Tuesday, April 07, 2009

Delta's Current World View

Well, the seats are flying empty so ...

A day after reorting that its international traffic fell 15 percent in March, Delta Air Lines is scrambling to keep people flying on some of those routes by reducing the number of miles required for some award-travel seats. In recent years, Delta made very big bets on the growth of international traffic, and those bets right now are looking a little questionable.

Delta today announced an award travel sale for SkyMiles and Northwest WorldPerks members traveling between the continental U.S. (including Alaska) and Canada and international destinations.

Members who book award travel by April 20 on Delta-or Northwest-operated flights for travel between April 20 and June 15, 2009 can save up to 20 percent on coach award travel and up to 25 percent on first class, BusinessElite and business class award travel.

Delta says, "For example, members may redeem a minimum of 48,000 miles for economy class round-trip award travel between Atlanta and Barcelona, a 12,000-mile savings, and a minimum of 75,000 miles for BusinessElite round-trip award travel between New York-JFK and London-Heathrow, resulting in a savings of 25,000 miles."

Restrictions apply, blah blah blah. See the SkyMiles and WorldPerks Web sites for details.

"Our expanded, global network offers customers more flights to more destinations worldwide than any other airline," said Jeff Robertson, Delta's vice president of Loyalty Programs.

Yes it does. And as I said, more seats are flying empty on that expanded global network.

Delta, which is still expanding internationally, reported on Monday that traffic on the all-important trans-Atlantis routes was off 13.9 percent in March. On Latin American routes, traffic was off 17 percent. (Measured by RPMs). On the Pacific routes that were largely brought aboard in the acquisition of Northwest, traffic was off 16 percent.

I recall Delta's exuberance a little over a year ago, when the airline was firmly into its ambitious international expansion -- and bleeding domestic routes to augment it.

The airline's president and chief financial, Edward H. Bastian, said then that "international growth is the core, the foundation and cornerstone" of Delta's restructuring.

"Internationally, we are go to be growing at a roughly 15 percent pace in 2008 over 2007, and we expect to see close to double-digit unit revenue gains despite the fact that we have double-digit capacity gains on a year-over-year basis," Bastian said then, when Delta was tossing over 40 percent of its total capacity onto international routes and shrinking domestic flying -- especially point-to-point routes -- in tandem.



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Randal L. Schwartz said...

" the all-important trans-Atlantis"

I didn't realize Delta could cross over the place of legends. Does it also circle the pillars of Hercules?