Delta Will Take Over Alaska Airlines?

[eolesen]

I haven't noticed anyone saying that people are sitting in those seats on DL.

That's because on average, DL isn't doing very well in traditional AS markets where they're head to head.

Remember the discussion on Juneau?... Here's load factor for the months DL was flying head to head:
 

Month	Market	DL	AS
2014-5	SEAJNU	41%	89%	-47%
2014-6	SEAJNU	42%	84%	-43%
2014-7	SEAJNU	55%	81%	-26%
2014-8	SEAJNU	47%	74%	-26%

Source - DOT T-100

Here's another -- SEALAS

Month	Market	DL	AS
2014-8	SEALAS	62%	89%	-26%
2014-9	SEALAS	50%	86%	-37%
2014-10	SEALAS	62%	86%	-24%

Source - DOT T-100

Want more?
 

Month	Market	DL	AS
2014-5	SEAFAI	71%	89%	-19%
2014-6	SEAFAI	78%	93%	-15%
2014-7	SEAFAI	85%	93%	-7%
2014-8	SEAFAI	84%	91%	-7%

2014-1	SEALAX	74%	85%	-11%
2014-2	SEALAX	83%	89%	-6%
2014-3	SEALAX	87%	90%	-4%
2014-4	SEALAX	82%	84%	-3%
2014-5	SEALAX	69%	79%	-10%
2014-6	SEALAX	73%	83%	-10%
2014-7	SEALAX	86%	89%	-2%
2014-8	SEALAX	88%	93%	-4%
2014-9	SEALAX	70%	86%	-16%
2014-10	SEALAX	70%	86%	-17%

2014-8	SEASAN	85%	92%	-7%
2014-9	SEASAN	71%	86%	-15%
2014-10	SEASAN	53%	82%	-29%

2014-1	SEAHNL	89%	94%	-5%
2014-2	SEAHNL	87%	90%	-2%
2014-3	SEAHNL	91%	92%	0%
2014-4	SEAHNL	88%	94%	-7%
2014-5	SEAHNL	82%	94%	-12%
2014-6	SEAHNL	96%	96%	-1%
2014-7	SEAHNL	95%	96%	-1%
2014-8	SEAHNL	92%	94%	-2%
2014-9	SEAHNL	78%	93%	-15%
2014-10	SEAHNL	91%	94%	-3%


Source - DOT T-100

The only market where DL did better was ANC, presumably because they have cruise contracts. Even that fell off a cliff in Oct 2014:
 

Month	Market	DL	AS
2014-5	SEAANC	92%	89%	3%
2014-6	SEAANC	95%	93%	2%
2014-7	SEAANC	93%	90%	3%
2014-8	SEAANC	85%	76%	9%
2014-9	SEAANC	70%	64%	5%
2014-10	SEAANC	45%	73%	-28%

Source - DOT T-100

I know -- it's been a formative year for DL. Maybe with a few draft picks they'll do better in 2015.

 

[jimntx]

Excuse me, Mr. E.  I believe it is a violation of board policy to post actual sources for data.  When asked for sources, you are supposed to reply "Look it up yourself.  I'm not doing your work for you."

 

[Kev3188]

I've said it before, but I still think people underestimate just how deep the brand affinity for AS is in the PacNW-all the more so in traditional markets. Heck, they're the first carrier that comes to my mind for several of those,, and I work for DL!

Formative stages indeed, but DL absolutely has work to do in changing that mindset...


 

Excuse me, Mr. E.  I believe it is a violation of board policy to post actual sources for data.  When asked for sources, you are supposed to reply "Look it up yourself.  I'm not doing your work for you."

Lol.

 

[WorldTraveler]

and brand loyalty to AS in the PMNW is only half of the story.

All of those routes have another end and outside of Alaska, DL has a stronger share of the market in every one of them.

and there is nothing wrong with noting that AS had higher LFs than DL in a number of markets.

and yes those not only are new markets but they also were largely added or increased just last summer.

DLs strategy of yield management is undoubtedly NOT to trash markets with low fares in the peak season but to add lower fares when it becomes necessary to do so.

and given that many AS people argued that DL wouldn't even be able to find its way to JNU, let alone land there, they undboutedly did a good job of convincing the local market that DL wouldn't be there.

not only is DL back this year with similar amounts of capacity (737-800 IIRC instead of a 757 which was partially driven by the fact that DL has a SEA 757/767 pilot base but did not have a 737 pilot base last year) but DL is converting both FAI and JNU to year round service and adding 2 more cities this summer to its Alaska network from SEA.

and given that DL said its SEA RASM was up last summer despite the new capacity, I imagine DL is well on its way to its goals as evidenced by its continued addition of capacity.

and you could just as easily find big differences between AS' performance on routes into DL hubs and even cities outside of the PNW, so DL is hardly in the position of having to develop capacity.

you might consider that while DL said its SEA hub RASM increased, AS' RASM (which is very heavily to/from the PNW) has been going down. AS is filling seats by decreasing fares.

finally, you might also want to look at AS' LFs on its routes to/from SLC ... and if you do you will see they are trailing DL's LF by as much as 20 points.

 

[jimntx]

Oh, well.  There goes AS down the drain.  Their load factor is not the leading load factor for the SLC market.  And, everyone knows that dominating SLC is absolutely essential to AS's survival.  RIP, AS.  (Did anyone even care about the SLC load factor besides WT?)

 

[WorldTraveler]

you missed the point.

AS is trying to build SLC and doing considerably worse in doing so than DL is in SEA.

remember that SEA domestic is only part of the equation. DL's int'l operation is unaffected by AS - although AS is trying to form partnerships with everyone they can to limit DLs ability to succeed with the grow its int'l network

but for now, SLC represents about 2% of AS' total capacity.

SEA domestic represents about 2.5% of DL's capacity - and that includes a lot of capacity to DL hubs which have been there for years.

so, AS and DL are both developing their network in other carrier's hubs. and both are putting a fairly small amount of their system capacity at risk.

as someone pointed out to us, because of DL's much larger size in SLC, it doesn't have to put much more capacity in the market to match what AS is doing but the inverse is true in SEA.

as much as some want to see a winner and a loser, neither DL or AS is likely to lose.... but the averages are far larger in DL's favor of establishing an expanded domestic presence in SEA than AS will have in succeeding with an equal percentage of its own capacity in a DL hub.

DL simply has a lot more size to use elsewhere to help develop its PNW presence.

 

[FWAAA]

I didn't think that AS was seriously trying to build a hub in SLC; I thought their antics in SLC were a stick in DL's eye for DL's SEA hub buildup.

 

[eolesen]

I didn't think that AS was seriously trying to build a hub in SLC; I thought their antics in SLC were a stick in DL's eye for DL's SEA hub buildup.

SEA-SLC is a little more complicated -- you have WN in there, and it's a DL hub, where I'd hope they were performing better than AS would.

Still, it isn't quite the bloodbath that it is where DL is flying from an AS hub into well established AS spokes.
 

Month	Market	DL	AS	WN
2014-1	SEASLC	74%	65%	59%
2014-2	SEASLC	81%	71%	61%
2014-3	SEASLC	88%	71%	67%
2014-4	SEASLC	84%	72%	64%
2014-5	SEASLC	81%	72%	65%
2014-6	SEASLC	86%	84%	78%
2014-7	SEASLC	90%	88%	73%
2014-8	SEASLC	91%	85%	71%
2014-9	SEASLC	88%	86%	
2014-10	SEASLC	85%	74%

 

[WorldTraveler]

uh, you forgot the half dozen other cities that AS started from SLC in addition to its own hub in PDX

let me help you out.

here are the routes AS operated from SLC in Dec and their LFs... and these were actually better than they were in some of the months before.

Dest Load Factor
BOI 80.44
LAS 64.48
LAX 61.03
PDX 70.34
SAN 64.55
SEA 79.02
SFO 43.02
SJC 49.87
TOTAL 66.06
 

I didn't think that AS was seriously trying to build a hub in SLC; I thought their antics in SLC were a stick in DL's eye for DL's SEA hub buildup.

and if AS was willing to lose money in order to poke a stick in DL's eye, then that is AS' loss - or actually their shareholders'.

in contrast, DL is out to build its presence in the SEA domestic market.

and by all measures, DL is doing that on a systemic and rational basis.
DL's domestic LF for SEA in the 2nd quarter of 2014 was 88% and over 89% for the 3rd quarter and beyond

remember, DL's domestic SEA capacity and AS' SLC capacity represent about the same amount of each carrier's total system capacity.

based on the data, DL is doing a far better job of picking markets which it can grow into without pulling down its overall performance, even if there are individual markets which still need development. DL operated ONE JNU flight last summer. ONE out of over 2500 flights/day. and it was something of a given that the 757 was too big of an aircraft but DL did not have a 737 base in SEA so could not use a 737 given that JNU has unique pilot requirements.

DL has a 737 pilot base in SEA this year.

and, btw, WN does not fly SEA-SLC any longer.

 

[topDawg]

Yeah, DL can add seats to the market.  I haven't noticed anyone saying that people are sitting in those seats on DL.   For instance, as mentioned earlier, the "seasonal" Haneda flights on which DL  can't even fill even a 767.  I suppose there will be a strategic downgrade to 737 with a courtesy call at Kamchatka on the way to HND.

Just like AA couldn't figure out how to fill a 777 in NYC-HND and has now completely ducked out of the NYC-TYO market all together.....

 

[WorldTraveler]

jim probably doesn't want to hear that DL carried as much revenue on its SEA-HND flight in the summer of 2014 as AA carried on its JFK-HND during the last summer it operated that route.

the difference is that Dl doesn't throw capacity into the market which can't profitably be filled.

and the same low fuel prices that will likely make AA's TPAC network profitable this year will also allow DL to operate its SEA-HND route on a profitable basis for much more of the year.

and most significantly, the SEA_HND route will stay with DL while AA will still not operate any HND routes on its own metal after giving up their own JFK-HND flight

 

[jimntx]

Just like AA couldn't figure out how to fill a 777 in NYC-HND and has now completely ducked out of the NYC-TYO market all together.....

True, but then you didn't see any of us claiming that AA was going to dominate the world, or that cutting flights a la NYC-HND is a strategic equipment realignment.  We tried it,  It didn't work.  So what?  We also tried DAL-STL and WN ate our lunch on the route.  Have you seen any of us all of a sudden mention the increasing AA load factor on DFW-GBG (we don't actually fly there so no need to correct my "error".  It's called sarcasm.) as an attempt to divert the discussion from your statement of a negative about AA, now have you?
 
Oh, and we don't have to fly NRT (the correct airport code) from every International hub.  We have a Joint Business Venture with Japan Airlines who offers JFK-NRT twice a day.  In case you didn't know, a JBV is more profitable than a codeshare, and you can strategically utilize your own metal elsewhere.
 
(Note that the word strategically makes it sound like I know what the hell I'm talking about.  You should always throw it in when you're whistling in the dark.)

 

[WorldTraveler]

like heck no one claimed AA wasn't going to dominate the world.... something I didn't say at all about DL.

We listened to "AA is the largest airline" for months and still hear it.

I have yet to hear any of the people who have repeatedly tried to trash DL's Japan operations admit that AA made a strategic mistake by trying to fly JFK-HND.

I totally get that AA can decide to realign its network.... E used that argument many times for the reason to close BNA and RDU as hubs and shift the capacity to MIA... and I agree with him.

problem is that the AA fanclub can't accept that DL's decision to close DFW as a hub and grow JFK and LGA was a direct result of reallocating corporate resources.

and the real issue is that AA has lost a far higher percentage of share in its key markets to competitors than DL has.... and the whole reason why AA people get so fixated by the notion of taking over AS is to try to reset the competitive clock on the west coast which DL and UA have significantly rearranged because of their own actions

 

[topDawg]

True, but then you didn't see any of us claiming that AA was going to dominate the world, or that cutting flights a la NYC-HND is a strategic equipment realignment.  We tried it,  It didn't work.  So what?  We also tried DAL-STL and WN ate our lunch on the route.  Have you seen any of us all of a sudden mention the increasing AA load factor on DFW-GBG (we don't actually fly there so no need to correct my "error".  It's called sarcasm.) as an attempt to divert the discussion from your statement of a negative about AA, now have you?

Most of you, you have a few in your camp that are as bad as he is. (however for the most part they do stay on the AA site and don't run over here to post propaganda like WT does.) 

 

[WorldTraveler]

sorry, but "staying in your own camp" and posting factually incorrect or logically disjointed information won't cut it.

DL isn't interested in trying to merge with AS any longer.

AA couldn't based on antitrust concerns.

to try to argue for what AA and AS could do together, esp. to DL, is nothing but an admission that DL and UA got their west coast strategies all figured out and implemented while AA was still thinking about BK and a merger.

and the implications for DL and UA moving ahead means that AA might permanently be in a "different camp" on the west coast, esp. to Asia.

btw, looks like AA is pulling down some JFK transcon capacity even while DL is adding it.