Delta's New World Order
The biggest surprise in the airline industry may be taking off in Atlanta.
Conventional wisdom has it that Delta Air Lines (DALRQ) is trapped in a downward spiral, fueled by a flawed strategy to boost revenue by throwing capacity at any international destination with an airport.
A top Delta executive disagrees, saying the airline industry will abandon that view in just a few months.
"The second quarter will drop some people's jaws," says Executive Vice President Glen Hauenstein in an interview. "It will change they way people think
Steady BuildDelta had a good day on Wednesday. The company's pilots voted to approve a three-year contract agreement that is expected to save Delta $280 million annually, and the bankruptcy court approved the deal. Meanwhile, the airline reported improved financial results for April. It lost $27 million, compared with a $163 million loss in the same month a year earlier. Costs per available seat mile were 7.26 cents, a 3.8% decline. Passenger revenue per available seat mile was 10.97 cents, representing a 17.1% improvement. "While our progress is encouraging, we're still at the bottom of the industry in terms of financial performance," says Chief Financial Officer Ed Bastian. "We have a plan for long-term viability, and it's working, but we still have a lot of work to accomplish before declaring victory."
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