adamj023

The model works well and will change over time, always hubs changed according to demand/need and route changes.

But the hubs are known as of now and JFK and LGA are nice hubs.

mylifenomadic

There seem to be a lot of reductions in flights from SLC to Mexico lately as well. The SLC-MEX flight will be ending this week and the rest are now seasonal. This was a great route for the Western US to connect to Mexico/Central/South America with AeroMexico connections from MEX. I would have assumed the addition of Aerolineas Argentinas to SkyTeam and MEX would make the route even stronger, but I guess they just want to funnel everyone across the country to ATL now.

The reduced number of leisure travelers to Mexico and AeroMexico and other Mexican LCC's expansion into more markets in the US (Denver, Las Vegas, San Francisco, etc) must have had a large impact and Delta must be content losing this traffic to AM.

adamj023

Not at all. Delta has very close ties with AeroMexico on Skyteam and lots of contracts with them.

Just like Alitalia taking over on some Italy routes. Delta will continue to use SkyTeam and partners as appropriate and this doesn't lead to lost revenue.

I don't fly to Mexico however.

florin

I'm not sure how you can say (type) that with a straight face. Yeah, I'm sure the global recession and the negative economic outlook has NOTHING to do with that... everybody will be flying everywhere on expensive tickets, even though more and more people are broke. Who cares about manufacturing declining everywhere in the world, demand for pretty much everywhere is dropping, unemployment is soaring... none of that matters if DL repaints another SkyClub bathroom because that will surely save us all.

james318

Delta doesn't just have close ties wtih AeroMexico. They own 4% of it.

johnslloyd

Wha??? Adamj023, help me understand your post. I 'chuckled' at akperry's clever way of pointing out that the guy that listed the DL hubs omitted SLC, the largest DL hub in the western US.

pbarnette

Considering ALL of South America is east of ATL, it doesn't seem like a particularly poor place from which to route connections there. Mexico is a bit more problematic and with DL's hub locations, they may be better off leaving it to AM.

I think the issue is the presence of B6 and the resulting trashing of yields.

With what equipment? There is also already a lot of capacity to Asia.

I suspect that your pessimism is rooted in your ties to Europe, where things do look bleak, indeed. But that is largely a political and demographic problem. Growth prospects in much of the world, look better, including the US where growth is weak, but positive, and employment is growing, albeit slowly. Virtually all forecasts call for substantial growth in air travel. DL seems reasonably well-positioned to benefit from that growth.

adamj023

The global recession and negative economic outlook was the past not future.

Airlines have merged, and gone thru bankruptcies and are more profitable than ever before.

Even on the fuel costs we are already seeing with the Trainer facility that Delta was dead right with the acquisition as of today.

http://www.bloomberg.com/news/2012-0...ery-start.html

If this holds up for jetfuel, Delta will be way ahead of the curve and have its best days ahead of it.

"The premium for jet fuel at the hub versus Nymex heating oil futures fell 1.25 cents to 12 cents a gallon.

Paul Jacobson, Delta�s chief financial officer, said in a July 25 earnings call that the company was on target to begin restarting the plant in mid-September. "

Another week or two, and it is up and running. They have gotten crude supply deliveries to the plant, but it hasn't been refining jetfuel yet.

One can see the plant @ maps.google.com and enter in Trainer, PA, and it is easy to determine what they acquired. Then you need to take into account the pipelines and distribution routes and the like.

Every reduction in cost for Delta adds up for profit for the firm, but lets not forget, while profit increases, it also means Delta can make greater capital expenditures to improve the business model and experience for the consumer. I do predict that when the jetfuel refinery is up and running Delta will see a lot lower costs and this will help Delta immeasurably.

For multiple years Delta was behind the curve in profit, but soon Delta will be a leaner, meaner and more profitable machine. The inherent long term issue will be the pending merger with AA/USAirways now that the court has thrown out the union contracts so the reemergence and/or merger will occur a lot more quickly now.

But with the new state of the airline industry in 2013 and beyond we will indeed see positives for the consumer side. Taxation of airline tickets is an issue as well IMHO which could be reduced.

I really do predict large growth for Delta because of lower costs in 2013 and beyond. Delta will have more fuel efficient equipment, lower fuel costs, modernized hubs and the like. I also would hope and think that Delta will eventually make another aircraft order in the future to modernize even more if profitability can be achieved. Newer planes mean lower operating costs and better customer satisfaction if you have the revenue on hand to be able to afford them and if the numbers work out.

http://articles.chicagotribune.com/2...delta-airlines

Article shows that Delta is interested in another order for its narrowbody fleet. Obviously if Delta places an order this year (which analysts predict), it should be good.

Capital expenditures are ongoing right now even though you have seen contraction in the market. But after these improvements are made during the bust cycle of the economy (when it is weak) when the economy gains traction and it will going forward, Delta could easily adapt since it will be much leaner and meaner and able to move forward quicker. The foundation is being laid right now so come 2013 and beyond we will indeed see economic expansion once again as we go forward in the future years.

RobertS975

First, B6 is not particularly cheap. They charge a decent fare for FL routes, especially after the initial deeply discounted seats are gone. Second, DL charges the same fares or less, but it is for two flights, two times the handling of passenger and luggage.

RobertS975

Do AM and DL have a joint venture like the TATL carriers have? Not that I know of.

flying_q

AdamJ - where did you go? It's nice to have your in depth Wikipedia contributions back in the forum.

Dieuwer

Of course your are right if you are referring to the nearby ICN KE Skyteam hub.
Still, it would be nice if DL offered more flights from NRT to US focus cities and points in SE Asia/Pacific.

SJC ORD LDR

You mean like Salt Lake City?

adamj023

Hi flying_q. I just posted back cause it looked like Delta's plans were working well. I don't follow Delta's hubs on a case by case basis, only regionally where I live (JFK and LGA for instance), and for NYC Metro Delta's hubs will be firmly cemented for 2013 as the terminal work is completed with the connector at LGA and T4 at JFK which are sorely needed.

But I do predict a huge economic recovery will occur in the coming years, or so I hope.

steex

DL is essentially a bottom feeder on traffic to SE Asia and the Pacific. They are at a significant disadvantage compared to the Asian carriers since they don't have near the FF base in Asia and their NRT-Asia offerings have poor times and frequency (generally all 1x daily) for business traffic. DL sees much lower yields than its competitors on the NRT-Asia segments, and that makes it difficult to succeed against the likes of ANA, JAL, Korean, Asiana, etc. As a random example, DL may see good yields on USA-NRT flights, but then sees either connecting traffic or lower yield fliers on the flight beyond NRT. Both of those types of travelers can be bad for yields considering a USA-SIN ticket is often not much more expensive than a USA-NRT ticket. By comparison, ANA is ideally positioned to capture higher yielding O&D traffic on both USA-NRT and NRT-SIN segments.

This isn't a knock on DL and is not unique to them. A lot of long fifth-freedom routes have disappeared, and many of the most successful ones cater to an untapped market of some kind on the "beyond" segment of the flight (think CX's HKG-YVR-JFK, where they had long been the only non-stop option on YVR-JFK).

As far as additional USA-NRT flying, where exactly would they fly? They're very unlikely to move into any American-carrier hub where they lack FF base on both ends (i.e., no ORD, DEN, DFW, etc.). Probably the most sensible city would have been BOS, but considering NW couldn't even make JFK work until DL paired it up with a JFK hub and growing NYC presence, I don't think they were necessarily wrong in passing on BOS.

While JAL's new BOS-NRT service is terrific and will almost certainly put a dent in connecting TPAC traffic ex-BOS, that doesn't mean DL was the right carrier (as they have far less ability to provide Asian connections and very little ability to provide any connections in BOS, either). I don't think DL adding a competing flight would be good for anyone, there would be the risk of both carriers failing to meet expectations and potentially pulling the route.