DL a potential suitor for Skymark?

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WorldTraveler

Corn Field
Dec 5, 2003
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CAPA notes that, among other alternatives, DL could be a potential suitor for Skymark, Japan's low cost airline that filed for Japanese bankruptcy.

The biggest issues of the deal appear to be around Skymark's order for 330s and 380s which involved customized industry-unique interiors which make placing those aircraft difficult for Airbus and lessor Intrepid.

Skymark was the 3rd largest domestic operator at HND

ANA has attempted to rescue and rehabilitate Skymark but Airbus and Intrepid have not offered a viable plan for the 330s and 380s.

The Japanese government has previously stated that it wants to end the NH, JL duopoly of Japanese aviation but foreign involvement would require a change to the mindset and limits regarding foreign airline investment in Japan.

http://centreforaviation.com/analysis/skymark-airlines-could-be-a-delta-target-as-airbus--intrepid-oppose-an-ana-led-restructure-228609
 
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I found this part interesting:
 
"Another wrinkle is that Delta has not had favorable relations with Tokyo. This stretches historically when merger partner Northwest was considered to be exploiting fifth freedom traffic rights. More recently Tokyo was taken aback by Mr Anderson's visit to Japan and bold calls to be given a handful of Tokyo Haneda slots – a clearly impossible ask."
 
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Tokyo, like Dallas, is a city that has been marred by government intrusions in the airline marketplace with each successful wave of intervention resulting in even more distortion in the marketplace.

It is no secret that JL and ANA did not like DL's hub at NRT but let's also not forget that access was a result of the US win over Japan in WWII. NWA rebuilt Japanese aviation and JL's first post-war aircraft were NW aircraft.

How long that privilege was supposed to last wasn't defined but NW wasn't exploiting anything that the Japanese didn't agree to - even if as a conquered nation at the end of WWII.

Further, NW's hub was at HND only for it to be forced out to NRT when NRT opened and HND was closed to most int'l flights.

JL and ANA convince the Japanese government to interfere in the marketplace once again when HND was reopened to int'l services, including the first flights from HND to the US in decades.

But since JL and ANA wanted to gain TPAC flights from HND to feed their huge HND operations but didn't want to provide enough slots to DL in order to move its TPAC operation, the US government undoubtedly hearing DL's side of the story said they would not accept allowing commercially viable slots for connections to be used for TPAC flights because doing so would weaken DL's NRT hub.

The Japanese gov't tried to break ANA and JL's duopoly in the marketplace by throwing slots at LCCs including Skymark that was run by people who had no idea how to ran an interline and who made stupid decisions that will cost billions of dollars to undo.

I don't know what will happen with Skymark. DL did float a proposal for cooperation several years ago but backed off particularly because DALPA didn't like it and partly because it was apparent that Skymark was headed for financial disaster on its own - it intended to start its own A380 service to LAX and JFK - putting it as a competitor to DL.

If the Japanese gov't would let the market decide, including accepting that NW and now DL is a viable major third hubbing airline in Tokyo, the market can decide on its own.

Given that int'l interests - including Airbus - are involved in Skymark's bankruptcy - the decision is not just open for the Japanese gov't to decide

Despite predictions that you, commavia, have repeatedly made, DL is not going to walk away from the Japanese market and will maintain its share in the TPAC markets.

A DL controlled Skymark could provide an alternative to a JV with KE or a Chinese carrier while allowing DL to serve the intra-Asia markets it needs to serve.

I'm honestly not holding my breath because it would have to be a highly complex deal but it is a possibility
 
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it would also appear that DL's decision to give up SEA-HND also would strongly bias its interest in Skymark.

Skymark does have NRT slots but DL's decision to add its own KIX service via NRT and to give up SEA-HND seems to say that DL is not interested in trying to spend money to make Japan work beyond what it is doing today or can do with lower CASM aircraft including new generation 330s and 350s.
 
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I don't count posts but simply discuss the business issues.

There was also no name calling on this thread.

If it takes name calling and defamation in order to make posts work, then there will be people who will be disappointed.

the topic was raised in several sources despite DL supposedly telling Skymark before they weren't interested.

Feel free to add your own comments specific to the topic but I would be surprised if DL does anything with Skymark at this point.
 
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WorldTraveler said:
I don't count posts but simply discuss the business issues.
 
Talking to yourself repeatedly about the greatness of DL does not constitute a discussion of business issues.
 
I thought with all the mental horsepower you claim to have that you would be able to grasp that.
 
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jcw said:
4 out of 5 posts by the same poster - interesting approach
When you alienate a large portion of an online community, you usually wind up talking to yourself, which just further alienates people.
 
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and when you and others have nothing to contribute except throw personal attacks, you shouldn't be surprised that you are shown how wrong you are on so many subjects ranging from incorrect load factors to Mexico to a host of wrong predictions regarding WN and DLs interactions, the latest of which is playing out right now exactly as I predicted it would.
 
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Once again you are confused - when others discuss topics you are on personal attack mode - just look through all your posts

Once again - if DL can start a JV with the 3rd airline in Japan that really doesn't have much marketshare good luck with the worst JV in Japan

I wish DL much success with it
 
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nope.


I start EVERY topic I discuss on the business issues and OTHERS turn them into pi78ing matches.

thanks for contributing to the discussion regarding Skymark. I don't know if anything will happen but I remain skeptical.

I was hoping that others here would actually be able to contribute something of the value on the subject.
 
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The good news is skymark is in third place and using your logic anyone in the 3rd position is doomed to failure so it's looking good for DL to setup a JV with Skymark
 
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DL doesn't have to rescue anyone. DL's position in the US-Japan market is still as the largest single carrier.
 
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WorldTraveler said:
DL doesn't have to rescue anyone. DL's position in the US-Japan market is still as the largest single carrier.
Ahh, the "immunized joint ventures don't matter" narrative. Sometimes they do, sometimes they don't. When DL doesn't win a route case, the complaint is that AA/JL and UA/NH should be added together, since poor DL doesn't have a joint venture partner. When DL was insignificant to LHR (before partnering with Beardy), AA/BA was a single carrier. Now that DL has a joint venture partner, we'll probably not hear how few DL airplanes fly to London, instead being treated to essays about the strength and power of the DL/VS joint venture.

How does DL stack up against the UA/NH joint venture on US-Japan? How does DL stack up against AA/JL on US-Japan?

Additionally, what if Japan-HI beach market seats are excluded? Not a single, solitary USA corporate account cares about DL's NRT-HNL flights, as those are aimed at Japanese tourists, not American-based business flyers.

JL has added BOS and SAN plus KIX-LAX, while AA will soon be adding LAX-HND. NH has added a few flights as well. My guess is that AA+JL isn't as weak to Japan (or Asia) as previously believed. In fact, didn't Cranky write such an article a couple years ago?

If DL partnered up with Skymark, that might permit DL to finally pull the plug on the downsized NRT hub, which might be a good thing. DL can then focus its efforts on 48-state to Japan flying and other opportunities, leaving the beyond-NRT flying to its new partner.
 
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