The real reason Delta cut Dubai route

Seggy said:
Ahhh, pretty sure United does NOT codeshare with FlyDubai.
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Well FZ shows as the connection if you try to search IAD-MCT. Maybe not Codeshare, but some other form of agreement.

They do however, with Jet Airways and Air India. They cover that region pretty well. I know you keep omitting that factoid in every conversation we have as it dilutes the points you try to make there so figure might as well bring it up again
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....and good for them. United is actually going to surpass DAL over the next decade because they appear to "get it" in terms of finding ways to serve the billions and billions of customers outside of North America and Europe. Witness the SFO-Chengdu service.

Do a search for a UAL flight from IAD to HYD and you actually find something that is reasonable. Do one from DTW-HYD on DAL and it comes up with nothing.

Still early in the game and a long ways to go, but pulling out of DXB as a clear grandstanding move when your weak case in Washington is losing steam is probably not a good long term strategy.




TP
 
Seggy said:
Yep! Something more is going on!
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Not really. American owed Isreal a whole lot of money in fuel and handling charges back from when they flew in there. I can't remember the amount or the reason for the dispute, but it was a lot. As long as they didn't fly there they didn't have to pay. With the merger, the former US, now AA flight is liable for those costs.
 
wheelsup said:
I agree they are trying to engineer some sort of "woe is me". Just my thoughts.

That being said, US airlines are making bank right now and instead of investing in their product to compete they are burning money buying back stock. The ME airlines have a point, our planes in general are lacking. The US carriers are making 4x the net profit Emirates is, they can afford it.

I have no idea what the barriers to entry to re-create the ME "hub/spoke" international system are, seems pretty high, that is a competitive advantage the ME3 have.
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Not to call you out specifically -- it seems to be a recurring general theme in the airline community -- US airlines are pouring more back into the company (via investment in the product and debt reductions) than they are into share buybacks. DAL, UAL, and AAL have each spent $1B+ annually in aircraft/product CapEx, and UAL/DAL have been spending like mad men the past few years to reduce their overall debt balances. Share buybacks have been large, for sure, but not unwarranted -- if you fronted money to any of the US3 to fund their business, would you not require them to repay you in full and then some? If not, there are plenty of entrepreneurs who would be happy to put your money to work for free.

The fundamental disconnect is that the US3 are making the claim that profits are not part of the investment equation for the ME3. This is similar to how US carriers operated back in the era of regulation - they spent lavishly on product because they were not forced to compete on price (re: the government funded the product). The US3 think if they spent all that money to have gold-plated decor, Emirates would simply continue to undercut them with fares with the limitless funds they have from their respective governments (US3 argument, not mine). If that were the case, it doesnt matter if the US3 make 4x the net profit or 1,000x the net profit -- when one side has unlimited pockets, no amount of profit and investment is enough to sustain the looming losses, and no investor (debt or equity) will tolerate it.
 
BobDDuck said:
Not really. American owed Isreal a whole lot of money in fuel and handling charges back from when they flew in there. I can't remember the amount or the reason for the dispute, but it was a lot. As long as they didn't fly there they didn't have to pay. With the merger, the former US, now AA flight is liable for those costs.
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I think it was 13 million dollars or so? I would think that they would be able to easily recoup that if the route was profitable.

Also I did find this...

http://www.haaretz.com/israel-news/business/1.672539

Who knows...
 
surreal1221 said:
Am I the first one who thought "Man, such an old file photo of Delta tales in Atlanta...goodness..."?
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The local news here always does that. When there are stories regarding Phoenix Sky Harbor or airlines in general, they show file footage in the background of the story with AA 727s landing and taking off, America West 737s taxiing around, a United DC-10 here or there, etc.
 
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Ecl!pse said:
The US3 think if they spent all that money to have gold-plated decor, Emirates would simply continue to undercut them with fares with the limitless funds they have from their respective governments (US3 argument, not mine).
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Emirates from LAX-DXB is roughly $25,000 in first class. I hate to say, they do not undercut anyone. I know the whole argument on JC stems from the idea that these carriers are undercutting US carriers, but know that it's false. Price it out.
 
dasleben said:
Emirates from LAX-DXB is roughly $25,000 in first class. I hate to say, they do not undercut anyone. I know the whole argument on JC stems from the idea that these carriers are undercutting US carriers, but know that it's false. Price it out.
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Definitely not your Orbitz traveler looking for the lowest fare. What's similar US carrier first class for same, ballpark?
 
MikeD said:
Definitely not your Orbitz traveler looking for the lowest fare. What's similar US carrier first class for same, ballpark?
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Well, comparing EK's business class to UA's business class between LAX and DXB (a fair comparison), EK is $9,621 and UA is $8,832 (actually Turkish wins out with $3,604, and it's a surprisingly nice ride). Your response is pretty common, but while it may seem that I'm defending the Middle Eastern carriers, I'd actually rather see US carriers step up to bat and try to compete. However, as someone who spends a lot of time deadheading around commercially, I can say that the US carriers are lagging heavily in terms of amenities and service. Delta gets the closest on the 777 and A330 fleets, but the service isn't to the same level. AA's and UA's seats are very poor in comparison, though AA's international service tends to be excellent.

I simply see this as the "US3" trying to save money by crying wolf, rather than actually trying to bring the quality up. It makes a good sound bite to say that the US carriers can't compete because the Middle Eastern carriers have oil money, but I'm afraid it misses the mark entirely.
 
dasleben said:
Well, comparing EK's business class to UA's business class between LAX and DXB (a fair comparison), EK is $9,621 and UA is $8,832 (actually Turkish wins out with $3,604, and it's a surprisingly nice ride). Your response is pretty common, but while it may seem that I'm defending the Middle Eastern carriers, I'd actually rather see US carriers step up to bat and try to compete. However, as someone who spends a lot of time deadheading around commercially, I can say that the US carriers are lagging heavily in terms of amenities and service. Delta gets the closest on the 777 and A330 fleets, but the service isn't to the same level. AA's and UA's seats are very poor in comparison, though AA's international service tends to be excellent.

I simply see this as the "US3" trying to save money by crying wolf, rather than actually trying to bring the quality up. It makes a good sound bite to say that the US carriers can't compete because the Middle Eastern carriers have oil money, but I'm afraid it misses the mark entirely.
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Is it a market type or style that the US3 can even afford to compete in, ala lavish accomodations and service? In other words, why don't they do that; unless there's not the market for it going from the US to there, as maybe there would be coming from there to the US? I don't know for sure the answers, am just curious.
 
dasleben said:
the US carriers are lagging heavily in terms of amenities and service.
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Yeah, this. I hate to say it, but I'd almost rather ride coach on Emirates than business class on some airlines over here. Don't get me wrong; I think the playing field isn't quite level and that what the US3 are saying has merit. But the fact is that US carriers have been lagging behind some of their international competition for a while. And I'm not just talking about $20,000 elite tickets. I'm talking basic stuff like the quality of the seats, onboard entertainment and food provided in long-haul coach.
 
MikeD said:
Is it a market type or style that the US3 can even afford to compete in, ala lavish accomodations and service? In other words, why don't they do that; unless there's not the market for it going from the US to there, as maybe there would be coming from there to the US? I don't know for sure the answers, am just curious.
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Couldn't really comment on that, but the US3 tend to lag behind a number of international carriers, not just the ME3. I'd rather my company give their money to US companies when I'm riding around, but more often than not, the better rides are on foreign carriers. It's easy for the US carriers to play the victim card, but any market share they lose in those markets is by their own doing (DFW-NRT on a clunker AA 777-200 isn't nearly as preferable as ANA or JAL, for instance, though in that market, AA is cheapest).
 
dasleben said:
Couldn't really comment on that, but the US3 tend to lag behind a number of international carriers, not just the ME3. I'd rather my company give their money to US companies when I'm riding around, but more often than not, the better rides are on foreign carriers. It's easy for the US carriers to play the victim card, but any market share they lose in those markets is by their own doing (DFW-NRT on a clunker AA 777-200 isn't nearly as preferable as ANA or JAL, for instance, though in that market, AA is cheapest).
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The fares my be comparable, but if you take out the taxes you'll see they really aren't even close.
 
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