to harm flight attendants and other passengers, critics say.

Several airline CEOs have also expressed qualms. Delta Air Lines chief executive Richard Anderson said in a letter to Pistole last week that he shares the “legitimate concerns” of the airline’s flight attendants. US Airways chief Doug Parker asked the TSA administrator to reconsider his position.

Several members of the House committee also urged Pistole to drop the proposal, warning that if he doesn’t, Congress may take steps to block the policy change.

Since the Sept. 11, 2001, terrorist attacks there have been no incidents in which terrorists have successfully used sharp objects to take over a plane, which suggests the current policy of keeping even small knives off planes is working, committee members said.

“How does allowing sharp objects on board now accomplish maintaining the goal of having zero planes taken over?” asked Rep. Eric Swalwell, D-Calif. “I’m asking why now, and why do we want to go back?”

The lack of instances in which terrorists try to use knives to take over a plane underscores that their tactics have shift to using explosive devices instead, which what TSA is devoting its energies to finding, Pistole said. He noted that the proposed policy would mostly conform U.S. regulations with international standards, which were changed in 2010 …read more
Source: FULL ARTICLE at Fox US News

Business, Finance, Occupation & Industry

Why Delta Air Lines Is Poised to Pull Back

March 11, 2013 Bartle Doo Leave a comment

By Brian Pacampara, Pacampara, The Motley Fool

Filed under: Investing

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool’s free investing community, airline operator Delta Air Lines has received the dreaded one-star ranking.

With that in mind, let’s take a closer look at Delta and see what CAPS investors are saying about the stock right now.

Delta facts

Headquarters (founded)

Atlanta, Ga. (1924)

Market Cap

$13.7 billion

Industry

Airlines

Trailing-12-Month Revenue

$36.7 billion

Management

CEO Richard Anderson

CFO Paul Jacobson

Return on Capital (average, past 3 years)

11.1%

Cash/Debt

$3.4 billion/$13.2 billion

Competitors

Southwest Airlines

United Continental Holdings

US Airways

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 41% of the 933 members who have rated Delta believe the stock will underperform the S&P 500 going forward.

Just last week, one of those Fools, gameguru, succinctly summed up the Delta bear case for our community:

The recent run-up seems unsupported by fundamentals. Oil prices likely can and will go higher. TSA delays and FAA furloughs may reduce traffic. Recent weather problems will hurt traffic. Delta continues trying to expand its already expansive routes, which is usually a recipe for capital loss in this space.

If you want market-topping returns, you need to protect your portfolio from any undue risk. Luckily, we’ve found another stock we are incredibly excited about — excited enough to dub it “The Motley Fool’s Top Stock for 2013.” We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won’t be here forever, so click here to access it now.

Want to see how well (or not so well) the stocks in this series are performing? Follow the TrackPoisedTo CAPS account.

The article Why Delta Air Lines Is Poised to Pull Back originally appeared on Fool.com.

Fool contributor Brian Pacampara has no position in any stocks mentioned. The Motley Fool recommends Southwest Airlines. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

function addEvent(obj, evType, fn, useCapture){
…read more
Source: FULL ARTICLE at DailyFinance

Articles of Interest

Richard Anderson, Delta CEO, Expresses ‘Legitimate Concern’ About TSA’s Knife Decision

March 8, 2013 Bartle Doo Leave a comment

By The Huffington Post News Editors

ATLANTA (AP) — The CEO of Delta Air Lines is objecting to plans by the Transportation Security Administration to allow small knives back on planes.

Richard Anderson‘s letter to TSA administrator John Pistole on Thursday says he shares the “legitimate concerns” of Delta flight attendants about the decision. He says allowing small knives will do little to speed up passenger screening — but adds risk for cabin staff and passengers.

Flight attendant unions have opposed the new policy, which goes into effect April 25. Flight attendants at Delta Air Lines Inc. are not in a union.

Major Airline Stocks Soar: Should You Sell?

March 5, 2013 Bartle Doo Leave a comment

By Adam Levine-Weinberg, The Motley Fool

Filed under: Investing

While many airline stocks performed well in 2012, their performance over the past three months has been nothing short of extraordinary. Since early December, the five largest U.S. airlines (excluding American, which is currently in bankruptcy) have seen their share prices appreciate by more than 30% on average.

Airline Industry Three-Month Price Chart, data by YCharts

The biggest carriers, Delta Air Lines and United Continental , have shown the strongest performance, gaining 60% and 45%, respectively, over that time period. Low-cost carriers Southwest Airlines and JetBlue Airways have each gained more than 20%, while US Airways stock price has taken a bit of a breather after tripling in the previous year.

Airline stocks may be flying high now, but this performance is not necessarily supported by the fundamentals. While some companies like Delta and US Airways have posted consistently strong results recently, others have lagged. United Continental and Southwest have both been hampered by merger integration problems and have not yet generated any meaningful “revenue synergies.” Meanwhile, JetBlue is starting to regain its momentum after seeing Hurricane Sandy eat into revenue and earnings.

Owning the strongest airline stocks is probably the best decision now, as is often the case. At some point, there will likely be an industry correction, but Delta and (to a lesser extent) US Airways may be more insulated from such volatility than peers. Both companies still trade at attractive valuations (five to six times expected 2013 earnings) and have been increasing their profit margins recently. By contrast, the share prices for Southwest and United Continental seem to be running ahead of the fundamentals: Continued disappointments could lead to a quick reversal in either case.

The merger catalyst
One major cause of the recent airline stock run was growing speculation that US Airways would merge with American Airlines. US Airways had been publicly pursuing American since early 2012, but it was only recently that American’s management team warmed to the idea. The merger was ultimately announced on Feb. 14, but the decision was widely expected by then. In the week before the announcement, I wrote that US Airways and American Airlines shareholders were unlikely to profit from the merger (at least in the short term). Sure enough, US Airways shares have dropped by roughly 10% since the merger was announced, as investors have come to grips with the obstacles that lie ahead.

By contrast, other airlines held their ground or moved higher after the merger announcement, despite having already rallied on speculation that US Airways and American would indeed merge. Some airlines may indeed see benefits: for example, JetBlue CEO Dave Barger recently stated that he believes JetBlue will be able to expand its partnership with American Airlines later this year. By allowing more passengers to connect seamlessly between the two airlines at JFK, both companies should benefit.

On the other hand, United Continental could be a big loser, as it …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Delta Reports Lower Metrics for February

March 4, 2013 Bartle Doo Leave a comment

By Eric Volkman, The Motley Fool

Filed under: Investing

Delta Air Lines saw a modest slump in most of its passenger metrics last month. For February, total revenue passenger miles — a key metric measuring the total distance traveled by paying customers — declined by just over 2% on a year-over-year basis to hit 12.7 billion.

Meanwhile, available seat miles — the calculation of the total number of miles available for a carrier to sell — declined by 5% over that same stretch of time to land a bit above 16 billion.

In terms of what was carried on its aircraft, Delta reported that the number of boarded passengers fell to 11.1 million, a drop of almost 3% from Feb. 2012’s figure. Cargo ton miles declined 3.5% on an annual basis, coming in at 179 million.

The article Delta Reports Lower Metrics for February originally appeared on Fool.com.

Fool contributor Eric Volkman has no position in Delta Air Lines, and neither does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Read | Permalink | Email this | Linking Blogs | <a target=_blank href="http://www.dailyfinance.com/2013/03/04/delta-reports-lower-metrics-for-february/#comments" title="View reader comments on this …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

United Continental May Have a Free Cash Flow Problem

March 4, 2013 Bartle Doo Leave a comment

By Adam Levine-Weinberg, The Motley Fool

Filed under: Investing

While earnings per share, or EPS, can be a handy statistic for investors to use to evaluate the performance of stocks that they own, it does not always tell the whole story. Ultimately, free cash flow is the holy grail for investors. Free cash flow is calculated by taking the amount of cash generated from operations and subtracting capital expenditures. In short, it represents the amount of profit left over after a company has made necessary investments in the business. Free cash flow is a particularly important metric for shareholders because it represents money that potentially could be returned to them through dividends or share repurchases.

On a straight P/E basis, United Continental looks fairly cheap even though it hit a new 52-week high last Friday. The Friday closing price of $27.38 is just 7.4 times the average analyst estimate for 2013 EPS, and 5.6 times the average estimate for 2014 EPS. However, free cash flow tells another story. United Continental is facing a period of heavy investment that will probably sap free cash flow through the end of this decade. This poor free cash flow outlook makes United a questionable investment candidate compared to peers, particularly Delta Air Lines .

Operating cash flow: a baseline
Over the past three years, United Continental‘s operating cash flow has been very inconsistent. This has been the result of two factors: profit instability caused by integration problems and rising oil prices, and one-time merger integration costs. In the past three years, operating cash flow has ranged from a low of $935 million last year to a high of $2.4 billion in 2011. If we add back United’s approximately $600 million of special charges in 2011, United would have generated as much as $3 billion in operating cash flow.

If we assume a return to that level of operating cash flow in 2013 and modest growth through the end of the decade (a bullish assumption, given United’s poor performance recently and the turbulent history of the airline industry), United may produce $25 billion in operating cash flow through 2019: an average of $3.57 billion a year. However, shareholders will see very little of that money.

Heavy capital commitments
The reason why shareholders may fare poorly even in the relatively bullish scenario outlined above is that United has very heavy capital commitments over the next seven years, as can be seen in the following table:

Year	Capital Commitments
2013	$1.8 billion
2014	$1.5 billion
2015	$2.0 billion
2016	$3.0 billion
2017	$2.5 billion
2018	~$2.5 billion*
2019	~$2.5 billion*
Total	~$15.8 billion

Data from United Continental‘s 2012 10-K (p. 139); * denotes author’s estimate.

United Continental has thus committed to spending nearly $16 billion in capital expenditures over the next seven years. Nearly all of those commitments relate to aircraft acquisitions. The company currently has 247 aircraft on order, …read more
Source: FULL ARTICLE at DailyFinance

News, Politics, Government

Man accused of slapping boy on flight while using racial slur

February 17, 2013 Bartle Doo Leave a comment

A Minneapolis woman says her 2-year-old son was traumatized by a man accused of slapping the boy and calling him a racial slur during an Atlanta-bound flight.

The boy’s mother, Jessica Bennett, said in a statement Saturday that her son has become “apprehensive to strangers” since the Feb. 8 flight from Minneapolis.

Joe Rickey Hundley, of Hayden, Idaho, has been charged with simple assault. His attorney said he will plead not guilty.

Bennett, 33, told authorities her son was crying as the Delta Air Lines flight prepared for landing. Hundley, 60, was sitting next to her and slapped the boy in his face, causing a scratch under his right eye, she said.

Hundley “told her to shut that (N-word) baby up,” FBI special agent Daron Cheney said in a sworn statement. “Ms. Bennett received assistance from several people on the plane.”

Bennett said the infant began crying louder after he was hit.

“Hundley’s comments were racist and hateful,” Bennett said in a statement to KARE-TV (http://kare11.tv/YyjZ58). “The family has numerous questions about how a passenger could get so violently out of control as to assault a toddler.”

Hundley was suspended from his job as president of Unitech Composites and Structures, The Atlanta Journal-Constitution reported.

Al Haase, president and chief executive of AGC Aerospace and Defense, Composites Group — Unitech’s parent company — said the firm was taking the matter seriously.

“In accordance with our company’s personal conduct policy, we have suspended the employee pending investigation,” Haase said in a statement.

Bartle Doo Article Archives

Tag Archives: Delta Air Lines

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Has Delta Air Lines Become the Perfect Stock?

Idaho businessman pleads not guilty to slapping toddler; was traveling to take child off life support, lawyer says

Delta in Talks to Buy Jets from Boeing, Airbus, Sources Say

Man pleads not guilty to slapping toddler on airplane

Hawaiian Airlines Goes Global: Why It Matters

TSA stands by plan to allow small knives on planes

Why Delta Air Lines Is Poised to Pull Back

Richard Anderson, Delta CEO, Expresses ‘Legitimate Concern’ About TSA’s Knife Decision

Major Airline Stocks Soar: Should You Sell?

Delta Reports Lower Metrics for February

United Continental May Have a Free Cash Flow Problem

Man accused of slapping boy on flight while using racial slur

Articles Archive