Atlanta: Delta Air Lines Inc is counting on ties with Asian carriers to expand its route network in China and boost revenue in one of the world’s fastest growing travel markets.
The company’s Asia-Pacific chief also said joint ventures with foreign carriers could help bolster business in Asia should open-skies agreements between the United States and other countries materialize.
“The Chinese economy and the Asia-Pacific economies were less influenced by the recession we had in 2009,” said Vinay Dube, Delta senior vice president for Asia-Pacific. Those “will continue to exhibit a very robust air travel demand picture.”
The International Air Transport Association forecast this week that China will be the biggest contributor of new air travelers globally through 2014. Of 800 million new passengers it expects by then, 214 million will travel on China routes.
As global air travel recovered in the past year, Delta saw its strongest revenue growth in Asia. While overall international passenger revenue rose 22% in 2010, growth in the Pacific region was 38%.
As demand returns, US carriers are looking to add service to high-growth business markets and upgrade their cabins with fully reclining seats and in-flight entertainment. By 2013, Atlanta-based Delta will have added full-flat beds to 150 trans-oceanic widebody planes used on routes such as between the United States and Asia.
New Flights to Region
Delta will start nonstop service between Tokyo’s Haneda airport and Detroit and Los Angeles on Saturday, and will resume flights between Atlanta and Shanghai later this year. The carrier is also adding flights between China and Japan and will start flying to Beijing from Detroit.
Japan and the United States signed an open-skies agreement last year allowing carriers to open routes between the countries and offer more flights for travelers.
Aviation consultant Michael Boyd says partnerships will be key as US carriers look to cope with growing Asia airlines.
“We’re going to be seeing US carriers attempt to ally with Chinese carriers,” said Boyd, who heads Colorado-based Boyd Group International.
Dube says ties with Chinese carriers give Delta an edge over its major US rivals, and pave the way for the airline to take passengers not only to the country’s biggest cities but also hundreds of other destinations within mainland China.
Guangzhou-based China Southern signed up for the Delta-led SkyTeam global alliance of airlines in 2007, and last year Shanghai-based China Eastern and Taiwan-based China Airlines decided to join the group.
Joint ventures that would allow Delta to share revenue and costs with foreign carriers on certain routes are also a way to expand business, Dube said. He added that such deals would first require an open-skies pact between the United States and other countries as well as government antitrust exemptions.
“We are very pro-openness in general and happy to see more and more countries signing open-skies agreements with the US,” Dube said.