It’s pretty much the same story every day: X Airline says that they’ll go bankrupt unless employees take a pay cut.
For the first time, Delta has suggested that bankruptcy may not be that far off. In a filing with the SEC, the carrier said:
“If we cannot achieve a competitive cost structure, regain sustained profitability and access the capital markets on acceptable terms, we will need to pursue alternative courses of action intended to make us viable for the long term, including the possibility of seeking to restructure our costs under Chapter 11 of the US Bankruptcy code…”
Delta says that its pilots, who are the highest paid in the industry, are the cause of its financial woes. The carrier is seeking $800 million in concessions, including a 30% pay cut. Its pilots have offered a 9% pay cut.
I heard a story from a former colleague who lives near a Delta pilot. The pilot told him that other pilots felt it was ridiculous to give back any pay because the airline may still go bankrupt even with the pay cuts—he pointed to all of the givebacks at US Airways, which is still in financial turmoil. If this pilot represents the views of the others, this negotiation will likely go down to the wire—just as it did at American.