usssla
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Re: Will DL return to HKG again?

Mon Feb 11, 2019 1:26 pm

panamair wrote:
For all those who are talking about how well HKG is working for UA, something that went seemingly unnoticed when UA reported Q4 and 2018 full year results was the $206m impairment charge that UA took against their HKG routes

From their Q4 2018 results/financial statements:

"....The company conducted its annual impairment review of intangible assets in the fourth quarter of 2018, which consisted of a comparison of the book value of specific assets to the fair value of those assets calculated using the discounted cash flow method. Due to increased costs without sufficient corresponding increases in revenue in the Hong Kong market, the company determined that the value of its Hong Kong routes had been impaired. Accordingly, in the fourth quarter of 2018, the company recorded a special non-cash impairment charge of $206 million ($160 million net of taxes) associated with its Hong Kong routes...."

https://seekingalpha.com/news/3421262-u ... ong-routes


I may reflect the termination of fifth freedom inter-Asia routes for Hong Kong market.
In fact, except the termination of inter-Asia routes, UA has increased the capacity for HK- US routes.
Guam-Hong Kong has increased from 4 weekly to 6 weekly and EWR-HKG will update from 772er to 77W in March 2019.
 
zakuivcustom
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Re: Will DL return to HKG again?

Mon Feb 11, 2019 1:30 pm

Ziyulu wrote:
When did DL pull out of CAN? Didn't they use to run NRT to CAN?


DL never did. NW did in 2004, but the route was dropped before NW merged with DL.

viewtopic.php?t=293629

DL did proposed restarting the route in Summer 2011, but never did.

https://www.routesonline.com/news/29/br ... -services/

P.S. What's with this 4 months old thread being prop up all of a sudden?
Free Hong Kong! Free China!
 
FSDan
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Re: Will DL return to HKG again?

Mon Feb 11, 2019 6:16 pm

StudiodeKadent wrote:
BoeingGuy wrote:
Why would that make any difference? Why can UA make EWR-HKG work any more than someone could make JFK-HKG work?


EWR is a very large United fortress hub with lots and lots of feed for the flight.


I'd be willing to bet that UA's EWR-HKG flight survives on mostly O&D, with relatively few connections. Most connecting traffic from the Eastern U.S. to HKG is better flowed over UA's ORD-HKG flight.

Also, DL's JFK hub connects most of the same medium and large Northeast markets as UA's EWR hub (DCA, PIT, BUF, BOS, etc.), so I don't see why EWR would have a major advantage over JFK in that regard. How many cumulative HKG connections is UA getting from EWR's unique destinations not served from JFK such as ALB, PVD, BGR, and PQI?
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gsg013
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Re: Will DL return to HKG again?

Mon Feb 11, 2019 6:45 pm

FSDan wrote:
StudiodeKadent wrote:
BoeingGuy wrote:
Why would that make any difference? Why can UA make EWR-HKG work any more than someone could make JFK-HKG work?


EWR is a very large United fortress hub with lots and lots of feed for the flight.


I'd be willing to bet that UA's EWR-HKG flight survives on mostly O&D, with relatively few connections. Most connecting traffic from the Eastern U.S. to HKG is better flowed over UA's ORD-HKG flight.

Also, DL's JFK hub connects most of the same medium and large Northeast markets as UA's EWR hub (DCA, PIT, BUF, BOS, etc.), so I don't see why EWR would have a major advantage over JFK in that regard. How many cumulative HKG connections is UA getting from EWR's unique destinations not served from JFK such as ALB, PVD, BGR, and PQI?


Yes DL could fly JFK-HKG that being said not sure how much $$ they would make on it. It would be tough competing against AA/ Cathay multiple times Daily between JFK&HKG. The flight is 8,072 mi (GCMAP) so if you were to fly it you need to be sure you are able to make money off it. DL is not in the business of flying a ULH route that will not make significant profits.
 
FSDan
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Re: Will DL return to HKG again?

Mon Feb 11, 2019 7:31 pm

gsg013 wrote:
FSDan wrote:
StudiodeKadent wrote:

EWR is a very large United fortress hub with lots and lots of feed for the flight.


I'd be willing to bet that UA's EWR-HKG flight survives on mostly O&D, with relatively few connections. Most connecting traffic from the Eastern U.S. to HKG is better flowed over UA's ORD-HKG flight.

Also, DL's JFK hub connects most of the same medium and large Northeast markets as UA's EWR hub (DCA, PIT, BUF, BOS, etc.), so I don't see why EWR would have a major advantage over JFK in that regard. How many cumulative HKG connections is UA getting from EWR's unique destinations not served from JFK such as ALB, PVD, BGR, and PQI?


Yes DL could fly JFK-HKG that being said not sure how much $$ they would make on it. It would be tough competing against AA/ Cathay multiple times Daily between JFK&HKG. The flight is 8,072 mi (GCMAP) so if you were to fly it you need to be sure you are able to make money off it. DL is not in the business of flying a ULH route that will not make significant profits.


Agreed. I don't think JFK-HKG on DL is very likely in the near future, but I do think it's probably their best shot at returning to HKG with their own metal. Second best option would probably be LAX-HKG, but that route has just as much competition, and DL doesn't have as strong of a market position in L.A. as they have in NYC. The problem with SEA-HKG and DTW-HKG was that neither has a particularly large or lucrative local market.

My comments on EWR-HKG vs JFK-HKG above are just me pushing back on the idea that EWR-HKG only works because of the scale of the EWR hub. I think that route works because of the large and high-yielding O&D, which JFK shares with EWR. Connections are just gravy, and JFK would be able to offer many of the same connections.
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UA857
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Re: Will DL return to HKG again?

Tue Feb 12, 2019 5:36 am

Why did DL cut SEA-HKG?
 
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compensateme
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Re: Will DL return to HKG again?

Tue Feb 12, 2019 5:40 am

UA857 wrote:
Why did DL cut SEA-HKG?


DL said it incurred heavy losses.
We don’t care what your next flight is.
 
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thekorean
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Re: Will DL return to HKG again?

Tue Feb 12, 2019 5:52 am

ElroyJetson wrote:
The yields stink to HKG and really all of China which is why CX is losing money and also why DL has entered into a JV with KE.

DL does not need to fly to every major Asian city. They have tried HKG from DTW, MSP, and SEA. They all lost money. I think DL will continue to funnel pax into ICN and let KE do the intra Asian flying.

Maybe you could see ATL-HKG someday, but I doubt it.

Aside from JFK, none of the DL hubs are where there is significant traffic to Hong Kong, I don't think.
 
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LAX772LR
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Re: Will DL return to HKG again?

Tue Feb 12, 2019 5:56 am

thekorean wrote:
Aside from JFK, none of the DL hubs are where there is significant traffic to Hong Kong, I don't think.

You mean except the second largest market to HKG in the country...?
I myself, suspect a more prosaic motive... ~Thranduil
 
Etabc2012
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Re: Will DL return to HKG again?

Tue Feb 12, 2019 6:15 am

compensateme wrote:
UA857 wrote:
Why did DL cut SEA-HKG?


DL said it incurred heavy losses.

That is quite ironic that DL is making a heavy losses with a steady high load factor on the route and CX announce to start the SEA route right after it's cancel which they quickly increase to a daily service with their A359
What makes DL struggle with the 777 but CX can make it work with daily 359?
 
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LAX772LR
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Re: Will DL return to HKG again?

Tue Feb 12, 2019 6:28 am

Etabc2012 wrote:
What makes DL struggle with the 777 but CX can make it work with daily 359?

ANSWER: they're chasing two different types of traffic and multiple different types of flows.
CX's is easily the more voluminous and arguably the more lucrative. The fact that they can offer tons of connects on both ends, helps as well.

DL was trying to send limited Seattle O&D, plus flow traffic from N.America, to HKG as a terminating point.

CX is trying to send limited Seattle O&D to HKG, plus the larger Seattle O&D to eastern, southeast, and south Asia, plus flow traffic from N.America generated by Alaska.... to HKG as both a terminating point and a hub.

Combine that with CX using a longer ranged and more efficient aircraft, and the fact that they command the HKG p.o.s. in a way DL never could match; and you have the reasons why they're far more likely to succeed on SEA-HKG than DL.
I myself, suspect a more prosaic motive... ~Thranduil
 
Detroit313
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Re: Will DL return to HKG again?

Tue Feb 12, 2019 6:42 am

Ridiculous that they don't fly at all to the world's, along with New York and London, top business center.
 
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SEAxSANxBOS
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Re: Will DL return to HKG again?

Wed Feb 13, 2019 3:10 am

Old Delta and Old NW. Fly places because tradition, prestige, and profits be damned.

New post merger Delta. Operate in a smart manner maximizing profits and alliance usage to create a stable business model. So they never go bankrupt again...
Does not reflect the views of Delta Air Lines

Favorite Airports: SEA, SAN, BOS, MSP, IND, CVG
 
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LAX772LR
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Re: Will DL return to HKG again?

Wed Feb 13, 2019 8:51 am

Detroit313 wrote:
Ridiculous that they don't fly at all to the world's, along with New York and London, top business center.

Yeah I know, what idiots. If they followed your advice, maybe someday they can aspire to be the most profitable airline on the planet.... oh wait. :roll:
I myself, suspect a more prosaic motive... ~Thranduil
 
fsafsx
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Re: Will DL return to HKG again?

Wed Feb 13, 2019 1:12 pm

If Delta returns to Hong Kong it should be from Minneapolis because theres no competition and it is in a geographically good location to fly the A350.
 
bkflyguy
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Re: Will DL return to HKG again?

Wed Feb 13, 2019 2:45 pm

Does the A339 have the legs to fly SEA-HKG? If its operating costs are much lower and it is not payload restricted like the A332, maybe DL can make it work. But I'm not banking on them bringing it back anytime soon.
 
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compensateme
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Re: Will DL return to HKG again?

Wed Feb 13, 2019 3:16 pm

bkflyguy wrote:
Does the A339 have the legs to fly SEA-HKG? If its operating costs are much lower and it is not payload restricted like the A332, maybe DL can make it work. But I'm not banking on them bringing it back anytime soon.


I agree, DL won’t be returning to HKG soon. They just exited the market, cutting loose dozens of staff including experienced professionals... and yet we see perpetual, re-occurring ‘when is DL going to return to HKG’ topics on a.net and it’s embarrassing. It had nothing to do with equipment, it was clear they were struggling to fill planes for quite some time, bouncing equipment size, frequency, etc.

That said, they probably will return to the market one day... maybe when they pickup some second hand magic 787 :).
We don’t care what your next flight is.
 
FSDan
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Re: Will DL return to HKG again?

Wed Feb 13, 2019 5:05 pm

bkflyguy wrote:
Does the A339 have the legs to fly SEA-HKG? If its operating costs are much lower and it is not payload restricted like the A332, maybe DL can make it work. But I'm not banking on them bringing it back anytime soon.


I believe the 339s will have similar range to the 332s. So probably no better for the SEA-HKG market (plus too big of an aircraft). As I understand it, the 772 had enough range, but too many seats for the market.
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winginit
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Re: Will DL return to HKG again?

Wed Feb 13, 2019 6:56 pm

fsafsx wrote:
If Delta returns to Hong Kong it should be from Minneapolis because theres no competition and it is in a geographically good location to fly the A350.


And there's no competition because there's virtually no local market between MSP and HKG. If they couldn't make SEA-HKG work no way MSP-HKG does any better.

compensateme wrote:
I agree, DL won’t be returning to HKG soon. They just exited the market, cutting loose dozens of staff including experienced professionals... and yet we see perpetual, re-occurring ‘when is DL going to return to HKG’ topics on a.net and it’s embarrassing. It had nothing to do with equipment, it was clear they were struggling to fill planes for quite some time, bouncing equipment size, frequency, etc.


Spot on.
 
Schmave
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Re: Will DL return to HKG again?

Wed Feb 13, 2019 7:48 pm

Talking about yields, I flew LAX-HKG round-trip in October for ~$350 on HX. And the cheap fare was basically the only reason we took the trip. Delta does not want to chase yields like that so, IMO, they won't be returning anytime soon. They can always connect customers through ICN via KE if they need to get someone there.
 
zakuivcustom
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Re: Will DL return to HKG again?

Wed Feb 13, 2019 8:23 pm

winginit wrote:
And there's no competition because there's virtually no local market between MSP and HKG. If they couldn't make SEA-HKG work no way MSP-HKG does any better.


NW tried that circa 1997-1998. Didn't last long at all. Yes, there are other problems going on (Asian Financial Crisis mainly), but that was back in the days with much less competitions also.

Schmave wrote:
Talking about yields, I flew LAX-HKG round-trip in October for ~$350 on HX. And the cheap fare was basically the only reason we took the trip. Delta does not want to chase yields like that so, IMO, they won't be returning anytime soon. They can always connect customers through ICN via KE if they need to get someone there.


We'll see how long HX long-haul experiment last. They've ended CNS/OOL, is ending AKL in May, had reduced HKG-YVR to 5/wk (instead of daily), and doesn't have the money to expand their long-haul flights (i.e. HKG-SFO is still 4/wk instead of daily). As long as HX is pushing fare way down, though, DL is not going to jump onto LAX-HKG.

LAX772LR wrote:
CX is trying to send limited Seattle O&D to HKG, plus the larger Seattle O&D to eastern, southeast, and south Asia, plus flow traffic from N.America generated by Alaska.... to HKG as both a terminating point and a hub.


Feed is actually relatively limited at SEA side due to the flight timing (arriving at 2100), nor the timing all that great for connection to India at HKG (Flight arrive early in the morning, while CX flights to India either around 6pm or 10pm). They did have feed at HKG the morning bank of flights to SE Asia, though, and SEA->East/SE Asia (inc. HKG) is definitely a larger market than Pacific NW -> HKG (technically it's the entire CONUS, but there are lots of competition from other gateways like SFO/LAX/ORD/NYC covering different parts of CONUS). Oh, and HK p.o.s. definitely favor CX by a huge margin.
Free Hong Kong! Free China!

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