Delta Airlines Inc.
) is reaping the benefits of its tie up with Virgin Atlantic as
it is picking up in the New York-London travel route − one of the
world's popular itineraries. Looking back, in Jun 2013, Delta
acquired a 49% stake in British carrier Virgin Atlantic from
The deal received the approval of the Department of
Transportation (DOT) in September the same year. The
Atlanta-based premier U.S. passenger carrier currently carries a
Zacks Rank #2 (Buy).
Both carriers are trying to complement each other's services
and are prioritizing customer convenience by aligning slots at
London's Heathrow airport. From Apr 2014, Delta will have 9
non-stop flights between New York and London. However, the figure
lags 17 daily flights between the same route offered by
American Airlines Group Inc.
) and its partner British Airways.
Currently, the New York-London route is the most lucrative
business opportunity for passenger carriers as executive are
ready to pay high fares for last minute travels. Carriers are
also enhancing air travel experience in the route with Wi-Fi and
flat-bed convertible seats.
Owing to the enhanced presence in U.S. and Europe,
Delta-Virgin passengers will have more flight options from New
York and London. Delta's improved schedule along with Virgin's
enhanced flight features is keeping it ahead of rival
United Continental Holdings Inc.
) in terms of market share. Delta's expanded presence in New York
airports like John F. Kennedy (JFK) and LaGuardia (LGA) is also
helping it to gain a stronger foothold in the transatlantic
However, post its merger with U.S. Airways, American Airlines
is striving to gain a greater share within the transatlantic
route. American Airlines has renovated its fleet of
The Boeing Co.
) 777-300 aircrafts for the route by installing separate cabins
for first and business class passengers along with reclining
seats and power outlets.
America Airlines also gains from British Airways' extensive
short-haul connectivity within Britain and Europe. Further, U.S.
Airways' strong corporate customer base in the eastern coast of
U.S. will strengthen America Airlines' corporate portfolio.
Thus, despite the transatlantic route boosting Delta's
passenger service revenues from the Atlantic region, the carrier
has lesser market share than American Airlines. We believe Delta
will have to increase its share to counter competition in the
AMER AIRLINES (AAL): Free Stock Analysis
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DELTA AIR LINES (DAL): Free Stock Analysis
UNITED CONT HLD (UAL): Free Stock Analysis
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