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b777900
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Delta Hong Kong

Mon Feb 08, 2016 5:47 am

DID DL stop the NS SEA-HKG? if so why and that would be perfect for the new 350's coming. any one?
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michman
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RE: Delta Hong Kong

Mon Feb 08, 2016 6:01 am

Quoting b777900 (Thread starter):
ID DL stop the NS SEA-HKG?

No, it currently operates only Wed/Sat (alternating with NRT-HKG flights). Goes back to daily the last week of March when NRT-HKG will be dropped (for the second time).
 
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b777900
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RE: Delta Hong Kong

Mon Feb 08, 2016 6:06 am

So than how would you go to HKG from ATL if there is no more NRT HKG? I thought all US Asia connections went through NRT?
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steex
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RE: Delta Hong Kong

Mon Feb 08, 2016 6:20 am

Quoting b777900 (Reply 2):
So than how would you go to HKG from ATL if there is no more NRT HKG? I thought all US Asia connections went through NRT?

Someone would fly ATL-SEA-HKG instead of ATL-NRT-HKG. In theory, SEA allows more one-stop connections to HKG than NRT does by the very nature of DL serving more cities.
 
Prost
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RE: Delta Hong Kong

Mon Feb 08, 2016 9:17 am

HKG would probably be an excellent candidate for A350 service, but I'm not certain DL will want to introduce a new type on a flight not touching ATL. And it is significantly larger than an A330-200, so I don't know if a larger plane would dilute the RASM. Diminished RASM might be acceptable with a lower CASM frame, however.
 
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hongkongflyer
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RE: Delta Hong Kong

Mon Feb 08, 2016 10:09 am

Quoting michman (Reply 1):
No, it currently operates only Wed/Sat (alternating with NRT-HKG flights). Goes back to daily the last week of March when NRT-HKG will be dropped (for the second time).

I suspect DL is subject to certain air traffic right constrains that they can only have 1 departure out of Hong Kong per day,
so when HKG-SEA become daily in summer seasons, HKG-NRT has to be dropped temporary.
 
steex
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RE: Delta Hong Kong

Mon Feb 08, 2016 10:11 am

Quoting hongkongflyer (Reply 5):
I suspect DL is subject to certain air traffic right constrains that they can only have 1 departure out of Hong Kong per day,
so when HKG-SEA become daily in summer seasons, HKG-NRT has to be dropped temporary.

That is not the case. DL would not be able to sustain SEA-HKG without directing all of their traffic via SEA, it cannot afford to split traffic between both SEA and NRT. NRT-HKG was previously dropped for this reason, but despite that, they still couldn't justify daily nonstop SEA-HKG in the winter season. NRT-HKG was only reinstated to maintain daily service without having to do SEA-HKG daily.
 
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LAXintl
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RE: Delta Hong Kong

Mon Feb 08, 2016 1:30 pm

Quoting hongkongflyer (Reply 5):
I suspect DL is subject to certain air traffic right constrains that they can only have 1 departure out of Hong Kong per day,
so when HKG-SEA become daily in summer seasons, HKG-NRT has to be dropped temporary.

DL could offer additional HKG services anytime it wishes. There are really minimal bilateral constraints on such.

The issue comes down to the fact that DL for whatever reason similar to NW prior is simply weak in HKG and has been unable to generate enough profitable traffic for even a consistent daily nonstop to US mainland.

DL weakness is really surprising when one compares position vis-a-vis UA which manages 3 daily US mainland departures plus a link to its GUM hub in addition to intra-Asian beyond flights to SGN and SIN.
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Osubuckeyes
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RE: Delta Hong Kong

Mon Feb 08, 2016 2:35 pm

Quoting steex (Reply 6):
NRT-HKG was previously dropped for this reason, but despite that, they still couldn't justify daily nonstop SEA-HKG in the winter season

Which is surprising because HKG isn't really a seasonal destination and IIRC winter actually had higher passenger numbers from the US across all carriers.
 
jetlanta
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RE: Delta Hong Kong

Mon Feb 08, 2016 2:43 pm

Quoting LAXintl (Reply 7):
DL could offer additional HKG services anytime it wishes. There are really minimal bilateral constraints on such.

The issue comes down to the fact that DL for whatever reason similar to NW prior is simply weak in HKG and has been unable to generate enough profitable traffic for even a consistent daily nonstop to US mainland.

DL weakness is really surprising when one compares position vis-a-vis UA which manages 3 daily US mainland departures plus a link to its GUM hub in addition to intra-Asian beyond flights to SGN and SIN.

Delta's weakness to HKG is primarily driven by a few facts. The market is extremely competitive. It is very long-haul. Delta's best potential hubs for HKG (SEA, DTW, ATL) have very little local O&D traffic. The other two gateways that make sense (JFK & LAX) are extremely well-served by Cathay & partners, leaving little local O&D available for Delta.

Some markets fit some carrier /gateway combos better than others. DTW-NGO and DTW-PVG, for example, are fantastic due to strong business ties in the local markets. HKG doesn't offer the same opportunities for Delta.

Delta will serve HKG either via NRT or SEA in order to keep it on the map. But its never going to be a great market for them. The economics of the A350 might change the equation a bit, but HKG is always going to be a tough fit for the DL network.
 
a380787
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RE: Delta Hong Kong

Mon Feb 08, 2016 2:58 pm

Quoting jetlanta (Reply 9):
The market is extremely competitive.

So are you insinuating the most profitable airline in the US cannot compete in markets that are competitive ?

Quoting jetlanta (Reply 9):
It is very long-haul.

It's reachable by 332. That's nothing close to "very long haul" unless we're moving goal posts here.

Quoting jetlanta (Reply 9):
The economics of the A350 might change the equation a bit

2 issues with this.

1. SEA-HKG seems to me like a volume issue, not a yield issue. What DL needs is a smaller plane to lower trip costs, not one that's far bigger than the 332 to lower CASM.

2. DL isn't the only one uniquely acquiring fuel-efficient next-gen planes of 787, 350, and 777X. The efficiency gains enabled by the 350 will simply be "keeping up with the joneses".
 
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:06 pm

Quoting a380787 (Reply 10):
So are you insinuating the most profitable airline in the US cannot compete in markets that are competitive ?

How do you think AA would perform in the DTW-PVG market? Or CX would perform in the JFK-LHR market? Profitable carriers chose their battles wisely. HKG is a very challenging market for Delta for the reasons I've listed above. Delta has virtually no point-of-sale traffic in Hong Kong, which is dominated by one of the word's finest airlines. So it has to rely on U.S. point-of-sale. Its hubs are not well-suited for HKG because the local market sizes are small.

Quoting a380787 (Reply 10):
It's reachable by 332. That's nothing close to "very long haul" unless we're moving goal posts here.

Its a very long-haul if you don't have enough revenue on the plane.

Quoting a380787 (Reply 10):
2. DL isn't the only one uniquely acquiring fuel-efficient next-gen planes of 787, 350, and 777X. The efficiency gains enabled by the 350 will simply be "keeping up with the joneses".

Let me make this simple for you. A more efficient aircraft "might" have lower costs on a long haul service such as DTW-HKG. Lower costs "might" make the route more profitable.
 
catiii
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:09 pm

Quoting a380787 (Reply 10):
So are you insinuating the most profitable airline in the US cannot compete in markets that are competitive ?

Well, DXB is a good example  
 
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christao17
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:11 pm

Quoting a380787 (Reply 10):
Quoting jetlanta (Reply 9):
It is very long-haul.

It's reachable by 332. That's nothing close to "very long haul" unless we're moving goal posts here.

Did you read his entire paragraph or are you cherry-picking this single sentence? The rest of his paragraph provides a very coherent explanation for why HKG is a tough fit in DL's overall map.
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roseflyer
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:24 pm

DL/NW have historically been very weak in the Hong Kong market. Pan Am and then United have been very strong in the market. This is not about alliances since UA has no alliance support in HKG yet has flights to SFO, EWR, ORD, NRT, SGN, SIN and GUM. DL only operates a single A330-200. It amazes me that with such a huge market, DL can't make it work. They are such a huge airline and compete in many other competitive markets.
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a380787
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:26 pm

Quoting christao17 (Reply 13):

Did you read his entire paragraph or are you cherry-picking this single sentence? The rest of his paragraph provides a very coherent explanation for why HKG is a tough fit in DL's overall map.

His entire spiel was just standard corporate talking points where tons of other "very long haul" or "competitive" markets DL does just fine against world-class competitors, but uniquely fails in HKG. Basically blaming everyone else except themselves.

SEA-HKG is a monopoly and yet that's what he calls "extremely competitive". Against what? 1-stop service from Hainan Air ?

Quoting jetlanta (Reply 11):

How do you think AA would perform in the DTW-PVG market? Or CX would perform in the JFK-LHR market?

Those are stupid analogies. SEA is a major DL hub, and SEA-HKG is a monopoly for DL.

Quoting jetlanta (Reply 11):
Delta has virtually no point-of-sale traffic in Hong Kong,

300 million people in the US plus 30-some million in Canada and more in Lat-Am and yet DL still needs to rely on HKG point-of-sale to make such a medium-length 10.5hr eastbound route work ?? If DL fails to develop proper point-of-sale arrangements that's entirely their own fault, not of the market.

Isn't it iroinc ? People keep yakking about "all aisle access J" as if it's the holy grail, and yet, the airline flunking HKG the most is the one with 100% all-aisle access, and the one succeeding the most is the one with 0%.
 
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:29 pm

HKG is long haul from most of the USA which makes it very expensive to fly to, compared to say Orlando.

NW flew MSP-HKG in the past. I think it was one of the least effective route decisions ever made by an airline, but there you go.

It is reasonable to expect DL to continue the SEA-HKG market indefinitely, and perhaps leave it at that IMO. They might do JFK, but as noted, direct competition vs entrenched and (superior) airlines isn't a wise use of DL's resources. They aren't stupid.
 
a380787
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:30 pm

Quoting roseflyer (Reply 14):
This is not about alliances since UA has no alliance support in HKG yet has flights to SFO, EWR, ORD, NRT, SGN, SIN and GUM.

To be fair, NRT-HKG has been chopped in favor of the nonstops. NRT-HKG only exist in the ANA JV form today.
 
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mercure1
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:37 pm

Its interesting to note that should a major airline like Delta with long inherited legacy in Far East has trouble serving a major financial and trade hub like Hong Kong.

If Seattle is indeed the carriers platform to across Pacific then surely at minimal a daily service link should be offered.
If the case is that Seattle cannot support link to mega city such as HKG then one wonders how could it support future growth to even smaller or more distant Far East markets?
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RDUDDJI
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:42 pm

Quoting LAXintl (Reply 7):
DL weakness is really surprising when one compares position vis-a-vis UA which manages 3 daily US mainland departures plus a link to its GUM hub in addition to intra-Asian beyond flights to SGN and SIN.

UA has HKG-SFO/ORD/JFK. All of those are much stronger HKG markets than SEA.

IMO, DL picking SEA as it's West Coast - Asian gateway was a mistake, but where else could they have an Asian gateway hub? None of DL's hubs have a particularly high amount of traffic to Asia.

Additionally, for many people on the East Coast and in the Midwest, it's a double connection to get to SEA...

Quoting a380787 (Reply 10):
So are you insinuating the most profitable airline in the US cannot compete in markets that are competitive ?

Business 101: Opportunity Cost. Why should DL (or anyone) fly a market that makes x in revenue when they could use the same assets to fly a route that makes 1.2x? That's a simplified example, but you get the gist.
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Flighty
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:46 pm

Quoting mercure1 (Reply 18):
If the case is that Seattle cannot support link to mega city such as HKG then one wonders how could it support future growth to even smaller or more distant Far East markets?

Good point, but the Seattle market has been growing recently and, in theory, could become the size SFO is today in 20 years. I think DL isn't looking backward to Seattle's fish processing past. They are looking forward to SEA becoming a software and wealthy emigree crossroads with millions of additional people. Of Earth's top 10 richest people, 2 live in SEA market and more software jobs are increasing (arguably more important as a whole than New York's financial center at this point).

To your point, I would imagine SEA-HKG will go daily, or else the whole strategy doesn't seem viable. But I believe it is.
 
a380787
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:49 pm

Quoting RDUDDJI (Reply 19):

Business 101: Opportunity Cost. Why should DL (or anyone) fly a market that makes x in revenue when they could use the same assets to fly a route that makes 1.2x? That's a simplified example, but you get the gist.

There are certain markets that should be strategic enough to the network's value proposition to be allowed to exist at below-optimal performance. Especially in light of the fact that DL lacks a JV partner to East Asia, they have no choice but to serve those destinations with their own metal. As one of the most premier financial hubs globally, HKG should be one of those strategic flights.

Quoting Flighty (Reply 20):

To your point, I would imagine SEA-HKG will go daily, or else the whole strategy doesn't seem viable. But I believe it is.

It *was* daily, then went to 2x weekly over the winter seasonally. And remember that unlike most foreign markets, the HKD is pegged to the USD, so the forex woes at other markets (e.g. Japan) does not apply here whatsoever.
 
Sightseer
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RE: Delta Hong Kong

Mon Feb 08, 2016 3:59 pm

Quoting a380787 (Reply 15):
DL does just fine against world-class competitors, but uniquely fails in HKG. Basically blaming everyone else except themselves.

Having a minimal presence in a large market is hardly unique to DL. Look at UA in MIA or AA in AMS.

Quoting a380787 (Reply 15):
SEA-HKG is a monopoly and yet that's what he calls "extremely competitive".

I'm sure you know as well as anyone that DL competes for far more than SEA-HKG O&D traffic.

Quoting a380787 (Reply 15):
SEA is a major DL hub, and SEA-HKG is a monopoly for DL.

By that logic, IAD-KWI, DFW-KIX, and ATL-DXB should all still be around.

Quoting mercure1 (Reply 18):
If the case is that Seattle cannot support link to mega city such as HKG then one wonders how could it support future growth to even smaller or more distant Far East markets?

DTW-HKG didn't stick around either, yet you don't see many people questioning DTW's effectiveness as an Asian gateway. For that reason, I'd say it's unfair to judge SEA solely based on the status of HKG.
 
roseflyer
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RE: Delta Hong Kong

Mon Feb 08, 2016 4:01 pm

Quoting RDUDDJI (Reply 19):

UA has HKG-SFO/ORD/JFK. All of those are much stronger HKG markets than SEA.

IMO, DL picking SEA as it's West Coast - Asian gateway was a mistake, but where else could they have an Asian gateway hub? None of DL's hubs have a particularly high amount of traffic to Asia.

Additionally, for many people on the East Coast and in the Midwest, it's a double connection to get to SEA...

If DL can't make SEA-HKG work there is something going on with DL. DL has the route to themselves and it should be enough of a market in my opinion. There are at least 3 777-300ERs a day flying from YVR, SFO and LAX and yet SEA can't fill an A330-200? Based on geography, SEA is the best connecting spot in the western US to HKG.

DL is going up against both Korean and Asiana with SEA-ICN. Despite Sky Team, there is no joint venture between DL and KE and KE has little interest in funneling passengers onto DL's SEA-ICN flight when they have their own equipment on the route. If DL can make other cities like ICN, PVG and PEK work from SEA, I don't understand why HKG with no competition doesn't work. DL just can't seem to make HKG work.

[Edited 2016-02-08 08:03:07]
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a380787
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RE: Delta Hong Kong

Mon Feb 08, 2016 4:11 pm

Quoting Sightseer (Reply 22):

DTW-HKG didn't stick around either, yet you don't see many people questioning DTW's effectiveness as an Asian gateway. For that reason, I'd say it's unfair to judge SEA solely based on the status of HKG.

Let's discuss SEA overall then.

1. KIX - cut
2. HKG - 2x weekly winter seasonal
3. HND - attempted to suspend for 90 days, then cut
4. PEK - less than daily year-round (after excluding holiday-related one offs)
5. ICN - less than daily year-round (after excluding holiday-related one offs)
6. Secondary China - never attempted
7. TPE - never attempted, despite partner hub
8. BKK/SIN - never attempted, despite having planes capable of doing it
(9. AUS/NZ - never attempted)

Only 2 routes were consistent - NRT, with a DL hub, and PVG, with a MU hub. I'll let the facts speak for themselves.
 
jetlanta
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RE: Delta Hong Kong

Mon Feb 08, 2016 4:18 pm

Quoting roseflyer (Reply 14):
DL/NW have historically been very weak in the Hong Kong market. Pan Am and then United have been very strong in the market. This is not about alliances since UA has no alliance support in HKG yet has flights to SFO, EWR, ORD, NRT, SGN, SIN and GUM. DL only operates a single A330-200. It amazes me that with such a huge market, DL can't make it work. They are such a huge airline and compete in many other competitive markets.

SFO, EWR and ORD are much stronger local O&D markets to HKG than Delta's gateways. They've also served them for years...well before the DL/NW merger. Cathay is huge in LAX and JFK, which effectively takes them out of contention as gateways with any reasonable chance of profitability for Delta. So Delta's options are SEA (which returns to daily service in a few months), DTW (which was a disaster the last time) and ATL (which would rank well below other ATL opportunities for long-haul aircraft time).

To be clear, Delta IS making HKG work. One way or another they are serving HKG daily. It is just not likely ever going to be a strength market for them. And that is my point. HKG is a great market for some carriers in some circumstances. For others, it is just not a great fit.

Quoting a380787 (Reply 15):
His entire spiel was just standard corporate talking points where tons of other "very long haul" or "competitive" markets DL does just fine against world-class competitors, but uniquely fails in HKG. Basically blaming everyone else except themselves.

SEA-HKG is a monopoly and yet that's what he calls "extremely competitive". Against what? 1-stop service from Hainan Air ?

What the hell are you talking about? Delta actually serves HKG and will serve HKG into the future. That is not "failure". Failure is serving a market and exiting it. I simply pointed out very valid reasons why Delta struggles in the market. Do you have better ones? Perhaps you could impart some wisdom.

And I didn't say SEA-HKG was "extremely competitive". I was referring to the entire HKG market. In particular, SEA-HKG is a small O&D, which means that Delta relies on connecting traffic. But since the entire HKG-U.S. market is so competitive and Delta has little HKG point-of-sale traffic, it struggles relative to AA/CX and the far longer established UA to establish any sort of premium revenue base.

Quoting a380787 (Reply 15):
Those are stupid analogies. SEA is a major DL hub, and SEA-HKG is a monopoly for DL.

No they are not.

Quoting a380787 (Reply 15):
300 million people in the US plus 30-some million in Canada and more in Lat-Am and yet DL still needs to rely on HKG point-of-sale to make such a medium-length 10.5hr eastbound route work ?? If DL fails to develop proper point-of-sale arrangements that's entirely their own fault, not of the market.

Isn't it iroinc ? People keep yakking about "all aisle access J" as if it's the holy grail, and yet, the airline flunking HKG the most is the one with 100% all-aisle access, and the one succeeding the most is the one with 0%.

You don't get it at all, do you? HKG is the HQ and hub for Cathay Pacific. Cathay OWNS the HKG long-haul point-of-sale market. You don't just "market" your way around that. That can't be "fixed" by Delta. So it has to rely on U.S. point-of-sale. But the U.S. point-of-sale is also being competed for by CX/AA, UA and AC, all of whom operate from gateways with significantly more local O&D demand and have a longer and deeper history in the market.

Can all of that be addressed by Delta? Maybe. But at what cost? Is that level of investment worth it? They've clearly determined that keeping HKG on the route map is worth some level of investment, so they have done it. To grow beyond where they are now comes at a huge opportunity cost. I don't think you will see them make that investment. Instead, they will take those risks in the PVG market, which holds far more long-term opportunity for Delta than HKG ever will.
 
jetlanta
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RE: Delta Hong Kong

Mon Feb 08, 2016 4:21 pm

Quoting a380787 (Reply 24):
Let's discuss SEA overall then.

1. KIX - cut
2. HKG - 2x weekly winter seasonal
3. HND - attempted to suspend for 90 days, then cut
4. PEK - less than daily year-round (after excluding holiday-related one offs)
5. ICN - less than daily year-round (after excluding holiday-related one offs)
6. Secondary China - never attempted
7. TPE - never attempted, despite partner hub
8. BKK/SIN - never attempted, despite having planes capable of doing it
(9. AUS/NZ - never attempted)

Only 2 routes were consistent - NRT, with a DL hub, and PVG, with a MU hub. I'll let the facts speak for themselves.

Dude, the hub is like two years old. And Asian economies have sucked for the entire duration it has existed. Calm down.
 
questions
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RE: Delta Hong Kong

Mon Feb 08, 2016 4:26 pm

A few questions:

1. Has UA done better to maintain/grow the Asia business PA to UA than DL has NW to DL?

2. AA, DL and UA seem to have healthy business serving Europe. What is preventing AA and DL from developing stronger positions US to Asia?

3. Was DL late to the game in obtaining an Asian SkyTeam alliance partners or were their negotiating skills inferior to AA and UA?

4. Did lacking a strong Asian partnership airline influence DL's decision to select SEA vs LAX?

5. Does US connection point have any influence on ticket purchase for those originating outside of the US?
 
RDUDDJI
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RE: Delta Hong Kong

Mon Feb 08, 2016 4:30 pm

Quoting roseflyer (Reply 23):
If DL can't make SEA-HKG work there is something going on with DL. DL has the route to themselves and it should be enough of a market in my opinion. There are at least 3 777-300ERs a day flying from YVR, SFO and LAX and yet SEA can't fill an A330-200? Based on geography, SEA is the best connecting spot in the western US to HKG.

I don't know that they're not making it work. However, SFO (8.5mil peeps in the CSA) and LAX (18.5mil) are not comparable markets to SEA (4.5mil). Both LAX and SFO also have much larger Asian communities.
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a380787
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RE: Delta Hong Kong

Mon Feb 08, 2016 4:32 pm

Quoting jetlanta (Reply 25):

And I didn't say SEA-HKG was "extremely competitive". I was referring to the entire HKG market. In particular, SEA-HKG is a small O&D, which means that Delta relies on connecting traffic. But since the entire HKG-U.S. market is so competitive and Delta has little HKG point-of-sale traffic, it struggles relative to AA/CX and the far longer established UA to establish any sort of premium revenue base.

You want to know what's truly "extremely competitive" ? SFO-HKG, where UA has to go against both SQ and CX head-on, 2 of the most renowned carriers globally, or SFO-ICN, where UA goes against SQ KE OZ.

DL has 100% monopoly on every single DTW-Asia route, so therefore it succeeds. At SEA, where *some* routes actually have real competition, then it struggles. Geeez.

Quoting jetlanta (Reply 25):

Can all of that be addressed by Delta? Maybe. But at what cost? Is that level of investment worth it? They've clearly determined that keeping HKG on the route map is worth some level of investment, so they have done it. To grow beyond where they are now comes at a huge opportunity cost. I don't think you will see them make that investment. Instead, they will take those risks in the PVG market, which holds far more long-term opportunity for Delta than HKG ever will.

Then DL should entirely quit HKG nonstop and just link it to NRT. This is where it is go-big-or-go-home.

Quoting jetlanta (Reply 26):

Dude, the hub is like two years old. And Asian economies have sucked for the entire duration it has existed. Calm down.

Check your facts. China has been growing at 7+%, while HKG has the world's hottest property market during those years. Your facts fail you once again.

Quoting questions (Reply 27):
1. Has UA done better to maintain/grow the Asia business PA to UA than DL has NW to DL?

UA is the only carrier in secondary China, and the only one trying routes like SIN nonstop. So yes, one can argue it has done a better job.

Quoting questions (Reply 27):
5. Does US connection point have any influence on ticket purchase for those originating outside of the US?

That should matter only little. Unless the transit point has a painfully horrible reputation (e.g. MNL or NBO), usually through-pax are somewhat agnostic to where the transit occurs.
 
jetlanta
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RE: Delta Hong Kong

Mon Feb 08, 2016 4:35 pm

Quoting questions (Reply 27):
. Has UA done better to maintain/grow the Asia business PA to UA than DL has NW to DL?

UA has a SFO hub to serve most of Asia. Delta had a NRT hub. Not even remotely the same network opportunities.

Quoting questions (Reply 27):
AA, DL and UA seem to have healthy business serving Europe. What is preventing AA and DL from developing stronger positions US to Asia?

Europe is a much more mature market, with stronger deeper immunized alliances for all three U.S. carriers.

Quoting questions (Reply 27):
Was DL late to the game in obtaining an Asian SkyTeam alliance partners or were their negotiating skills inferior to AA and UA?

Delta has plenty of SkyTeam partners in Asia, it just doesn't have a particular one that wants to be in a JV. And it did negotiate a minority stake in JAL which was nixed at the last minute by a new JAL CEO.

Quoting questions (Reply 27):
Did lacking a strong Asian partnership airline influence DL's decision to select SEA vs LAX?

No. LAX is not well-situated to be a "gateway" in either geographic or competitive terms. Good luck to AA on that one.

Quoting questions (Reply 27):
Does US connection point have any influence on ticket purchase for those originating outside of the US?

Probably not.
 
roseflyer
Posts: 9602
Joined: Fri Feb 13, 2004 9:34 am

RE: Delta Hong Kong

Mon Feb 08, 2016 4:35 pm

Quoting jetlanta (Reply 25):

To be clear, Delta IS making HKG work. One way or another they are serving HKG daily. It is just not likely ever going to be a strength market for them. And that is my point. HKG is a great market for some carriers in some circumstances. For others, it is just not a great fit.

DL is barely making HKG work. 2 days a week from SEA and 5 from NRT is a very poor option for their customers. It's winter slow season so dropping some frequency to about 5 a week isn't bad, but 2 a week nonstop from SEA and 5 a week from NRT doesn't really support business travel very well. Connecting in SEA adds a couple hundred miles over NRT from the northeast. For the vast majority of people, SEA is a better connecting point since it has a much larger network than NRT so people won't be happy if they get one stop only in a single direction and require a double connection the other way.
If you have never designed an airplane part before, let the real designers do the work!
 
commavia
Posts: 11489
Joined: Mon Apr 25, 2005 2:30 am

RE: Delta Hong Kong

Mon Feb 08, 2016 4:39 pm

Quoting questions (Reply 27):
1. Has UA done better to maintain/grow the Asia business PA to UA than DL has NW to DL?

Yes, but it's frankly an unfair comparison. United has clearly been far more successful than Delta/Northwest in diversifying their Asia network away from NRT, but then United had far, far better tools to work with in the form of hubs - particularly SFO, but frankly also ORD and later EWR - that that were substantially better positioned for Asia. Delta has caught up tremendously in the last few years and is well on its way to establishing a robust nonstop U.S.-Asia network built around SEA/DTW, but United has such a lead over Delta (and AA) that I don't think either of those rivals can ever really catch up.

Quoting questions (Reply 27):
2. AA, DL and UA seem to have healthy business serving Europe. What is preventing AA and DL from developing stronger positions US to Asia?

Again, I think network is part of it. The combination of SFO, ORD and EWR is just unbeatable - United's U.S. hub structure is perfectly oriented for Asia. Beyond that, though, AA has suffered from a historically week network and brand recognition. That being said, AA has dramatically closed the gap vs Delta in just the last few years. AA only has a few more additions to make - I'd say LAX-ICN and LAX-PEK - and it will have essentially matched Delta's nonstop U.S.-Asia network.

Quoting questions (Reply 27):
3. Was DL late to the game in obtaining an Asian SkyTeam alliance partners or were their negotiating skills inferior to AA and UA?

This has been much discussed. The critical issue facing Delta's SkyTeam partnerships in Asia, and some would argue Delta's competitiveness in Asia more broadly, is Korean. Korean Air has an extensive network throughout East Asia, and ICN is an exceptional hub. Unfortunately, the unstoppable force of Delta's requirements for a deeper relationship have seemingly met the immovable object that is Korean Air's own requirements for independence. I doubt it's really an issue of Delta's "negotiating skills" per se, but more just about these two "partners" having fundamentally different views on what they want their "alliance" to be.

Quoting questions (Reply 27):
4. Did lacking a strong Asian partnership airline influence DL's decision to select SEA vs LAX?

I think the bigger driver was that SEA was within 767 range of northeast Asia, had relatively less U.S. and foreign competition than LAX, and was a major hub for Alaska (which, according to past discussion here, Delta was hoping to "lock up" with an exclusive partnership excluding AA).
 
User avatar
Polot
Posts: 10338
Joined: Thu Jul 28, 2011 3:01 pm

RE: Delta Hong Kong

Mon Feb 08, 2016 4:39 pm

Quoting questions (Reply 27):
1. Has UA done better to maintain/grow the Asia business PA to UA than DL has NW to DL?

It is hard to compare the transitions as PA->UA was about 30 years ago while NW->DL was ~8, but NW was feeling the pressure in Asia before DL. UA has a much better hub for Asia (SFO) which allowed them to decrease their dependence on NRT and develop business ties elsewhere in the continent. NW was still heavily NRT dependent when DL took them over, and DL was weak in Asia so did not add much to the equation when they took NW over in that area.

Quoting questions (Reply 27):
2. AA, DL and UA seem to have healthy business serving Europe. What is preventing AA and DL from developing stronger positions US to Asia?

Competition. US-Asia is much further (SEA-NRT, one of the shortest transpac routes possible, is only 600 nm shorter than LAX-LHR), with less traffic, than US-Europe, and United is the only airline with a fortress hub well suited for Asia. It is because of that hub that UA is able to make secondary Asian markets work nonstop to the US. DL is trying to replicate it in SEA, while AA is trying to hit the heavy markets from all its hubs.

Quoting questions (Reply 27):
4. Did lacking a strong Asian partnership airline influence DL's decision to select SEA vs LAX?

Again competition (or lack there of). UA/AA/DL are all very close in size at LAX, not to mention all the international carriers. SEA just has AS, who does not fly intercontinental and who DL was originally partnering with. DL is trying to build a fortress to make Asia work like UA has done in SFO.
 
Sightseer
Posts: 991
Joined: Mon Jan 12, 2015 6:04 am

RE: Delta Hong Kong

Mon Feb 08, 2016 4:52 pm

Quoting a380787 (Reply 24):
Let's discuss SEA overall then.

Sure, in this context:

Quoting jetlanta (Reply 26):
Dude, the hub is like two years old. And Asian economies have sucked for the entire duration it has existed. Calm down.

Anyway ...

Quoting a380787 (Reply 24):
1. KIX - cut

Currently served by only one US airline from the strongest, most well-established TPAC hub in the country. Also cut from DTW.

Quoting a380787 (Reply 24):
2. HKG - 2x weekly winter seasonal

Well-documented elsewhere in this thread.

Quoting a380787 (Reply 24):
3. HND - attempted to suspend for 90 days, then cut

Currently served from larger markets in LAX (on DL), SFO, and HNL under extreme slot requirements. Also cut from DTW and JFK.

Quoting a380787 (Reply 24):
4. PEK - less than daily year-round (after excluding holiday-related one offs)

No it's not.

Quoting a380787 (Reply 24):
5. ICN - less than daily year-round (after excluding holiday-related one offs)

No it's not.

Quoting a380787 (Reply 24):
6. Secondary China - never attempted

Currently served by only one US airline from the strongest, most well-established TPAC hub in the country.

Quoting a380787 (Reply 24):
7. TPE - never attempted, despite partner hub

Low-yielding and more likely to come once next-gen aircraft arrive. Also, currently served by only one US airline from the strongest, most well-established TPAC hub in the country.

Quoting a380787 (Reply 24):
8. BKK/SIN - never attempted, despite having planes capable of doing it

BKK is even lower-yielding than TPE, while SIN is currently unserved by everyone and will soon be served by only one US airline from the strongest, most well-established TPAC hub in the country.

Quoting a380787 (Reply 24):
(9. AUS/NZ - never attempted)

Terrible geography, small local market, and better served by the stronger, more well-established gateway at LAX. Only discussed on A-net.

So basically my main takeaway from this is that SEA isn't as strong as SFO, which no one has tried to dispute.
 
BigGSFO
Posts: 2277
Joined: Sun Jun 12, 2005 5:27 am

RE: Delta Hong Kong

Mon Feb 08, 2016 5:01 pm

Quoting a380787 (Reply 10):
So are you insinuating the most profitable airline in the US cannot compete in markets that are competitive ?

One of the reasons they are profitable is because they don't waste money in underperforming markets. If SEA-HKG doesn't meet their expectations, it'll be cut. If it does, they will keep it. There are many different reasons though that a market is maintained even if it isn't profitable. There could be corporate contracts that could be lost if the route doesn't stick around.
 
Flighty
Posts: 9963
Joined: Thu Apr 05, 2007 3:07 am

RE: Delta Hong Kong

Mon Feb 08, 2016 5:06 pm

Quoting a380787 (Reply 29):
Then DL should entirely quit HKG nonstop and just link it to NRT. This is where it is go-big-or-go-home.

Failure and success can have multiple meanings. Leaving a market isn't the only kind of failure. Serving it daily and losing money is also failure. DL is nurturing a route with a bright (and IMO near unquestionable) future.

Quoting polot (Reply 33):
NW was still heavily NRT dependent when DL took them over, and DL was weak in Asia so did not add much to the equation when they took NW over in that area.

Correct. NW's supposed strength in Asia was outdated by the time of the merger. It was a prestige thing. But the fares just haven't been high for... 18 years, since SARS? What can we really say? I flew a NW Narita itinerary in '96 and it cost more money then than it would today. All this anticipation, all this growth, but I don't see yields. So far, Asian profits are a mirage for US carriers. Possible exception United. The other majors make their money in middle America and the intra-East Coast.
 
a380787
Posts: 4573
Joined: Tue Jul 09, 2013 4:38 pm

RE: Delta Hong Kong

Mon Feb 08, 2016 5:11 pm

Quoting Sightseer (Reply 34):

Check the schedules . SEA ICN is like 6x weekly currently.
 
YLWbased
Posts: 905
Joined: Mon Jan 30, 2006 6:09 pm

RE: Delta Hong Kong

Mon Feb 08, 2016 5:32 pm

I think DL returning HKG-SEA to daily is for good, not a seasonal change.

I've just booked myself on DL 16 and 17 for Sep this year, and the flight is still operating daily, shown as operating by A332.

YLWbased
Hong Kong is not China. Not better or worse, just different.
 
Sightseer
Posts: 991
Joined: Mon Jan 12, 2015 6:04 am

RE: Delta Hong Kong

Mon Feb 08, 2016 5:39 pm

Quoting a380787 (Reply 37):
Check the schedules . SEA ICN is like 6x weekly currently.

Yes, currently, but not year-round; contrary what was stated below ...

Quoting a380787 (Reply 24):
4. PEK - less than daily year-round (after excluding holiday-related one offs)
5. ICN - less than daily year-round (after excluding holiday-related one offs)

Both are showing daily starting in mid-May.
 
a380787
Posts: 4573
Joined: Tue Jul 09, 2013 4:38 pm

RE: Delta Hong Kong

Mon Feb 08, 2016 5:43 pm

Quoting Sightseer (Reply 39):
Quoting a380787 (Reply 37):
Check the schedules . SEA ICN is like 6x weekly currently.

Yes, currently, but not year-round; contrary what was stated below ...

Quoting a380787 (Reply 24):
4. PEK - less than daily year-round (after excluding holiday-related one offs)
5. ICN - less than daily year-round (after excluding holiday-related one offs)

Both are showing daily starting in mid-May.

My point is correct. 6x weekly in winter = summer seasonal daily = not all 365 days daily. You still never explained why ICN, a partner hub, isn't daily on all 365 days.
 
Sightseer
Posts: 991
Joined: Mon Jan 12, 2015 6:04 am

RE: Delta Hong Kong

Mon Feb 08, 2016 5:52 pm

Quoting a380787 (Reply 40):
6x weekly in winter = summer seasonal daily = not all 365 days daily.

I took sub-daily year-round to mean that over the entire year, the service was less than daily.

Quoting a380787 (Reply 40):
You still never explained why ICN, a partner hub, isn't daily on all 365 days.

Because I never said I would? Although I will point out that DL is the only US airline with anything close to twice daily service on USA-ICN.
 
a380787
Posts: 4573
Joined: Tue Jul 09, 2013 4:38 pm

RE: Delta Hong Kong

Mon Feb 08, 2016 6:04 pm

Quoting Sightseer (Reply 41):

Because I never said I would? Although I will point out that DL is the only US airline with anything close to twice daily service on USA-ICN.

IIRC, ICN is the singular Lower48 to Asia market where DL is significantly ahead of the US legacy competition where competition exists. (of course they're ahead in NGO because no one else flies there)

For Lower48 to NRT, DL has more seats but not more destinations or frequencies.

Correct me if I'm wrong.

ps : if AA launches LAX-ICN as rumored, they might become the new #1 to ICN.

[Edited 2016-02-08 10:06:31]
 
steex
Posts: 1437
Joined: Wed Jun 27, 2007 8:45 am

RE: Delta Hong Kong

Mon Feb 08, 2016 6:06 pm

Quoting a380787 (Reply 40):
You still never explained why ICN, a partner hub, isn't daily on all 365 days.

What do you want people to say? If people attempt to give market or competitive reasons for why DL can't sustain service, you dismiss them out of hand. It seems you will not be satisfied with anything other than blaming DL for corporate incompetence.

Do you really think there is a larger profit for DL to have by flying SEA-Asia with greater frequency, but their management is so poor that they don't feel like making that money? If the answer is no, then the levels of service being currently flown would seem to match market conditions. If the answer is yes, then there is no point in discussing this further.

[Edited 2016-02-08 10:07:28]
 
YLWbased
Posts: 905
Joined: Mon Jan 30, 2006 6:09 pm

RE: Delta Hong Kong

Mon Feb 08, 2016 6:10 pm

Quoting Sightseer (Reply 41):
Quoting a380787 (Reply 40):
You still never explained why ICN, a partner hub, isn't daily on all 365 days.

Because I never said I would? Although I will point out that DL is the only US airline with anything close to twice daily service on USA-ICN.

Let me try. ICN isn't as strong of a hub as you think. In my personal opinion, skyTeam is very weak in Asia, not in terms of coverage (they have MU, CZ and CI covering greater China, can't beat that), but in terms of reputation.

2 of DL's most likely partner hope in Asia should be TPE and ICN, which are the hub of KE and CI, the 2 airlines that even average joe with little aviation knowledge knows to avoid. Even though CI haven't had a single fatal crash in years, but their bad safety record still marks deep inside people's heart across Asia. One good example would be my parents still refuses to fly CI to Taiwan for vacation, even if the ticket is cheapest and CI overall delivers a better product than CX on the route.

KE is another thing, ever since the Asiana crash in SFO, the general public comes to a realization of how much the "order obeying" culture of the Koreans have would affect flying safety. I have colleagues (not one) refusing to fly KE on any occasion and this seems to be a wide spread trend in Asia for business / high yielding pax, especially when you can transit through HND/NRT at the about the same price but fly on JL and NH instead.

MU has such a poor on-time performance due to the frequent air-flow control imposed by the PLA near PVG, no one in their right mind (even MU is ALWAYS the cheapest options to North American from anywhere in Asia) will transit through PVG, not to mention both MU and CZ have terrible customer service.

This pretty much is a nail on the coffin for SkyTeam in Asia, of course there is still GA, also being stuck in the "no fly" list of most flying public due to safety concerns.

And back to HKG, Skyteam has an incredibility weak presents out of HKG, which makes feeding traffic through HKG almost impossible. The only logical transfer that DL can do through HKG are only GA to CGK (yes, GA only flies to CGK from HKG), VN to SGN (HAN flight is a no go due to timing) and Guangdong/Guangxi province secondary cities destinations that are being served by CZ and MU. I wonder how many passengers comes off the SEA-HKG flights are connected to anyone of these destinations.

If Delta truly wants to do better in their USA-Asia flights, they might actually have to switch alliance for that.

YLWBased

[Edited 2016-02-08 10:13:43]

[Edited 2016-02-08 10:16:25]
Hong Kong is not China. Not better or worse, just different.
 
a380787
Posts: 4573
Joined: Tue Jul 09, 2013 4:38 pm

RE: Delta Hong Kong

Mon Feb 08, 2016 6:15 pm

Quoting steex (Reply 43):

What do you want people to say? If people attempt to give market or competitive reasons for why DL can't sustain service, you dismiss them out of hand. It seems you will not be satisfied with anything other than blaming DL for corporate incompetence.

Because it seriously highlights the hypocrisy that exists. When UA flunks it's always about their reputation or their seats or the less-than-inspiring catering or their employees or Smisek, but when DL flunks it's about external forces outside their own control, as if they're the victims having someone else dictate their destiny.

You don't see anything wrong with such a world view ?
 
Flighty
Posts: 9963
Joined: Thu Apr 05, 2007 3:07 am

RE: Delta Hong Kong

Mon Feb 08, 2016 6:27 pm

Quoting YLWbased (Reply 44):
If Delta truly wants to do better in their USA-Asia flights, they might actually have to switch alliance for that.

Great post and people may be underrating UA's Star membership as the key to its "success" in Asia. That may be it.
 
steex
Posts: 1437
Joined: Wed Jun 27, 2007 8:45 am

RE: Delta Hong Kong

Mon Feb 08, 2016 6:38 pm

Quoting a380787 (Reply 45):
Because it seriously highlights the hypocrisy that exists. When UA flunks it's always about their reputation or their seats or the less-than-inspiring catering or their employees or Smisek, but when DL flunks it's about external forces outside their own control, as if they're the victims having someone else dictate their destiny.

You don't see anything wrong with such a world view ?

Fair enough, I can't speak to that.

Regarding DL, I personally think it's a two-pronged issue:

1) DL is flying the routes/frequencies they are out of SEA because that's the best they can do right now.
2) DL has to do that because they are building a hub in a sub-optimal place, especially compared to what UA has with SFO. Time will tell if they can reach a stable critical mass for larger operations over time.

In essence, they're making lemonade out of lemons, which is good management. It was management's choice to buy lemons in the first place, though, and it remains to be seen if that was the best decision. In that way, it certainly is not accurate to chalk it all up to external forces on a macro level, but I think they play a more significant role on a route-by-route micro level.
 
jasoncrh
Posts: 760
Joined: Wed Jun 08, 2005 10:29 pm

RE: Delta Hong Kong

Mon Feb 08, 2016 7:04 pm

United was successful in Asia far before Star Alliance started. Simply, UA's success is a legacy of Pan Am's longstanding market development in Asia. Pan Am started the routes
decades ago, nurtured them, nurtured all the Asian Point of Sale relationships (travel agencies, etc), and United simply
kept nurturing them since they bought those routes in the 1980s. Most importantly, United's now gateways are the largest
gateways and the source of the highest O/D traffic to/ from Asia. Simply put, United isn't as reliant on connecting traffic
as Delta is for Asia. Delta's gateways simply do not have the same volume of traffic nor the quality of traffic (in terms of fare), with
some specific exceptions (DTW-NGO, DTW-PVG) as United, so has to rely more on connecting traffic, which by definition,
is lower yielding.
So, it's not surprising that SEA-HKG is challenging - the Seattle local market simply isn't as large as SFO/ORD/NYC or YVR,
so DL has to try to fill their planes with connecting traffic. If this were viable year round you'd see daily year round service,
end of story. And quality of service - including all aisle access J class, etc - wont change a thing about the basic underlying
market fundamentals that Delta really has no power to change in the short term.

Quoting Flighty (Reply 46):
Great post and people may be underrating UA's Star membership as the key to its "success" in Asia. That may be it.
 
User avatar
enilria
Posts: 10076
Joined: Fri Feb 22, 2008 7:15 pm

RE: Delta Hong Kong

Mon Feb 08, 2016 7:11 pm

Quoting michman (Reply 1):
Goes back to daily the last week of March when NRT-HKG will be dropped (for the second time).

Must be the fault of HND   

Quoting jetlanta (Reply 26):
Dude, the hub is like two years old. And Asian economies have sucked for the entire duration it has existed. Calm down.

To be fair, they have been doing Asia with AS a domestic feed for a long time. You could argue that the ramp up of their own SEA domestic operation has actually reduced their domestic feed at SEA, but certainly they have had SEA long-haul for a long time with AS supporting it.

Quoting YLWbased (Reply 44):
Let me try. ICN isn't as strong of a hub as you think.

It would be if DL was closer with KE.

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