Delta Air Lines ‘committed’ to new Boston hub; Austin, Raleigh focus cities
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Delta Air Lines is committed to returning to its coastal hubs and many of its focus cities as it begins what is expected to be a multi-year rebuilding of the airline’s route map.
The Atlanta-based carrier will return to its hubs in Boston (BOS) — its newest hub — Los Angeles (LAX), New York John F. Kennedy (JFK) and LaGuardia (LGA), and Seattle (SEA) as it resumes flying, Delta CEO Ed Bastian told staff at a virtual town hall on Wednesday that was viewed by TPG. Delta is also committed to returning to its Austin (AUS) and Raleigh-Durham (RDU) focus cities.
“We’re committed to New York, we’re committed to Boston, we’re committed to LA, Seattle, Austin [and] Raleigh,” he said. “All the places we’ve made big investments in, we’re coming back.”
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Bastian’s comments came after he told staff that Delta only plans to fly about half of what it flew in the U.S. domestic market at the end of 2019 by the end of this year. The resumption in international flying is likely to be about a year behind that, he added.
A halved Delta would fly around 72,600 domestic flights in December, based on 2019 numbers, according to Cirium schedule data. That’s about double the nearly 38,800 flights it has scheduled in June when it only plans to fly about a quarter of what it flew last year.
There is a lot of uncertainty in the forecasts for this fall and winter. While leisure travelers are returning in notable numbers this summer, business travel has not returned in any meaningful way. Holiday travel traditionally slows down after Labor Day, potentially leaving a big gap in the market if corporate flying does not pick up.
“It really is [that] there is just so much unknown,” Raymond James analyst Savanthi Syth told TPG this week. “Airlines are putting the cash cushion in and hoping for the best.”
Delta has already begun building back its core hubs in Atlanta (ATL), Detroit (DTW), Minneapolis/St. Paul (MSP) and Salt Lake City (SLC). These bases allow the airline to provide travelers with connectivity across its network — even with numerous cities suspended — regardless of where they are coming from or going to.
The carrier’s coastal hubs and focus cities have been slower to return, largely due to less local demand for air travel, Bastian told staff. However, as demand returns these bases will return as well.
“The focus city idea is a low risk way to build a deeper operation.”
— Edward Russell (@e_russell) June 10, 2019
Delta’s focus cities in Cincinnati (CVG), Nashville (BNA) and San Jose, California (SJC), were absent from Bastian’s remarks. While Nashville and San Jose are among its newest and least-developed bases, the exclusion of Cincinnati may hint at what many have long expected: that Delta plans to downsize the former hub to just a point on its map.
Cincinnati was among Delta’s earliest hubs when the airline created it in 1981. The operation has shrunk since peaking in 2005, a shift that was accelerated by the addition of relatively nearby Detroit as a hub following the airline’s merger with Northwest Airlines in 2008.
— Airline Maps (@airlinemaps) May 7, 2020
Featured image by John Tlumacki/The Boston Globe via Getty Images.
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