Delta is laying plans to add 15 international routes to Europe, Asia and Africa starting in summer 2009, cashing in on its merger with Northwest and continuing its global expansion.

During this year's third quarter, international markets accounted for 41% of Delta's capacity, up from 35% for the same quarter last year, Delta President Edward Bastian told analysts in October.

He expected consolidated international capacity for Delta and Northwest to be up 13% to 15% through the rest of the year.

Taking advantage of new opportunities created by its buyout of Northwest, Delta's new route offerings will give the airline even more leverage across the Pacific.

Among the new flights are nonstops to Tokyo Narita from New York and from Salt Lake City, which will be the first transpacific service from the Rocky Mountain region. Earlier this year, Delta started a Paris flight from its Salt Lake City hub, and the airline said there is more than enough traffic through the hub now to generate the traffic for the new transpacific flight.

"The merger will give us more feed," said Delta spokeswoman Maria Schnabel.

The new flight will be flown with Airbus 330 aircraft from the Northwest fleet.

Delta also plans new flights between Atlanta and Nairobi, Kenya, and Cape Town, South Africa (via Dakar, Senegal); between Atlanta and Monrovia, Liberia; Abuja, Nigeria; Luanda, Angola; and Malabo, Equatorial Guinea (all via Sal Island, Cape Verde); and between New York and Lagos, Nigeria.

Delta Air Lines also announced the start of two additional nonstop flights between France and the United States with the airline's first-ever nonstop service between Paris-Charles deGaulle International Airport and Raleigh-Durham, N.C. and Pittsburgh. Delta will make history in Pittsburgh and Raleigh-Durham with its new flights. The new trans-Atlantic route from Pittsburgh will be the only nonstop transatlantic service offered by any airline from the city. The new route from Raleigh-Durham will be Delta's first-ever nonstop trans-Atlantic flight offered from North Carolina and will be operated from Raleigh's terminal two, the airport's newest terminal, which opened Oct. 26.

The airline is looking to start transatlantic service with the only nonstop flights operated to Gothenburg, Sweden, and Valencia, Spain, both from New York.

Also planned are nonstops from New York to Prague and a seasonal flight to Zurich, plus the addition of a second daily nonstop to Tel Aviv.

Delta Says It's Committed To Keeping 7 Airport Hubs
Source: Freep.com

The new Delta Air Lines now flies out of seven U.S. hub airports, some of which -- such as Detroit and Cincinnati -- are close neighbors.

But Delta's president said that the company is committed to maintaining those hub operations coveted by airports.

The merger between Delta and Northwest Airlines -- now just a little over a month old -- created the world's largest airline. Added together, the new airline has seven hubs: Detroit, Atlanta, Cincinnati, Memphis, Minneapolis/St. Paul, New York JFK and Salt Lake City.

Detroit is the airline's second-largest hub. Many airline observers have voiced skepticism about whether operating seven hubs make sense.

"Yes it does," Ed Bastian, Delta's president and CEO of Northwest, said in an interview with the Free Press. "And the reason for that is we've already paid for them; they are ours."

"If you started an airline from scratch, would you put a hub in Cincinnati and Detroit and Minneapolis and Memphis? No, you wouldn't. But the reality is that they are there."

The definition of a hub is inexact, but mainly it is a focal point used by airlines for incoming and outgoing long-distance flights -- a base of operations.

Bastian said both Cincinnati and Detroit are centers for big corporate accounts and great employees.

Delta has announced it will cut 12% of its flights from Cincinnati beginning in January.

Delta also announced it will drop two nonstop international flights from Detroit Metro -- Osaka, Japan, and Paris.

Bastian said both those routes were weak performers. He stressed that the airline expects to add a route from Detroit to Shanghai, China, in March and said international expansion is planned from Detroit, but would not divulge specifics.

He did say it would make sense to add routes from Detroit to Latin America.

Detroit will have a role in Delta's expansion internationally, he said, even though the local economy is slowing. Much of the airline's traffic through Detroit is connecting.

"Detroit is a wonderful facility; it's the state-of-the-art facility in North America," he said.

By 2010, Delta is striving to make 50% of its routes international flights.

However, he expects Delta to reduce the number of international flights it operates next year, slowing the pace of growth in response to economic conditions. Internationally, Delta has been growing at double-digit rates, he said.

Bastian also predicted the company would be profitable in 2009, after struggling in 2008. Delta has already pulled back flights operated by about 15%, he said.

To prepare for the summer 2009 schedule, Delta in January will increase connectivity between its U.S. hubs to improve customers' connections to the world. Overall, Delta will offer 14.5 percent more capacity between Atlanta, Detroit, Minneapolis, Cincinnati, Salt Lake City, New York and Memphis in January 2009 compared with the year prior.

Hub-to-hub changes include replacing select regional jet flights with mainline equipment connecting Atlanta to Memphis, Minneapolis and Detroit. Delta also will add a third daily flight between Salt Lake City and Detroit; new daily service between Salt Lake City and Memphis; and new daily service connecting New York-JFK and Memphis.

Delta also continues to roll out customer benefits as it integrates with Northwest. Effective Jan. 5, 2009, customers can take advantage of full Delta-Northwest codeshare reciprocity on flights between Delta hubs, creating thousands of additional connecting opportunities. Delta will launch a fully consolidated worldwide flight schedule in advance of summer 2009.

Delta to Trim More Capacity
Source: copyright 2008, Travel Weekly/USAtoday.com

Because demand has slowed, Delta intends to further pare capacity for 2009, the airline said Friday in a Securities and Exchange Commission filing.

Including Northwest's operations, Delta's fourth-quarter capacity is already down 4% system-wide; domestic is down 12% and international is up 9%. Domestic advance bookings in the fourth quarter are running two points higher year over year, reflecting domestic capacity reductions, Delta said. International advance bookings are down 4 to 5 points.

Consolidated revenue per available seat mile (RASM) is up 2 to 4 points in the fourth quarter, and the combined airline's operating margin is flat to minus-2%.

Other carriers also are reacting to falling demand:

• United is reconfiguring its international jets to reduce premium-class seats by 20% and add more seats in coach. That's a further indicator of softness in demand among business travelers, who typically buy premium-class tickets and drive airline profits.
• Continental treasurer Gerry Laderman said his carrier will retire 30 Boeing 737s in 2009 and add only 19 new planes, 18 of them new 737s. He added that the airline is seeing "softness" in demand for first- and business-class seats.
• JetBlue now expects its 2009 capacity to remain unchanged or grow up to 2%, down from its previous forecast of 3% growth, treasurer Mark Powers said.

Delta Air Lines CEO Richard Anderson and Alaska Air Group Chairman and CEO Bill Ayer announced an agreement in principle to amend their marketing agreement to make the airlines preferred alliance partners on the West Coast.

The amended agreement will offer important benefits to customers including supporting the launch of new Delta long-haul trans-Pacific and Latin American routes from the West Coast; expanded connecting opportunities to and from Alaska Airlines and Horizon Air hubs and focus cities; and enhanced worldwide frequent flier and lounge reciprocity agreements between Delta and Alaska.

By the end of 2009, Delta and Alaska/Horizon plan to launch a series of customer benefits resulting from the enhanced agreement, including:

• Access for Delta Crown Room Club and Northwest WorldClub members to Alaska Board Rooms in Anchorage, Seattle, Los Angeles, Portland, San Francisco and Vancouver, and for Alaska Board Room members to Crown Room Clubs and WorldClubs worldwide; and
• Elite reciprocity privileges for Delta SkyMiles members and Alaska Airlines Mileage Plan members including priority boarding, priority check-in and seat assignments, and reciprocal upgrades for customers who have reached Platinum or Gold status in either airline's frequent flier program. Northwest WorldPerks members and Alaska Mileage Plan members who have reached Platinum or Gold status already enjoy reciprocal upgrades when flying on Alaska and Northwest operated flights.

The U.K.'s air passenger duty for coach travelers flying from the United States will increase from 40 to 45 British pounds (from about $60 to $68) late next year, according to a pre-budget report by Her Majesty's Revenue and Customs (HMRC), the U.K.'s tax collector.

Premium-class passengers will be hit with a 10-unit increase, from 80 to 90 pounds (from about $121 to $136).

The tax hike would be effective for travel beginning on or after Nov. 1, 2009.

HMRC proposes even larger increases for the following year -- a 60-pound charge for transatlantic coach travelers and 120 for passengers in premium classes.

HMRC is proposing head tax increases on flights from all other world regions, as well. Unlike previous years, the 2009-10 air passenger duty will have four tax brackets. Passengers traveling longer distances will pay more. The plan is being touted as environmentally responsible.

The travel industry lambasted the tax hike.

James May of the Air Transport Association (ATA), a trade group representing U.S. airlines, called the measure "a revenue raiser for the government under the guise of environmental protection."

Further, the ATA claims the tax hike is illegal. "Among other things, the duty improperly asserts regulatory jurisdiction over flights far outside U.K. airspace by taxing flights according to various distance bands arbitrarily set by the U.K. government," said the association.

Ryanair said that the air passenger duty has been billed as an environmental tax since it was introduced in the mid-1990s, but that "not one penny of the tax has done anything to address environmental issues."

Qantas has today it was exploring a potential merger via a dual-listed company structure after a similar announcement earlier by BA that sent the British company's shares soaring in London trade.

BA also said its tie-up talks with Spanish airline Iberia were continuing.

"In response to recent media speculation, British Airways Plc confirms that it is exploring a potential merger with Qantas Airways Limited via a dual-listed company structure."

Qantas echoed BA's assertion that there was no guarantee any transaction would be forthcoming and a further announcement would be made in due course, if appropriate.

Qantas said any transaction would comply with its obligations under the Qantas Sale Act - which stipulates the company must be 51 per cent Australian-owned, keep its headquarters in Australia, and have an Australian chairman.

Seven Investment Management analyst Justin Urquhart Stewart said it was logical for BA and Qantas to explore a merger, especially as activities such as replacing aircraft would prove difficult in coming years with limited capital and credit available.

He said that while any union of the two would "almost certainly" draw complaints from competitors, such objections would not block a deal as long as it did not result in a monopoly.

BA and Iberia announced in July they were holding merger talks to create the world's third-largest airline in terms of income.

British Airways, Iberia and American Airlines signed an agreement in August to cooperate on flights between North America and Europe.

Virgin Atlantic Airways, which has already objected to the BA-American-Iberia tie-up, said BA was attempting to increase its dominance to the detriment of competition.

BA and Qantas are already code-sharing partners in the oneworld global alliance, which brings together 10 of the world's carriers.

News of their merger talks came a day after the Australian Government revealed plans to increase the level of foreign ownership allowed in Qantas, but it will not permit a takeover.

Australian law currently limits a single foreign holding to 25 per cent, while a group of foreign holdings can total 35 per cent.

A Federal Government policy paper proposes lifting the foreign ownership limit - whether by one company or a group of companies - to 49 per cent. That would allow Qantas and BA to swap equal stakes in each other.

The aviation sector is seeking consolidation as airlines fight for survival having been crippled by record high oil prices. They now face a fall in air travel as the global economy enters recession.

James Shugg, an economist at Westpac, said any merger between BA and Qantas was just one of many consolidation options in the industry.

Recently BA chief executive Willie Walsh said his airline had expressed strong interest in a commercial alliance with troubled Italian carrier Alitalia.

Following BA's announcement of a potential merger with Qantas, the British airline's share price closed up 12.5 per cent at £1.57 ($3.64) on London's FTSE 100 index.

Last month, British Airways announced a 91.6 per cent plunge in half-year profits. Pre-tax profits dived to £52 million ($120.65 million) from £616 million ($1.43 billion) during the same six-month period a year earlier.

The airline recorded a net loss of £42 million ($97.45 million) for the six months to the end of September and said passenger numbers were down by almost four per cent.

Qantas meanwhile has announced further cuts to its capacity, saying the global financial crisis was continuing to dampen passenger demand.

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Through the Secure Flight program, the TSA will assume from airlines, responsibility for conducting prescreening of passenger information against federal government watch lists. Initially, airlines with flights operating within the United States will be required to provide the TSA with the following passenger data; in a second phase, international flights will be added:

• Passenger's full name as it appears on the ID used to pass through airport security
• Date of birth
• Gender
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• Specific passenger data described above
• If provided by passenger, passport information and itinerary information

By assuming watch list matching responsibilities from airlines, TSA will:

• Decrease the chance for compromised watch list data by limiting its distribution
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