Fri, May 25, 2012
Fleet Shift Is A Win For Both Carriers
When you merge airlines, and one of the carrier's planes don't fit with your existing fleet ... what do you do? Southwest Airlines announced on Wednesday that it hopes to ink a deal to to sublease its 88 Boeing 717s inherited from its merger with AirTran to competitor Delta Airlines. The deal is a rare win-win solution to both carriers’ fleet dilemmas. Offloading the 717s will allow Southwest to revert back to its one type, Boeing’s 737, saving on training and maintenance costs while allowing Delta to replace older DC-9s and 50-seat regional jets. The 717 shares a common type rating with the DC-9, so cross-training between types is minimal.
There are, however, a few details to be ironed out before finalizing the deal. Delta will take the planes starting next year so long as its pilots approve a new labor contract, which is not guaranteed.
Dow Jones Newswires reports Southwest COO Mike Van de Ven as saying "This is a very complex transaction that requires time and close coordination with multiple parties. While we do have a tentative agreement with Delta, final details must be completed with all parties before a binding agreement between Delta and Southwest can be completed."
If the details can be worked out, Delta will begin taking the 717s in mid-2013 at three per month until all 88 aircraft are accounted for. Delta does not expect a net increase in capacity from the deal. The airline is looking to buy up to 70 larger regional jets with 76 seats as the 717s join the fleet, allowing it to retire more of the 50-seat regional jets and DC-9s. Delta pilots will gain jobs through the addition of the 717s to the fleet.
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