Delta Air Lines To Keep Growth In Check

Credit: Delta Air Lines

Delta Air Lines said it would slow planned capacity growth through the end of the year, part of an effort to improve reliability issues that weighed on its second-quarter (Q2) performance.

Atlanta-based Delta’s Q2 capacity was 18% below 2019 levels. A stretch of irregular operations between late April and mid-June—owing largely to staffing shortages and training bottlenecks—led the company to slash its summer schedule by around 100 flights per day between July 1 and August 7.

Speaking July 13 on Delta’s Q2 earnings call, CEO Ed Bastian said the airline will hold capacity steady at June levels for the remainder of 2022, nixing plans for further growth. For full-year 2022, capacity is now expected to be 15% below 2019 levels, marking a reduction of 5 percentage points from original plans.

The reduced schedule already appears to be bolstering Delta’s reliability. So far in July, Delta reports a completion factor of 99.2%, with 84% of flights arriving within 14 min. of scheduled arrival time.

“By ensuring capacity does not outstrip our resources, and working through our training pipeline, we will continue to further improve our operational integrity,” Bastian said.

Bastian added that the company plans to gradually ramp up capacity next year, with seats offered expected to match 2019 levels again by summer 2023.

Bastian attributed strong pent-up travel demand and better than expected premium sales for the airline achieving adjusted revenues of $12.3 billion in Q2–99% recovered from pre-crisis levels despite capacity being down 18%.

Domestic leisure revenue is already greater than 2019 levels. International leisure demand in the transatlantic and Latin American markets is also running hotter than before the pandemic, while the Asia-Pacific market shows signs of life again following re-openings in Australia and South Korea.

Ben Goldstein

Based in Washington, Ben covers Congress, regulatory agencies, the Departments of Justice and Transportation and lobby groups.