Delta Industry News Update #3

Delta reports strong second quarter, optimistic in Asia Pacific growth in 2018

Delta reported a second quarter total revenue growth of 3.3%, and a record growth in unit passenger revenue from more than 2 years of negative growth. Although revenues from Pacific routes down 12.9% this comes as Delta is on a multi year effort to shift Asia Pacific focus from Tokyo toward Shanghai, Beijing and Seoul.

“…we’re really at the endpoints of the restructuring and looking forward to very much improved 2018 in the Pacific”, company President Glen Hauenstein


American Airlines to bringing back direct booking to lower cost

Airlines in the states have in the last decade been bound by third party distribution systems for ticket booking instead of having agencies book directly with the airline. Last week American Airlines re-introduced the the direct booking scheme that was abandoned more a decade ago. Under the new system American Airlines would pay agencies incentives directly for booking on Airline system saving enormously in fees that would lower operating costs. Sabre, the ticket booking platform replied that this move may put unforeseen costs back on the airline from inefficiencies huge cost of maintenance.


Big data predicts pissed loyalty members

Loyalty program outweighs their costs enormously when they are done right. In recent years airlines have changed loyalty programs more towards valuing high spending members and weeding out basic members, with less and less attractive features for upgrade. People are taking their dissatisfaction to social media where airlines are often oblivious of consumer sentiments that can predict more about where the program is going. The study by Travel Data Daily followed Cathay Pacific’s Marco Polo program’s 13,000 elite members sentiments on social media before and after the programs change that lowered mile earning for lower fare classes while increased for high fare classes. The research found 10% of members switch programs and were vocal about new airline with a corresponding with increased booking at new airline.

A graph of members discussion of competing airlines online and their corresponding flights booked on each.

Where digitizing and monitoring social media also becomes valuable is in its capability to predict high value customers dissatisfaction and target media to facilitate transfer from competitor programs.


Aloha, send Hawaiian Airline customer service a text message

Hawaiian Airline realizing the potential time waste for customers to wait on the phone is opting for text message as means to handle customer service inquiries with technology support from Liveperson Inc. Currently running on real human power, but Hawaiian is optimistic that in the future it will be looking to advanced AI and chatbots for text based customer service.


Qatar Airways turns a fare mistake into an opportunity for customer loyalty


Qatar Airways recently mistakenly issued its business class fare from Ho Chi MIn city to the States for less than $700. The news quickly blew up on social media, and instead of retracting the fare as a mistake like many would, Qatar went on to fully honor all flights booked and people have taken to social media to praise the airline’s moves.

Delta Industry News Update #2

Laptop ban future uncertain

Wider ban on laptops would cost passengers $1 billion, airline group warns

Widening the current laptop ban for flights from middle east and north Africa to include European flights would affect more than 10,000 flights monthly and would cost more than $1 billion dollars in the long run. The industry in on the edge of its seat advising that U.S and U.K authorities to work closely with the industry if they want to introduce further bans.

U.S. proposing increased security measures

U.S will lift the laptop ban for Etihad Airways flights arriving from Abu Dhabi. 9 other airlines including Emirates are still under the ban. Reason for this repeal is that Abu Dhabi airport already has a U.S. border security which will ensure screening more boarding the aircraft. Last week authorities introduced new measures that will increases screening for electronics that might be promising for loosening the ban.

Increase traffic volume and stable oil price contributing to a profitable quarter amidst turmoil

Delta airlines’ profit increased 3.5% in May over last year. A review of historical U.S airline record since 2004 shows that although overall jet fuel consumption and domestic departures has been declining, airline revenues are seeing a steady increase. This is due to the increased fuel economy of the new aircrafts and airlines increased occupancy of the flights, which increased 5% from 2007- 2016. Stable low oil price will help increase airline profits this quarter.

Airlines avoiding capacity growth

Delta airlines’ profit increased 3.5% in May over last year and increased traffic by 1.7% with no capacity growth. Seven major airlines have slowed down capacity growth as price competition due to overcapacity became major factor in harming airline profitabilities.


Say goodbye to Virgin America, Richard Branson looking to start new Airline

Richard Branson hints at potentially starting a new airline in the U.S. - Travel + Leisure.clipular (1)

Alaska Airline announced after acquisition of Virgin America brand that it would be dissolved in 2019. When asked about whether he is planning to start a new airline Richard Branson told report: “Watch this space” hinting at possibilities.


Airlines’ China appeasement policies backfires into series of PR disasters

Recently airlines competing in the China market have made series of moves to appease the Chinese sensitivities that have turned out into unmanageable disasters.

Emirates airline has recently increased capacity to 39 flights weekly to major Chinese cities. In a leaked corporate email the airline ordered its Taiwanese cabin crews last week to switch their Taiwanese flag uniform pin for Chinese flag pins i. This has incited anger among the Taiwanese staff and had since been retracted after it being publicized.


Cathay Pacific flight crews refused to add Chinese name tag.

After a disappointing quarter and the biggest ever job cut plan, and a huge debate between using traditional or simplified Chinese in flight, Cathay Pacific is in the news again after ordering its Hong Kong and Taiwan crews to add Chinese names on their name tags. Many resented the act as an appeasement to its Chinese customers and will potentially infringe on the crews privacy if their customer look them up and publicly criticize their service. And many did not like to use their Chinese names as they were sound too “outdated”

For airlines there are definitely ways to make your customers identify with you more through better services but it should never be at the cost of the respect for your own employee’s, especially when it comes to the sensitive topics on China relations and identities.


Dutch king reveals he held part-time job as airline pilot

Dutch King Willem-Alexander has revealed that for the past 23 years his favorite pastime was to fly the KLM passenger jets as “guest pilot” saying: “You can’t take your problems from the ground into the skies. You can completely disengage and concentrate on something else. That, for me, is the most relaxing part of flying.”

Colombian airline wants to make passengers stand

Low fare airline Viva Columbia is considering removing seats from its cabins and introduce a standing cabin hoping that it will drive down fares by squeezing in more passengers each flight.

Delta Industry News Update #1

North America: powerhouse of global profits

IATA expects passenger numbers to exceed four billion in 2017. (Rob Finlayson)

New IATA summit reports forecast global airline revenues $743 billion dollars, profits $31.4 billion dollars in 2017, with North America accounting for more than 50%.Industry forecasting a record volume of 4 billion annual travels.Asia Pacific forecasts $7.4 billion dollars, with noted rebound in cargo market, which accounts for more than 40% of global volumes.

IATA forecasts US$31.4 billion in airline profits in 2017

Multiple pressures push airlines competition for Asia and China

Virgin Australia, Singapore airlines, Cathay Pacific post record losses in 2016 from decreasing domestic demand and high costs. Low cost carriers eroded Delta, United and American’s share in the transatlantic market. With looming travels bans disrupting Europe and the Middle East airlines are looking eastward to address China market in efforts to try to regain the huge losses elsewhere.

Loss-making Cathay Pacific makes biggest job cuts in 20 years
财报 | 维珍航空利润承压,欲争抢中国旅游业市场份额
Loss-making Cathay Pacific makes biggest job cuts in 20 years
Singapore Airlines Tumbles Most in Six Years After Surprise Loss


It’s a laptopocalypse !

Middle Eastern airline profits plunge, other bracing as travel ban widens

Airline Report #1 - Google Slides.clipular

Airlines are seeing setbacks as a result of the recent carry-on laptop ban for flights traveling to U.S. and UK directly from Middle East. Emirates reported 82% dip in profits from last year and begins cutting flight capacities to major U.S. cities. Recent terror attacks in Europe further confirms airlines fear of new waves of travel and electronic bans both to and from U.S . ,Europe and Middle East.

No carry-on laptop ban on board flights from Europe for now: U.S.
Airline Profits Plunge As Laptop Ban Expands

IT system posts biggest threat to airline profits

More than 75,000 passengers were affected by British Airway’s IT system meltdown over the weekend and caused the airline more than $150 million and countless in long term reputation. Airlines run into frequent IT disaster as their large system are often a result of countless updates, merges and addition of new functions and features, one faulty router sent Southwest system down for more than 12 hours and resulted in more than 2300 flights canceled.

IT meltdown could cost British Airways £150m – it should be much more
Why airlines’ computer systems crash so often


Warren Buffett continues to bet on U.S airlines growth


Biggest shareholder in American Airline, Southwest and Delta Berkshire Hathaway up sizable stake in American Airline and Southwest by 8 and 10 percent respectively from the firm’s first quarter reports. After a decade of consolidation and the shadow of fuel and labor cost, the airline industry is finally soaring into profitability as they slowly monopolizes routes and increased barrier of entry.

Buffett’s Berkshire boosts American, Southwest airline bets; sheds Fox


Delta partners with Lyft rideshare

In another smart partnership after Clear and Airbnb to attract more young and professional travellers, Delta frequent flyers will get one point for every dollar they spend on Lyft rideshare. Delta has forego Uber because of its numerous disputes with authorities, drivers and employees. Travelling in taxi/ shared car is also a major part of business travel, operators such as 首汽约车 that also targets a more luxury forward travellers could make great partners for Delta in China.

Delta Air Lines Links Its Rewards Program to Lyft


Speed, Comfort, Convenience Delta, Always on time

Delta is slowly becoming U.S. travellers’ favorite airline

Delta tops the chart in on time arrivals, 86.9%, followed by Hawaiian, United, American. Only 65.5% of Virgin’s flights arrived on time, according U.S. Transportation department

On time arrival rate is something that business travellers value the most and will be a key strength for Delta going into the future to capture its frequent business flyers

Creating culture pays off

In the latest report, Delta bumps the least number of travellers off their flights. And also receives the most volunteers who gave up their seats. It goes to show creating culture and showing respect for your customers pays in the long run.

Here are the most reliable U.S. airlines

#Delta Proud

Delta reads 80,000 employee names on livestream 

Delta - How do you thank more than 80,000 hard-working, dedicated....clipular

Delta held a 50 hours long Big Thankyou livestream show reading out 80,000 employees names, 450 participated in the act including celebrities, athletes and business leaders. This act aims to show appreciation for its employees as the busy travel season starts. Many of the viewers are Delta employees and were excited to tune in on their names being read on the live show

Delta holds marathon Facebook Live to read names of 80,000 employees