How will Alaska and American's new partnership affect Delta?
 

It has just been announced that Alaska and AA will form a new partnership (see here), which includes operating more international flights out of SEA (SEA-BLR in Oct 2020, and SEA-LHR in March 2021). In addition, AS intends to join OW in Summer 2021. It will be interesting to see how this new partnership affects DL, especially in SEA. Thoughts?

I've checked the T100s from time to time to check DL's (financial) perf at SEA for the domestic routes and the numbers have actually more or less improved over time, though on most non-hub routes AS is still outperforming DL, sometimes by as much as 10% in PRASM so it's possible DL is building some FF loyalty here, but it's probably not a resounding success. In most non hub market AS still has a much larger market share (sometimes double if not more) than DL has. I think the bigger problem for DL at SEA is whether the hub survives the next recession, whenever it does come.

Even if AA decides to add some Asian routes out of SEA, I'm not sure that's a problem for DL because they don't have the proper equipment to fly it and seem fairly content with outsourcing flying to KE for secondary markets as part of their broader strategy in Asia.

I don't think this is that big of a deal. Until recently, AA/AS basically had the exact same partnership and then inexplicably decided they wanted to go at it alone and started shrinking their partnership ahead of a full breakup slated for this year.

AS has also been partners with most of OW this entire time so it's not really adding much new -- you can already fly XXX - SEA - LHR on AS/BA and BA/AA.

Good luck with the BLR flight -- what exactly does AA have in mind with that one? Presumably trying to draw the LAX and SFO traffic though competing with the ME3 on flights to India hasn't exactly panned out well for the rest of the world's airlines. I expect AA to lose a ton of money on that route if it ever actually launches.

If we're talking about bigger international routes, it's hard to gauge. With a KE partnership, I can't see additional expansion to APAC. It's really not the right time either to launch additional China routes, nor TPE. At best they can look at CX and SQ and hope for an exit from either of them.

I'm crossing my fingers for a YYJ return though.

DL only served YYJ from SEA, so ending the route involved a station closure at YYJ (people losing their jobs etc) - it's probably not coming back anytime soon.

not at all "inexplicably" ... the AA/AS divorce was a condition of AS acquiring VX

I would say the big winners in this deal are SEA flyers who get some nice deals as DL/AS/AA duke it out for market share. I do think if AA does any serious growing at SEA (so far it's really just two Int'l flights in the next two years) something will have to give.

Yeah, that's quite possibly the dumbest super long haul route I've ever seen an airline add as it's first Int'l service from a US airport... AA must be in worse shape than I thought. Seriously SEA to BLR?! That's how you're going to corner the SEA market...? FAIL.

The deciding factors here will be major corporate contracts, not individual travelers. This permits AA to better market itself to major tech players @ Seattle area and AS to derive feeder revenue from lots of smaller stations.

Also worth remembering that it isn't just traffic xSEA but traffic to SEA and AA gets a major boost from things it has long sought such as access to AS out-of-perimeter slots xDCA.

Something about two marginally mediocre airlines partnering is apparently big news for whatever reason. This likely will have little affect on anything DL related. The people who have the most to fear are those who fly AS. Until now, their FFP was actually pretty valuable, moving forward, I see a lot of those valuable partners going away.

SFO fliers are big winners as well. AS, having PNW tunnel vision, deemphasized SFO and starting making fliers connect in SEA or LAX to get a lot of places they flew. Plus there are a ton of places that AS doesn't go to that AA does. AS+AA will get the two of them up to 23% of SFO flights, a lot closer to UA's 40%.

Personally it will make me ponder my options for 2021 depending on how much AS guts their frequent flyer program in order to align with OneWorld.

Maybe it's dumb, maybe it isn't. AA isn't after the SEA market with a flight to BLR (as in, let's launch a crazy flight and that will make people want to fly AA). It's after, specifically, the SEA/LAX/SFO/SJC-BLR market, corporate contracts, etc.

The AA flights will have immaterial impact. AS joining OW will have a small/medium impact, but not enough to dissuade DL from their ambitions. There are not a lot of people around here that jump up and down wanting to fly AA. The AA flights will be attracting cost-conscious customers - not what DL is seeking, so no loss. AS joining OW will have a small impact as there is a sizeable group (including myself) that chose DL over AS, because AS did not have the global network or as big a network domestically. AS's customers in SEA are generally frequent flyers within the West Coast and occasional trips to the East Coast or internationally. DL's customers tend to be long haul flyers with occasional trips within the West Coast. The OW partnership makes AS a lot more attractive to frequent international customers.

This will have little to no impact on DL. AA is weak on the west coast so the addition of AS to OW will help fill in their route map where they are not as strong. The risk to AA is that their flyer will realize that AS is a far better carrier than AA is and will move business over to As when they can.

I am much more optimistic about SEA-BLR. There are deep tech industry connections there, and the direct will be far more attractive than connecting on Emirates. And don’t forget the collapse of Jet - and Air India’s perpetual struggles - have together left a huge vacuum in the US to India market.

With an expanded AS partnership, Alaska will be able to provide feed for the BLR flight as well. There aren’t a lot of good choices for west coast to India nonstops, and SEA has real geographic advantages for that route over California - 8100 miles is much more viable than 9100.

As a PDX-based DL flyer, this news does make me raise my eyebrows a bit. AS/AA all of a sudden became a reasonable alternative to DL, and I'm sure there are plenty of SEA flyers thinking the same thing. I don't think overall it will be that huge an impact to DL, but it should make some markets more competitive to them.