Archive for the 'Delta Air Lines' Category
April 15 2008
I’m not going to write much about the Delta - Northwest merger because you’ll find plenty about it elsewhere, but there are 2 points I’d like to make:
- This is not a done deal. There will be significant pilot opposition to this, and that should not be discounted.
- In theory - theory - I can understand doing this if you shut down a hub or two (Memphis comes to mind) and laid off a bunch of people, cutting a bunch of cost out of the system. Perhaps, then, I’d understand how they’ll generate some cost savings. But that’s not the message. In an email, Northwest says that they won’t be eliminating any hubs or any service to small towns. Now, I’m guessing that is one giant load of poop, as how could you possibly save two struggling carriers by simply jamming everything they have together. That doesn’t really make any sense (as if the airline industry is run by sense).
I have the feeling that I’m missing something, but if neither one of these airlines could be successful longterm on their own in an extremely difficult environment, how would focusing on merging these airlines together (instead of the actual airline operation) improve matters? And when United and Continental get together (as rumored) - look out. As I’ve mentioned before, this will be an operational mess the likes of which we’ve never seen. I’m an optimist about this industry, and I cannot conceive how how this can all work out.
I’m done.
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April 14 2008
You’ll read about this everywhere else, so I just wanted to make sure you saw that Delta and Northwest could announce a merger as soon as Tuesday. Blah blah blah pilots seniority, blah blah blah consolidation, blah blah blah crazy idea, blah blah blah two wrongs don’t make a multi-billion dollar right.
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March 18 2008
How bad is the fuel situation? Delta just announced that it will offer buyouts to 30,000 staff, or roughly half its workforce, and shrink domestic capacity by an additional 5% this year. They hope to layoff about 2,000 people through this program.
This week they’ve already announced that they’re discontinuing service to a number of cities (including Islip, Atlantic City, and Bellingham, WA) that were being served by expensive to operate regional jets (has any aircraft seen its fortunes fall faster than the regional jet? Airlines couldn’t get enough of them in the 90s, but then quickly realized that they were way too expensive to operate…something that frequently-quoted-airline-commentator Michael Boyd has been saying for a while. Bravo).
In any case, this will not be the only airline to significantly shrink their workforces this year. The ugly has only just begun.
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February 27 2008
Delta and American Express just announced their Pay with Miles program, and it’s actually quite good (assuming you have a Gold or Platinum American Express SkyMiles credit card*). In short: You can pay with flights using miles, with 10,000 miles knocking $100 off the flight’s cost. This isn’t great for business class tickets, but it can come in handy for coach tickets. There are plenty of times where, say a ticket to a European city would cost $500-600, but a reward seat isn’t available (on Delta, this would be most of the time). So you would just use 50,000 miles to “buy” the ticket. Voila, free seat.
This deal seems to make the most sense for tickets to Europe where their value (about $500-$600, at least in the non-summer months) is roughly in line with their miles cost (50-60,000 miles). This would also be good for an Asia flight with no reward seats - you’d pay in the $800/80k miles range, but you get the benefit of availability, which is priceless.
* (I had originally posted this information correctly. This is now corrected)
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February 20 2008
Delta announced that it will launch nonstop flights from JFK to Georgetown, Guyana, beginning in July - fares are about $600 round trip for the 4x weekly service. Much has been made of Delta’s international expansion, and I’ll give them a ton of credit for trying some of the more obscure visiting-friends-and-relatives (ie, VFR) markets like this one.
But I haven’t really seen anyone mention that Delta has basically looked at tiny North American Airlines’ route map and copied it. The small carrier flew from New York to Georgetown, Accra, and Lagos — all markets served (or to be served) by Delta. It is perhaps, then, coincidence that NAA announced they are pulling out of those markets entirely and redeploying the planes on charter routes. They blame rising fuel costs, but Delta’s appearance couldn’t have helped.
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February 19 2008
The NY Times is reporting that Delta and Northwest are close to announcing a merger, an announcement of which will supposedly be shortly followed by Continental and United joining forces.
You’ll read plenty of commentary about these mergers elsewhere, so you don’t need me to analyze the minutia, but let me say this: if you thought flying last summer was rough, just wait until 4 of the country’s largest airlines are trying to jam themselves together during the summer travel season. We will be in a level of disaster that we’ve never even considered. Ask your friends who fly US Airways how well their merger went. Now envision that on a much larger scale. Plus thunderstorms.
One word for your summer travel plans: drive.
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January 22 2008
The AP is reporting that Delta Air Lines is insisting that, should it merge, the new airline will have the Delta name and be headquartered in Atlanta.
I’ve often said that there’s some truth in every rumor, so I don’t doubt that this issue has come up, but do you really think they’d kill a multi-billion dollar merger and a chance to build a successful company because it won’t be HQ’d in Atlanta? I doubt that, even if I think it’s true that they’d prefer if it were located there. Don’t believe everything you read.
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January 11 2008
Everyone and their mother will comment on the news about Delta exploring mergers with either Northwest or United, so I don’t need to pile on to that other than to say what many have already said before: airline mergers are notoriously difficult for many reasons (labor, operations, technology), and few have succeeded. Putting two not-quite-strong-enough companies together does not make one very strong company. And I’ll agree with analyst Michael Boyd who has noted in the past that the idea that merging will lead to less capacity is bunk — someone will always come in and fill the void. I’m sure we’ll hear lots about this in the coming months, but just know that it will be messy (just ask US Airways and America West, two much smaller airlines that are struggling mightily from their merger — little route overlap does not a good merger make).
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December 11 2007
Delta has posted a series of short (30 seconds or so) animated videos titled Planeguage that show some of the customer etiquette issues we all face when we fly (being stuck in the middle seat, the person who opens the window during a movie, badly behaved kids, etc…) They’re actually pretty amusing and well animated. This is the first time I’ve seen an airline actually show what a flight is like (versus the typical commercial where it’s absolute heaven, even in the middle seat). It’s an extremely clever piece of marketing that actually made me happy that I’m flying them tomorrow. Extremely well done…
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November 15 2007
You’ve no doubt read about the (possible) merger talks between United and Delta. Yes, there are synergies in their route structures — it would create an airline giant with a massive global footprint. But let’s get real. Airline mergers have not failed because of route overlap. They fail because of workforces (see: US Airways/America West); because of technology (see: US Airways/America West); because of fleet integration issues (they would have a laundry list of aircraft); and because the supposed synergies of a largescale integration never arrive.
Is this merger impossible? No. Is this merger unlikely? Yes. Are the operational issues of merging these two groups together virtually insurmountable? Absolutely. US Airways and America West announced their merger 2 1/2 years ago, and it’s still an operational mess (see: website). And those were small(ish) airlines compared to these two. Just because a merged United would fly to Cape Town, Kiev, and Seoul does not make this a great idea.
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A Quick Word about the (now announced) Northwest - Delta Merger