UA to End NRT-SEA Service in 2014
Oct 9, 2012, 1:51 pm
#106
Join Date: Sep 2009
Programs: UA GS>1K>Nothing; DL DM 2MM; AS 75K>Nothing>MVP
Posts: 9,341
I think it's a smart move by DL, and I believe they are
1. Trying to pickup local corporate contracts in one of the fasted growing economic areas in the country.
2. Optimizing the economics of connecting flights for everything from Kansas north and west.
As for me, there have been 4 problems with DL.
1. No flat bed in J
2. No international F
3. Terrible FF program.
4. Dishonest management
They've fixed one of the problems, but they have a long way to go.
1. Trying to pickup local corporate contracts in one of the fasted growing economic areas in the country.
2. Optimizing the economics of connecting flights for everything from Kansas north and west.
As for me, there have been 4 problems with DL.
1. No flat bed in J
2. No international F
3. Terrible FF program.
4. Dishonest management
They've fixed one of the problems, but they have a long way to go.
Oct 9, 2012, 1:54 pm
#107
Join Date: Jan 2005
Location: New York, NY
Programs: UA, AA, DL, Hertz, Avis, National, Hyatt, Hilton, SPG, Marriott
Posts: 9,452
If Delta truly were setting up a Pacific connection hub (or if their primary motivation is doing so), they would also be dramatically increasing the online feed available at SEA, as Delta gains no appreciable revenue premium whether pax arrive on AS metal or any other carrier. Essentially, the interline pax are O&D travelers from an accounting standpoint but flow traffic from a revenue perspective. Of course, originating revenue pax are more profitable than flow passengers in most cases if the airline's RM and pricing isn't totally out of whack.
DL has more efficient online routing options, especially for East Coast customers to Asia, than via SEA. In those cases, Delta retains 100% of the revenue.
I still stand by my assertion that DL is trying to capture the high-yield segment of the SEA market and only using AS connecting traffic to buttress that position. It's important from a marketing perspective to emphasize the closeness of the AS codeshare but make no mistake that DL is actively courting the high-dollar Seattle customer.
The fuel argument is compelling, but it does not take into account that the Delta share of the revenue on those tickets will be reduced to the extent that pricing of the underlying tickets for connecting passengers over SEA is impacted by available nonstop options at the point of origin (priced at a premium, thus diluting yield on the SEA-XXX longhaul segment). In other words, yes, the fuel bill on a DL SEA-Asia flight might be lower, but Delta's share of the revenue of connecting travelers on that flight is also reduced by a similar factor given that the feed was contributed by an interline carrier.
In my view, Delta is simply trying to offer a better value proposition for the Seattle business traveler with more longhaul flights to major international hubs and a cozy relationship with the hometown domestic carrier to sweeten the deal. Driving more Pacific connecting traffic over SEA is an ancillary (but considerable) benefit to seizing a larger chunk of the SEA corporate pie.
DL has more efficient online routing options, especially for East Coast customers to Asia, than via SEA. In those cases, Delta retains 100% of the revenue.
I still stand by my assertion that DL is trying to capture the high-yield segment of the SEA market and only using AS connecting traffic to buttress that position. It's important from a marketing perspective to emphasize the closeness of the AS codeshare but make no mistake that DL is actively courting the high-dollar Seattle customer.
The fuel argument is compelling, but it does not take into account that the Delta share of the revenue on those tickets will be reduced to the extent that pricing of the underlying tickets for connecting passengers over SEA is impacted by available nonstop options at the point of origin (priced at a premium, thus diluting yield on the SEA-XXX longhaul segment). In other words, yes, the fuel bill on a DL SEA-Asia flight might be lower, but Delta's share of the revenue of connecting travelers on that flight is also reduced by a similar factor given that the feed was contributed by an interline carrier.
In my view, Delta is simply trying to offer a better value proposition for the Seattle business traveler with more longhaul flights to major international hubs and a cozy relationship with the hometown domestic carrier to sweeten the deal. Driving more Pacific connecting traffic over SEA is an ancillary (but considerable) benefit to seizing a larger chunk of the SEA corporate pie.
Last edited by EWR764; Oct 9, 2012 at 2:04 pm
Oct 9, 2012, 4:14 pm
#108
Join Date: Aug 2010
Location: SFO
Posts: 311
What I don't get is that even with the previous flight offerings, SEA-NRT never appeared to be a very full flight for UA.
Over the last ~2 years whenever searching for award routings SFO-NRT, SEA-NRT was almost always available at saver rates when SFO-NRT never was. If this route was high demand, I wouldn't have expected to see it constantly showing saver award space.
Now that capacity has increased by a factor (2X or more?) I'm not sure where these passengers are going to come from?
Over the last ~2 years whenever searching for award routings SFO-NRT, SEA-NRT was almost always available at saver rates when SFO-NRT never was. If this route was high demand, I wouldn't have expected to see it constantly showing saver award space.
Now that capacity has increased by a factor (2X or more?) I'm not sure where these passengers are going to come from?
Oct 9, 2012, 4:48 pm
#109
Join Date: Feb 2008
Programs: 6 year GS, now 2MM Jeff-ugee, *wood LTPlt, SkyPeso PLT
Posts: 6,526
If Delta truly were setting up a Pacific connection hub (or if their primary motivation is doing so), they would also be dramatically increasing the online feed available at SEA, as Delta gains no appreciable revenue premium whether pax arrive on AS metal or any other carrier. Essentially, the interline pax are O&D travelers from an accounting standpoint but flow traffic from a revenue perspective. Of course, originating revenue pax are more profitable than flow passengers in most cases if the airline's RM and pricing isn't totally out of whack.
DL has more efficient online routing options, especially for East Coast customers to Asia, than via SEA. In those cases, Delta retains 100% of the revenue.
I still stand by my assertion that DL is trying to capture the high-yield segment of the SEA market and only using AS connecting traffic to buttress that position. It's important from a marketing perspective to emphasize the closeness of the AS codeshare but make no mistake that DL is actively courting the high-dollar Seattle customer.
The fuel argument is compelling, but it does not take into account that the Delta share of the revenue on those tickets will be reduced to the extent that pricing of the underlying tickets for connecting passengers over SEA is impacted by available nonstop options at the point of origin (priced at a premium, thus diluting yield on the SEA-XXX longhaul segment). In other words, yes, the fuel bill on a DL SEA-Asia flight might be lower, but Delta's share of the revenue of connecting travelers on that flight is also reduced by a similar factor given that the feed was contributed by an interline carrier.
In my view, Delta is simply trying to offer a better value proposition for the Seattle business traveler with more longhaul flights to major international hubs and a cozy relationship with the hometown domestic carrier to sweeten the deal. Driving more Pacific connecting traffic over SEA is an ancillary (but considerable) benefit to seizing a larger chunk of the SEA corporate pie.
DL has more efficient online routing options, especially for East Coast customers to Asia, than via SEA. In those cases, Delta retains 100% of the revenue.
I still stand by my assertion that DL is trying to capture the high-yield segment of the SEA market and only using AS connecting traffic to buttress that position. It's important from a marketing perspective to emphasize the closeness of the AS codeshare but make no mistake that DL is actively courting the high-dollar Seattle customer.
The fuel argument is compelling, but it does not take into account that the Delta share of the revenue on those tickets will be reduced to the extent that pricing of the underlying tickets for connecting passengers over SEA is impacted by available nonstop options at the point of origin (priced at a premium, thus diluting yield on the SEA-XXX longhaul segment). In other words, yes, the fuel bill on a DL SEA-Asia flight might be lower, but Delta's share of the revenue of connecting travelers on that flight is also reduced by a similar factor given that the feed was contributed by an interline carrier.
In my view, Delta is simply trying to offer a better value proposition for the Seattle business traveler with more longhaul flights to major international hubs and a cozy relationship with the hometown domestic carrier to sweeten the deal. Driving more Pacific connecting traffic over SEA is an ancillary (but considerable) benefit to seizing a larger chunk of the SEA corporate pie.
If you look at DL's network, They don't have flights from their hubs in LAX/ATL/MSP/JFK - other than to NRT. PDX only has service to NRT, and SLC does not even have service to NRT. The only direct service (and then only to PEK/INC/NRT/Nagoya/PVG is from DTW. Seattle is not getting all of this service for O/D traffic. What Delta will do is use existing (or expanded) flights from its hubs to Seattle and then board these folks onto the SEA flights. Rather than going for example ATL-DTW-Asia, they will go ATL-SEA-Asia. Far better for DL with shorter flights with lower opperating costs and from some places that show as shorter and therefore more appealing to travelers who are scarred by a 13 hour flight.
Note also that DL is adding BF service from JFK to Seattle AND is adding JFK-SEA flights as well. They are not doing this because all of a sudden they see need JFK-SEA, the intend to push premium passengers via SEA.
Oct 12, 2012, 11:43 am
#110
Join Date: Dec 2001
Location: Florida
Programs: UA 2MM
Posts: 1,917
Booked SEA-NRT on UA for mid-Nov. Normally, I'd go ORD-NRT-MNL on ANA but the fare $476 OW ORD-SEA-NRT-MNL was impossible to pass up. Gonna be lots of room to spread out in E+. ^ Here's the seat map, if this is what it normally looks like a month out, there is no way they are filling this plane.
.
.
Last edited by BangkokTraveler; Oct 12, 2012 at 11:51 am
Oct 12, 2012, 11:59 am
#111
Join Date: Jan 2005
Location: New York, NY
Programs: UA, AA, DL, Hertz, Avis, National, Hyatt, Hilton, SPG, Marriott
Posts: 9,452
DL generates about the same average fares on JFK-SEA as it does on JFK-LAX/SFO, but it lags United from EWR. Were Delta solely trying to build a connecting hub at SEA, it would only time the BE flight with the transpac bank. By offering service throughout the day, it intends to use the BE product to drive up local yields. While it is clear that DL is looking to leverage AS to flow connecting traffic onto its longhaul flights, there is no doubt that DL is also making a serious effort to win Seattle-area corporate contracts. SEA has a wealthy, well-traveled population and larger corporate market than the size of its MSA indicates.
Oct 12, 2012, 1:14 pm
#112
Join Date: Feb 2008
Programs: 6 year GS, now 2MM Jeff-ugee, *wood LTPlt, SkyPeso PLT
Posts: 6,526
DL generates about the same average fares on JFK-SEA as it does on JFK-LAX/SFO, but it lags United from EWR. Were Delta solely trying to build a connecting hub at SEA, it would only time the BE flight with the transpac bank. By offering service throughout the day, it intends to use the BE product to drive up local yields. While it is clear that DL is looking to leverage AS to flow connecting traffic onto its longhaul flights, there is no doubt that DL is also making a serious effort to win Seattle-area corporate contracts. SEA has a wealthy, well-traveled population and larger corporate market than the size of its MSA indicates.
Keep in mind that flying to asia from SEA saves roughly 1500-1700 miles over DTW on the over-water leg. And at the differences in range that is roughly $150 each way in fuel costs for the overseas flight. DL is much more competitive via SEA. Expect them to drive hub traffic via SEA as well as pick up AS connecting traffic. Yes, there is local O/D traffic (some of it premium, although SEA lacks the banking/financial traffic), but much of the 3.5M people in the metro area can also fly via YVR, so there are limits on pricing power, and even without YVR as an option, the O/D traffic is no where near large enough to support this number of flights to Asia.
Oct 12, 2012, 1:31 pm
#113
Join Date: Sep 2009
Programs: UA GS>1K>Nothing; DL DM 2MM; AS 75K>Nothing>MVP
Posts: 9,341
Alas I think we disagree, I think this is directly linked to a new "gateway" stratagy. DL will be going from 3-4 flights JFK-SEA (mix of 752 and 738s) to 4 BF 752 and 1 BF 763. So its not just adding BF, its lift. I would expect them to time the 763 for international departures/arrivals. AND THESE CHANGES OCCUR IN JUNE 2013, not now. They occur around the same time as DL will be starting the upgaged/expanded pacific flights.
Keep in mind that flying to asia from SEA saves roughly 1500-1700 miles over DTW on the over-water leg. And at the differences in range that is roughly $150 each way in fuel costs for the overseas flight. DL is much more competitive via SEA. Expect them to drive hub traffic via SEA as well as pick up AS connecting traffic. Yes, there is local O/D traffic (some of it premium, although SEA lacks the banking/financial traffic), but much of the 3.5M people in the metro area can also fly via YVR, so there are limits on pricing power, and even without YVR as an option, the O/D traffic is no where near large enough to support this number of flights to Asia.
Keep in mind that flying to asia from SEA saves roughly 1500-1700 miles over DTW on the over-water leg. And at the differences in range that is roughly $150 each way in fuel costs for the overseas flight. DL is much more competitive via SEA. Expect them to drive hub traffic via SEA as well as pick up AS connecting traffic. Yes, there is local O/D traffic (some of it premium, although SEA lacks the banking/financial traffic), but much of the 3.5M people in the metro area can also fly via YVR, so there are limits on pricing power, and even without YVR as an option, the O/D traffic is no where near large enough to support this number of flights to Asia.
Oct 12, 2012, 3:24 pm
#114
Join Date: Feb 2008
Programs: 6 year GS, now 2MM Jeff-ugee, *wood LTPlt, SkyPeso PLT
Posts: 6,526
Very interesting discussion. I think the fuel cost argument is pretty convincing especially when you think that a lot of DL connecting traffic has to back track to connect through MSP or DTW. Also with the 787s coming on stream at UA, DL (refinery aside) is going to be at a real disadvantage on fuel costs. I also suspect, DL has an eye on corporate contracts in the Seattle area, which might be conditional on better international and TCON service.
But bottom line is that per Boeing on a 6000 mile flight on a 772ER when the plane is FULL, the burn is 78g of fuel (jetA is $3.20/g) or $249 in fuel. A 7700 mile flight on a 772ER burns 127g of fuel or $406 in fuel. These fundamental economics explains why Airlines want to run load via SFO (UA) or SEA (DL).
Likewise, they explain why Jeff is so "excited" about the 788, which ANA has said is 21% more efficient than its 763ERs (and would have higher fuel costs than the 772ER I provide above, which is supposed to be a 10% or more efficient AC than the 773ER)
An interesting read on AC efficency is here: http://leehamnews.wordpress.com/2012...-aisle-battle/
Oct 29, 2012, 3:24 pm
#115
Join Date: Jul 2006
Location: SEA & RDM
Programs: UA - 1MM, DL Diamond, AS MVP75, Marriott Titanium, Hilton Gold
Posts: 8,037
I had to choose
flying to ICN business class next Monday...
so do I go
SEA-SFO-ICN on UA
SEA-NRT-ICN on UA (old config 777 right now)
SEA-NRT-ICN on NH
so do I go
SEA-SFO-ICN on UA
SEA-NRT-ICN on UA (old config 777 right now)
SEA-NRT-ICN on NH
Oct 29, 2012, 5:45 pm
#116
Join Date: Sep 2004
Location: PDX
Programs: Free agent!
Posts: 1,427
Oct 29, 2012, 9:04 pm
#117
Join Date: Nov 2004
Location: Los Angeles, CA; Philadelphia, PA
Programs: OZ Diamond
Posts: 6,134
Oct 29, 2012, 9:58 pm
#118
Join Date: Jul 2006
Location: SEA & RDM
Programs: UA - 1MM, DL Diamond, AS MVP75, Marriott Titanium, Hilton Gold
Posts: 8,037
Oct 30, 2012, 12:30 pm
#119
Moderator: Budget Travel forum & Credit Card Programs, FlyerTalk Evangelist
Join Date: Aug 2002
Location: YYJ/YVR and back on Van Isle ....... for now
Programs: UA lifetime MM / *A Gold
Posts: 14,429
Oct 30, 2012, 3:06 pm
#120
Join Date: May 2003
Location: Redwood City, CA USA (SFO/SJC)
Programs: 1K 2010, 1P in 2011, Plat for 2012,13,14,15 & 2016. Gold in 17 & 18, Plat since
Posts: 8,826
UA is pushing SEA via price...
From SFO, you can often save $$$ flying SFO-SEA-NRT instead of the direct SFO-NRT, and be guaranteed that you'll avoid the 747. Not like it's the biggest contrast in the world, the oldest 777 config vs the walking-dead 747 in Y.
My SFO-SIN mileage run is routed through SEA on the outbound, LAX on the return. I did a lot of searching, trying to optimize price & miles, and SEA consistently came out on top for the outbound. Regarding load factors, thankfully all of my long-haul segments look pretty light right now (hoping there's not a delayed demand ripple caused by the storm on the east coast, but since my flight's not until Monday, I think I'm safe).
As for all the talk about fuel economics, one has to wonder about those 747s they've got still flying SFO-SYD, SFO-NRT, SFO-PEK and SFO-PVG. Oh, and ORD-NRT etc. That's gotta be expensive! You'd think there'd be a temptation to price those a bit less to ensure a full load. Thankfully that wasn't the case for my run. Don't think I could survive multiple long hauls in a 747 on one itin.
My SFO-SIN mileage run is routed through SEA on the outbound, LAX on the return. I did a lot of searching, trying to optimize price & miles, and SEA consistently came out on top for the outbound. Regarding load factors, thankfully all of my long-haul segments look pretty light right now (hoping there's not a delayed demand ripple caused by the storm on the east coast, but since my flight's not until Monday, I think I'm safe).
As for all the talk about fuel economics, one has to wonder about those 747s they've got still flying SFO-SYD, SFO-NRT, SFO-PEK and SFO-PVG. Oh, and ORD-NRT etc. That's gotta be expensive! You'd think there'd be a temptation to price those a bit less to ensure a full load. Thankfully that wasn't the case for my run. Don't think I could survive multiple long hauls in a 747 on one itin.