AZ to leave Skyteam TATL JV

[WorldTraveler]

http://atwonline.com/finance-data/alitalia-end-air-france-klm-partnership-2017?hootPostID=7491398c765f56de7eed051f796ca5cd


Addition of AZ to the DL-AF JV caused the imbalance in the JV which has been a big part of DALPA's objections to JVs

Based on DOT data DL is the largest carrier between the US and Italy on An O&D basis

 

[FWAAA]

The OP did not read the article very closely or carefully. The article does not say that AZ is leaving the Skyteam TATL joint venture, only that AZ is not renewing the European joint venture with AF and KL:

It is unclear what, if any, implications Tuesday’s announcement has for Alitalia’s SkyTeam membership and its transatlantic joint venture with Air France-KLM and Delta Air Lines.

An Air France-KLM spokesperson told ATW in an emailed statement: “Air France-KLM is currently holding discussions with Alitalia to see how they can cooperate in the future in Europe. The agreements under the European JV between AF-KLM and Alitalia still applies until January 2017.”

Accordingly, the topic title is incorrect and the discussion of DALPA's objection is irrelevant.

 

[WorldTraveler]

AF is who brought AZ into the JV.


The AZ JV is fully dependent on the European and TATL systems being integrated.

There is no way that AZ will remain in the Skyteam TATL JV without the level of participation they have with AF/KL which includes treating AZ just like it AF/KL which is what the JV does.

Etihad might well want DL to not dump its portion of the JV but that is very, very unlikely to happen.


whether the article says it or not, that is the reality.

and AZ and AF/KL are still talking.


If I am wrong, I will be happy to admit it.

Meanwhile, DL is still the largest carrier between the US and Italy based on O&D traffic and carries very little traffic beyond AZ's gateways.

 

[1AA]

AZ has or will be switching over to SABRE Reservation system to be in line with Etihad.

 

[WorldTraveler]

Etihad controls Alitalia now and they will align everything about their business model to their way of doing business.

There is very little reason at this point for them to remain in Skyteam unless the US government comes down with strict sanctions on the ME3 - and that is not terribly likely.

 

[BABABOOY]

According to Delta: "This does not impact the existing long-term North Atlantic joint venture between Air France-KLM, Alitalia and Delta, which is a long-term business arrangement that will run until at least March 31, 2022."

 

[WorldTraveler]

yes, because there is a contract but the conflict between DL and AF/KL's goals will make it very hard to continue with business as usual, esp. since some of AZ' new friends will become AF's staunchest competitors.

This is far more of a swing for AF/KL than for DL but DL will be impacted.

You can't divide a company and say that half of AZ will be loyal to DL while the other half will be a tougher competitor to AF/KL, DL's strongest commercial partnership, within Europe.


There are multiple levels of cooperation between AF/KL and AZ but it will be very hard for DL to continue doing what it is doing with AZ without impacting AF/KL even though piggybacking on DL is exactly what Etihad wants AZ to do given DL's size in the market.


This will be just like the AS and KE situations. Business models change for multiple carriers.

 

[topDawg]

http://atwonline.com/finance-data/alitalia-end-air-france-klm-partnership-2017?hootPostID=7491398c765f56de7eed051f796ca5cd


Addition of AZ to the DL-AF JV caused the imbalance in the JV which has been a big part of DALPA's objections to JVs

Based on DOT data DL is the largest carrier between the US and Italy on An O&D basis

DALPA doesn't object to the JV at all. The object to Delta signing a contract and not living up to said contract. 
 
and this has nothing to do with AF/KL/AZ/DL JV as of right now. IMO AZ/EY would be complete fools to leave said JV, at least till AZ gets its EU/Domestic house in order. 

 

[WorldTraveler]

yes, it is true that ALPA doesn't object to JVs in general but they have been very vocal about the AF/KL JV since AZ joined it because DL is out of compliance ONLY because the addition of AZ changed the amount of flying done by AF/KL/AZ and put DL out of compliance. DL didn't drop flights as some have indicated in order to force the imbalance.

and Etihad might not want DL to leave - they are getting a free ride on DL's industry leading US-Italy network but the intra-European and TATL parts of the network are part of the same JV.

I simply do not see how the TATL JV can survive with AF/KL being in a very different relation with AZ but for now it is being held together by a contract - just as the AS relationship is.

 

[topDawg]

yes, it is true that ALPA doesn't object to JVs in general but they have been very vocal about the AF/KL JV since AZ joined it because DL is out of compliance ONLY because the addition of AZ changed the amount of flying done by AF/KL/AZ and put DL out of compliance. DL didn't drop flights as some have indicated in order to force the imbalance.

and Etihad might not want DL to leave - they are getting a free ride on DL's industry leading US-Italy network but the intra-European and TATL parts of the network are part of the same JV.

I simply do not see how the TATL JV can survive with AF/KL being in a very different relation with AZ but for now it is being held together by a contract - just as the AS relationship is.

they didn't? 
 
ATL-SVO/PRG/ARN/CPH/ year round ZRH and year round MXP weren't cut? 

 

[WorldTraveler]

how long have you been at DL? DL has dropped flights on a seasonal basis since the day DL started its first TATL service - and that increased with the Pan Am acquisition which brought a lot of Mediterranean markets which are heavily summer seasonal as well as far northern Europe - Scandinavia - which is highly dependent on US tourism in the summer and low fare European vacations to the US in the winter.

And DL has not operated more than a single flight per day to ZRH in the winter since the days of the DL/SR/SN alliance.

and DL is still the largest airline to Italy on a year round basis because DL adds so much capacity and additional markets in the summer. can you name all of DL's destinations in Italy in the summer?

PRG is also one of those summer seasonal markets. OK is simply not large enough to support year round connections on top of a local market.

You do realize that UA has pared back its winter flights in some of the same markets, don't you?

 

[FWAAA]

Apparently, Ed Bastian disagrees with WT:

Ed Bastian, speaking at a media event in France, also said he expected Italy's Alitalia to remain part of a transatlantic joint venture with Delta and Air France-KLM despite growing ties with 49-percent owner Etihad.

http://finance.yahoo.com/news/delta-air-lines-says-seeks-162051182.html

Long-term, WT may in fact be correct, but titling this thread "AZ to leave skyteam TATL joint venture" was simply not factual, as the article in the OP wasn't about the TATL joint venture. WT and non-factual? Nothing new there.

 

[WorldTraveler]

you do know what the word "expect" means?

and since AZ is contractually obligated to be in Skyteam and the JV, it very well may be that DL and Etihad might have to have some side discussions.

Just like any chance of DL rearranging Skyteam in Asia would require that there be some pow wows on the sidelines.

and I would bet you that DL has offered to let AS out of their agreement too... for a price.

psst.... tell me again the date when AZ can leave the Skyteam JV and if they are still in it on that date, I just might have to something really special for you. do you have a calendar that goes out that far?

 

[topDawg]

how long have you been at DL? DL has dropped flights on a seasonal basis since the day DL started its first TATL service - and that increased with the Pan Am acquisition which brought a lot of Mediterranean markets which are heavily summer seasonal as well as far northern Europe - Scandinavia - which is highly dependent on US tourism in the summer and low fare European vacations to the US in the winter.

And DL has not operated more than a single flight per day to ZRH in the winter since the days of the DL/SR/SN alliance.

and DL is still the largest airline to Italy on a year round basis because DL adds so much capacity and additional markets in the summer. can you name all of DL's destinations in Italy in the summer?

PRG is also one of those summer seasonal markets. OK is simply not large enough to support year round connections on top of a local market.

You do realize that UA has pared back its winter flights in some of the same markets, don't you?

God you are so full of deflections and excuses its a joke. 
 
This is a simple yes or no question. Has Delta cut routes like ATL-CPH/PRG/SVO/ZRH/ARN etc since the JV? yes or no. 
 
Nothing more is needed. 

 

[WorldTraveler]

and what you are completely unable to admit is that DL has also added routes and flights.

AMS-SLC just started. DL is operating double daily to ATH on some days.

and DL hasn't cut any capacity to ZRH... it has simply moved the nonstop to JFK, a strategy that has been repeated with a number of markets.

etc

etc


but you don't see any of that because all you focus on is loss and never see the positive or gain.

and it still doesn't change that DL is the largest carrier to Italy and has more seats to Italy this summer than it has ever had.

In fact, with over 15,000 seats per day from the US just to continental Europe (over 5000 even more to the UK and the Middle East and Africa), DL is by far the largest carrier across the Atlantic and is larger this year than last.

when you parrot ALPA's talking points, you would never both to know statistics like that.