And until a vaccine is widely available, the industry recovery will be choppy at best.

American Airlines CEO Doug Parker told his employees a week ago that American stood to get $12 billion of the $50 billion of help available because of it is the world's largest airline. Passengers aren’t rushing back. But for airlines, it is a headache — a big and unpredictable expense that confounds managers.“A lot of energy guys hate it, and I can understand why, because we’re taking money out of their pockets,” Ed Bastian, the airline’s current chief executive and then president, said at an industry conference in 2012.But the refinery made only modest profits some years and lost money in others. Risky Business. But the Delta shares began rising in early April after it agreed to take $5.4 billion in aid under the CARES Act. Delta’s foray into oil refining illustrates some of the reasons the business was in trouble even before the pandemic. He said April's schedule will be down "at least 80% smaller than originally planned, with 115,000 flights canceled. It Didn’t Go as Planned. That math suggested other airlines would be foolish not to make similar purchases.“Everybody was kind of content to watch what Delta did with it and if it made a whole lot of sense you might have seen others replicate it, but in this case that’s not what happened,” said Helane Becker, a managing director and senior airline analyst at Cowen, an investment bank.While the refinery had some decent years, it never yielded the amount of jet fuel that the airline had originally hoped for relative to other fuels. The market capitalization of $20 billion is just 42% of last year’s revenue.But there is the virus. It said it was taking in just $1 million a day in bookings and ancillary fees, down from $22 million during April last year. Chat with us in Facebook Messenger. Copyright © 2020 InvestorPlace Media, LLC. It previously held 11% of Delta's shares, and 10.3% of Southwest before the recent sales, along with 10% of Berkshire is among the three largest shareholders of all four airlines. “It will be interesting to see how long it takes for people to regain comfort about getting on a plane if and when we have a vaccine.”Marathon Petroleum, the nation’s biggest independent refiner, announced last month that it would shut down two refineries in California and New Mexico.

But it's not expecting any significant rebound soon. Employees face a hard choice between taking voluntary severance now or being laid off That may not be enough.
International flights averaged 29 passengers.During the pandemic, Delta has announced it reducing its domestic flying by 80% and international flights by 90%.

Refinery executives have many long-term worries, like stricter fuel economy standards and the growth of electric vehicles. “But our plans have not changed with respect to the refinery right now.”As Delta’s demand for jet fuel has dropped, Monroe has switched to producing more diesel. Oakland will no longer have service, with San Francisco International as the alternative. International travel remains very limited.
refineries made good money in recent years exporting gasoline, diesel and jet fuel. Airlines that did not file by Friday stood the risk that there would not be money available to them when they did.There's another $25 billion in loan support available as part of the package. This year, as the coronavirus hammered demand for air travel, it has become a liability for Delta, widely considered by analysts as one of the best-run airlines in the country.The energy industry critics Mr. Bastian dismissed appear to have correctly identified the flaws in Delta’s strategy. Copyright © Nasdaq

Factset: FactSet Research Systems Inc.2018.

But it would be the right bailout to take.Article printed from InvestorPlace Media, https://investorplace.com/2020/06/delta-dal-stock-bankruptcy-best-bailout-cares-act/.Financial Market Data powered by FinancialContent Services, Inc. All rights reserved. All rights reserved. Nevertheless, Delta has argued that the facility helps to blunt the effect of the volatile energy market and lowers jet fuel prices across the board by boosting supplies.The refinery relied largely on crude shipped by rail from the Bakken Formation in North Dakota.

Picture is an Airbus A321. All rights reserved. ... civility that it might make some passengers go out of their way to fly the airline. That change encouraged companies to build pipelines that took Bakken crude more cheaply south for export or refining in Gulf Coast refineries.Executives at Delta and its refinery declined requests for comment.In a recent conference call, Paul Jacobson, the airline’s chief financial officer, said that the plant was operating “at break-even levels” after a steep April loss. The harder today’s negotiations, the more likely future shareholders will prosper.


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