At a media event Korean Air President/COO Walter Cho confirmed to reporters that KE and DL were in talks for a joint venture.
Cho declined to elaborate further, saying that details could be provided later.

Korean Air in Talks With Delta for Joint Venture, Executive Says
https://www.bloomberg.com/news/articles ... utive-says

=

Could certainly be a win-win for both.

For those that might not know Ed Bastian is personal friends with KE's president and even golf together here in Los Angeles. From what I have heard one of the first things Bastian did after Richard Anderson's departure was to reach out to KE again to reseed the JV idea.

It's about time.

If this works I'm finally going to actually earn decent MQMs on my flights to Asia (seriously, Category 4 is the worst)! Nice to see 2 SkyTeam partners work to improve their relations. But what will happen to their partnership with MU? Do they really need 2 Asian partners?

Here's hoping for 2x daily DTW-ICN. Maybe one DL A359 and one KE A332.

N644US wrote:

But what will happen to their partnership with MU? Do they really need 2 Asian partners?

DL has 8 Asian partners.

None of them, however, are in an immunized J/V with DL, so that (as a combo) will be a first in Asia for them.
(IIRC however that DL (and NW) before it, did also have ATI with MH at one point, but no J/V.)

@LAX772LR Maybe I should have clarified -- it would be better to say 2 close Asian partners. If this J/V goes through, we're more than likely to see an increase in the earning of SkyMiles and MQMs on KE. The only other Asian partner that DL has that actually credits under Group 1 for miles is MU, and the remaining airlines are practically useless when it comes to crediting miles to DL as Group 3/4 partners. Also, what is the 8th DL partner? I see MU, CI, CZ, GA, MF, VN, and KE (7 partners).

N644US wrote:

Also, what is the 8th DL partner? I see MU, CI, CZ, GA, MF, VN, and KE (7 partners).

Actually 9, hit the wrong number.

SV and ME, in the MidEast.

N644US wrote:

If this works I'm finally going to actually earn decent MQMs on my flights to Asia (seriously, Category 4 is the worst)! Nice to see 2 SkyTeam partners work to improve their relations. But what will happen to their partnership with MU? Do they really need 2 Asian partners?

Eh well yes until KE starts to fly to 30 chinese cities or Australia i dont see why the relationship is mutually exclusive.

And the airline world breathes a collective sigh of "about time."

This could have a transformational effect on Delta's transpacific business - a JV with Korean is the network exit ramp from NRT that Delta has long needed as it has steadily wound down its beyond-Japan network in favor of SEA and DTW. The combination of SEA, DTW and ICN, and perhaps also LAX, would be an extremely strong and compelling offering in competition with AA/JAL and United/ANA.

LAXintl wrote:

At a media event Korean Air President/COO Walter Cho confirmed to reporters that KE and DL were in talks for a joint venture.
Cho declined to elaborate further, saying that details could be provided later.

Korean Air in Talks With Delta for Joint Venture, Executive Says
https://www.bloomberg.com/news/articles ... utive-says

=

Could certainly be a win-win for both.

For those that might not know Ed Bastian is personal friends with KE's president and even golf together here in Los Angeles. From what I have heard one of the first things Bastian did after Richard Anderson's departure was to reach out to KE again to reseed the JV idea.

This is big. I'm not sure it is great for KE in terms of growth. It means less capacity on the Pacific than they planned as Delta will demand that. It's also bad for SEA growth as markets like SIN and TPE are better from ICN if that becomes a JV option.

LAX772LR wrote:

N644US wrote:

Also, what is the 8th DL partner? I see MU, CI, CZ, GA, MF, VN, and KE (7 partners).

Actually 9, hit the wrong number.

SV and ME, in the MidEast.

That makes more sense... I was going by the "Miles and Points" definition as to what Asia was (Middle East is a separate category).

downdata wrote:

N644US wrote:

If this works I'm finally going to actually earn decent MQMs on my flights to Asia (seriously, Category 4 is the worst)! Nice to see 2 SkyTeam partners work to improve their relations. But what will happen to their partnership with MU? Do they really need 2 Asian partners?

Eh well yes until KE starts to fly to 30 chinese cities or Australia i dont see why the relationship is mutually exclusive.

KE flies to 28 Chinese cities and 2 destinations in Australia (SYD+BNE).

downdata wrote:

N644US wrote:

If this works I'm finally going to actually earn decent MQMs on my flights to Asia (seriously, Category 4 is the worst)! Nice to see 2 SkyTeam partners work to improve their relations. But what will happen to their partnership with MU? Do they really need 2 Asian partners?

Eh well yes until KE starts to fly to 30 chinese cities or Australia i dont see why the relationship is mutually exclusive.

KE flies to 28 Chinese cities and 2 destinations in Australia (SYD+BNE).

I'm pretty excited by this, as a NYC based DL flyer. Gives me a lot more 1 stop options for Asia travel.

flyDTW1992 wrote:

Here's hoping for 2x daily DTW-ICN. Maybe one DL A359 and one KE A332.

That would be amazing but I'm not holding my breath because Delta wants a reduction of seats in the Detroit market.

N644US wrote:

@LAX772LR Maybe I should have clarified -- it would be better to say 2 close Asian partners. If this J/V goes through, we're more than likely to see an increase in the earning of SkyMiles and MQMs on KE. The only other Asian partner that DL has that actually credits under Group 1 for miles is MU, and the remaining airlines are practically useless when it comes to crediting miles to DL as Group 3/4 partners. Also, what is the 8th DL partner? I see MU, CI, CZ, GA, MF, VN, and KE (7 partners).

Why not? DL has three close JV partners on TATL: AF/KL, VS and AZ; the AF/KL, AZ and DL works together. The Star alliances' version, A++ JV, also has three companies AC, UA and the LH Group. Even absent a JV, airlines continue to strong partnerships that go against JVs. DL works well with UX; AF/KL works well with WestJet; then there is a odd opposite where EI is a part of IAG but yet competes with the AA/IAG JV.

For the time being DL/MU can't be anything more than good friends anyways and given the rhetoric coming from the Trump administration it seems likely that the gov't would make US-Sino aviation partnerships easier.

"KE flies to 28 Chinese cities"

And it's those 28 Chinese destinations, more than any other carrier (except perhaps KA), that is the strategic plum DL should be salivating over. Miles ahead of anything that UA/NH or AA/JL can offer. Maybe now under Bastian DL will finally develop a meaningful relationship with KE.

I've flown KE quite a bit and its to bad the business class product on the A380, to be quite frank, sucks. The seat has to be as uncomfortable as they come and the lack of air vents combined with very warm cabins makes for a very long flight. On the other hand, the business cabin on the 748 has to be the best out there. After my last KE A380 in Prestige, ICN-SYD, I swore I would never fly KE again unless its the 748.

Best guesses, when does this JV become official and does it need regulatory approval from any governing body/agency?

N717TW wrote:

N644US wrote:

@LAX772LR Maybe I should have clarified -- it would be better to say 2 close Asian partners. If this J/V goes through, we're more than likely to see an increase in the earning of SkyMiles and MQMs on KE. The only other Asian partner that DL has that actually credits under Group 1 for miles is MU, and the remaining airlines are practically useless when it comes to crediting miles to DL as Group 3/4 partners. Also, what is the 8th DL partner? I see MU, CI, CZ, GA, MF, VN, and KE (7 partners).

Why not? DL has three close JV partners on TATL: AF/KL, VS and AZ; the AF/KL, AZ and DL works together. The Star alliances' version, A++ JV, also has three companies AC, UA and the LH Group. Even absent a JV, airlines continue to strong partnerships that go against JVs. DL works well with UX; AF/KL works well with WestJet; then there is a odd opposite where EI is a part of IAG but yet competes with the AA/IAG JV.

For the time being DL/MU can't be anything more than good friends anyways and given the rhetoric coming from the Trump administration it seems likely that the gov't would make US-Sino aviation partnerships easier.

Yep. Good friends with a $450 million investment into MU, 3.55% ownership, and an observer seat on the board by DL. Only friends...

If the JV goes through, will that be the end of the AS/KE relationship?

commavia wrote:

And the airline world breathes a collective sigh of "about time."

This could have a transformational effect on Delta's transpacific business - a JV with Korean is the network exit ramp from NRT that Delta has long needed as it has steadily wound down its beyond-Japan network in favor of SEA and DTW. The combination of SEA, DTW and ICN, and perhaps also LAX, would be an extremely strong and compelling offering in competition with AA/JAL and United/ANA.

Yeah, this is a huge deal. I know that some folks around here never thought it would happen. But what the public sees isn't always the entire story. There was certainly some gamesmanship going on over the past several years. But those moves were always intended to lead here. The strategies of KE and DL haven't always aligned, but the competitive environment is changing quickly and their common interests are reaching critical mass. They both need each other. A JV has always been inevitable.

What will be most interesting is to see how this effects the combined network. KE's fleet is quite top-heavy with large aircraft. The 787-9 is probably the right size airplane for much of the growth that will occur. Obviously, for Delta, the A350 is critical in terms of leveraging the opportunities. My suspicion is that frequency will become more critical than capacity. DTW/LAX/SEA will ultimately be strengthened by the carriers' improved competitive position in Asia. None of them will cease being gateways but their capacity will be focused on the largest nonstop O&D markets (much like today). Additional frequency from those hubs to ICN will likely occur over time. What will be more fascinating is how other hubs develop. We've already seen clues of what will happen in the ATL market with DL's new ATL-ICN service. I'd expect to see further frequency development, and in some cases, secondary gateway development. MSP and SLC may see ICN service. You can imagine BOS as well.

ICN offers multiple connecting banks. I suspect one of the goals will be to fill out connectivity to those banks from the key gateways. It may not be super sexy, but since KE already serves so many US markets, there aren't likely to be a ton of new cities served from ICN.

And frankly, I expect any changes to roll out over a period of years. There won't be a ton of immediate changes. KE's US network is quite mature and has always been built to align with the DL network.. The JV will offer new opportunities but doesn't change the fact that Trans-Pac is pretty weak at the moment. So we will probably see more of a shuffling of the deck than a ton of new capacity over the near term.

jumbojet wrote:

I've flown KE quite a bit and its to bad the business class product on the A380, to be quite frank, sucks. The seat has to be as uncomfortable as they come and the lack of air vents combined with very warm cabins makes for a very long flight. On the other hand, the business cabin on the 748 has to be the best out there. After my last KE A380 in Prestige, ICN-SYD, I swore I would never fly KE again unless its the 748.

Best guesses, when does this JV become official and does it need regulatory approval from any governing body/agency?

All JV's require anti-trust immunity so generally you need regulatory approval from all countries that are involved (so South Korean and US regulators need to sign off). Given that AA and UA have trans-pac JVs already, I figure getting anti-trust immunity shouldn't be an issue for DL.

klakzky123 wrote:

jumbojet wrote:

I've flown KE quite a bit and its to bad the business class product on the A380, to be quite frank, sucks. The seat has to be as uncomfortable as they come and the lack of air vents combined with very warm cabins makes for a very long flight. On the other hand, the business cabin on the 748 has to be the best out there. After my last KE A380 in Prestige, ICN-SYD, I swore I would never fly KE again unless its the 748.

Best guesses, when does this JV become official and does it need regulatory approval from any governing body/agency?

All JV's require anti-trust immunity so generally you need regulatory approval from all countries that are involved (so South Korean and US regulators need to sign off). Given that AA and UA have trans-pac JVs already, I figure getting anti-trust immunity shouldn't be an issue for DL.

Don't KE and DL already have ATI?

cathay747 wrote:

"KE flies to 28 Chinese cities"

And it's those 28 Chinese destinations, more than any other carrier (except perhaps KA), that is the strategic plum DL should be salivating over. Miles ahead of anything that UA/NH or AA/JL can offer. Maybe now under Bastian DL will finally develop a meaningful relationship with KE.

Except China will be excluded from the JV according to Korean Air President (and son of Chairman) Walter Cho - Cho said the carrier is working on its joint venture with Delta. “We’re very eager to get it started,” he said. “All of the trans-Pacific {service} excluding China will be in the JV.”

https://www.forbes.com/sites/tedreed/20 ... 88becd6c64

The JV still has tons of merit as the rest of Asia is an enormous market, so I am looking forward to its announcement.

carljanderson wrote:

klakzky123 wrote:

jumbojet wrote:

I've flown KE quite a bit and its to bad the business class product on the A380, to be quite frank, sucks. The seat has to be as uncomfortable as they come and the lack of air vents combined with very warm cabins makes for a very long flight. On the other hand, the business cabin on the 748 has to be the best out there. After my last KE A380 in Prestige, ICN-SYD, I swore I would never fly KE again unless its the 748.

Best guesses, when does this JV become official and does it need regulatory approval from any governing body/agency?

All JV's require anti-trust immunity so generally you need regulatory approval from all countries that are involved (so South Korean and US regulators need to sign off). Given that AA and UA have trans-pac JVs already, I figure getting anti-trust immunity shouldn't be an issue for DL.

Don't KE and DL already have ATI?

They got it years ago but I'm not sure if it actually covers a potential trans-pac joint venture. Perhaps it does and this is a moot point. I'm just not sure of its scope.

klakzky123 wrote:

All JV's require anti-trust immunity so generally you need regulatory approval from all countries that are involved (so South Korean and US regulators need to sign off). Given that AA and UA have trans-pac JVs already, I figure getting anti-trust immunity shouldn't be an issue for DL.

Korean and Delta already have anti-trust immunity. I think the greater question is what will UA/ANA do when the KE/DL JV is announced. Will there be a push to add Asiana to the UA/ANA JV?

China and any other nations which do not have open-skies agreements won't be included in any potential JV.

LAX772LR wrote:

N644US wrote:

Also, what is the 8th DL partner? I see MU, CI, CZ, GA, MF, VN, and KE (7 partners).

Actually 9, hit the wrong number.

SV and ME, in the MidEast.

SV & ME are middle east, not Asian.

Maybe it'd be more likely to have a shift towards KE for Asian flights via ICN (replacing NRT), as well as having a smaller complementary partnership with MU just for China. It'd weaken ties between MU and DL, but would also mean all of Asia would be covered by a major Asian partner.

commavia wrote:

And the airline world breathes a collective sigh of "about time."

This could have a transformational effect on Delta's transpacific business - a JV with Korean is the network exit ramp from NRT that Delta has long needed as it has steadily wound down its beyond-Japan network in favor of SEA and DTW. The combination of SEA, DTW and ICN, and perhaps also LAX, would be an extremely strong and compelling offering in competition with AA/JAL and United/ANA.

I also think this deal makes sense from a CapEx standpoint for DL. There are currently 4 763's tied up flying NRT-MNL/SIN/PVG/TPE. One of the advantages of the JV witih KE is that DL can retire 4 763's without needing to expend the CapEx for new planes to replace them, as KE can replace that flying for DL through ICN instead of NRT.

From a KE opportunity standpoint, DL could move PDX from NRT to ICN, as the 763 has the legs to do PDX-ICN. DL could also fly SLC/MSP/LAX-ICN with the 332s in its fleet, as these routes are shorter than the DTW-NGO/PEK and SEA-HKG currently flown by the 332. DL could also send a 77E from JFK to ICN.

dmorbust wrote:

Except China will be excluded from the JV according to Korean Air President (and son of Chairman) Walter Cho - Cho said the carrier is working on its joint venture with Delta. “We’re very eager to get it started,” he said. “All of the trans-Pacific {service} excluding China will be in the JV.”

https://www.forbes.com/sites/tedreed/20 ... 88becd6c64

The JV still has tons of merit as the rest of Asia is an enormous market, so I am looking forward to its announcement.

This is a big progress than the last time when KE wanted JV only for Korea-America routes (KE was larger than DL by like 7 times) while DL wanted all TPAC (DL was slightly larger than KE). Now KE wants all TPAC but Chinese routes, which is much broader than the last time but I'm not sure why China was excluded or whether DL would agree on it. Without China, KE and DL offers similar direct flight capacity across TPAC but once China is included, DL has ~20% more capacity. Capacity is known to be proportional to the power in JV.. I was told here in a.net.

Of course, in complement to the pre-existing services to ATL, ORD, DFW, HNL, IAH, LAS, LAX, MIA, JFK, SFO, SEA, and IAD. Maybe a shifting of some of the current NRT services, but not all of them. PDX comes to mind especially with such a largeness percentage of connection traffic.

VictorKilo wrote:

I also think this deal makes sense from a CapEx standpoint for DL. There are currently 4 763's tied up flying NRT-MNL/SIN/PVG/TPE. One of the advantages of the JV witih KE is that DL can retire 4 763's without needing to expend the CapEx for new planes to replace them, as KE can replace that flying for DL through ICN instead of NRT.

That's true, but 4 aircraft - even widebodies - is so small a capex relative to Delta's fleet needs that the increment doesn't move the needle. It could be viewed as one quarter of capex - amortized over a long period.

This is a big progress than the last time when KE wanted JV only for Korea-America routes (KE was larger than DL by like 7 times) while DL wanted all TPAC (DL was slightly larger than KE). Now KE wants all TPAC but Chinese routes, which is much broader than the last time but I'm not sure why China was excluded or whether DL would agree on it. Without China, KE and DL offers similar direct flight capacity across TPAC but once China is included, DL has ~20% more capacity. Capacity is known to be proportional to the power in JV.. I was told here in a.net.

I suspect that China will not be included in the KE-DL JV as to not offend China Eastern and China Southern. I would expect that both Airlines would be upset if XXX-PVG/PEK-Regional China traffic would instead be routed XXX-ICN-Regional China, and I also expect that DL has less of a need for XXX-ICN-Regional China with the China Eastern and China Southern partnerships.

VictorKilo wrote:

This is a big progress than the last time when KE wanted JV only for Korea-America routes (KE was larger than DL by like 7 times) while DL wanted all TPAC (DL was slightly larger than KE). Now KE wants all TPAC but Chinese routes, which is much broader than the last time but I'm not sure why China was excluded or whether DL would agree on it. Without China, KE and DL offers similar direct flight capacity across TPAC but once China is included, DL has ~20% more capacity. Capacity is known to be proportional to the power in JV.. I was told here in a.net.

I suspect that China will not be included in the KE-DL JV as to not offend China Eastern and China Southern. I would expect that both Airlines would be upset if XXX-PVG/PEK-Regional China traffic would instead be routed XXX-ICN-Regional China, and I also expect that DL has less of a need for XXX-ICN-Regional China with the China Eastern and China Southern partnerships.

Actually if you look above at the reply from LAXIntl, China is excluded because it does not have an open-skies agreement in place with the US. Other countries without open skies are also precluded from being added to the JV.

Good news for Delta if such a venture becomes reality.

I do wonder however what DL will do with Japan as it shifts focus on Korea? Japan still one of the worlds largest travel markets in the world (2nd in Asia after China), and its US rivals will be left with a huge advantage in such a large market still.

OA412 wrote:

Actually if you look above at the reply from LAXIntl, China is excluded because it does not have an open-skies agreement in place with the US. Other countries without open skies are also precluded from being added to the JV.

I thought that blocks JV between US carrier and Chinese carrier. I wonder whether UA-NH or AA-JL JV also exclude Chinese routes?

ICN is an amazing airport. Very modern facility, great lounges, easy to connect, if you like shopping, ICN is one of the best I have seen. If this happens, this is tremendous news as ICN is just about as good as it gets. A million times better than PVG and I'd even say a notch or two better than NRT/HND.

jetlanta wrote:

We've already seen clues of what will happen in the ATL market with DL's new ATL-ICN service. .

Funny how that worked out being that Detroit is suppose to be their Asian gateway from the eastern part of the USA. Would have thought at the same time Korean would have announced Detroit but Detroit once again is being snubbed by Delta and it's future intentions for this market become clearer everyday.

klm617 wrote:

jetlanta wrote:

We've already seen clues of what will happen in the ATL market with DL's new ATL-ICN service. .

Funny how that worked out being that Detroit is suppose to be their Asian gateway from the eastern part of the USA. Would have thought at the same time Korean would have announced Detroit but Detroit once again is being snubbed by Delta and it's future intentions for this market become clearer everyday.

Give it a rest. By that reasoning DTW would have never got GRU service because ATL is Latin gateway.

I normally don't make any effort to respond to you inane drivel, but since you quoted me, I will. I'm a Michigander. I began my career at DTW. I care about the market and I care about its future in the Delta network. DTW has an extremely solid future in the Delta network. That is not going to change. But Detroit is not a a fast-growing market. It is barely growing at all. And Delta is not a fast-growing airline. When it grows its network, it focuses on fast-growing markets or in strategically critical ones. The better opportunities are generally elsewhere because DTW is clicking on all cylinders with a right-size network. While it may not get a bunch of flashy new routes (though, it actually has), DTW has been getting pretty significant capacity upgrades. The replacement of smaller aircraft is an investment that Delta has made to grow the market. But it is still Detroit. It has its strengths (auto-centric O&Ds and a fantastic facility with great geography). But its weaknesses will always be a huge challenge.

Delta's "future intentions' for Detroit are indeed clear. Maximize its profitability to ensure long-term stability. That is exactly what they are doing. The growth you want is going to be slow coming at DTW. That is a nature of the market, not the hub. The fastest-growing gateways are all fast-growing markets. It is entirely proper that Delta should focus its limited growth in those places.

LAXintl wrote:

China and any other nations which do not have open-skies agreements won't be included in any potential JV.

The impediment is not open skies. The impediment is that China does not allow JV partners to codeshare/cooperate on flights to China through another Asian hub.

That is the explanation AA gave the DOT for why it could not operate LAX-PEK with a codeshare/JV flight on JAL through Tokyo.

(Delta had disingenuously argued that it could. Apparently, Delta can't either.)

LAXintl wrote:

At a media event Korean Air President/COO Walter Cho confirmed to reporters that KE and DL were in talks for a joint venture.

The progress on this has been so slow that I'm not going to hold my breath, but the fact that KE has confirmed discussions are taking place is certainly a good sign. I hope a JV is announced soon, for the sake of both carriers.

ldvaviation wrote:

LAXintl wrote:
China and any other nations which do not have open-skies agreements won't be included in any potential JV.


The impediment is not open skies. The impediment is that China does not allow JV partners to codeshare/cooperate on flights to China through another Asian hub.

I am not a JV expert by any means, but I had always thought/assumed the DOT only allowed JVs to cover countries that had Open Skies with the US. Is that not the case? I do know what can happen when you assume ...

N644US wrote:

Of course, in complement to the pre-existing services to ATL, ORD, DFW, HNL, IAH, LAS, LAX, MIA, JFK, SFO, SEA, and IAD. Maybe a shifting of some of the current NRT services, but not all of them. PDX comes to mind especially with such a largeness percentage of connection traffic.

I thought PDX- Tokyo was largely O/D? I wonder how Seoul compares to Tokyo in terms of O&D from PDX.

I had no idea KE had service to 28 cities in China from ICN. Does OZ have a similar presence in China? I'm also curious what will become of KE/AS in an DL/KE JV scenario.

HeeseokKoo wrote:

OA412 wrote:

Actually if you look above at the reply from LAXIntl, China is excluded because it does not have an open-skies agreement in place with the US. Other countries without open skies are also precluded from being added to the JV.

I thought that blocks JV between US carrier and Chinese carrier. I wonder whether UA-NH or AA-JL JV also exclude Chinese routes?

No open skies between US and China is the main reason why the proposed DL/KE JV will not include the 28 Chinese routes. Neither UA/NH nor AA/JL include them. However, HKG is included in both, as it does have open skies.

enilria wrote:

It's also bad for SEA growth as markets like SIN and TPE are better from ICN if that becomes a JV option.

It's a way for DL to grow its Pacific network (which has been gradually shrinking) and better compete with AA & UA. It's doubtful DL would've seriously considered SEA-TPE/SIN.

PDX-ICN on KE makes more sense than DL. KE would benefit from AS feed from PDX. AS can no longer feed DL at PDX, correct?

theasianguy wrote:

No open skies between US and China is the main reason why the proposed DL/KE JV will not include the 28 Chinese routes. Neither UA/NH nor AA/JL include them. However, HKG is included in both, as it does have open skies.

Thanks for the clarification.

N644US wrote:

If this works I'm finally going to actually earn decent MQMs on my flights to Asia (seriously, Category 4 is the worst)!

I know everyone hopes a category move, but KE needs to step up too. KE at the moment requires severe own-metal condition to achieve the lowest-tier, Morning Calm. 50k total in 2-year is the condition, and among 50k, at least 30k should be KE-coded flight miles while up to 20k could be either from partner airline or credit card partners. In other words, DL flight miles are treated same way as credit card miles, which is basically what category 4 is for. DL may demand to include DL-coded flight miles in the first 30k criterion.