Delta is acquiring 36 used aircraft.
- 7 used Airbus A350s
- 29 used Boeing 737-900ERs
Even with the acquisition of more (used) Boeing aircraft, this move will make Delta less invested in aircraft from Boeing and its predecessors than before the pandemic since they’ve retired Boeing 777s, MD88s and MD90s.
Delta CEO Ed Bastian says,
As we look past the pandemic, Delta’s disciplined, innovative approach to fleet renewal positions us for growth as travel demand returns, while enhancing the customer experience and supporting our sustainability commitments.
And you know that “disciplined” here means they were able to acquire the planes on the cheap.
The deal for A350s and Boeing 737s was scooped by The Air Current a full week before Delta’s announcement.
“Disciplined” is also a signal to Wall Street that Delta is not looking for growth for growth’s sake.
The significance is that Delta is able to get fuel efficient aircraft at prices that are clearly lower than if they ordered those planes new.
Given that the A350 burns 20% plus less fuel per seat than the 777s which American and United still operate and which form about half of each of their international fleets, Delta will gain a substantial cost advantage to its peers.
Delta still has more new generation widebodies on order than American and United so Delta is clearly prepared to engage in some significant international growth.
DL has a old plane problem with a lot of older A319, A320, 737-800, 757 and 767 plus older A330 models. Their fuel burn is much worse than AA’s per seat (plus seat back IFE weighs a LOT) and they have higher maintenace costs. I feel these are good moves but DL by no means do they have a fleet that will benefit as fuel prices rise. If they got them at a good price (which I am sure they did) it will help.
@sunviking
Actual statistics say differently.
Airlines provide data on the amount of ASMs and revenue as well as revenue they produce. Delta has had a revenue production advantage to American and United for years – even with the MD80s (which incidentally American only retired a few months before Delta) and MD90s and 777s.
Getting rid of 18 777s was relatively easy for Delta but American still has over 50 (including the 777-300ERs) and United has almost 100. Fuel efficiency matters the most on longhaul international routes. American and United will be saddled with a far less fuel efficient international aircraft for years. American’s 777-300ERs have virtually the same number of seats as Delta’s A350-900s and yet the A350-900 burns 34% less fuel based on data that both airlines filed with the DOT. Even the Delta A330-300 burns 18% less fuel than the 777-200ER.
American has a far larger fleet of A319s than Delta.
And all of this doesn’t even consider regional jets which American and United have many more of – and all burn more fuel per seat than the 737-900ER and even 321, let alone the A321NEO. There is a reason that United is ordering so many large narrowbodies as replacements for regional jets.
and AVOD doesn’t weigh much, esp. since Delta is using tablet based systems
Real statistics show that Delta has a significant fuel advantage compared to American and United and that advantage will only grow.
The A350’s are fairly recent. They can’t be more than 6 years old. The 737-900ER are potentially different. They could be anywhere from 1 to more than 20 years old.
The first 737-900ER was delivered 14 years ago so they can’t be older than that.
DL Tech Ops is the BEST! I’d fly on a 20- 30 year old Delta plane any day and feel perfectly comfortable.
They have invested in and refreshed their older generation planes so good you can’t tell if it just rolled off the assembly line floor.
Fly Delta Jets!
@Tim Dunn,
Your posts almost read as if you want American and United to go belly up. Most of the common measures (RASM, CASM, EBITAR, etc.) are flawed in one way or another when taken out of context. Delta reports its quarterly earnings tomorrow (7/14). I hope it makes a profit. Because, unlike what your comments tend to imply, I don’t want to see any airline go broke. I don’t have a vendetta against any of them. In my experience, there’s not a significant difference among most airlines in terms of their core product – transportation. I’ve universally gotten where I wanted to go, in one piece, and reasonably on time. That’s what I value most. What’s outside the window is usually far more interesting than watching television.
By the way, in spite of Mr. Dunn’s over-the-top enthusiasm for Delta and obvious disdain for American and United, I do agree with him. These are very smart transactions that will serve the airline well for many years.
AA has the youngest fleet of all the Majors… DL is still flying TWA’s 717’s.
Putting lipstick on a very very very OLD PIG!!! Delta has, by far, the oldest fleet on the market. To quote Al Bakker, “they’re flying old crap” No matter how you spin this, DL screwed up when they abruptly retired their 777 fleet. Albeit small, still profitable. And now, all they’re trying to do is patch things up in a hasty and screwed up way. At the end of the day, you are still on the fleet of oldest, used and second hand jets out there!!
Good thing they aren’t looking at the used car market for acquisitions as well.
No, I am not hoping for anyone to go belly up and I never said that.
Even though American has touted fleet age for years, it is nothing more than a point of bragging and has no connection with any financial metric.
Businesses including airlines don’t exist to amass the largest and newest set of assets but to maximize profits.
Even before covid and the retirement of the MD80 and 777s, Delta’s fleetwide fuel efficiency was on par w/ American even w/ Delta’s older fleet. The A330-300 burns 18% less fuel than the 777-200ER and Delta is now adding more new generation aircraft including the A330-900 and A350-900. Delta knows how to use its older aircraft on routes where the fuel efficiency isn’t near as much of a drag. That is why they now use the 757s on 2-3 hour flights (esp. ATL/DTW to Florida) and use more fuel efficient aircraft like the A321 and 737-900ERs (which are more fuel efficient per seat that B6′ A320CEOs out of JFK and BOS, btw) on longer routes.
Delta has invested in cabins to provide a higher level of amenities on older aircraft.
Fuel efficiency matters the most on longhaul flights and that is where Delta is investing the majority of money for new aircraft. Used aircraft are a viable strategy just as it would be for any other company. The global aircraft market is depressed and it makes sense for US airlines to pick up assets since US airlines are in better shape than foreign airlines.
Delta has never followed the industry status quo on fleet and this is yet another example of how they manage to get more value out of their fleet than their peers.
@Tim Dunn,
Of course, you won’t state you want a company to go out of business in those terms, but your excessively negative put-downs about anything United and American do imply just that. I’m happy to see Delta have a good quarter, but unlike you, I want all airlines to do well. I don’t have a vendetta against any of them.
American had A330s. It retired all of them, including some fairly new -200s. If they were as superior to 777s as you assume, it’s not a stretch to believe the airline would have kept them and lived with the fleet diversity. If Delta feels the A330/A350 is as superior to the 777 as you allege, then why did the airline completely refurbish its 777s before it apparently decided that fleet commonality was more important? Corporate behavior reflects what is happening in the real world. DOT statistics don’t necessarily reflect that. It’s real-world performance, not DOT statistics that matter. And Delta seems to be performing quite well in the real world. Good for it.
Radio,
your comments are particularly interesting given that we all note the advantages and strengths of particular companies; if you think that I am hoping for someone’s demise by noting an advantage that someone else has, then I’m not sure why you bother to engage in discussions that involve an advantage vs. a disadvantage.
The simple reality is that Delta is demonstrating once again that it moves slower than its peers with its fleet plans but manages to gain comparable or better cost efficiency at lower acquisition costs. That will be particularly notable now that Delta has a much newer generation, more efficient international fleet where cost efficiency matters the most.
AA’s A330-300s were older and less capable than DL’s. DL has some of the newest, most capable A330-300s as a result of their top up order shortly before they ordered the -900s. AA went for fleet efficiencies but half of their international fleet is still 777s which will be far less efficient than any aircraft in DL’s international fleet and esp. the 777-300ER which seats nearly the same number of passengers as DLs A350-900s. And, no, AA doesn’t make up for the higher fuel burn with better revenue according to DOT data. At least UA has 15% more seats on their 777-300ERs than AA which improves their economics.
As for the comment above, United has the oldest fleet among US airlines – easily verifiable from sources like airfleets – and will spend more than $10 billion over AA and DL to gain the same level of fuel efficiency.
@Tim,
It’s not “fair” comparisons I have an issue with. It’s the usually unfair comparisons that rely on cherry-picked data. It’s also a condescending tone I sense toward any airline not named Delta. I have no loyalty to any particular airline. They all tend to get their customers where they need to go safely and on time. And even though the core of each airline, i.e., providing transportation, is similar, each company approaches its operation a bit differently. I happen to think that’s a good thing, not something to be put down.
You don’t like any data that shows that Delta is doing better – even though you repeatedly argue about why other airlines “win” in whatever category you want to use. We get it.
There is nothing cherrypicking about categorizing fleets as either international or domestic. The latter category competes with every US airline; the former is only between AA, DL and UA as well as foreign longhaul carriers.
American spent tens of billions and never gained a systemwide operating cost advantage – in large part because the interest expense for its debt is far higher than the fuel cost difference which newer aircraft are supposed to fix.
United waited years to decide to move away from 50 seat regional jets and is now spending tens of billions of dollars more than even American to fix a strategic problem which United created. Now UAL is going to have to prioritize a modern domestic fleet at the expense of a cost inefficient international fleet. Given that UAL has claimed for years that its international system is its bread and butter, it is more than a risk for them to be flying aircraft that have a double digit percent cost disadvantage not just to Delta but to most other global carriers. Let me know how many of UA’s global competitors are still operating 777-200ERs?
Delta has always opportunistically bought aircraft and managed to get better deals than United and American – and I am hardly the only person that has figured that out.
btw, this conversation has been about the big 3 but Southwest manages to do as good of a job if not better in fleet spending than Delta, esp. since they still remain loyal to the 737.
These are obvious industry conclusions based on verifiable facts. If you wish to engage in this discussions, you should be prepared to read things that might not be exactly what you hope for.
American has sacrificed soft product experience and customer satisfaction for financial performance. They won’t add a toothpick on a plane if it can’t be cost justified. I totally understand their financial predicament and the need to be excessively stringent in their spending. It’s the US Airways model and Parker made it work back in the day. Not sure if American customers will tolerate the frugal operation long term.