# WSJ - Delta and Northwest to announce merger this week/Merged



## T_R_Oglodyte (Apr 13, 2008)

From the Wall Street Journal: Delta, Northwest Could Unveil Merger as Early as Tuesday



> Delta Air Lines Inc. and Northwest Airlines Corp. have spent the last week readying their long-delayed merger announcement, with the aim of unveiling it as early as Tuesday, said people familiar with the matter.
> 
> They could go ahead without the support of Delta's 6,000 pilots. Delta and its pilots remained in talks over the weekend on a new post-merger contract that would cover that group only, leaving negotiations with Northwest's 5,000 pilots for a later day, these people said.


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## ricoba (Apr 13, 2008)

I saw that article earlier today.

Any ideas on the new name/brand?


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## Icarus (Apr 13, 2008)

ricoba said:


> I saw that article earlier today.
> 
> Any ideas on the new name/brand?



Nothworst and Delta .. Deworst? 

Usually one of the two names survives. The bigger one. Not sure which one it would be for Delta and Northwest. (Example: US Air and America West -> US Air).


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## ricoba (Apr 13, 2008)

Icarus said:


> Nothworst and Delta .. Deworst?



:hysterical: :hysterical: :hysterical:


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## sfwilshire (Apr 13, 2008)

I assume the ff accounts from both airlines will be combined? That will be great for us as every family member has some Northwest points. If we fly Northwest most of us ask for Delta miles, but we flew one of Northwest's partners in Hawaii and now five of us have points at risk of expiration. It's a real pain trying to keep all the accts for the six of us alive on various airlines. 

I also have a Northwest voucher that I got Friday for taking a bump (earned it too when my luggage was held hostage for 48 hours). That should go nicely with the Delta ff miles we have to use if I can get seats when I need them.

Sheila


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## Icarus (Apr 13, 2008)

sfwilshire said:


> I assume the ff accounts from both airlines will be combined?



Eventually, I'm sure they will be combined. We'll have to wait for an official announcement to find out what the plans are. It could take a while, and during the interim it's possible that some miles could expire, so you need to keep your eye on things. I sure don't want to lose my 600 Delta Skymiles. 

Let's put it this way: It's highly unlikely that members of either program would lose their miles or their status in the new airline. If the status levels and benefits are different between Delta and NW, the details will be interesting for those that have elite status in one of the two programs.

Even when AA absorbed TWA, my old TWA miles survived, but I had to call to get them transfered to my AA account. I can't think of any cases where anybody lost miles in a merger.

-David


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## Carolinian (Apr 14, 2008)

As one who fled DL SkyMiles, appropriately called by some ''SkyPiles'' in the Rob Borden days and comping over to the much superior Worldperks at NW, this is absolutely the merger from hell in terms of ff programs.  If it gets aprroved, which I certainly hope it does not, I will have to comp over to either UA or AA.  SkyMiles is a lousy program and it rapidly getting worse.  My Worldperks miles being converted to crappy Skymiles on a one for one basis is about as welcome as if I were forced to convert my € to $ on a one for one basis.

One of the reasons why DL has absoutlutely the worst ff program out there among US airlines is that they recently started gouging Europe-based passengers for a massive fuel surcharge on award tickets, something they have said they are going to take systemwide eventually.  That is a huge devaluation of miles.  They have also been the king of junk fees to raise the cost of award tickets.

On NW, my upgrade percentage as an elite has been almost 100%, compared to about 30% when I was a DL elite.

The pilots are very unhappy with this merger, and we can only hope that they go to war with management over it and bring down the merger from hell. We also need to write the regulatos and complain.  If it can be delayed into the next administration, there is particular hope that this monster can be strangled in the cradle.

For paid tickets, approval of this merger is likely to tirgger at least one other merger, CO and UA perhaps,  and the resulting oligopoly will really jack up ticket prices.  This is the main reason consumers should be very concerned about the merger from hell.

As to ff programs, the biggest concern is the Air France factor.  Part of the deal is that AF invests a billioin and gets a seat on the board.  They are expected to have far more influence than one seat would normally give, and that is extremely bad news since AF recently has been one of the most anti-consumer airlines with their ff program.  Instead of Worldperks simply becoming SkyPiles, look for a stunt like AF pulled when they took over KLM.  They created an entirely new ff program, Flying Blue, that was but a pale ghost of what the predecessor programs, Frequence Plus and Flying DUtchman has been.  Frequence Plus and FLying DUtchman had both been great programs but Flying BLue is so bad it is not even worth participating in, especially for leisure travellers'

As to a new name, what would be appropriate is ''Air France West''

Randy Petersen of Inside Flyer magazine says that the merger was driven by management blunders at DL that have left them looking for a cash cow to pull their chestnuts out of the fire in a merger.  I guess NW, with the best cash position of all US majors, had a bulleye painted around it as a target. Hopefully the DL management morons will have to stew in their own juices and not get an opportunity to mismanage another airline.

Unfortunately there were those at NW all too willing to hand over the keys to the drunk dirvers from DL.  NW CEO Doug Steenland has an interesting contract provision that gives him a $10 milllion golden parachute if the airline merges before June, and he is pushing just as hard as he can to get that paycheck for himself before it is beyond reach.  Both boards are packed with representatives of large shareholders who got their shares in exchange for debt in the bankruptcies.  These shareholders are looking to unload those shares at a higher price, one they think they can arrange through the illusion of merger euphoria.  It is absolutely sickening to see Dougie Boy's hunger for a big personal payout and the effort by board members to churn stock lead to the demise of a great airline like NW.

Possible CHAOS action by the pilots, and the approval process by regulators are the last hopes of driving a stake through the heart of this monster.

If a merger had to happen, I would much rather have had my SkyPiles become US Dividend Miles in the proposed DL/US merger than see my Worldperks degraded to SkyPiles.

To give a practical example of the difference in the two ff programs, I will use as an example an award ticket I got for a family member a couple of months ago for this summer, flying R/T from Bucharest to RDU and return.  Both NW and DL came up with award seats, NW on the exact days I asked for but with more connections and leaving Bucharest on a dreaded early morning flight while DL found seats within a few days of those requested with a more direct schedule and leaving Bucharest on a more civilized late morning flight.  Both wanted 50K miles.  So far, it was largely a draw, but then came the kicker.  NW wanted a bit under $100 in taxes and fees while DL wanted over $330.  That gouging made it a no brainer to say ''no way jose'' to DL.


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## Ken555 (Apr 14, 2008)

Well. I'm just glad I redeemed 35,000 miles last week for a Hawaii ticket later this year on DL. I'm now left with 270,000 or so of those "SkyPiles" (!), which I may try to redeem for other flights later this year rather than hold onto. I previously strictly used miles for international travel, but last year decided to slowly start to use them domestically. Given the price of flights now and the upcoming changes, I'm more inclined to use my miles for domestic flights rather than pay $$$ for the seats on any airline.


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## johnmfaeth (Apr 14, 2008)

But will Delta walk away from the final stages and kill NW like it did PanAm, (after getting the good routes for a pittence).

Will they adopt "Oops, I did it Again" as their theme song if that happens?


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## Carolinian (Apr 14, 2008)

johnmfaeth said:


> But will Delta walk away from the final stages and kill NW like it did PanAm, (after getting the good routes for a pittence).
> 
> Will they adopt "Oops, I did it Again" as their theme song if that happens?



I think you have it backwards.  NW is the airline with the strongest cash position (cash on hand as a percentage of revenue) of any US legacy airline.  NW, unlike DL, is well on the way to fleet renewal to more fuel-efficient planes like the A-330s that have replaced all of the DC-10s on the lucrative international routes and the B787s they have on order, the first US airline scheduled to receive the Dreamliners. It is DL whose management based its whole post-bankruptcy plan on $65 oil and is now hurting and needing the lifeline that they hope to get from NW.  The management at NW had the foresight to buy some fuel hedges.

It would serve DL right if NW walked away and killed DL.  Unfortunately, the pressure on both airlines from Air France is probably too great for that to happen.  AF's takeover of KLM means it can pressure NW because of the possibility of not renewing the lucrative trans-Atlantic deal between NW and KLM.

From a management standpoint, I wouldn't have as big a problem with a takeover of DL by NW, although that would still stiffle competition and would be objectionable from a consumer standpoint.  A takeover of NW by DL is just objectionable all the way round.  Their mismanagement of one airline should not give them the opportunity to screw up another one.


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## falmouth3 (Apr 14, 2008)

*Northwest Announcing Merger*

As a valued Northwest Airlines customer and WorldPerks® member, I wanted you to be among the first to hear that we have announced a merger with Delta Air Lines. Subject to regulatory review, our two airlines are joining forces to create America’s premier global airline which, upon closing of the merger, will be called Delta Air Lines.

By combining Northwest and Delta, we are building a stronger, more resilient airline that will be a leader in providing customer service and value. Our combined airline will offer unprecedented access to the world, enabling you to fly to more destinations, have more flight choices and more ways than ever to earn and redeem your WorldPerks miles.

You can be assured that your WorldPerks miles and Elite program status will be unaffected by this merger. In addition, you can continue to earn miles through use of partners like WorldPerks Visa®. And once the new Delta Air Lines emerges you can look forward to being a part of the world’s largest frequent flyer program with expanded benefits.

The combined Delta Air Lines will serve more U.S. communities and connect to more worldwide destinations than any global airline. Our hubs – both Delta’s and Northwest’s – will be retained and enhanced. We will be the only U.S. airline to offer direct service from the United States to all of the world’s major business centers in Asia, Latin America, Europe, Africa and around North America.

Both airlines bring tremendous strengths to this new partnership. Our complementary service networks form an end-to-end system that is truly greater than the sum of its parts. This is a merger by addition, not subtraction, which means all of our hubs – both Northwest’s and Delta’s – will be retained. In addition, building on both airlines’ proud, decades-long history of serving small communities, we plan to enhance global connections to small towns and cities across the U.S.

All of these positive benefits of our combination mean that we can:

    * Offer a true global network where our customers will be able to fly to more destinations, have more schedule options and more opportunities to earn and redeem frequent flyer miles in what will become the world’s best and most comprehensive frequent flyer program.
    * Continue to serve our current roster of destinations and to maintain our hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York, Salt Lake City, Amsterdam and Tokyo.
    * Improve our customers’ travel experience, through new products and services including enhanced self-service tools, better bag-tracking technology, more onboard services, including more meal options, new seats and refurbished cabins.

While we work to secure approval of our merger, which may take up to 6 to 8 months, it will be business-as-usual at both airlines. We will continue to operate as independent airlines and the people of Northwest will remain focused on providing you with the very best in safe, reliable and convenient air travel. At the same time, both airlines will be planning for a seamless integration of our two airlines, one that delivers to you the enhanced benefits that will earn – and retain – your preference.

As we work through this process, we will keep you informed at every step along the way. Thank you for your business and we look forward to serving you on your next Northwest flight.

Sincerely,

Bob Soukup
Managing Director, WorldPerks


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## T_R_Oglodyte (Apr 14, 2008)

To consolidate, I suggest this thread be merged with the existing thread on Delta-NW merger.


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## ricoba (Apr 14, 2008)

*Bye Bye Northwest --- Hello Delta*

Well they game me the answer today to my earlier question.

The brand is going to be Delta.....

So I guess it's gonna be "Deworst" & not Northworst.


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## pointsjunkie (Apr 14, 2008)

very happy for the merger, so when they join the 2 FF accounts i will have over 270,000miles. good stuff. i hope they keep the delta amex card, it is a better card IMHO.


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## falmouth3 (Apr 14, 2008)

ATLANTA - Delta Air Lines Inc. and Northwest Airlines Corp., squeezed by record high fuel prices and a slowing economy, are combining in a stock-swap deal that would create the world's biggest carrier. The boards of both companies gave the deal the go-ahead Monday.

Delta said the combined airline, which will be called Delta, will have an enterprise value of $17.7 billion. It will be based in Atlanta, and Delta CEO Richard Anderson will head the combined company.

Under the terms of the transaction, Northwest shareholders will receive 1.25 Delta shares for each Northwest share they own. The exchange ratio represents a premium to Northwest shareholders of 16.8 percent based on Monday's closing stock prices.

Delta Chairman Daniel Carp will become chairman of the new board of directors and Northwest Chairman Roy Bostock will become vice chairman. Delta President and Chief Financial Officer Ed Bastian will retain his titles.

The new board will be made up of 13 members, seven of whom will come from Delta's board, including Anderson, and five of whom will come from Northwest's board, including Bostock and Doug Steenland, the current Northwest CEO. One director will come from the Air Line Pilots Association, the union that represents pilots from both carriers.

There will be an unspecified number of job cuts or transfers through the consolidation of overlapping corporate and administrative functions, Delta said. The two airlines employ more than 80,000 people combined. The company expects no involuntary furloughs of front-line employees and said the existing pension plans for both companies' employees will be protected.

Delta doesn't plan to close any of the two airlines' hubs.

Delta also said that it has agreed with its pilot leadership to extend its existing collective bargaining agreement through the end of 2012. The agreement, which is subject to pilot ratification, will allow the combined company to realize the revenue synergies of the transaction, Delta said. It also provides the Delta pilots a 3.5 percent equity stake in the new company and other enhancements to their current contract.

The agreement does not cover Northwest pilots.

Delta said it will use its best efforts to reach a combined Delta-Northwest pilot agreement, including resolution of pilot seniority integration, prior to the closing of the merger.

U.S.-based non-pilot employees of both companies will get a 4 percent equity stake in the new airline when the deal closes, Delta said.

Northwest pilots and the union representing most of Northwest's ground workers immediately announced they would fight the combination.

Dave Stevens, chairman of the Northwest branch of the Air Line Pilots Association, said in a prepared statement, "The risk to Northwest Airlines and to the Northwest pilot group from letting this merger proceed, as it is now structured, is simply too great."

Northwest didn't consult with the union that represents its baggage handlers, ramp workers and ticket agents, said Joseph Tiberi, a spokesman for the International Association of Machinists and Aerospace Workers.

"If the airline wanted the support of their employees they should have brought us in and discussed it with us earlier," he said.

Lee Moak, head of Delta's pilots union, said Delta hopes cooler heads will prevail.

"It takes two to fight," Moak told The Associated Press. "We don't see a fight here. We see a cooperative relationship with the Northwest pilots to bring everybody to parity as soon as possible."

The two pilots unions were unable to agree on integrating seniority lists before the combination was announced. A joint contract they had reached was never consummated.

The announcement comes a year after the two carriers emerged from Chapter 11 bankruptcy protection. Both carriers are losing money again but are in much better shape than the four much-smaller airlines that have filed for bankruptcy or gone out of business in recent weeks.

The deal will need antitrust approval, and integrating the work forces of fully unionized Northwest and Delta, where pilots are currently the only major unionized work group, will be tricky.

The joining of Atlanta-based Delta and Eagan, Minn.-based Northwest, if approved by regulators and shareholders of both companies, will result in combined annual revenue of $31.7 billion, vaulting it ahead of Fort Worth, Texas-based AMR Corp.'s American Airlines for the top spot in the U.S.

It would be the biggest carrier in the world in terms of traffic, before any further domestic capacity cuts and any divestitures that might be required by antitrust regulators.

The agreement comes after several months of merger discussions between Delta and Northwest and at one time between Delta and Chicago-based UAL Corp.'s United Airlines. Analysts believe a Delta-Northwest combination will stand up better to regulatory scrutiny because the two carriers have less overlap, even though a Delta-United combination could create more scale and have greater synergies.

Years of mounting losses forced Delta and Northwest to file for bankruptcy protection in New York on Sept. 14, 2005. Both emerged from bankruptcy as leaner carriers last spring, after shedding billions in costs during their reorganizations.

While in bankruptcy, Delta fended off a hostile takeover bid by Tempe, Ariz.-based US Airways Group Inc.

Delta said its plan to remain on its own would create more value than US Airways' $9.8 billion bid, which Delta argued would not pass regulatory hurdles. The value argument never materialized, as Delta's post-emergence market capitalization started out $1 billion less than US Airways' bid and less than the $9.4 billion to $12 billion Delta projected. Its market value has fallen precipitously in the months since amid airline industry woes, including high fuel prices and a general inability to gain traction raising ticket prices.

Many analysts predicted an eventual Delta-Northwest merger after Anderson, a former Northwest CEO, was named last August to be the chief executive officer of Delta.

Anderson, who was Northwest's CEO from 2001 to 2004, immediately sought to quiet those suggestions, telling Delta's pilots union chairman the morning his appointment was announced that he believed in Delta's standalone plan and that "he was not coming in as CEO to facilitate a merger with Northwest."

But eight months later, that's what Anderson is doing, and many analysts believe he didn't have a choice amid plummeting airline market values and soaring fuel prices.

Wall Street and some airline executives have pushed for consolidation for years, arguing that too many seats are chasing too few passengers. The resulting discounting has made it hard for airlines to cover their expenses.

However, Northwest and Delta overlap relatively little in the U.S. — which could actually help them gain antitrust approval. Delta's routes are strongest in the eastern U.S. and to Latin America and Europe. Northwest would complement that with its near-lock in the Midwest along with flights to its Tokyo hub and other points in Asia.

Northwest's Asian routes have been one of its main appeals to other carriers. It and United are the only two U.S. carriers with the rights to pick up new passengers in Japan and fly them farther into Asia. Delta and Northwest also complement each other internationally because they are both part of a marketing alliance that includes Air France-KLM.

U.S. airlines get the majority of their revenue from domestic service, though that trend has shifted in recent years as more carriers, particularly Delta and Northwest, have sought to increase international service.


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## Talent312 (Apr 14, 2008)

= Looks like a win for Delta, as NWA is merging into Delta and will disappear. =


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## jjlovecub (Apr 14, 2008)

Very sad day


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## Carolinian (Apr 15, 2008)

pointsjunkie said:


> very happy for the merger, so when they join the 2 FF accounts i will have over 270,000miles. good stuff. i hope they keep the delta amex card, it is a better card IMHO.



If you like higher fares, massive fees to try to use your miles, lower bonuses, fewer upgrade opportunities, inept management, etc. then oh! it is just lovely! Is joining two ff accounts into one that is of far less value really worth that very minor convenience?

The biggest problem for consumers is not in the ff programs.  It is that if this merger gets approved, then others will follow.  That will mean less competition in the airline industry, which will mean that tickets will cost more, and in many cases a lot more.

This is absolutely dreadful news for the informed members of the travelling public.


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## Carolinian (Apr 15, 2008)

Talent312 said:


> = Looks like a win for Delta, as NWA is merging into Delta and will disappear. =




. . . and a huge loss for air travellers.


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## Carolinian (Apr 15, 2008)

THey conveniently forget the main advantages to those calling the shots - 1) CEO Doug Steenland gets in under the June deadline to collect his $10 million  golden parachute, and 2) the board members representing the shareholders who are former bankruptcy creditors get a chance to churn their stock in the illusory market of merger euphoria.

Meanwhile, NW passengers get their ff miles seriously devalued and all passengers get higher fares for the future as competition in the airline industry declines.

Time to flood the regulators with letters opposing the merger from hell that is anti-competitive and will lead to an oligopoly situation in the airline industry.


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## driftdiver (Apr 15, 2008)

Inside Flyer has a nice writeup on their speculation about the DL/NW merger impacts they expect, FF miles, etc.

Inside Flyer


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## Carol C (Apr 15, 2008)

Carolinian said:


> THey conveniently forget the main advantages to those calling the shots - 1) CEO Doug Steenland gets in under the June deadline to collect his $10 million  golden parachute, and 2) the board members representing the shareholders who are former bankruptcy creditors get a chance to churn their stock in the illusory market of merger euphoria.
> 
> Meanwhile, NW passengers get their ff miles seriously devalued and all passengers get higher fares for the future as competition in the airline industry declines.
> 
> Time to flood the regulators with letters opposing the merger from hell that is anti-competitive and will lead to an oligopoly situation in the airline industry.



Could you provide names/address for regulators? I promise to write, because I can't believe there's any good to come out of all this for mere consumers and frequent fliers.


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## Carolinian (Apr 15, 2008)

driftdiver said:


> Inside Flyer has a nice writeup on their speculation about the DL/NW merger impacts they expect, FF miles, etc.
> 
> Inside Flyer



He missed some of the biggies, like some of the new DL fees, like an extra fee for booking an award ticket on a partner, fuel surcharges on partners, and other things that NW doesn't have.  And the biggest of all is the new DL fuel surcharge on DL award tickets that they have started imposing on tickets originating in Europe and intend to expand systemwide.  This makes an award ticket on DL cost over $200 more than a similar award ticket on NW on routes from Europe.  That is a huge devaluation of miles.


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## Carolinian (Apr 15, 2008)

Carol C said:


> Could you provide names/address for regulators? I promise to write, because I can't believe there's any good to come out of all this for mere consumers and frequent fliers.



I haven't seen the address posted yet, and it will probably be best to wait until it is formally presented.  I will post the info when I get it.


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## falmouth3 (Apr 15, 2008)

*Delta SkyMiles letter*

As a SkyMiles® member, you know how important convenient worldwide connections are to your business and leisure travel plans. That's why we are excited to announce that Delta is merging with our SkyTeam® partner Northwest Airlines to create America's premier global airline. 

You've long known Delta and Northwest for our many customer and network strengths—Delta as the largest airline across the Atlantic and a leading carrier on the Eastern Seaboard; and Northwest as a leading U.S. carrier to Asia, Canada and throughout America's heartland. We're proud to bring these complementary networks together in a combination that better connects your hometown to the globe. 

The combined airline, which will be called Delta, will offer unprecedented access to the world. You will be able to fly to more destinations, have more schedule options and more opportunities to earn and redeem miles in what will become the world's largest frequent flyer program. Once we bring our operations together, we will serve more U.S. communities with convenient connections to more worldwide destinations than any other global airline. And we will be the only U.S. airline to offer direct service from the United States to the world's major business centers across Asia, Latin America, Europe, Africa and the Middle East. 

Delta will combine the individual strengths and complementary service networks of both airlines, which today focus on different parts of the country and the world. This will enable us to: 

Offer continued access to more than 390 worldwide destinations in 67 countries with no hub closures. 
Strengthen global connectivity from each of our hubs in Atlanta, Cincinnati, Detroit, Memphis, Minneapolis/St. Paul, New York, Salt Lake City, Amsterdam and Tokyo-Narita. 
Accelerate the upgrading of existing international aircraft with lie-flat seats and personal on-demand entertainment. 
Improve customers' travel experience through new products and services, including enhanced self-service tools, better bag-tracking technology, new seats and refurbished cabin interiors. 
Have the opportunity to exercise options for delivery of up to 20 widebody jets between 2010 and 2013 to provide more international service than ever before. 
While the merger is undergoing review, which is expected to be completed later this year, it will be business as usual at both airlines, and we are committed to maintaining the same industry-leading customer service and focus on safety you have come to expect from us. Once the transaction closes, any operational changes will be clearly communicated to all customers worldwide, and I assure you that we are taking steps to ensure a seamless transition. 

For more information about the merger, please visit newglobalairline.com. 

Thank you for being a loyal SkyMiles member. We look forward to serving you on your next Delta flight—anywhere in the world. 

Sincerely,

Richard Anderson
Chief Executive Officer


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## Icarus (Apr 15, 2008)

driftdiver said:


> Inside Flyer has a nice writeup on their speculation about the DL/NW merger impacts they expect, FF miles, etc.
> 
> Inside Flyer



Great article. Thanks for the link.

-David


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## Carol C (Apr 16, 2008)

T_R_Oglodyte said:


> To consolidate, I suggest this thread be merged with the existing thread on Delta-NW merger.



Steve, are you suggesting a "merger"?


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## short (Apr 16, 2008)

*Miles have not kept up with inflation*



Carolinian said:


> He missed some of the biggies, like some of the new DL fees, like an extra fee for booking an award ticket on a partner, fuel surcharges on partners, and other things that NW doesn't have.  And the biggest of all is the new DL fuel surcharge on DL award tickets that they have started imposing on tickets originating in Europe and intend to expand systemwide.  This makes an award ticket on DL cost over $200 more than a similar award ticket on NW on routes from Europe.  That is a huge devaluation of miles.



Is this a devaluation in miles or the fact that the current system of reward miles has not kept up with inflation.  I am not talking about consumer price index.  I am talking about airfare specific inflation which is partially made up of fuel increases as well as other costs like labor and taxes.  An airline can use hedging to even out spikes in fuel but you can not expect to hedge prices at 1990 levels forever.  Eventually your hedge price will rise to meet the market.

I think the merge company should take the oppertunity to scrap the old miles earning system in favor of awarding miles on miles on dollars spent not miles flown.  A person spending $1000 on a ticket would get twice as many miles as a person spending $500 on a ticket.  Change the redemption of miles to the new Delta pay with miles program available to AX Skymiles cards.  Make the system earning the same value as spending at say 1 cent per mile value.  That way if airfare goes up so does redemption miles.  If someone wants to fly to Hawaii during Christmas the pay more.  If they want to fly during the offseason when the airlines want more people to fill seats they would redeam for fewer miles.

This would be a very radical move but would line up purchases with airfares with redemption.

The mileage runners and elites on Flyer Talk would likely have a fit over such a proposal but then they are generally don't like change even if it were good for the general public.

I think I'll go over to Flyertalk and broach this idea and see how much flake I stir up.  

Short


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## x3 skier (Apr 16, 2008)

What happens, happens. This (and others) was inevitable given the price of crude above $100 a barrel. I for one prefer mergers to get a set of airlines that are financially sound (no certainty for sure) rather than flying on 40 year old DC9's from Northworst or 20+ year old MD-80's from Delta.

If fares go up to much, I probably will continue to fly, just less frequently. 

Nothing I can do about it so whatever the result, I will learn to live with the result. 

Cheers


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## Carolinian (Apr 17, 2008)

The real inflation in ff programs comes from airlines selling miles to everybody under the sun, so that people gets miles for lots of things other than butt-in-seat miles.  Of course that is a big profit center for airlines, so they are probably not about to change it.  But they may inflate miles to the point this way that they kill their own golden goose.

As to changing the reward system from a frequent flyer system to a frequent buyer system as you suggest, DL tried a version of that a few years ago and met such a strong protest by their customers and so many high-value elites left, that they had to abandon it.  See www.saveskymiles.com

Such a system might get traction if passengers could be neatly divided into high fare business flyers and low fare leisure flyers, but the reality is there is a huge group in the middle made up of mixed fare flyers.  Some are like me, with personal trips at low fares and busines trips at high fares.  Others have mainly business travel but have a travel department always looking for the lowest fare if they can get it, which is not all the time.  For us mixed fare passengers, out attitude is ''shortchange us on actual miles on our leisure tickets, and you won't get out business travel, either''.





short said:


> Is this a devaluation in miles or the fact that the current system of reward miles has not kept up with inflation.  I am not talking about consumer price index.  I am talking about airfare specific inflation which is partially made up of fuel increases as well as other costs like labor and taxes.  An airline can use hedging to even out spikes in fuel but you can not expect to hedge prices at 1990 levels forever.  Eventually your hedge price will rise to meet the market.
> 
> I think the merge company should take the oppertunity to scrap the old miles earning system in favor of awarding miles on miles on dollars spent not miles flown.  A person spending $1000 on a ticket would get twice as many miles as a person spending $500 on a ticket.  Change the redemption of miles to the new Delta pay with miles program available to AX Skymiles cards.  Make the system earning the same value as spending at say 1 cent per mile value.  That way if airfare goes up so does redemption miles.  If someone wants to fly to Hawaii during Christmas the pay more.  If they want to fly during the offseason when the airlines want more people to fill seats they would redeam for fewer miles.
> 
> ...


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## Carolinian (Apr 17, 2008)

Inevitable?  Other than Alitalia which has been a basket case for years, whatever the price of oil, airlines are doing okay on this side of the pond.  Large LCC's like EasyJet and RyanAir, which sell tickets much cheaper than US carriers, are profitable and growing.

Takeover of other airlines is no panacea, and in fact can lead to the demise of a sound airline.  SwissAir was run like a Swiss watch until it started its crusade to take over other airlines.  Now it is in the dustbin of history.  If you think taking over other airlines is a surefire way to make an airline ''financially sound'', wanna buy some Swiss Air stock?  I don't think there has ever been an airline merger in the US that has lived up to the hoopla around it, and many have been little short of disasters in the final analysis.

As far as old planes and fleet renewal, you apparently haven't kept up with Northbest.  On the international routes the DC-10s are all gone, replaced by modern, fuel efficient, passenger freindly A-330's.  Northbest also has Boeing 787 Dreamliners on order and is scheduled to be the first domestic carrier to receive them.  Retirement of the DC-9's on domestic routes is being accelerated, and the new larger Embaer and Canadair models, with a first class cabin and almost the capacity of the 9's are arriving to replace them.  Actually, as an elite I am sad to see the 9's going as they have a large first class cabin that makes upgrades almost a sure thing.  I'd much rather sit up front on an upgrade in a 9 than I would back in steerage in a newer plane. But I do know that are fuel hogs and with the current oil prices, the decision to accelerate replacement makes sense.  Oh, and Northbest also has the best cash position (cash on hand as a percentage of revenues) of any US legacy carrier.

As far as the ''nothing I can do about'' it position goes, you are wrong. US Air's self-styled ''cockroaches'' forced that airline to reverse some customer-unfriendly ff changes, as did the www.saveskymiles.com campaign at Delta.  I doubt the corporate boards are going to back down on this unless their backs are put to the wall, but mergers require DOJ approval and that is where vocal opposition can help.  Passenger opposition helped stop the UA/US merger and it can play the same role here as well.  As far as putting their backs to the wall, the boards have created a very poisonous relationship with the NW pilots and other employees.  A CHAOS campaign by pilots and perhaps other employees could really put the heat to the board, and they deserve it for selling out the interests of the airline for their own personal interests in this merger.




x3 skier said:


> What happens, happens. This (and others) was inevitable given the price of crude above $100 a barrel. I for one prefer mergers to get a set of airlines that are financially sound (no certainty for sure) rather than flying on 40 year old DC9's from Northworst or 20+ year old MD-80's from Delta.
> 
> If fares go up to much, I probably will continue to fly, just less frequently.
> 
> ...


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## Icarus (Apr 17, 2008)

I guess you might say it's fradulent of them, eh?

Northbest 

-David


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## x3 skier (Apr 17, 2008)

Carolinian said:


> Inevitable?  Other than Alitalia which has been a basket case for years, whatever the price of oil, airlines are doing okay on this side of the pond.  Large LCC's like EasyJet and RyanAir, which sell tickets much cheaper than US carriers, are profitable and growing.



If you don't mind the service and limitations and out of the way airports, Euro LCC's should be making money since their costs are lower. Southwest was one of the most profitable but since their fuel hedges are running out and their work force is aging and getting more expensive, they may eventually wind up in the same basket as the rest of the US Airlines.

Good luck in trying to stop the merger but I suspect it will happen and any campaigns against it will be marginal at best once they get DOJ Clearance and the bus drivers settle their bickering. I did participate in the save sky miles campaign FWIW.

Cheers


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## Carolinian (Apr 17, 2008)

Generally, from what I have seen most DL flyers support it and most NW flyers oppose it, and probably there is a lot of self interest in terms of ff programs each way.  The whole prospect not only of this merger, but the likely UA/CO one that will follow, will hurt all air travellers by decreasing competition and raising prices.

As to European LCC's and out of the way airports, many are changing that aspect of their model.  EasyJet has acquired GB Airways and its many slots at Gatwick, so that is becoming one of its major bases.  SkyEurope has moved its main base from Bratislava to the main Vienna airport.  Even in Bucharest, EasyJet has moved from the secondary Banaesa airport to the main Otopeni airport.  RyanAir is the main LCC not moving in this direction.





x3 skier said:


> If you don't mind the service and limitations and out of the way airports, Euro LCC's should be making money since their costs are lower. Southwest was one of the most profitable but since their fuel hedges are running out and their work force is aging and getting more expensive, they may eventually wind up in the same basket as the rest of the US Airlines.
> 
> Good luck in trying to stop the merger but I suspect it will happen and any campaigns against it will be marginal at best once they get DOJ Clearance and the bus drivers settle their bickering. I did participate in the save sky miles campaign FWIW.
> 
> Cheers


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## Carolinian (Apr 20, 2008)

Carol C said:


> Could you provide names/address for regulators? I promise to write, because I can't believe there's any good to come out of all this for mere consumers and frequent fliers.



Here is the address that has been posted on another site:

antitrust.atr@usdoj.gov


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