Tag Archives: Delta Air Lines

Delta set new records in July, upgrades its Airbus A319 and A320 fleets

Delta upgraded A320 cabin (Delta)(LRW)

Delta Air Lines (Atlanta) issued this report on its busy summer season:

Delta logo

July is the only month in which each day is a part of Delta’s busy summer schedule. So as July wraps up – and with 17 days remaining in the summer schedule – here are nine amazing facts to keep in mind the next time you see a Widget-branded aircraft soaring overhead.

Delta’s summer schedule begins in early June and runs through mid-August.

1. July 31 set an all-time single-day bookings record of more than 620,000 customers. That’s as if the entire population of Portland, Oregon, booked to fly Delta in one day.

2. Nearly 2,200 more flights are scheduled so far in summer 2015 than the same period in summer 2014, a 0.7 percent increase.

3. Reliability on Delta Connection – the airline’s group of regional carriers – is dramatically improving: there have been 1,400 fewer Delta Connection cancellations this summer compared to the same period last summer.

4. The Delta system’s “completion factor” – days without any canceled flights – is 99.02%, 0.44 percentage points better than the same period last summer. That’s an amazing 1,308 fewer cancels than in summer 2014. And it includes both mainline flights and Delta Connection.

5. In June, Delta went 139.2 consecutive hours without a mainline cancellation; the closest streak during a summer schedule was June 2014 – 80.3 consecutive hours

6. Twenty-one days of 100 percent mainline completion factor so far in summer 2015, compared with 12 during the same time period in 2014.

7. Delta’s mainline aircraft numbers nearly 800 for the summer operation, including 41 737-900 ERs and 71 Boeing 717-200s.

8. TechOps is moving maintenance performance to new heights:

Mainline maintenance “completion factor” of 99.97 percent.
Maintenance on-time departure performance of 96.70 percent, best-ever for a summer schedule.

9. Year-to-date, Delta mainline has transported more than 2.2 billion pounds of checked bags and 987 million pounds of cargo freight.

Delta A319 revamped lavatory (Delta)(LRW)

In other news, Delta is revamping its Airbus A319 (above) and A320 fleets:

Delta will debut its latest single-aisle jet to receive a nose-to-tail interior modification this week—the first of 57 Airbus A319s to receive the state of the art upgrade.

The 132-seat aircraft is the latest in a series of upgrades coming to Delta’s domestic narrowbody fleet and follows just a few short months after Ship 3235 rejoined the flight line.

Delta A319 Panasonic entertainment system (Delta)(LRW)

Airbus A320 interior

Panasonic in-flight entertainment at every seat (above), large pivoting overhead bins capable of accommodating 60 percent more carry-on bags (below), new galleys and an innovative, pod-like overhead passenger service unit highlight just a few of the new amenities designed by Zodiac Aerospace that Delta customers will enjoy. The 9 inch high definition seat-back entertainment screens offer more content than any other domestic carrier. Each seat also as 110v and USB power to plug in electronics in flight.

Delta A320-200 revamped overhead storage (Delta)(LRW)

The airline is the first in the world to receive the interior modifications on both Airbus fleets.

All 126 A320 and A319 aircraft will be retrofitted with the new interior by summer 2017. The larger of the two jets, the A320, will also receive in-flight entertainment, though not initially, through 2018.

Many of Delta’s Boeing 757 jets are receiving interior enhancements as part of the airline’s more than $770 million investment in the domestic fleet to provide a more consistent customer experience.

Fleet:

Delta 7.2015 Fleet

Photos: Delta Air Lines. All 126 of Delta’s Airbus A319 and A320s are undergoing interior upgrades.

Copyright Photo below: Copyright Photo: Michael B. Ing/AirlinersGallery.com. Airbus A319-114 N330NB (msn 1549) departs from Los Angeles International Airport.

Delta aircraft slide show (current livery only): AG Airline Slide Show

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Delta and China Eastern solidify their strategic partnership, Delta to acquire a 3.55% share

Delta Air Lines (Atlanta) and China Eastern Airlines (Shanghai) today signed an agreement to expand their partnership and better connect Delta’s global network with China Eastern, one of the leading airlines in China. The agreement will include a $450 million investment by Delta to acquire a 3.55 percent stake in China Eastern.

Delta continued:

Delta logo

This move marks a significant step in the airlines’ collaboration and partnership that will allow Delta and China Eastern to compete more effectively on routes between the U.S. and China, provide more travel options for customers in both countries and make joint investments in the customer experience.

“The execution of the Subscription Agreement and the launching of commercial cooperation plan by China Eastern and Delta indicate significant strategic moves of China Eastern to comprehensively reform further, actively explore and develop mixed ownership economy, and actively promote globalized development,” said Shaoyong Liu, China Eastern CEO. “The cooperation of the parties is based on a global vision and joint strategic blueprint. The parties will take advantage of their respective route networks, flight services, relevant businesses and advantageous resources to fully connect the world’s two top economies as well as two top air transportation markets. The parties wish, through excellent operation and international cooperation, to optimize customer experience, enhance the parties’ global competitiveness and promotes the development and revenue growth of both parties.”

“Delta’s relationship with China Eastern is long-standing. We share a vision that will create the most profitable, enduring franchise between the U.S. and China, with world-class customer service,” said Richard Anderson, Delta CEO. “For the past three years, Delta has welcomed members of the China Eastern team at our headquarters for sharing best practices and work study opportunities. We have learned much from one another already and look forward to deepening our already effective partnership.”

China Eastern 2014 logo (LRW)

China Eastern, with its wholly owned subsidiary Shanghai Airlines, and Delta currently operate codeshare flights on 30 domestic routes in the U.S., 43 domestic routes in China and seven trans-Pacific routes between China and the U.S. China Eastern serves the three largest U.S. markets, with four nonstop flights from Shanghai and Delta serves the three largest cities in China with six daily non-stop flights from the U.S.

  • China Eastern and Delta continue to strengthen cooperation and support each other in the China-U.S. market through greater access to each other’s networks and an improved customer experience. Among recent improvements:
  • China Eastern and Delta have expanded their joint China-U.S. offering – further cementing their position in the largest market to/from Shanghai – with Delta’s recent addition of new Los Angeles to Shanghai service.
  • Delta’s recent move to Terminal 1 at Shanghai’s Pudong Airport to co-locate with China Eastern and Shanghai Airlines has resulted in more convenient connections and a seamless airport and baggage experience for customers.

Newly developed joint corporate sales provide more competitive products to customers in China and the U.S.

Equity investment

As part of the enhanced strategic partnership, China Eastern and Delta entered into a conditional subscription agreement where Delta will invest $450 million in China Eastern’s H-shares, which trade on the Hong Kong Stock Exchange. The investment equals approximately 10 percent of China Eastern H shares and [3.55] percent of the total shares of China Eastern. Delta also will be entitled to an observer seat on the China Eastern board of directors. The agreement is conditioned upon achievement of a final marketing agreement and approval by each carrier’s board of directors.

China Eastern in the U.S.

China Eastern will operate 35 weekly departures to 4 destinations in US from Shanghai, 2 flights a day to Los Angeles, daily to New York, San Francisco and Hawaii, also 3 flights a week from NanJing to Los Angeles. China Eastern operates Luxurious new 777-300ERs on routes between China and North America, which will be a major market for China Eastern over the future years. China Eastern plans to open new routes to North America and also boost frequencies on existing routes.

Delta in China

Delta will operate 28 weekly departures to Shanghai this summer. Delta also offers daily service to China’s capital, Beijing, from Seattle and Detroit and to Hong Kong from Seattle. Delta has grown its China network by nearly three times in the past five years.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. China Eastern’s new Boeing 777-39P ER B-2002 (msn 43288) climbs away from Los Angeles International Airport (LAX).

Delta aircraft slide show (current livery only): AG Airline Slide Show

China Eastern aircraft slide show: AG Airline Slide Show

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Delta to extend the seasonal Boston-Paris (CDG) route to year-round service

Delta Air Lines (Atlanta) will extend its seasonal daily nonstop service between Paris-Charles de Gaulle and Boston Logan International Airport to a year-round operation, beginning on October 25.

The route will be operated in conjunction with joint venture partner Air France (Paris) and will become Delta’s 10th U.S. gateway offered year-round from Paris. Delta will operate the service on a Boeing 757-200 aircraft.

Copyright Photo: Jay Selman/AirlinersGallery.com. Boeing 757-232 N660DL (msn 24422) approaches the runway at Las Vegas.

Delta Air Lines aircraft slide show: AG Airline Slide Show

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Delta’s CEO Richard Anderson: The 40 Boeing 737-900 ERs and 20 Embraer E190s will be cancelled

Delta Air Lines (Atlanta) management team held a conference call yesterday, mainly with the analysts and representatives of the media, after posting a record second quarter profit, beating all Wall Street forecasts.

In the conference call, CEO Richard Anderson when asked about the rejection of the proposed contract by the pilots, stated, without elaborating further, the 40 Boeing 737-900 ERs and 20 Embraer ERJ 190s on order “will be cancelled”. The company had tied these two orders with the ratification of the new pilot contract.

The comment could be considered posturing by some observers, intended as a new salvo to the pilots for the next round of contract negotiations.

The pilots, represented by ALPA, voted nearly two-to-one against the proposed contract. Both sides will now have about six months to further negotiate new terms in which both sides can agree.

ALPA has not formally responded to the comments.

The Embraers would have represented a new lower level of mainline flying.

Read more from Bloomberg Business: CLICK HERE

Copyright Photo: Brian McDonough/AirlinersGallery.com. Boeing 737-932 ER N817DN (msn 31928) banks on the river approach to the runway at Washington’s Ronald Reagan National Airport.

Delta Air Lines aircraft slide show: AG Airline Slide Show

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Airbus brings the A350-900 to five U.S. cities including Oshkosh

Airbus (Toulouse) kicked off the U.S. leg of its tour of the Americas by arriving in Atlanta yesterday. The demo tour features a flight test version of the A350-900 XWB, which Airbus is showing off to investors and airlines in Atlanta, Newark, Chicago (O’Hare) and Milwaukee before the general public can experience the A350 XWB at EAA’s AirVenture air show in Oshkosh, Wisconsin.

While it is was in Atlanta, Delta Air Lines employees toured the aircraft, familiarizing themselves with its layout and features. For many of them it will be their first opportunity to get a closer look at what will become the newest member of its fleet in 2017, when Delta accepts the first delivery of its 25 A350 XWBs. Delta currently operates Airbus A319, A320 and A330 aircraft, with additional outstanding orders for each type.

The A350-900 that is in the U.S. this week is a flight test aircraft featuring a two-class cabin. It seats 42 in lie-flat, business-class seats, which are four abreast, and 210 economy-class seats. For passengers, the aircraft will provide new levels of comfort, with extra space in all classes. It features wider panoramic windows, larger overhead stowage compartments and the latest in-flight entertainment and connectivity.

Copyright Photo: Eurospot/AirlinersGallery.com. The pictured Airbus A350-941 F-WWCF (msn 002) in the Caron Fiber livery is the tour aircraft.

Delta reports adjusted earnings of $1 billion in the second quarter, up 22%, expects capacity to decrease 3% in the 3Q

Delta Air Lines (Atlanta) today reported its best second quarter financial results in its history:

Delta Air Lines today reported financial results for the second quarter (June) 2015 quarter, including adjusted net income of $1.0 billion or $1.27 per diluted share, up 22% from the same quarter in 2014.

“Delta’s record results have allowed the company to invest in its employees through higher wage rates and profit sharing; improve the experience for our customers through new aircraft and innovative partnerships with global carriers; and uniquely deliver value for our shareholders by accelerating our capital returns while also paying down debt,” said Richard Anderson, Delta’s chief executive officer. “We have more work and opportunity ahead of us on all of these fronts as we continue to execute on our long-term plan.”

Anderson continued, “Our significant fuel savings in the September quarter should allow us to produce another record quarter with more than 30% EPS growth, a 19-21% operating margin and $1.9 billion of operating cash flow.”

Delta 2Q Graph

Revenue Environment

Delta’s operating revenue for the June quarter increased 1%, despite $160 million in foreign currency pressures which reduced unit revenues by approximately 2 points. Passenger unit revenues declined 4.6% on a 3.9% decline in yields.

Delta saw solid progress with several of its revenue initiatives, including Branded Fares, which increased passenger revenues by $56 million, and its enhanced agreement with American Express, which produced an incremental $60 million in revenue.

“Our commercial initiatives continue to gain traction in the marketplace and we will produce summer margins in excess of any achieved in our history,” said Ed Bastian, Delta’s president. “However, unit revenue growth is an important component of our long-term plan to expand margins. We continue to project flat system capacity growth for the fourth quarter of 2015 – a level in line with current demand expectations, which should put the business on the right trajectory to stem the erosion in unit revenues by the end of the year.”

Investment Strengthens Partnership and Expands Global Reach

Strengthening its existing partnership with Gol, Delta recently agreed to purchase up to $56 million in preferred shares as part of a larger rights offering by the Brazilian carrier. In addition to the equity, Delta will guarantee up to $300 million in borrowings by Gol under a term loan with third-party lenders. Delta’s guarantee will be secured by Gol’s interest in SMILES, Gol’s publicly-traded loyalty program. Delta and Gol have also agreed to extend their exclusive commercial agreement for flights between the United States and Brazil, the largest aviation market in Latin America. This transaction is subject to normal closing conditions, including regulatory approvals.

Cost Performance

Adjusted fuel expense2 declined over $463 million compared to the same period in 2014, as 39% lower market fuel prices and a $77 million increase in profit at the refinery offset nearly $600 million in settled hedge losses. For the remainder of 2015, Delta expects its fuel expense to be $1.90 – $2.00 per gallon, a significant reduction to the $2.65 per gallon it realized in the first six months of the year.

CASM-Ex3 decreased 0.8% for the June quarter on a year-over-year basis, with foreign exchange and the benefits of Delta’s domestic refleeting and other cost initiatives offsetting the company’s investments in its employees, products and operations. This marks the eighth consecutive quarter of CASM growth below 2%, in line with the company’s long-term goals.

Delta’s debt reduction initiative continued to improve the company’s interest expense, producing $46 million in interest savings for the quarter compared to the same period in 2014.

“Because of the momentum we’ve built with our cost reduction initiatives, we expect to post our ninth consecutive quarter of sub-2% unit cost growth in September,” said Paul Jacobson, Delta’s chief financial officer. “Cost efficiency has contributed to the record results that allowed us to return $1 billion to shareholders in the June quarter while investing in our employees and customer experience.”

Cash Flow, Shareholder Returns, and Adjusted Net Debt

Delta generated $2.5 billion of adjusted operating cash flow and $1.6 billion of free cash flow during the quarter. The company used this strong cash generation to reinvest nearly $1 billion back into the business, primarily for aircraft purchases. The company returned $1.0 billion to its owners through $72 million of dividends and $925 million of share repurchases, while also strengthening its balance sheet by reducing its adjusted net debt to $7.1 billion.

September 2015 Quarter Guidance

Following are Delta’s projections for the September 2015 quarter:

3Q15 Forecast

Unit Revenue (compared to 3Q14)

(4.5%) – (6.5%)

Operating margin

19% – 21%

Fuel price, including taxes, settled hedges and refinery impact

$1.90-$1.95

CASM – Ex (compared to 3Q14)

Flat

System capacity (compared to 3Q14)

~3%

Special Items

Special items, net of taxes, in the June 2015 quarter totaled $458 million, including:

$454 million for mark-to-market adjustments and settlements on fuel hedges;

a $16 million charge for fleet and other items, primarily associated with Delta’s domestic fleet restructuring initiative; and

$20 million for mark-to-market adjustments on hedges owned by Virgin Atlantic.
Special items, net of taxes, in the June 2014 quarter totaled $88 million, including:

a $69 million charge for debt extinguishment associated with Delta’s debt reduction initiative; and

a $20 million charge associated with Delta’s domestic fleet restructuring.

Top Copyright Photo: Fred Freketic/AirlinersGallery.com. Delta has been introducing the former AirTran Airways Boeing 717s around the country including the West Coast. Boeing 717-2BD N966AT (msn 55027) departs from the New York (JFK) hub. All 717s are leased from Southwest Airlines.

Delta Air Lines aircraft slide show (current livery):

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Delta to lead off the 2Q airline sector earnings reports today

DELTA AIR LINES LOGO

Delta Air Lines (Atlanta) today leads off all U.S. airlines with the financial results for the second quarter. Lately the U.S. airline sector has been hit hard on Wall Street over growing concerns about overcapacity and “discipline”. Many investors will be keying on Delta’s announcement today.

Delta is webcasting its conference call and will be discussing its second quarter (“June Quarter”) results at 1000 (10 am) EDT with CEO Richard Anderson, President Ed Bastian and CFO Paul Jacobson.

To listen you must register: CLICK HERE

We will have the full 2Q financial details when they are released.

Other known airline and manufacturing reporting dates (others are welcome):

Boeing July 22

Alaska Air Group July 23

JetBlue Airways July 23

Southwest Airlines July 23

United Airlines July 23

Spirit Airlines July 24

American Airlines Group July 24

Ryanair July 27

UPS July 28

Hawaiian Airlines July 28