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Discussion in 'Delta Air Lines' started by 700UW, Sep 21, 2014.
DL will be suspending SEA-HND effective 10/1; currently, it's scheduled to resume 3/29.
Hardly shocking. The somewhat dismal prospects for HND as an alternative to NRT are one of the few things most of us here agree on. Its a great airport, and the Japanese have ensured that it won't be successful for anyone but JAL and ANA.
and the Japanese also aren't going to get the right to operate flights from the US to HND at commercially viable times - so no one wins with new service between the US and Japan since Japan has awarded all of the other slots to other countries.
DL made sure that it protected its investment at NRT by providing enough service to HND while no one else has demonstrated that they can profitably service HND with the same times DL must use. Lest anyone point to Hawaiian, it is worth noting their Pacific system is deeply in the red and their average fares to Japan are considerably less than what other carriers get for comparable service to NRT.
UA has just announced they will reduce capacity to/from NRT by 17% over the winter.
It is clear the weakness is not just DL and not just HND.
I don't recall anyone ever insinuating that there was any weakness with DL.
Clearly, Asia is seeing signs of trouble. If the Chinese economy continues its slowdown, things will get ugly fast.
I didn't say you did.
What should be dispensed with is that there is anything unique about what DL is doing or that the issue is related just to HND.
DL's decision to accelerate the 744 retirements is clearly related to Japan since that is precisely where the 744s are predominantly used.
Despite the JV that UA and NH have, they have pulled capacity before DL. it is likely precisely because UA realizes that they cannot report another year of abysmal winter financials that they are cutting NRT - which will help DL the most.
When you consider the much higher percentage of Asian developmental flying that AA is doing relative to both DL and UA, it is very likely that AA's losses over the Pacific will accelerate.
DL is clearly taking this move to ensure they fly what can be profitable.
United is just getting more in line with what Delta has been doing. ie pulling the airline down over the winter compared to the summer.
UA is pulling far more capacity out of Japan they are out of the rest of their system. This isn't a "balanced" effort.
and these cuts are far deeper than the seasonality that DL has in its schedules.
People are asking on Flyertalk whether DL has sought DOT permission to suspend SEA-HND for six months - I looked at the Regulations.gov website and couldn't find any recent filings by DL, but I suspect that a polling letter might draw an objection from HA, which wants more slots to move more Japanese tourists to the islands (hardly benefiting any USA business travelers). Anybody know whether DL has begun a dormancy request?
all DL has to do is operate a couple flights during the Christmas season and the route doesn't become dormant.
HA can try to gain frequencies but they run a sizable average fare deficit to carriers that operate HNL to NRT. At some point, they will come to grips with the reality that their costs are not low enough for them to make money on the kind of fares they are getting.
Their Pacific expansion has been unprofitable and the only choice they have is to cut, not add.
Japan's economy is the weakest and DL has repeatedly shown it will give HA no room in the Japan market.
DL's schedules are also showing they are adding back flights in Japan-Hawaii markets.
adding more flights doesn't solve that problem for HA.
my understanding is it is 1x NRT-IAH going from daily 777 to 3x weekly 787 for the winter. 1x SFO-NRT 744 going to SFO-HND 787. Also because it is a YOY reduction you can also count LAX-NRT going down to a 787 from 777 and NRT-HNL going 2x 777 from 2x 744s.
that is a cut, but its not that big of a cut. I would bet if you look Delta is also going to be in able the same ball park. ATL/LAX/SEA/MSP-NRT all 747 to 777 and one 333. NRT-PEK and NRT-HKG cut plus reductions to Hawaii......
on a percentage basis, UA's reductions in its US-NRT schedules are already greater than DL's... in addition, UA is decreasing its intra-Asia flying by a greater percentage than DL as well.
you are free to "size" the cuts as you wish but UA's reduction in Japan capacity is larger than DL's and it is logical considering that UA has a JV partner but DL does not.
DL was also profitable flying the Pacific last year in the first quarter while UA was not, in part because DL has lower costs.
DL recognizes they must restructure their Pacific network but they are doing it from a position of strength esp. in the US-Japan market, and not weakness.
As with other markets, DL recognizes the strategic changes that are taking the necessary steps to NOT get behind the 8 ball and be forced to react.
They haven't that i have seen.
UA dropped NRT-BKK and ICN
profitability comes from DOT data.
will PM you later today.
Time for you to show your math, Skippy.
"On a percentage basis" is useless without the measure you're referring to, be it ASM's, frequencies, destinations, or the median age of flight attendants working the cabin...