Delta Air Lines Plans To Trim Capacity Growth And Hike Fares

Oilprice.com ^ | 18-05-2016 | Flying Dutchman

[bananaman22]

In the second part of the year, Delta Air Lines aims to boost its fares as it faces rising fuel costs and barriers to revenue.

Delta Air Lines presented its investors some new strategies for the second part of the year that will trim its capacity growth plan—a plan that eventually could end with higher fare prices.

According to Delta, it hopes to become “the first network carrier to return to positive unit revenue growth later this year.”

[MNDude]

Rising fuel costs?

[MichaelCorleone]

My guess is that either they anticipate higher fuel prices later this year (a distinct possibility) and/or they see ever higher taxes tacked on to each gallon of fuel (also a distinct possibility).

I seem to remember they purchased a refinery near Philadelphia a few years ago so that if/when the availability of fuel was in question, DAL would always have their own supply. Even though they’re not in the refining business, I thought that was a wise move.

Maybe because of their ties to the refining business, they have some inside information.

[Ray76]

> Rising fuel costs?

My thought exactly.

I like the other one, “barriers to revenue”.

[johniegrad]

Rising fuel costs?

Had me scratching my head , too.

[napscoordinator]

What crap. The airlines are in a boon right now. They made so much money last year. The airlines and energy companies are the most selfish companies in America.

[Arm_Bears]

Barriers to Revenue = TSA

[delapaz]

they are expecting a recession soon, and do not want to expand into it.

[IronJack]

My guess is that ... they anticipate higher fuel prices later this year

Funny, when fuel prices were dropping like a lead balloon, they didn't seem to "anticipate" those. Or if they did, it sure didn't seem to be reflected in their ticket prices.

Let's face it: we're being gouged. These are the same flimsy excuses the airlines have been using for decades now.

Remember when fuel prices spiked a few years ago and we were charged a surcharge for baggage, to accommodate that cost? Oddly enough, when fuel prices returned to normal, the baggage surcharge didn't go away.

Apparently the airlines agree with the government that people are total idiots.

[bill1952]

They’ve already hedged in these low prices for years to come.
Fuel isn’t the issue
“According to a U.S. Department of Transportation report published earlier this month, U.S. airlines raked in a profit of $25.6 billion last year, a 241 percent increase from 2014.”

[Mase]

The airlines and energy companies are the most selfish companies in America.

Instead of bashing capitalism, maybe you should buy stock in the energy and airline companies and watch your money grow. That might reverse your occupy attitude a little. Or not.

[erlayman]

Delta has raised rates at least twice already this year so I doubt fuel prices had anything to do with it. United prices just increased, so maybe they matching. But at least United has legitimately beefed up customer service trying to get out of the position as the only airline to actually lose money last year.

[napscoordinator]

I have stock in the industries. I stand by my statements.

[Mase]

So you’re greedy and selfish like they are? Or do you prefer it when their market value plummets?

[Shanghai Dan]

I look at their financials and see last year as a serious outlier. They lost a fair amount several year ago... But I guess you believe that any profit made is selfish, and losses are not an issue? Guess what - save up during fat years, because historically most years are NOT fat years, and tend to be lean to negative.

At least, that's what the historical facts show...

[baltimorepoet]

I have not flown for years, partly because I despite the air travel industry.

I wish I could get everyone else to join me, just so we could bankrupt that industry.

[sheana]

They’re making a ton of money from fees. I take a budget airline from LAX to XNA because it is the only one that is non stop. They charge $X for luggage check, $X for luggage carry on. $X for an assigned seat and $X for priority boarding. About $100 in fees by the time I’m done booking. It’s still cheap but the fees really add up.

[airplaneguy]

gee thanks jerk. I work in the airline business. ill be sure to tell my family that some ignorant nobody on the internet wants us to go hungry. :(

[baltimorepoet]

gee thanks jerk. I work in the airline business. ill be sure to tell my family that some ignorant nobody on the internet wants us to go hungry. :(

Its nothing personal... I have a long list of why I hate the air industry.

Whether it is the douchebag security theater of the TSA and the morons they employ.
Or the fact that it is basically a fascism zone where you have no rights.
It could be how the airlines fricking nickel and dime you every chance they get.

How there are so many delays, how they overbook the flight, etc.
The fact it seems to get progressively worse. When I was a kid, the didn't skimp on food or drinks. Now a days, they are even researching ways of how to crowd even MORE people into planes. It is like a race to the bottom.
It is like if a Government Agency impregnated Comcast and the Airline Industry is the bastard mutant child they produced.

[napscoordinator]

I love when the market plummets. I buy even more during those times. I’ve invested for almost 30 years and seen it all. The best times are during stock market free falls.