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Delta curbs capacity in light of Brexit
Delta Airline has decided to reduce capacity between the US and the UK following Britain’s decision to leave the European Union.
It says foreign currency pressure from the steep drop in the British pound and the economic uncertainty has prompted it to curb winter capacity by 6 percentage points.
"These changes, in combination with other network actions, will reduce system capacity by approximately one point in the December 2016 quarter and the company now expects to grow its system capacity by 1 percent year over year during this period," it said today.
Delta president Glen Hauenstein added: "While the revenue environment remains challenging, with persistent headwinds from close-in domestic yields and geopolitical uncertainty, we remain focused on achieving our goal of positive unit revenues by year end.
"We’ll continue to move quickly and aggressively with all our commercial levers, including an incremental 1 point reduction in our December quarter capacity levels, to make sure we create the momentum we need to achieve this goal."
Announcing its financial results for the June 2016 quarter, the airline said adjusted pre-tax income was $1.7 billion, a $42 million increase over last year.
Adjusted net income was $1.1 billion or $1.47 per diluted share, slightly better than analysts had expected.
"The Delta people again delivered another quarter of solid profitability, superior operational performance and great customer service, continuing to strengthen our brand and our foundation for the future," said CEO Ed Bastian.
"As we look to the remainder of the year, the large year-on-year savings driven by lower fuel are largely behind us and it is important to achieving our long-term financial targets that we get unit revenues back to a positive trajectory."
Bev
Editor in chief Bev Fearis has been a travel journalist for 25 years. She started her career at Travel Weekly, where she became deputy news editor, before joining Business Traveller as deputy editor and launching the magazine’s website. She has also written travel features, news and expert comment for the Guardian, Observer, Times, Telegraph, Boundless and other consumer titles and was named one of the top 50 UK travel journalists by the Press Gazette.
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