Delta CEO promises a more reliable summer than last year
Delta Air Lines is ready for the summer rush, CEO Ed Bastian said Wednesday, promising that the airline would avoid repeating its mistakes from early last summer.
Speaking at a presentation at Wings Club — an organization for aviation industry professionals and executives — Bastian told attendees that the airline had miscalculated last year by scheduling more flights than it could reliably operate, seeking to take advantage of surging travel demand following the widespread COVID-19 vaccine rollout and related reopenings.
"We all stretched ourselves," Bastian told the Wings Club attendees, "even though we all told ourselves not to do it."
"Discipline is great to talk about, harder to do," Bastian added. "And I think last summer we weren't very disciplined — we did everything we could to make good cash."
Bastian said Delta and the broader U.S. airline industry would use what they'd learned last year to avoid similar missteps.
"This summer's going to be very disciplined."
Airlines, eager to capture resurgent travel demand in the spring and summer of 2022, threw as much capacity as possible onto their networks, adding routes and frequencies to try and sell as many flights as possible.
Ongoing staffing challenges among various airline workgroups, airport workers and third-party vendors led to a spate of delays and cancellations, particularly during the busiest travel weekends and following uncontrollable disruptions like bad weather.
All airlines faced challenges to a degree, but Delta stood out as the worst performer, with more than 4,000 canceled flights in May and June and many more delays. Delta had the most cancellations during the 2022 Memorial Day, Father's Day and Juneteenth weekends.
While Delta eventually pulled down its capacity and ended the summer on a stronger note, a rough holiday travel period linked to severe weather, combined with strong demand this year, led to concerns over similar issues.
Bastian said, however, that the airline was ready to take on the challenge, even as head winds remain, such as a shortage of air traffic controllers. The airline recently reduced its August schedule in the New York market by roughly 6.3%, following American Airlines and United Airlines, in response to an Federal Aviation Administration request linked to the controller shortage.
The airline and its regional partners within its network will fly 3.6% more flights this summer compared to summer 2022, according to the Cirium database, although improved staffing levels this year would mean that the airline can handle the larger operation more effectively.
Delta executives have repeatedly said that demand for summer travel has been unprecedented. Airline president Glen Hauenstein previously said that the airline had sold out 75% of its international seats for the summer as of mid-April. Travelers have also begun booking trips further in advance — at a conference March 14, Bastian said that the airline had seen "the 10 highest sales days in our company's history" within the previous month.
Bastian echoed the sentiment Wednesday, hyperbolically characterizing the summer as "sold out" and noting that the airline was also benefiting from high revenue with "the 20 highest cash sales days in our history, all this calendar year."
With such high demand and sales, the stakes are high for Delta, and the airline acknowledges the need to get it right.
"We need to continue to run a great business," Bastian said. "We need to stay out of the headlines and do the best to continue to serve our customers."
Even with a better operation, Bastian warned of some pinch points during a conversation with reporters following the presentation. While the airline is working on fixing the issue of long lines at its Sky Club lounges, he noted that it's still a work in progress.
"There's no question there will be some lines, but we're going to try to minimize it," he said, citing the airline's new "grab and go" concept.
Related: Delta reduces late-summer NYC flying, following other carriers
During the presentation, Bastian touched on other topics, including revenue models, sustainability and labor negotiations. Bastian said that the airline had "no plans" to join rivals United and American in placing orders for Boom Supersonic's planned high-speed passenger jet and noted that nearly 60% of the airline's revenue came from sources other than tickets, including purchased upgrades to premium seats and more.
Bastian also noted that the SkyMiles frequent flyer program, which represents a major revenue stream for Delta through its cobranded credit card partnership with American Express, has more than 600,000 new members who have signed up in order to access the airline's new free Wi-Fi.
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