Enilria combed through airlines trading their takeoff and landing rights in New York and DC and found something shocking: that Delta managed to obtain slots from Canada’s WestJet that the federal government had fought to keep out of its hands for 12 years.
It appears to be the culmination of Delta’s plan – laid out 15 years ago – to “win New York.”
In 2011, US Airways management made one of the all-time short-sighted moves in aviation. They traded much of their position at New York LaGuardia airport to Delta for slots at Washington National airport and cash.
Originally proposed in 2009, the deal gave Delta 132 slot pairs (flights) at LaGuardia while US Airways got 42 slot pairs at National plus $66.5 million.
- US Airways would have strengthened its position at National airport anyway just a couple of years later when it took over American Airlines
- The federal government didn’t allow them to grow beyond their Delta deal at National airport, forcing a divestiture of slots with the American merger. Basically they took Delta slots at National instead of taking the American ones. But they lost their position at LaGuardia.
- They will never recover the position they had at New York LaGuardia and they’ve had no New York strategy ever since, as Vasu Raja puts it ‘too small to compete, too big to walk away.’
Now-American Airlines has gone through several failed New York strategies. A decade ago they tried to ‘bring passengers to New York’ instead of serving the local market of New Yorkers. They they shifted to trying to run a ’boutique operation’ focused on their hubs and joint venture partner destinations. Finally they entered into a revenue-sharing and schedule-coordination partnership with JetBlue that they lost to anti-trust.
Just like United traded away its position at New York JFK, US Airways-now-American traded away its position at LaGuardia – and neither will ever get those back. In both cases the beneficiary in New York was Delta.
However, the Department of Transportation wouldn’t allow all of the slots Delta had at National to go to US Airways. There were remedy slots that had to be leased elsewhere. And they wouldn’t allow all of the US Airways slots at LaGuardia to go to Delta. WestJet took 8 roundtrips.
- Even though DOT refused to allow Delta to take those 8 roundtrips from US Airways they have now allowed Delta to secure them back from WestJet.
- And concern that Delta would gain control over those 8 New York LaGuardia trips is literally what stood in the way of the Delta-WestJet joint venture.
This is shamefully asleep at the switch for the Department of Transportation, and a Biden administration the has claimed to prioritize competition, but it’s amazing government affairs work by Delta. They weren’t allowed to grow at LaGuardia, the government was specifically concerned about the WestJet slots which were originally the solution to Delta’s dominance at LaGuardia and Delta got them anyway? This seems literally insane.
Delta’s government relations capability is impressive. They led the charge for more beyond-perimeter slots at National airport in FAA reauthorization, to secure the strongest position at Tokyo Haneda airport and to mobilize the government to act against the competitive threat of American Airlines and JetBlue partnering in the Northeast.
They do not get everything they want.
- They sought to have the government ban or limit U.S. flying by Emirates, Etihad and Qatar (and someone tricked gullible Doug Parker not just into giving up his New York slots, but lobbying with them against their partners Etihad and Qatar).
- The remedies were too rich to gain WestJet joint venture approval and they’re now fighting to save their joint venture with Aeromexico.
- They fought reauthorization of the Export-Import Bank which subsidizes foreign airline purchases of Boeing aircraft.
However Delta plays political hardball. They reportedly threaten Georgia legislators with pulling back flying from their districts if they don’t go along with the airline’s asks. Of course all of the big airlines do. This is a highly regulated industry.
Most everything they do is controlled by government. Airports are owned by governments, security is performed (not merely regulated) by government. Aircraft interiors are regulated by government. From the moment of push back to taxi in, where their jets move is dictated by government. The space for market competition is a limited one, despite notions of deregulation that simply mean the government no longer explicitly tells airlines where they’re allowed to fly and how much they’re able to charge.
Incidentally, according to Enilria subscriber data (well worth it, IMHO) in putting together its dominant position in New York, Delta leased 25 roundtrips from United at New York JFK and 5 roundtrips from Endeavor and 13 from United at New York LaGuardia as well. They’re also leasing 3 roundtrips from United at National airport.
Gary just set the stage for Tim Dunn to waste at least three hours of his life today. I predict at least 7,000 words of Tim comment barf before all the dust settles here.
Delta didn’t win New York. United did. Even with the mistake of leaving JFK – the fact is NYC’s high end professionals tend to live on the west side of Manhattan or in Jersey closer to EWR, anyway.
United also serves LGA from a much better terminal. There’s no CLEAR but the Delta terminal has CLEAR but it’s not any faster.
Star Alliance is also much better than SkyTeam.
I don’t know how anyone can argue that Delta won NYC. We can all agree that AA lost!
The main takeaway is that Delta set out long term plans and go after them ruthlessly while UA and AA are muppets. Both AA and UA concluded it was a good idea to step back from the largest market in the country, so maybe it rather than DL being especially smart, they are just not as dumb as their peers.
Incredible to think the incompetent’s at US Airways went on to lead AA (backwards)
Yet more proof that landing slots need to be auctioned off in rotation every 10 years.
first, as much as some want to believe otherwise, Delta is flying 18% more flights than United from 3 NYC airports.
DL’s flight schedule at LGA and NYC is capped by the current ATC restrictions which reduce about 10% of flights.
EWR is capped by capacity and cannot grow larger even if ATC allowed it = unless UA wants to have the operation meltdown as happened last June.
EWR has 2 effective runways while LGA and JFK have 5.
DL could easily have 25% more flights/day from NYC than any other airline. They will certainly add JFK to Asia flights (East and South Asia) which will chip away at UA’s dominance of the NYC-Asia market which has been decimated by Russia overflight rules. UA is only serving Tokyo among its pre-covid E. Asia destinations.
Delta and Latam are already the largest carrier from NYC to Latin America.
And specific to competition, DL understood at the time of the US and UA slot swaps that the government limits slot holdings to 50% of the capacity of the airports.
US already had more than 50% of the slots at DCA but wanted to trade for more.
UA already had 70% of the slots at EWR but wanted more.
DL did then and still does not have more than 50% of the slots at any airport but has the largest slot pool in the country.
UA is leasing slots to DL because it was part of the deal by which UA would leave JFK and DL would reduce its presence at EWR; the DOJ blocked the deal but DL did not have to return the slots that UA leased – they are still under contract.
And Scott Kirby and Doug Parker simply made the dumbest move in aviation history with the DL-US slot deal; even if it went as planned, DL would have gotten more LGA slots than DCA slots.
With the AA-US merger, the two ended up right back at the same number of slots that DL-US agreed to – net net. DL offered a daily flight to Brazil (which has been replaced) and $60 million. Net net, DL got 1/4 of LGA’s slots for $60 million.
DL is still the 2nd largest slot holder at DCA.
DL simply knows and plays by the rules and uses its understanding of staying on the legal side of a competitive industry to its advantage.
The DL-WS slot swap as original proposed was part of a joint venture. WS has dramatically pulled down its presence in Eastern Canada. DL is stronger from the Eastern US to Eastern Canada.
The deal makes sense, is legal, and helps both carriers unlike illegal deals such as the NEA that were struck down.
It’s all Pete Buttigieg / DOT’s fault. He is “Alfred E. Neuman”.
Delta has also done a masterful job at fighting a 2nd airport in Atlanta for decades. A city that could benefit from a 2nd airport north of the city and Delta has made sure that will never happen.
@ Gary — You must have missed El Primo Windbag.
If you are a thoughtful, elite traveler, Delta offers premium, elevated travel experiences from LAX, JFK, SLC, and other airports.
Tim Dunn says:
May 3, 2024 at 11:15 am
What’s the over/under on the number of times he achieved Shangri-la during that long diatribe?
@ Tim Done — Just scroll past his nonsense like I do. I don’t know why there isn’t a View from El Primo blog. Perhaps becuase no one read it?
Joe,
the voters of EVERY single jurisdiction where a second airport could have worked on the north side of the Atlanta metro voted down having commercial flights.
None of which changes that DL has grown to be the largest carrier in NYC by playing by the rules. In contrast, US couldn’t figure out how to use 1/4 of the slots at LGA, AA – despite have 1/3 of LGA’s slots and at one time the largest slot pool at JFK – hasn’t been able to make NYC work because they don’t know how to win corporate travel in the biggest corporate travel market in the world, and UA can’t overcome the dumb decisions and contracts its former execs made or the fact that EWR was never designed to be a replacement for JFK.
DL has simply come up w/ smarter strategies in hub after hub and in the largest market in the world – NYC – DL has played masterfully.
Sure, some are shocked when businesses succeed by running their businesses well and right but NYC is more emblematic of how bad strategically and operationally DL’s competitors are and have been.
The solution to Delta’s increasingly outsized market share at LGA and JFK is to allow JetBlue to sell slots to American and United at LGA and at JFK. Those will be in play as JetBlue slides further to sustained unprofitability and is gutted by Icahn and team.
Haha first comment from Jim wins a prize.
Gary’s not dumb. Diamond Dunn and his clones generate a lot of clicks. I can hear the cash register ringing.
Back in the day I would fly AA from ATL-LGA-JFK-LHR in discounted business just to avoid the overpriced nonstop Delta One from ATL-LHR for $15K or whatever.
Taking the cab from LGA to JFK was like getting a free ride on the scream machine and was well worth the $10K in savings for an extra 4 hours each way. Not sure what AA was thinking, they could have really built up NYC and charged a premium.
@Gene not to worry. No way am I going to read all of that drivel
While your assessment of Delta’s strategic prowess is accurate, the real crux of this story is the ongoing destruction of American Airlines by inept and incompetent US Airways management and their culture. I’m a 1.7 million mile AA flyer and abandoned them two years ago after finally getting fed up with Doug Parker squeezing premium fare customers and catering to budget basement flyers. The destruction continues under new AA management. Haven’t spent a penny on AA in over two years and your photos of inoperable first class seats keeps me away.
Delta has a product for wealthy people, and New York metro area has the US’ largest concentration of people making $200k or more.
How can AA’s strip down product targeted to poorer Southerners compete effectively? It’s like trying to explain why Corollas can’t compete in the Hamptons against Suburbans and BMWs.
Conspiracy theories and misinformation generate clickbait for this blogger’s income, but the reality is that AA’s current market share in NY is 100% the result of AA’s own long list of cancelled routes, which they probably cancelled because people have voted with their pocketbook for an airline better suited to their wealth (and which, the data shows, they pay more to fly as it’s a better value).
Robert,
you hit the real gist of the issue as much as some people can’t accept it.
DL’s competitors are just strategically and operationally weak.
AA is still a massive airline with a huge domestic market. AA is simply no longer trying to win corporate business – a huge part of NYC revenue.
All of the slots from B6 won’t fix AA’s NYC problem because they don’t offer a decent product or compete for all of the business that is available.
You can’t win in the rest of the country if you don’t win in NYC.
UA understands that and is fighting to hold onto what it has but DL simply has much more growth potential in NYC on top of already having more flights than UA.
Just as UA reminded us not long ago, the sins of the father are passed to multiple generations. UA’s position in NYC will be handicapped because of decisions its former leaders made.
Tim Dunn hit the nail on the head. Delta has done nothing wrong. Use all of the metaphors you want. Kinda like the cheetah sneaking up on its prey, Delta has legally sneaked up on their competitors in the valuable New York markets and when the competitor makes a wrong move…they pounce. I call that good business. UAL has Scott Kirby. American has Robert Isom. Delta, with Ed Bastian at the helm and Glen Hauenstein as the “route guru”, they will continue to capitalize on the competitors misguided mistakes.
DOT should take back those WestJet slots and re-distribute them.
Win,
just remember that Scott Kirby was the “network guru” at USAirways when they did the slot swap.
I still have the letter from him and Parker sent to US employees discussing the slot swap.
DL’s being ready to pounce is why they surpassed AA at LAX, is on par w/ AA at AUS and likely will overtake them as soon as data comes in after AA’s pullback, and in BOS while AA and B6 got tied up trying to get a deal which the DOJ has never allowed.
And, as much as AA people want to pretend otherwise, it is why the DL-Latam JV will see a significant change in market share to/from Latin America including in MIA as DL builds out its combined network and overtakes UA as the 2nd largest carrier to Latin America; DL was at 95% of UA’s revenue in the MRQ.
AA is simply not competing for the high value corporate and negotiated revenue which is DL’s bread and butter.
and AA and B6 could have leased slots but could not have had a JV.
Problem is that B6 had and still has as low of a service reputation (for different reasons) as AA. Neither can or are profitable w/ the slots they have.
Same thing is happening in BOS, another high revenue market. DL has moved from a bit player to competing with B6 to be the dominant airline. DL more or less fill Terminal A, and the new gates that were built in Terminal E (International long haul) is now DL central.
Back in the day AA/US was the main airline, but they fell asleep and let B6 take over. Now DL are coming in and with B6 in decline, they will soon be the clear leader.
But as has already been said, this is more about inept leadership at AA than some sort of game changing vision at DL. DL just seem to avoid doing stupid things more often than their peers.
*Skymiles is the pits as a FFP, but it is to the shame of their peers that they cannot make that count against DL
I’m curious, can Gary or someone else tell me what percentage of flights DL has at LGA, JFK, and EWR?
I agree with all of the spot-on comments about the ineptness of DL’s competitors and the savvy of DL’s management. However, I worry that DL may be getting a little bit to big for its britches. I’m a former DL Diamond Medallion passenger and before UA went downhill I was a United 1K. Now that I’ve stepped down/back at the company I founded I’m traveling much less for business and I simply can’t keep status at those levels under the new DL Skymiles rules. So as I no longer blindly booking travel on DL no matter the price or schedule, I’ve begun to experience the world of Southwest. I refuse to travel on Spirit or Frontier but I will travel on Southwest and I suspect others will travel less frequently on DL domestically. It will be interesting to see what the next couple of years bring.
John,
for Jan, according to DOT data, DL had 32% of DOMESTIC flights at BOS.
AA had 61% of flights at DCA
UA had 75% of flights at EWR.
DL had 47% of flights at JFK and the same percentage at LGA.
These numbers don’t include international – so UA has a higher percentage of total flights at EWR.
These numbers don’t include international carriers at JFK so DL’s percentage is much smaller.
The notion that DL dominates its NE airports to the exclusion of competitors is contrary to actual data.
@ David — Diamond? Doubt it. Maybe FO.
Sounds like a premium strategy by America’s most overrated airline.
Did anyone mention B6 in this. From zero to #2 JFK coverage and #3 at LGA. You claw, kick, scream, & fight for gates, slots, and volume. Nobody gives you anything in the airline business (except for government money in extreme down turns).
Since JetBlue is retreating, its new name should be Eastern Airlines 3.0 because it can’t support much west of the Hudson River. Delta needs to keep an eye over its shoulder because Eastern 3.0 has no place else to go!!
@Paper Boarding Pass – “Did anyone mention B6 in this. … Nobody gives you anything in the airline business ”
Chuck Schumer would like a word. He pried 75 slots out of DOT to get JetBlue started at JFK
https://www.nytimes.com/1999/09/17/nyregion/new-airline-gets-waivers-for-flights-to-upstate-cities.html
With the announcement of those new slots, Schumer declared ‘I feel like a proud uncle’ to the airline.
paper
B6 has been using dozens of AA’s LGA slots as part of the NEA; once all of those slots are returned to AA, B6 will likely be at #5 again.
And at JFK, B6 has been losing money and that was even carrying some passengers as part of the NEA.
The only thing that helps AA and B6 from not having to fly all of those slots that the DOJ says must be returned to their owners is the FAA’s slot usage waivers which have put 10% of NYC’s slots on ice for this year and perhaps well into 2025.
Delta sucks.
Aside from their employees and Tim Dunn, the rest of the industry laughs at their holier-than-thou douchebaggery.
I was going to read the comments but then realized it would be the usual TD BS.
I hope he runs for mayor again. Maybe he’ll have something to do.
I think @Tim Dumb should check his math on how many runways there are at EWR/LGA/JFK
Here Tim Dunn goes again with all the Delta is the world’s only PERFECT airline garbage. His continuous defensiveness and incessant condescension are legendary. Delta has grown New York brilliantly. But I challenge anyone to see the future. At the time of the slot swap, US Airways operation at LaGuardia was serving a number of marginal routes using old turboprops. It was much stronger at National, even before the merger. There’s no God’s green Earth no way that Parker could have known that his airline would merge with a bankrupt American in 2009, when the slot swap was announced. And it’s simply laziness to believe otherwise. No one is clairvoyant. Living in the Phoenix area, I flew America West often. I also flew American at times, and from this customer’s experiences America West offered the better travel experience. Period.
The rest of my comment is a quote from Theodore Roosevelt, who Sums up my views about second guessers, “It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”
hey ghost
You say the same thing OVER AND OVER again because you can’t accept that any halfway intelligent person CAN and SHOULD be able to see a glimpse of the future.
The only two legacy airlines that had not merged were US and AA.
Parker was hellbent that HP dba US would not be left alone when AA wanted to do a standalone plan so Parker made sure he destroyed AA’s future by inserting HP into the equation.
Yeah, we all could see the future. Many of us saw it 15 years ago.
Parker and Kirby were an absolute disaster for AA which will never recover.
Delta just simply waited to mop up and benefit from the mess.
And 220, as usual, is clueless. LGA and JFK effectively operate with 5 runways and EWR with 2. If you don’t understand how that happens, you should stay out of the conversation.
@Tim Dunn. BREVITY. Brevity means that clever people can express intelligent things using very few words.
GO Away.
You can use 1/2 runway at LGA as those two are perpendicular, and you can use 2/4 runways at JFK as those are two sets of parallel runways.
At EWR 2/3 runways are parallel.
So JFK/LGA gives DL 3 runways, EWR gives UA 2 runways.
And as far as I’m aware the number 3 and the number 5 are not the same thing.
Wow Timmy
1am idiotic posts? Late night at Blake’s for you
I hope your day isn’t entirely consumed by defending delta dismantling lax though… looking at omaat, it already is. But like you say “ Yeah, we all could see the future.” at lax with delta given their position in the market.
Try to pretend like you have a life. At least try…
@ Joe: DL is not the blame for Atlanta not having a second airport north. As a former resident of north Georgia, the reason would be politically incorrect for me to say if you can fill-in-the blanks. This goes back to 70s and at one time ATL had some 10,000 acres in Dawson County, but for reason(s) above it got nixed.
@harry
Even a simple google search would show you’re wrong
Delta and the city of Atlanta actively prevent and fund means to keep a second Atlanta airport
Max
We know you and A210 live your lives telling us the world is all wrong if it doesn’t believe what you do. JFK and LGA effectively operate w 5 runways
The citizens of N Georgia don’t want another commercial airport
Timmy
Just suggesting you use google. It’s not tough
Challenging your bias may not be the worst idea for you
@Gary
How did B6 grow at Boston? Did the senator give B6 the slot at BOS as well? Number One in Boston.
As I stated, should rename itself Eastern Airlines 3.0. God awful service west of the Hudson River.
By the way, A220HubandSpoke…what is a HubandSpoke? I always get a kick out of watching the major air carriers thrash it out with their competitors and, more often with their employees. They go through torturous negotiations with every union from ALPA to the “IBTPWC” (International Brotherhood of Toilet Paper Changers) over bits and pieces that don’t mean a hill of beans…well except to the union bank accounts. Once all of these competitors sign a contract and (sorta) smooth down the worker’s feathers…for now, Delta shells out $1+Billion in profit sharing plus a cross the board pay raise.
@Max: Sorry not wrong. Google Atlanta second airport – Dawson Forest. That’s the tract that never made it and wasn’t because of Delta.
@MaxPower: Sorry I had to use Google to get it right from @MAX.
Harry is correct. The political power in north Georgia, especially the Hall County Mafia, AKA: the Hall county Democratic party, that once controlled much of the political power in Georgia pretty much said no on a second airport. Harry is also correct on the “politically incorrect” reasons as well.
@harry
It’s amusing to see delta employees ignorant on the usage of search engines but not surprising
But I’m sure you can figure it out
Maybe grab a margarita with Tim at Zocalo (chances are tim created you in his imagination anyway) and you two can learn how to google Atlanta constitution articles together
It’s not tough and you’ll both enjoy your local newspaper since it seems you don’t read it
Your own local newspaper has articles about delta’s funding for anti new airport groups
With no local support, just delta funding lol
This delta fanboy nonsense is too much sometimes
Learn to read.
@MaxPower: Learn to suck it up guy. Read other comments like Dal7910. I KNOW what I’m talking about just can’t put it in print.