Delta lowers profit forecast due to new pilot contract
Delta Friday said it will take a half-a-billion-dollar hit in Q4 from a new contract that pilots approved on Thursday, which hikes pay retroactively to the beginning of 2016. Delta said it will pay US$475m in higher wages and profit-sharing for pilots, including US$380m related to the first three quarters of the year. That is expected to push down its operating profit margin about five points to between 9.5 and 10.5%. The pilot agreement raises wages 30% by 2019, just one example of the wage crunch that top airlines are facing. Excluding the impact of the new pilot deal, Delta said its margin would be at the high end of prior guidance. It said average fares were stabilizing for US flights booked at the last minute, after having fallen for months.<br/>
https://portal.staralliance.com/cms/news/hot-topics/2016-12-05/sky/delta-lowers-profit-forecast-due-to-new-pilot-contract
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Delta lowers profit forecast due to new pilot contract
Delta Friday said it will take a half-a-billion-dollar hit in Q4 from a new contract that pilots approved on Thursday, which hikes pay retroactively to the beginning of 2016. Delta said it will pay US$475m in higher wages and profit-sharing for pilots, including US$380m related to the first three quarters of the year. That is expected to push down its operating profit margin about five points to between 9.5 and 10.5%. The pilot agreement raises wages 30% by 2019, just one example of the wage crunch that top airlines are facing. Excluding the impact of the new pilot deal, Delta said its margin would be at the high end of prior guidance. It said average fares were stabilizing for US flights booked at the last minute, after having fallen for months.<br/>
