zack14

This is very sad.

woodenshoe101

Substantial for sure (probably a few million per frame), but in the context of the overall book value of those planes, its small potatoes. The quoted 1.4-1.7B impairment works out to $78-94M per plane (I'm sure Richard Anderson could find a few used but operable 777s for $7M now ).

DataPlumber

I�d bet that those routes aren�t coming back, unfortunately.

ethernal

I mean the reality is that all large widebodies are going to have trouble in the "new normal".

That said, long-haul flying has very different economics than short-haul flying. Fuel efficiency is much, much more important. Delta and other high labor cost airlines don't care much about how fuel efficient a 600 mile segment is for a 150 seater, but definitely does on a 6000 mile segment. on a 300 seater. There is always "more" incentive to buy new, fuel efficient widebodies over fuel efficient narrowbodies. It's probably one of the reasons the 777 got the axe.

Right or wrong, I also wonder if Delta regrets bucking the trend and going 9-abreast in the 777. I realize that more seats in a low demand market isn't really a great answer, but I'm sure that the CASM calculations were hard to swallow and justify in this environment. If they were 10-abreast, Delta may have found a reason to keep them for their hub trunk routes.

At the end of the day, I'm not surprised. Delta needs the 767s for their route network. Other than BOM and JNB, they don't need the 777. If they have excess widebodies, it makes sense that they cut the 777 first. The only reason why they wouldn't is that they had just refurbished them... but that is a sunk cost and Delta is (rightly) not falling into a sunk cost fallacy. That money was already spent.

FlyerWx

Looks like JFK-BOM isn't coming back for a long time either...

This is really unfortunate

Duke787

Yeah good points and in reality DL doesn't need to fly to BOM and JNB in the new normal. The only place they really need to have on their route map is SYD (especially with Virgin Australia's troubles) and if the A359 can fly it (which sounds like it can from others upthread) they should be fine with a simplified A359/A339/767 approach to international flights.

I wonder if Boeing has put any serious though into re-opening the 767 passenger line. The line itself is still open for the KC-46 and Boeing claims they won't make more passenger 767s but the new normal could bring such a plane back into favor (with some fuel efficiency improvements).

Mountain Explorer

DL can probably convert some of its A350-900 orders into A350-900ULR. Essentially the same jet with a modified fuel system. Problem solved

Mountain Explorer

So basically a 767 Max 8.

ethernal

There have been articles posted on a "767-X" which is essentially a re-engined 767. Allegedly Boeing was in talks with GE about this back in October. So yes, they were thinking about it. But October was a lifetime ago. I doubt Boeing's current solution to a capacity glut is to open another line. They will move forward with the 777X given that the supply chain is already coiled, continue the 787 at a reduced rate, and try to get the 737MAX back in the air. That is already more capacity than its customers need, so the liklihood of a NMA or re-engined 767 in the next 5 years is probably close to zero.

rylan

The news from DL says the 359 burns 21% less fuel per seat... its really that much less than the 777? Or is there some magic marketing math from Airbus in the works there? OR si the cargo capacity of the 359 much lower? Obviously the 777 LR has greater range for those ultra-long trips to JNB etc.

readywhenyouare

Delta isn't ordering anything anytime soon. They're not even taking the aircraft currently on order. Delta very much prefers outsourcing as much longhaul flying as possible to their JV's. They will have zero concerns pushing JNB passengers onto AF/KLM metal.

SFO777

Looks like those dastardly ME3 carriers will reap the benefits.

Or as Ed likes to say... subsidies for me, but not for thee.

pfreet

Why did Delta need to announce this? Couldn't they wait a month or two and see what happens? We don't know for sure if the long haul travel drop will look like a U or a V yet

FlyBitcoin

DL is making a definitive bet that long haul international travel will not recover to any degree of profitability for 3-5 years minimum.
This is also a bet by DL that TATL travel will come back faster than their current suite of long-haul routes to Asia and JNB.

They are probably right since we are going to see prolonged restrictions like mandatory 2 week quarantines for arrivals and wildly differing definitions of immunity for at least 2 years.
Countries who have a strategy of suppressing the virus at all costs will not co-mingle with countries that have a higher percent of exposed citizens (although likely immune) for a long time. The strategies of how to "handle" the virus are more aligned between the US and Europe compared to the US and Asia and even Australia thus far. And those routes that do continue will be served just fine with the A339 and A359.

Mountain Explorer

Well of course they won't place an order anytime soon, they ALREADY have plenty of open orders on the books for A350s. And yes, some of them have been deferred. But do you seriously believe that if DL called up Airbus and asked for a few more deliveries that Airbus would refuse and tell them to go away? Give me a break.