Wednesday, July 15, 2015

Pilot vote leads Delta to cancel order for 40 737-900ERs, 20 E-190s

Delta Air Lines’ order for 40 new Boeing 737-900ERs and 20 used Embraer E-190s has been shelved owing to the carrier’s pilots rejecting a tentative agreement on a new labor contract.

“Those orders will be canceled,” CEO Richard Anderson said Wednesday when asked about the aircraft on Delta’s second-quarter earnings conference call. Delta executives and the Air Line Pilots Association (ALPA) had reached a tentative agreement on a three-year labor pact to replace the pilots’ current contract expiring at the end of this year.

Delta said the terms of the deal allowed it to place the order for 60 aircraft, including 20 E-190s it planned to place into mainline service.

The Delta Master Executive Council (MEC) of ALPA endorsed the tentative labor deal in June and sent it to the airline’s nearly 13,000 pilots for a ratification vote. But ALPA announced late last week that the rank-and-file pilots, more than 10,000 of whom cast ballots, rejected the contract by a 65%-35% margin.

Anderson said he was “disappointed” by the pilots’ vote and noted that the rejected contract would have made the flight deck crew the highest paid in the US airline industry. But he pointed out that the sides still have more than five months to negotiate before the current contract expires.

Though the agreement rejected by the pilots included an immediate 8% pay raise and further salary hikes over the course of the three-year contract, it also made changes in profit sharing that a wide majority of Delta’s pilots apparently won’t accept. The Delta MEC said it will meet July 21 to “reassess our strategic plan.”

(Aaron Karp - ATWOnline News)

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