worldtraveler
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Delta Will Surive And Thrive

Thu Mar 09, 2006 10:03 am

Bashing Delta or wishing for its demise has been one of the more popular pastimes of this board. It’s time to lay out a sound case for why DL will not only thrive but survive. For those of you who work for or are passengers of Delta, you have lots of reasons to have hope. For those of you who work for competitors, you have a formidable challenge on your hands. And for those of you who like to see Cinderella stories, one is being written before your very eyes.

First, DL has a pre-deregulation legacy of being one of best run airlines in the world. To be sure, DL hasn’t had the industry leadership since the US domestic airline industry was deregulated in 1978 that it did before but it still has done very well since deregulation. First, Delta has been given nothing in its 75 year history – quite a contrast to that of many of its legacy competitors. Delta never was given the choice industry routes and never had the access to the big cities in the US or overseas that seemed to provide unlimited opportunities for competitors like American, United, and Northwest. Delta has always fought very hard for what it has and in the process, outlived airlines like Eastern, Pan Am, and TWA that had been given much more to work with.

Delta’s profitable strategy was exactly what has now created so much difficulty for it: DL built a route system designed to blanket the US, particularly the eastern US, with access to more cities than any other airline. Because its home in the southeast US was full of many small cities, DL had to carry traffic through hubs. And DL’s home in Georgia was right next to Florida, one of the world’s top vacation destinations, providing a seemingly endless supply of passengers to fill its jets.

Make no mistake. Delta’s strategy of high frequency connecting service in the SE was very profitable. Until 2001. 9/11 in itself wasn’t the issue but rather the pulldown that was necessary by the legacy carriers to survive the terrorist attacks. And as the legacy carriers pulled down capacity, the low fare carriers took advantage of the opportunity to grow. And they did. Although low fare carriers had long existed, the tipping point was reached. Customers knew that low fares were available between most regions of the country, even if it meant traveling to an alternate airport. As such, the legacy carriers could no longer charge $2000 for roundtrip flights by business people. And Delta’s seemingly personal wealth stash began to vanish. DL’s strategy was very valid… but for a different era.

The regional jet played a role, too. Delta saw the opportunity to grow its network and deployed more regional jets through its partners than any other airline – and strengthened its already formidable domestic route network. But as other carriers began acquiring regional jets, no market was inaccessible to other carriers. Not only did LFCs put pressure on nonstop flights and in connecting markets subject to an LFC presence but regional jets meant that the few remaining premium connecting markets were “fair” game for all of the legacy carriers, including those in the SE where DL had long been able to command a significant revenue premium.

As with most companies that must rework its strategies in order to survive, Delta only got part of the formula right in its first attempts. Delta slowly began to pull down connecting capacity, starting with DFW where it never gained a significant share of the local market against American. Even though SLC and CVG are small cities, they have fared better in DL’s efforts to cut back capacity. CVG does have a strong business base even though it is small while SLC generates much more traffic than a city of its size normally does due to Utah’s attraction as a leisure and religious center. But the missing piece in DL’s turnaround plan – as is true in most companies – is that DL did not find new sources of revenue or deploy assets effectively into new markets.

That has changed. In a big way. DL’s strategy of providing lots of domestic capacity meant that it had an unusually high percentage of widebody aircraft in its fleet. When the L1011s were retired, DL made the decision to replace 300 seat domestic L1011s with 287 seat 767-400s, an aircraft that has substantial capabilities despite it being one of Boeing’s least popular models. The light bulbs finally went off in some Delta people’s heads that those 767-400s plus some of DLs 767-300ERs that were flying domestic routes could and should be redeployed to international routes. Because DL has nearly 30 767-300s and 400s that can be redeployed, the international growth prospects are enormous. Even after retiring the 15 767-200s, DL still has the world's largest fleet of 767s, a very capable and cost-efficient aircraft. So far, DL has announced plans to use only about 1/3 of the “newly discovered” international capabilities of its 767 fleet. And DL’s international growth capacity is even larger if it decides to start flying 757s on overseas routes, potentially providing the opportunity to develop secondary markets in the UK and far western Europe as well as from Boston deeper into Europe or from the US deeper into S. America. More significantly, by pulling substantial capacity out of its domestic network, Delta is not only improving its domestic revenue performance but will help many of its competitors that carry connecting passengers as well. However, DL’s huge fleet of regional jets will ensure that markets without nonstop service but could have an RJ flight will probably get one from one of DL’s partners and that DL will have abundant capacity to feed its international network.

Delta also struggled for much of its existence about whether it was a first tier or second tier airline. I consider American and United as 1st tier airlines because their route systems are built around the US and world’s largest cities. Delta and Northwest, on the other hand, historically have built their route systems around smaller cities and both US and global regions. But DL and NW have owned the regions from which they fly…until everyone showed up with regional jets. Delta particularly has had a large presence in key business centers such as New York and Los Angeles but has regionalized its presence from those cities, serving primarily Florida from New York and east coast cities (its hubs and Florida) from LA.

You will see Delta becoming much more of a 1st tier carrier than it has been in the past.

Delta’s strategy shift is one of the most significant at any airline and even among other industries. Delta still has one of the most expansive domestic route networks of any airline and can make money carrying domestic connecting passengers – but they will pay much higher fares. And that huge domestic route network is well-suited to carrying passengers to the far corners of the world. Most of Delta’s current and expansionary international routes are to/from places where there is limited service by other US carriers (such as to smaller cities in continental Europe or Africa) or in O&Ds where other carriers cannot connect the hundreds of small markets that are part of every international destination. Eastern Europe is growing at rates as fast as economies in Asia and yet no other US airline serves Eastern Europe nor does any Eastern European country have a particularly strong local airline; the Eastern European market is for Delta to take away from the big three European carriers that carry most Eastern European passengers to and from the US via their western European hubs. To be sure, however, DL is also asserting itself in key local international markets such as from New York to Latin America. And Latin America represents a considerable growth opportunity for Delta. Although it has operated Latin American flights almost exclusively from ATL, Delta has become the 2nd largest airline to deep S. America and will likely surpass CO this year as being the largest airline to all of S. America. ATL is very well positioned geographically to develop new Latin markets which are already served from Miami and Houston. And DL’s growth prospects are very significant when they begin to develop JFK as a Latin American gateway. LAX and Florida also hold the potential for significant Latin growth prospects.

After years of struggling to find its role in the deregulated environment, DL now knows what they should be and do...not just what they should not do. That is key in recognizing that DL's turnaround plan is sound and geared for success.

It is not surprising that the template for Delta’s network turnaround has come in no small measure from Continental, an airline that spent decades and two bankruptcies trying to find itself after deregulation. Today, CO acts much more like a 1st tier airline than DL or NW although it has very little market share outside of its hubs. CO has used its assets extraordinarily well, possible both by having a major hub on one of the coasts but also because of NYC’s location relative to western Europe and Latin America which dovetails nicely with CO’s narrowbody capabilities. EWR became CO’s primary new source of revenue in the same way that DL is growing revenue through its international expansion. Further, two of CO’s former top network leaders are now doing the same job at Delta. It seems particularly ironic that the people who jeer Delta today are the same ones who rightfully laud Continental as running an extraordinarily good airline. And they do. DL will best CO at its game in just one trip through bankruptcy.

However, Delta has an even greater chance of success than CO because it has a much larger fleet of international capable aircraft, has a nationwide route system, and has multiple hubs which are capable of supporting international traffic (ie. despite the domestic cutbacks, CVG has more int’l air service than any similar sized city in population or wealth and it’s all provided by Delta and continues to do well despite the domestic cutbacks). Delta has many opportunities ahead of it but for the 1st time in perhaps 25 years, Delta has a vision of what it can be and the resources to make it happen. And while Delta has almost limitless growth potential over the next few years, its domestic competitors have very little growth capacity available to them. Because it still has a very large fleet of regional jets of all types, Delta is in very good shape to become an extraordinarily strong international airline while giving up very little of its domestic network through aircraft downsizing. Just as CO did in the 90s, Delta will possess a strong ability to grow relative to its domestic and international competitors given the cost advantage that Delta will have.

No US airline has developed and maintained the dense worldwide route systems that characterize British Airways, Air France, and Lufthansa. Based on the route announcements and rumors we have seen and heard over the past few months, Delta could very well have the most expansive international route network of any US airline. There will still clearly still be holes in their network but Delta should be able to fill those holes from a position of strength in the not too distant future.

However, a strong network isn’t the only ingredient necessary for a successful airline. Airlines end up in bankruptcy because of damaged finances. To their credit, American Airlines is the only legacy airline that has managed to avoid bankruptcy throughout its history and they have done that by responding to the threats that challenged their business and their balance sheet. However, bankruptcy is not all bad and CO again stands an example of a company that successfully used bankruptcy not only as an opportunity to develop a new strategy but also to clean up the damage from years of losses that resulted from those flawed strategies. To be sure, CO is still a highly leveraged airline and extraordinarily leveraged when compared with other industries but it is generating the revenues necessary to service its debt.

Again, Delta will have an advantage in its financial restructuring when compared with other airlines. Delta entered bankruptcy with the highest amount of unsecured debt of any US airline: $4 billion; its previously strong finances allowed it to offer unsecured debt that others could not. Ironically, Delta tried to renegotiate much of its unsecured debt in the 18 months prior to its bankruptcy filing, but without success. Most of those debt holders will end up with pennies on the dollar but with a stake in the reorganized Delta Air Lines. Put in another perspective, those unsecured debt holders in a sense supported Delta through several years of losses post 9/11.

By being near the back of the pack of airlines that have filed for bankruptcy in this business cycle, Delta has learned a lot. It has learned that it will not accept debt-only exit bankruptcy financing as one airline has done; replacing the debt that one came into bankruptcy with new debt doesn’t do much to provide a platform for success. Delta has also learned that a business needs capital to grow – necessary to keep costs down as the LFCs are good at doing but as they develop new business opportunities. DL’s route development over the next several years will be worthless if it cannot obtain the ultra long haul aircraft necessary to convert many of these new far flung markets into nonstop routes which will be necessary to build premium revenue. Further, DL still needs a cost efficient 100 seat airplane and it is very doubtful that Boeing, as Delta’s exclusive airframe supplier, will cede not only Delta’s business in that segment but also that of the entire industry to a Brazilian company. Boeing has no choice but to build a plane that meets Delta’s needs. Boeing will build it and Delta will fly it. Delta will have the finances necessary to build its business. Even in bankruptcy, Delta is upgrading its cabin interiors and airport facilities. Failing to invest in the business for any period of time is tantamount to deciding that you will not be a class leading competitor in your industry. Most importantly, DL is laying the framework to be a profitable airline which will ensure that it has the financial resources to remain a viable company. Having the lowest costs among the legacy carriers will serve as a huge advantage for Delta, just as it has in the past when Delta was one of the most efficient and lowest cost producers. It is not lost on DL’s leaders today that DL’s losses began to mount when it lost its cost advantage. Bankruptcy has been a powerful wakeup call for Delta. It has reenergized Delta as it has not been energized in decades and required it to develop the strategies and plans necessary to survive and thrive in the current airline environment.

People make up the final wing on which the retooled Delta will fly. Long recognized before deregulation as being one of the best companies in the world to work for, Delta has allowed its relationship with its employees to be badly damaged and has done little to improve it. Even though Delta employees have historically been well paid when compared with their peers, Delta employees were not happy. Delta has cut pay over multiple occasions rather than doing it once in a large enough measure to ensure success. While many people would like to think otherwise, high pay is not in and of itself a key to happiness at work. Continental employees have considered their airline one of the best to work for and yet they haven’t made industry leading salaries in a very long time. They do, however, share in their company’s success and are given considerable credit for their efforts at running their airline. You will see Delta moving from a patriarchal institution to one which is much more entrepreneurial in nature and in which employees are encouraged to see Delta’s goals as their own – exactly as it was for decades before deregulation. Delta succeeded because its employees understood what it took for the company to survive and made Delta succeed, to their mutual benefit. A confrontational work environment epitomized by salary cuts is never successful and that is the environment Delta has had for the better part of the past 15 years. As Delta people become competitively compensated, the confrontation and takebacks will come to an end and Delta people can share in their company’s hope in the future.

Delta has not forgotten how to run a profitable airline. It has taken longer than many of us would have liked for them to find a new way but they have obviously found it and are executing to make it win. Just you watch and see.
 
mirrodie
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 10:15 am

So are you either a DL stockholder or are you the CEO?

It was an interesting read I guess. But hanging on to hopes like that is as useful as listening to DL naysayers.
So I an not sure the point of the thread....
to warn us???
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Aeroflot777
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 10:17 am

WoW! How long did that take you to type?!? But anyways...intersting read! I surely hope DL will pull through, I wish them best of luck!

Aeroflot777
 
LambertMan
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 10:26 am

Wow. Someone care to summarize so I don't have to spend the whole night reading it?
 
aircanada014
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 10:40 am

I don't want to be rude or anything, I do have respect for the airline Delta, but why do we have to concentrate on DL. There's seem to be more topic on DL than any other airlines. I know that I have a choice to read it or not but just seeing so many topics about DL. Isn't it time to think about something else beside DL. Not much topic regarding NW. I guess you all prefer DL more than NW.
 
nonrevman
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 10:43 am

Is this a thesis?

I do think that international expansion will help as well as the buildup in SLC and JFK. It is about time something besides ATL got some attention. No, I am not bashing DL, I just think it is exceedingly dangerous to place all of one's eggs in one basket. A well balanced route structure in addition to expanding to cities that can provide profit are a big help indeed. Hopefully they will start making money soon, because many of the jets approaching the retirement age will need replacement.
 
OttoPylit
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 10:50 am

WorldTraveler,

A very good outlook and a good read. But beware, as we have seen already, the doom and gloom crowd hate logic and reason.


And to help clarify just how fare DL can reach with its widebodies, DL has 105 763 and 764's, with options for 34 more, and the next 777 is scheduled for delivery early 2008. A pretty impressive fleet for expansion opportunities.



OttoPylit
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Alias1024
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:02 am

I want what he's smoking!!!!

Quoting WorldTraveler (Thread starter):
First, DL has a pre-deregulation legacy of being one of best run airlines in the world.

Totally irrelevant. How much of their current management was there before 1978? The only management that counts is the one in place now. They fix it or they file for Ch. 7

Quoting WorldTraveler (Thread starter):
And while Delta has almost limitless growth potential over the next few years, its domestic competitors have very little growth capacity available to them.

Please explain why Delta has limitless growth potential while others do not.

Quoting WorldTraveler (Thread starter):
Just as CO did in the 90s, Delta will possess a strong ability to grow relative to its domestic and international competitors given the cost advantage that Delta will have.

Cost advantages? UA, US, and NW have all been to bankruptcy court. Do you think their costs might be able to compete? Will Delta's costs be lower than say AirTran? Probably not.

Quoting WorldTraveler (Thread starter):
Delta has not forgotten how to run a profitable airline. It has taken longer than many of us would have liked for them to find a new way but they have obviously found it and are executing to make it win.

What's obvious is that they are hemmoraging red ink. Now, their only idea for fixing it is to try and copy CO. But CO has a major hub at NYC, offering a great mix of O&D and connecting traffic for their international flights. Pulling out a CO route map and copying isn't going to work from JFK. Delta doesn't have the domestic feed, even with the recently announced expansion.

There isn't any real proof that the current management ever knew how to run a profitable airline. I don't think they forgot, I think they never had it figured out. Don't forget, this is the management that implemented Simplifares, capping their potential exploit their most loyal and profitable customers.
It is a mistake to think you can solve any major problems with just potatoes.
 
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SLCUT2777
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:05 am

What reeally killed DL was Leo Mullin's tenure as CEO. His direction to acquire network carriers ASA and ComAir clearly contributed more than anything to Delta's downfall, and Grinstien and company are left to pick up the pieces. ASA was sold for not even half the price that was paid for them 7-8 years earlier. Real swell throw away of capitol Leo! Sad While Grinstien was on the board during Mullin's tenure, he was more proactive as CEO of Burlington Northern/Santa Fe RR during that time after coming off a successful stint as CEO of Western Airlines. The thing people need to watch Grinstien for is that as a corporate attorney his trademark is merger anti-trust and he is the architect of two major mergers in the transportation industry. During the 1980's he was the architect of the DL/WA merger that was completed in 1987, and subequently during the early 1990's he again was successful in merging Burlington Northern Railraod with the Atchison, Topeka & Santa Fe RR System, this after the later was unsuccessful a few years earlier with a merger with Southern Pacific (later acquired by Union Pacific).
If Delta is to survive, I can only be certain that Grinstien, now well into his 70's, is looking at merger possabilities once he gets DL out of the restructuring process. Who will Delta merge with if they are to be the big dominant carrier you envision them to be? NWA, Continental? Late 2007-2008 will likely be when this happens. Stay tuned.  crossfingers 
DELTA Air Lines; The Only Way To Fly from Salt Lake City; Let the Western Heritage always be with Delta!
 
isitsafenow
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:06 am

As Danny DeVito once said in a movie...."amen.....amen because you just heard
a prayer".
I like Delta....I use them number three in my most of my travels behind 1. my Buick, 2. NW 3. Delta......
I wish the widget well but their problems may be too deep and the timing too late......but we shall see what the pilots do...strike? then, its turn out the lights.
No strike? Lots of ground to cover to get back to making $$$$$$.
safe
If two people agree on EVERYTHING, then one isn't necessary.
 
767-332ER
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:08 am

Amen my friend. You said it best with great pride for a great airline. Welcome to my RI.

Regards and may the widget keep flying high!
Twinjets...if one fails, work the other one twice as hard!!!
 
incitatus
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:20 am

While I appreciate the information provided, I don't currently share the optimism. Given that this was extra long, I'll dwell in a few parts only.

Delta is not Continental. Continental has a hub at Newark and had a solid following there before it went past 6 destinations in Europe. Delta will never have a similar operation at JFK. For Delta to effectively serve Europe, it needs two flights to every destination: one from JFK and one from ATL. Continental only needs one from Newark. Continental has an unbeatable competitive advantage - no other US airline can touch that.

Boston to Europe on Delta will not work any time soon, and that just comes to show the over-optimism of the entire posting. And in New York they have to fight for market share with Continental, American and JetBlue.

Expansion is not the same as success in airlines. Can most flights be consistently profitable? I am even more skeptical seeing that both Northwest and United have reduced frequencies across the Atlantic. They are willing to cede space to Delta, a symptom that the market is at best barely profitable. While placing long-haul planes in long-haul markets is a good move, Delta still has too many aircraft and their inability to figure that out will only make their adjustment longer and more painful.
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BigGSFO
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:22 am

Dang that was a novel.

Quoting Alias1024 (Reply 7):
Quoting WorldTraveler (Thread starter):
And while Delta has almost limitless growth potential over the next few years, its domestic competitors have very little growth capacity available to them.

Please explain why Delta has limitless growth potential while others do not.

I agree with Alias. DL's growth potential is just as limited (or limiltess) than it's compeitors. AA has just as much opporuntiy, if not much more given their current route network, than DL to grow. UA and CO too. ATL, by far DL's most dominant market, is reaching critical mass and very soon will run out of profitable destinations which can be added. JFK has opportunities, but the New York marketplace is finite and competition fierce, and DL does not have the same metro dominance in NYC as they do in ATL. CVG are SLC are very limited markets.

Nonetheles I appreciate your zeal for DL. Although I am not a big fan of them, I do wish them the best and believe they will survive, which they must do first, before they can thrive.
 
luv2fly
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:26 am

Quoting WorldTraveler (Thread starter):
First, Delta has been given nothing in its 75 year history – quite a contrast to that of many of its legacy competitors. Delta never was given the choice industry routes and never had the access to the big cities in the US or overseas that seemed to provide unlimited opportunities for competitors like American, United, and Northwest

Hate to burst your bubble here, AA and UA both bought LON from TW and PA respectively. DL bought the rest of PA and even sold parts of it off for profit, i.e. LGW from DTW to NW for Millions of dollars.
You can cut the irony with a knife
 
767-332ER
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:36 am

Quoting Luv2fly (Reply 13):
Hate to burst your bubble here, AA and UA both bought LON from TW and PA respectively. DL bought the rest of PA and even sold parts of it off for profit, i.e. LGW from DTW to NW for Millions of dollars.

Okay, one example but how would DTW-LGW work for DL?

Give me some more examples where DL's 'inheritance' from PA was as beneficial internationally as UA, AA and others. I wouldn't even necessarily consider DTW-LGW a "big opportunity."

Now, DL did inherit a number of rights to "secondary" European cities, such as JFK-FRA and the FRA mini-hub (only exploited by DL until the mid 1990's). Everything else served from the ATL megahub was created in its own by Delta. The only thing that was beneficial from the PA inheritance were the extra L1011-500's and the need to fill the international void left by PA's demise.
Twinjets...if one fails, work the other one twice as hard!!!
 
malaysia
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:41 am

I think I need to go to bed soon... the posting was perfect for shut-eye to me
There Are Those Who Believe That There May Yet Be Other Airlines Who Even Now Fight To Survive Beyond The Heavens
 
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SLCUT2777
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:43 am

Quoting 767-332ER (Reply 14):
Okay, one example but how would DTW-LGW work for DL?

Quite honestly if NW went chapter 7 and liquidated, DL would do very well to move that hub operation north up I-75 to DTW since the O&D numbers would be substantially better than what CVG could offer.
DELTA Air Lines; The Only Way To Fly from Salt Lake City; Let the Western Heritage always be with Delta!
 
luv2fly
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:44 am

Quoting 767-332ER (Reply 14):
Give me some more examples where DL's 'inheritance' from PA was as beneficial internationally as UA, AA and others. I wouldn't even necessarily consider DTW-LGW a "big opportunity."

For one DL did not pay the price tag that both AA and UA paid for the rights for LON, also the one route in question and I am going from memory was purchased from DL by NW for close to 14 million dollars, not a bad chunck of change if you ask me.

Also AA, UA, NW and CO all grew Europe one destination at a time.

[Edited 2006-03-09 03:47:17]

[Edited 2006-03-09 03:48:17]
You can cut the irony with a knife
 
jacobin777
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:49 am

Quoting Aeroflot777 (Reply 2):
WoW! How long did that take you to type?!? But anyways...intersting read! I surely hope DL will pull through, I wish them best of luck!

Aeroflot777

I was thinking the same thing.....maybe he used IBM's ViaVoice or something. Smile

it was an interesting read, but I agree with most on this board.....DL has big up hill battle on its hands.......though I hope it makes it.....
"Up the Irons!"
 
SESGDL
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:54 am

Quoting Incitatus (Reply 11):
Delta is not Continental. Continental has a hub at Newark and had a solid following there before it went past 6 destinations in Europe. Delta will never have a similar operation at JFK. For Delta to effectively serve Europe, it needs two flights to every destination: one from JFK and one from ATL. Continental only needs one from Newark. Continental has an unbeatable competitive advantage - no other US airline can touch that.

Many DL destinations are served to Europe strictly from JFK: TXL, VCE (ATL starting soon), NCE (ATL starting soon), ATH, BUD (soon), KBP (soon), IST, and for a while SVO. DL has long depended on O&D routes to Europe from JFK, while CO has to depend of heavy feed just to fill 757s to some destinations. Your info is wrong, DL is by no means trying to create a Continental-type operation.

Jeremy
 
avconsultant
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 12:09 pm

Keep in mind DL has $29 Billion in debt held by 2 banks - GECAS and American Express. Their expectation on returns will be more agressive than an investment group. In order to pay off this debt, DL will not be profitable for awhile. DL needs to look at expansion into Asia. The loss of the China route might be crucial.

I predict DAL will be purchased within 3 years.
 
travelin man
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 12:34 pm

Quoting WorldTraveler (Thread starter):
Delta never was given the choice industry routes and never had the access to the big cities in the US or overseas that seemed to provide unlimited opportunities for competitors like American, United, and Northwest.

AA and UA both BOUGHT their LHR rights. They weren't given to them. If DL didn't outbid their competitors for those rights, then I guess it doesn't speak well for the "best managed" airline of the past 75 years.

Quoting WorldTraveler (Thread starter):
Although it has operated Latin American flights almost exclusively from ATL, Delta has become the 2nd largest airline to deep S. America and will likely surpass CO this year as being the largest airline to all of S. America.

DL is larger than AA to South America? To be quite honest, I would be shocked to find out that is true. AA is huge to South America.

Quoting WorldTraveler (Thread starter):
There will still clearly still be holes in their network but Delta should be able to fill those holes from a position of strength in the not too distant future.

How will they fill their holes in Asia or the South Pacific? The only thing mentioned is potentially serving SYD through HNL. They have NO aircraft that can go trans-Pacific. And, trans-Pacific is currently the biggest hole in their route structure. With no available aircraft capable of doing trans-Pacific, how will they fill that (huge) hole in the "not too distant future"?

I also notice you didn't mention their alliance as a reason for hope. Currently Skyteam is the weakest of the "Big 3" alliances. Without significant additions in Asia, Skyteam will continue to be a second-tier alliance, with financially shaky carriers (AF and KL excepted). Star and OneWorld help make AA and UA "tier 1" airlines. I don't think Skyteam provides DL with the same synergies.

I'm not bashing DL (I flew them here to ATL, where I'm on business). But painting such an overly-optimistic portrait of DL's future, while not acknowledging some obvious weaknesses, merely invites people to poke holes in your post.

I wish DL the best of luck, and I don't think they'll go Chapter 7 any time soon. But DL definitely has some hurdles to overcome.
 
incitatus
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 1:10 pm

Quoting SESGDL (Reply 19):
Your info is wrong, DL is by no means trying to create a Continental-type operation.

What's wrong is the suggestion of the original poster that DL can pull off the same kind of expansion. Wait... no, he said "Delta has an even greater chance of success than CO (...)". So apparently it's not going to be a Continental-type operation - it will leave CO's eating dust. Yes, dream on.
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LawnDart
Posts: 861
Joined: Fri May 20, 2005 11:33 pm

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 1:35 pm

Quoting Travelin man (Reply 21):
They have NO aircraft that can go trans-Pacific.

What, exactly, would you consider the ATL-NRT route? And what, exactly, does DL operate it with?

Quoting Travelin man (Reply 21):
Currently Skyteam is the weakest of the "Big 3" alliances.

How do you figure Skyteam as being the weakest of the "Big 3" (there are only 3, aren't there?) alliances? Passengers carried? Cities served?

Quoting Travelin man (Reply 21):
But painting such an overly-optimistic portrait of DL's future, while not acknowledging some obvious weaknesses, merely invites people to poke holes in your post.

While I have to agree the original post was a little on the overly-optimistic side, be careful about how you poke, lest you be poked in return.
 
travelin man
Posts: 3198
Joined: Tue Mar 14, 2000 10:04 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 2:23 pm

Quoting LawnDart (Reply 23):
What, exactly, would you consider the ATL-NRT route? And what, exactly, does DL operate it with?

What I said was:

Quoting Travelin man (Reply 21):
With no available aircraft capable of doing trans-Pacific, how will they fill that (huge) hole in the "not too distant future"?

DL's HUGE hole is Asia. They do not have AVAILABLE aircraft to fill that hole in the "not too distant future" per the original poster's assertion. No 777s are available for additional flying to Asia. The 767s cannot make it trans-Atlantic. So perhaps you can enlighten me on how they will fill that hole in the "not too distant future"???

Quoting LawnDart (Reply 23):
How do you figure Skyteam as being the weakest of the "Big 3" (there are only 3, aren't there?) alliances? Passengers carried? Cities served?

Well, for one, the health of the carriers within the alliance. DL? AZ? NW? KL/AF are strong, but they are matched by the health of BA and LH. In addition, OneWorld and Star fly to more destinations, serve more countries, and have a bigger fleet than Skyteam.

Star Alliance:
Annual passengers: 382.6 million
Countries served: 138
Airports served: 790
Fleet: 2832

OneWorld:
Annual passengers: 304.5 million
Countries served: 141
Airports served: 689
Fleet: 2285

Skyteam:
Annual passengers: 343.6 million
Countries served: 133
Airports served: 684
Fleet: 2069

With the exception of passengers served, OneWorld and Star have Skyteam beat. And my real point was the huge hole Skyteam has to Australia, New Zealand, and Southeast Asia. But yes, if you want to travel from North America to Europe, Skyteam is quite strong.

[Edited 2006-03-09 06:28:05]
 
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SLCUT2777
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 3:51 pm

SkyTeam is the weakest of all the FF alliances and the shakiest at the moment. NW is a liquidation possability and CO is a possible defector. If NW goes down and CO defects to OneWorld, SkyTeam crashes and burns, and DL goes over to Star.
DELTA Air Lines; The Only Way To Fly from Salt Lake City; Let the Western Heritage always be with Delta!
 
DC10GUY
Posts: 2590
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 4:17 pm

WOW what a bag of wind. Its pretty simple really, Delta has way too much debt, promised employees pensions that it can't afford and paid huge salaries to executives that where more interested in there own wealth then the airline. Now they have to deal with it. So I say go Air tran go !!!
Next time try the old "dirty Sanchez" She'll love it !!!
 
flyibaby
Posts: 717
Joined: Wed Aug 25, 2004 5:23 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 4:23 pm

Quoting Travelin man (Reply 24):
Well, for one, the health of the carriers within the alliance. DL? AZ? NW? KL/AF are strong, but they are matched by the health of BA and LH. In addition, OneWorld and Star fly to more destinations, serve more countries, and have a bigger fleet than Skyteam.

Star Alliance:
Annual passengers: 382.6 million
Countries served: 138
Airports served: 790
Fleet: 2832

OneWorld:
Annual passengers: 304.5 million
Countries served: 141
Airports served: 689
Fleet: 2285

Skyteam:
Annual passengers: 343.6 million
Countries served: 133
Airports served: 684
Fleet: 2069

With the exception of passengers served, OneWorld and Star have Skyteam beat. And my real point was the huge hole Skyteam has to Australia, New Zealand, and Southeast Asia. But yes, if you want to travel from North America to Europe, Skyteam is quite strong.

Just my two cents, but with a fleet size 216 airframes smaller than Oneworld, Skyteam is actually pretty impressive compared to Oneworld in the fact that they are carrying 39.1 Million more passengers than Oneworld and yes, to only five less overall cities. Your second argument with Asia is totally wrong. NRT is an Asian hub for NW, a Skyteam partner and Seoul is a hub for Korean. There are plenty of opportunities to get there via Skyteam. The only part of your argument that is valid is Australia.
 
rwsea
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 4:36 pm

Quoting Travelin man (Reply 24):
They do not have AVAILABLE aircraft to fill that hole in the "not too distant future" per the original poster's assertion.

Wrong - they still have several 777-200ERs that can be used Trans-Pacific. NRT, TLV are the only destinations that have to have them. JNB will use them as well, but that still leaves at least 3 more for expansion to Asia if need be.

Quoting Travelin man (Reply 24):
The 767s cannot make it trans-Atlantic.

Wrong - DL flies dozens of flights across the atlantic with the 767 every day.
 
UAL777UK
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Joined: Sun Nov 20, 2005 1:16 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 5:42 pm

Quoting Travelin man (Reply 21):
DL is larger than AA to South America? To be quite honest, I would be shocked to find out that is true. AA is huge to South America.

Very true, only yesterday DL announced that eventually yhey want to become No 2 to South America.....behind, yep you guessed it AA!
 
N160LH
Posts: 264
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 5:43 pm

Okay I was really just going to read this thread and enjoy a pro Mother DL outlook for once.... But then someone had to go ahead and say something ridiculously stupid....

Quoting AvConsultant (Reply 20):
Keep in mind DL has $29 Billion in debt held by 2 banks - GECAS and American Express. Their expectation on returns will be more aggressive than an investment group. In order to pay off this debt, DL will not be profitable for awhile. DL needs to look at expansion into Asia. The loss of the China route might be crucial.

I predict DAL will be purchased within 3 years.

Alright "AV" you have it right, the Mother DL is officially in a mass of debt... But with that being said, why in the hell would someone want to purchase an airline that has a massive $29 Billion dollar debt...!?! That's a total oxymoron... My prediction is that "AV" will be wrong...!

"World" great read...! Really hope your right...


As always.... Just my thoughts
N160LH
"I do alright up in the air, its down on the ground that I tend to mess up..."
 
Carpethead
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 5:48 pm

DL has 8 trans-Pacific capable planes to operate from its hubs. Unless this changes quickly (which most will agree will not happen in the next 2-3 years), they will not increase Asian flying. Of course, the 763s are useful from SEA but they don't have a hub there nor are they about to start a build-up there.

I still think without the benefit of a large 777 fleet like at other US majors, DL's route structure will be limited to the 763ER. If int'l travel growth continues or accelerate, DL's decision to retire the MD-11s will backfire starting around next year till more 777s arrive or when they can get delivery slots for the 787 beyond 2010.

Quoting Travelin man (Reply 21):
with financially shaky carriers (AF and KL excepted).

To add, KE is doing good too.
 
PSA727
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 6:05 pm

There is no way that DL can overtake CO in the trans-Atlantic
market. CO's terminal at EWR is so much more superior than what
DL has at JFK. DL will have to do some serious financial investment
at JFK to even come close. And is DL going to offer the same amount
of feeder flights into JFK that CO does at EWR?

And what is with the belief that "if you will schedule it, they will fly"?
I think that DL is looking at an artificial demand for all of these int'l
flights. European visitors are not coming to the U.S. in record numbers
like they used to. U.S. Customs and Immigration is kind of taking away
the fun of it. And aside from summer months, American demand for
European travel is not the greatest. In fact, I do believe that London
is the most visited European city by Americans, and DL does not seem
to be adding much capacity there. Also, look at the small percentage
of Americans that actually posess a valid U.S. Passport. Yes, there is
a business demand for European travel, but I don't think that this
demand can fill all of the seats which DL wants to add.

I'm afraid that the overcapacity which we have seen plague the domestic
market will now spill over into the international one. Not very promising.
fly high, pay low...Germanwings!
 
sparkingwave
Posts: 563
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 6:27 pm

That's quite a very rosy outlook on DL's fate.

Delta may survive, but I have to cast doubt that it will thrive. Reasons?

1. Bankruptcy and restructuring
2. Delta "family" gone - disgruntled pilots and cabin crew staff
3. Delta name brand doesn't pull same recognition as other int'l carriers
4. Price of oil
5. No Asia/Pacific hub or operations (ATL-NRT just doesn't cut it)
6. Inflight service not as innovative as other carriers (AVOD, Connexion, P.S. Service, etc.)

I admire its aggressive Europe expansion, but many of these routes were tried before (and abandoned). Just like PA before it, success in Europe will remain vulnerable to spikes in oil prices or acts of terrorism/war.

Fuel for thought,

SparkingWave ~~~
Flights to the moon and all major space stations. At Pan Am, the sky is no longer the limit!
 
DAL767400ER
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 6:29 pm

Love how yet another pro-Delta thread has turned into another bashfest. Sorry for you WorldTraveler that your attempt has been so drastically shot down, but that's A.net CivAv forum for you: Lots of people who have no clue about aviation and pretend they know better than people actually working in aviation. I'd put you on my RU if I hadn't done so before, but I have to give one advice, though:
Don't bother posting a lenghty positive thread about any airline operating under CH11 on a.net. You will only be shot down, and it's just not worth the time.
 
aircanada014
Posts: 1224
Joined: Sun Oct 09, 2005 2:24 pm

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 7:56 pm

Quoting Flyibaby (Reply 27):
Your second argument with Asia is totally wrong. NRT is an Asian hub for NW, a Skyteam partner and Seoul is a hub for Korean

Travel Man was refering to SouthEast Asia not northern ASIA. DL and or NW doesn't fly to SIN, BKK, TPE and or HKG.
 
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aerorobnz
Posts: 7413
Joined: Sat Feb 10, 2001 3:43 pm

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 8:24 pm

Quoting DAL767400ER (Reply 34):
Lots of people who have no clue about aviation and pretend they know better than people actually working in aviation.

And also some who do work in the industry & do know about airlines. While there is a lot in DLs favour they still lost USD300million in either January or February, which is a load of money in anyone's language. Until they consistently turn a profit their future is in doubt, naysayers & yaysayers aside. DL have a long long way to go, as does my own airline, before they are making money in the way their potential deserves.
Flown to 120 Airports in 44 Countries on 73 Operators. Visited 55 Countries and counting. Wanderlust is like Syphilis, once you have the itch it's too late for treatment.
 
BNinMSY
Posts: 217
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 9:22 pm

I doubt Delta will survive, I doubt an airline with the customer service policies and level of poor attitude that is prevelant at Delta can carry them for the longterm.

I see Delta or Northwest being swallowed up by Continental or American.
Delta just doesn't 'get it'. And as someone said previously the Delta 'family' is gone... they gave this baby up to foster parents who really don't know anything about nuturing clients.
 
SeeTheWorld
Posts: 1090
Joined: Sat Dec 31, 2005 2:46 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 10:17 pm

Quoting SLCUT2777 (Reply 16):
Quite honestly if NW went chapter 7 and liquidated, DL would do very well to move that hub operation north up I-75 to DTW since the O&D numbers would be substantially better than what CVG could offer.

And, on the flip side, if DL went Ch. 7, NW would have a hub setup in ATL even before the final DL plane landed.
 
isitsafenow
Posts: 3413
Joined: Sun Feb 01, 2004 9:22 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 10:30 pm

Quoting SeeTheWorld (Reply 38):
NW would have a hub setup in ATL even before the final DL plane landed.

Perhaps you are right, but my money would be on American to bet em to the punch.
safe
If two people agree on EVERYTHING, then one isn't necessary.
 
texan
Posts: 4059
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RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 10:38 pm

Delta Still Playing Catch Up

Yes, DL has a chance to survive and thrive. They need more than a few things to fall in place for it to happen, though. Good luck to them, it'll be a tough fight.

Texan
"I have always imagined that Paradise will be a kind of library."
 
SeeTheWorld
Posts: 1090
Joined: Sat Dec 31, 2005 2:46 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 10:57 pm

Quoting AvConsultant (Reply 20):
The loss of the China route might be crucial.

As DL's application for the China route showed, their forecast was exceedingly optimistic, and they knew it. Their commitment for the first round of Chinese routes was lukewarm at best as they didn't even apply for the 2005 designation. Experience says if an airline wants a route designation bad enough, it asks for it every which way it can, and that includes immediately, regardless of its limited number of 777s. If China was so important to DL, it would have found a way to make it work from a fleet standpoint. It's all about priorities. And, in this instance, I believe DL did the right thing by filing the application the way it did.

It was imperative that DL apply for the China designations because they had to placate their employees, stockholders, and Wall Street; and they knew that if they lost both the 2005 and 2006 designation, they would be first in line for the next round of China flights (hopefully 2007). I believe that the primary reason they opted for 2006 only and not 2005 was twofold: 1) If by-chance they got it, the extra year of passenger growth would at least help improve margins that looked awful, and 2) They wanted to subtly signal their interest, but indicate they weren't quite ready. The passenger numbers from Atlanta (even with steep stimulation), including the 100+ connections (primarily from the Southeast), were not enough to make the flight acceptable, and those passenger numbers were significantly less than the Continental and American flights from EWR and ORD, respectively, even with the current competition.

Ultimately, DL will be able to make China work, but the timing for them in this past round was just a little too soon. What might have made their application more competitive, based on the DOT's decision, is if DL had applied to Shanghai instead of Beijing. Since Continental was likely a lock for an award (because of New York) to Beijing, both DL and American competing for a Shanghai frequency might have changed things. But, that's assuming DL really wanted the route or that they would have known which markets CO and AA were going to apply for and thus leveraged the difference.

Asia is important, but it is not a market like Europe (as everyone on here knows), where you can just willy-nilly add flights here and there. Unfortunately for DL, ATL is the best hub for them to Asia (and, in general), but it suffers from a cmparatively small local size (vs. other legacy carrier gateways), connecting cities with comparatively small local sizes (most of the U.S. China traffic is located in the Northwest and West Coast, the Midwest is next, followed by the Southeast), circuity from larger connecting cities, and it's just several hundred miles farther than its competitors' hubs (CO-EWR, AA-ORD, UA-ORD/SFO/LAX, NW-DTW/MSP).

When the time comes, however, DL will go to China and they will make it work (if they can get the rest of the house in order). Had they won the 2006 China route, it would have been a huge drain on cash in year one and possibly year two as well. Waiting until 2007 or 2008 will be much better for DL in the long run.
 
commavia
Posts: 9651
Joined: Mon Apr 25, 2005 2:30 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:02 pm

First, let me say that I think DL has a lot of great people working for it, and a lot of dedicated people who have dedicated their lives to making the 'widget' look good in the eyes of customers. I applaud them. Unfortunately, DL has had such horrible management in the last 10 years, that it largely ruined what strides the employees made. Mullin f-ed DL up so badly, that now someone else is having to undo his doing. Quite sad, really, and I sincerely hope that the OP was right, and that Delta will "survive and thrive" again.

Quoting WorldTraveler (Thread starter):
Delta never was given the choice industry routes and never had the access to the big cities in the US or overseas that seemed to provide unlimited opportunities for competitors like American, United, and Northwest.

As others have said, if DL "never was given" anything, than its their own fault. No airline has ever been "given" anything -- they had to go out and take it. AA and UA bought LHR fairly, UA bought the Pacific fairly, and Delta -- I might add -- was not completely clueless on this point, as it bought the remnants of Pan Am fairly, after AA and UA had already picked away at the most important parts.

Quoting WorldTraveler (Thread starter):
To be sure, however, DL is also asserting itself in key local international markets such as from New York to Latin America.

DL's quaint little "push" into New York-LatAm will probably last a few months. I certainly could be wrong, sure, but I doubt DL is really going to be that successful on, say, JFK-GRU, up against two Brazilian airlines and two U.S. airlines, all of which are much more heavily entrenched.

Quoting WorldTraveler (Thread starter):
And Latin America represents a considerable growth opportunity for Delta. Although it has operated Latin American flights almost exclusively from ATL, Delta has become the 2nd largest airline to deep S. America and will likely surpass CO this year as being the largest airline to all of S. America.

It is admirable that DL plans on become 2nd place to LatAm, surpassing CO -- I read that press release too -- but they will never even come close to AA. They are such a miniscule blip on the radar screen compared to AA when it comes to LatAm that they will never catch up, for one reason and one reason only: M-I-A-M-I.

Quoting WorldTraveler (Thread starter):
ATL is very well positioned geographically to develop new Latin markets which are already served from Miami and Houston. And DL’s growth prospects are very significant when they begin to develop JFK as a Latin American gateway. LAX and Florida also hold the potential for significant Latin growth prospects.

ATL has the potential to be a good secondary LatAm hub, linking major LatAm capitols with ATL once, maybe twice at most, per day, in order to offer connections, but it has no potential as a mega hub to LatAm, along the lines that Miami is to LatAm or JFK is to Europe. DL has very little future in the JFK-LatAm markets. They may be able to fill out a few more ex-Song 757s to Caribbean sunspots from JFK, but even that is doubtful with AA so hugely dominant, and B6 moving in. JFK-South America for DL? Good luck. As for LAX and Florida, LAX has hardly the market required for an airline like DL, which has been steadily declining its presence there, to really have a market opportunity, and I think Florida is already well spoken for when it comes to links to LatAm. They don't need DL.

Quoting WorldTraveler (Thread starter):
Based on the route announcements and rumors we have seen and heard over the past few months, Delta could very well have the most expansive international route network of any US airline.

Expansive? Define expansive. From Jan-Sep 2005 (when latest figures are available), AA carried more than double -- actually two and a third more times -- the number of passengers internationally as DL. AA generates about two thirds more RPMs, as did the #2 carrier in the RPM category, UA. So, unless DL has some international expansion plans under their hat they haven't announced yet -- say, on the order of doubling their international network -- I don't think you could fairly call DL's international route network, then or in the future, the "most expansive" among U.S. carriers.
 
LawnDart
Posts: 861
Joined: Fri May 20, 2005 11:33 pm

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:10 pm

Quoting Travelin man (Reply 24):
Star Alliance:
Annual passengers: 382.6 million
Airports served: 790

OneWorld:
Annual passengers: 304.5 million
Airports served: 689

Skyteam:
Annual passengers: 343.6 million
Airports served: 684

Of the statistics you quoted in comparing the three allliances, Annual passengers is the most relevant measurement for "size". Cities/countries served, while a convenience for someone wanting to fly to every little podunck destination there is, isn't really relevant as a handfull of cities comprise the vast majority of traffic anyway - diminishing return (you serve Poughkepsie (sp?), New York, but only 10 people fly there...).

Fleet size isn't as relevant as fleet utilization - just ask Southwest.

So, by passengers carried annually, Skyteam is nearly 13% larger than Oneworld.

By airports served, Oneworld has a whopping 0.7% advantage over Skyteam.

Quoting Travelin man (Reply 24):
They do not have AVAILABLE aircraft to fill that hole in the "not too distant future" per the original poster's assertion.

As another poster pointed out, they could move aircraft to different routes (aircraft mobility is a wonderful thing).

I would also point out that, with a focus on the eastern half of the United States, maybe DL has determined they don't need to fly to Singapore or Bangkok. Or, they could do it through their Skyteam partners Korean or NW.
 
SeeTheWorld
Posts: 1090
Joined: Sat Dec 31, 2005 2:46 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:12 pm

Quoting Isitsafenow (Reply 39):
Perhaps you are right, but my money would be on American to bet em to the punch.

An ATL hub is vastly more important to a NW than to anyone else, including LCCs. While any airline might be tempted by the void and the large O&D at ATL, no one would beat NW to the punch because NW wouldn't let anyone beat them. And every other airline knows that's ATL is worth so much more to NW then anyone else, and NW would fight to the death for it. It wouldn't be worth it for anyone to test this theory. Every airline management team in the U.S. right now is playing a series of "what if" games, and they all understand pretty much what the other carriers are looking at in the event of a major liquidation of any of the legacy carriers.

There are TWO primary reasons NW would snatch ATL up (regardless of what any and every other carrier might try in ATL): 1) They need a LARGE, non-northern U.S. hub, and 2) They are a SkyTeam member, and ATL is full of SkyTeam passengers. It would be a slam-dunk.
 
congaboy
Posts: 258
Joined: Fri Jan 20, 2006 3:48 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:17 pm

I admire your optimism, WorldTraveler. That type of attitude is really needed at a time like this for DL. Dont hang your head, like we did at EA....attitudes are infectious, so it better be positive. Can we shoot holes in DL, are they messed up, do large problems exist, are there hard times ahead...yes, yes, yes. It is what it is...what to do about fixing it? DL is trying to climb out with motions like international expansion and some outsourcing...the big challenge is with the pilots. Best of luck, but its all about hard work and leaving your ego at the door.
"Joey, you like movies about gladiators?"
 
DLPMMM
Posts: 2118
Joined: Wed Apr 20, 2005 12:34 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:22 pm

Quoting AirCanada014 (Reply 35):
Travel Man was refering to SouthEast Asia not northern ASIA. DL and or NW doesn't fly to SIN, BKK, TPE and or HKG.

Then what was that flight I was on 3 weeks ago from KIX to TPE? It sure looked like a red tail, and it said NWA on my ticket stub.
 
bmacleod
Posts: 2453
Joined: Sat Aug 25, 2001 3:10 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:23 pm

If DL is to survive, which odds are still 3:1 against DL, it'll have to further streamline it's fleet, dump remaining MD-88s and -90s, and go all Boeing. SLC is needed for trans-Pacific routes, but CVG may have to be shut down in order to regain profitability.

Also nagging DL are grumpy unions   ...all these areas must be taken care of if DL really wants to survive.

[Edited 2006-03-09 15:24:17]
The engine is the heart of an airplane, but the pilot is its soul.
 
kkfla737
Posts: 1017
Joined: Sat Oct 09, 2004 2:28 am

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:28 pm

Quoting WorldTraveler (Thread starter):
First, DL has a pre-deregulation legacy of being one of best run airlines in the world.

Agreed. Up until about 1985 or 1985 Delta was considered a premium airline by most. Growing up in Florida it was often contemplated whether or not to fly Delta, apremium carrier or Eastern what many considered a low class carrier with poor service.

Quoting WorldTraveler (Thread starter):
Delta has always fought very hard for what it has and in the process, outlived airlines like Eastern, Pan Am, and TWA that had been given much more to work with.

In the case of Eastern and TWA I agree, although Eastern was so big by the 1970s that the CAB seemed to have a policy of making sure Eastern didn't get any bigger, a policy which benefited Delta among others. EA and WA Transworld Airlines (USA)">TW had some of most lucrative domestic routes and if EA had been able to hang on a few more years being the dominant US carrier to Latin America could have been a major feather in its cap. I am not sure I agree on PA though. Pan Am did have Heathrow and Narita slots and Frankfurt beyond rights (all sold piecemeal) but had little domestic feed which gave TWA a huge advanatage with trans atlantic flying, and Braniff and then Eastern a major advantage to Latin America, NW to Asia, etc. Pan Am also flew at a time when int'l markets were not as open and demand from certain points of the USA to PA destinations in far flung places was much less than it is today.

Quoting 767-332ER (Reply 14):
Now, DL did inherit a number of rights to "secondary" European cities, such as JFK-FRA and the FRA mini-hub (only exploited by DL until the mid 1990's). Everything else served from the ATL megahub was created in its own by Delta. The only thing that was beneficial from the PA inheritance were the extra L1011-500's and the need to fill the international void left by PA's demise.

Delta developed many of the European routes like Stuttgart, Hamburg, Dublin, shannon and Copenhagen from Atlanta before buying PA's European operation. I think you mean A-310-200s which Delta shelved about 4 years after the PA route purchase.


One thing that bothers me about Delta's future is that as some posters noted above Delta is less of a national airline than American or United. That is absolutlely true. Delta inherited LAX from WA and squandered it as well as numerous routes to Mexico and a network to Asia that was the 3rd largest among US airlines as recently as 1995. But Delta is working on shoring up its strengths in its network. Trans Atlantic flying including the fact that Delta is the # 1 US airline to India, which is emerging as one of the worlds major economies and the only US airline serving the former soviet bloc give DL a major competetive advantage. Domestically, emphasis on the Southeast and the Northeast should help DL survive.
 
767-332ER
Posts: 1974
Joined: Sun Mar 18, 2001 1:20 pm

RE: Delta Will Surive And Thrive

Thu Mar 09, 2006 11:44 pm

Quoting Luv2fly (Reply 17):
For one DL did not pay the price tag that both AA and UA paid for the rights for LON, also the one route in question and I am going from memory was purchased from DL by NW for close to 14 million dollars, not a bad chunck of change if you ask me.

Right and tell me which routes to 'LON' did AA and UA get....(Heathrow!!!). Of course if I were NW, I would pay a high price for the DTW-LGW route, considering NW wanted to build up their DTW hub.

Quoting Kkfla737 (Reply 48):
Delta developed many of the European routes like Stuttgart, Hamburg, Dublin, shannon and Copenhagen from Atlanta before buying PA's European operation. I think you mean A-310-200s which Delta shelved about 4 years after the PA route purchase.

No, I meant just what I said...a number of L1011-500s were received from PA and were even transferred from United when their had inherited some of PA's L10's on Pacific routes. These aircraft became the backbone of the international fleet for a good 10 years. The A310-200s were disposed of rather quickly as you have said and therefore that's why I am not listing them as a "positive" gift from PA to DL.
Twinjets...if one fails, work the other one twice as hard!!!

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