Delta Beats Rivals With Fare Cut to Fill Jets After Summer
Delta Air Lines Inc. moved ahead of UAL Corp.’s United Airlines and other competitors by offering a fare sale to help fill its planes this fall, when demand traditionally slows.
The sale, effective today for travel through Nov. 17, is being offered earlier than last year, when Delta waited until the end of July to discount fares for November and December. It covers both domestic and international routes. Delta, based in Atlanta, is the world’s biggest airline.
“Delta has a lot of airplanes out there, a lot of seats to fill,” Terry Trippler of Rulestoknow.com, a website explaining airline fare and airport travel rules. “They’re making a wise move to say, ‘We’re going to fill the seats as soon as possible.’”
Under the sale, a one-way fare between Chicago and New York, purchased 21 days in advance, is $89. A ticket to fly from Los Angeles to Sydney is priced at $429. Delta declined to provide an average percentage discount in the fall promotion.
The lack of major international business routes on the sale indicates the airlines aren’t seeing a slowing of corporate travelers, who generally pay higher fares, said Dan McKenzie, a Hudson Securities Inc. analyst in Chicago.
The sale is a “more tactical and competitive move by Delta to try and fill up seats so they can manage revenue on the back end, as opposed to an indication of fall demand,” he said. McKenzie recommends buying Delta.
U.S. airlines are expected to report their first quarterly profit as a group in two and a half years starting next week. Delta is scheduled to report results first, on July 19.
Southwest Airlines Co., the largest low-fare carrier, announced its own fall sale on June 22, also about two weeks ahead of last year. The carrier “was trying to get customers to book early and start thinking about fall travel a little earlier in the summer,” said Ashley Dillon, a spokeswoman for Dallas- based Southwest.
Delta fell 25 cents, or 2.1 percent, to $11.96 at 2:19 p.m. in New York Stock Exchange composite trading.