Delta CEO blames the Middle Eastern carriers for their Indian exit

While my American friends are covering the war of Delta, American Air and United on the Big 3 middle east carriers, the arguments of the American carriers are all propaganda and usually without substance. Read some of One Mile At A Time’s posts on this topic.

A few years back, American Airlines quit their only Indian route between Chicago and Delhi. A few weeks back, Delta quit their only route between NYC and Mumbai (via AMS). And they took the blame to the Middle East Carriers, yet again! Here is the Delta CEO Richard Anderson blaming them for this move:

India is a very big country. It has a huge trade relationship with the US, particularly for IT, has huge agricultural trade between the two countries.But in essence we don’t really have any aviation trade. We have exited the market completely.

Because essentially what these carriers have done is with subsidised government strategies, come into the marketplace to basically shift the traffic off of us and take us out of the Indian market.

And think about it. US flag carriers ought to be in the Indian market. American and Delta should be in the Indian market. But it’s not sustainable when you have that. When you have USD 41 billion worth of subsidy it’s very difficult, if not impossible for us to be able to compete. And that harm is immediate.

Blah Blah Blah is all I heard there.

This CEO forgets that they are in the pits on service. They used to fly a 767 to Mumbai, and people were not exactly falling over each other to get on their planes. The one time I flew them in Economy on BOM-AMS, their arrogant flight attendants made me wait 90 minutes for a glass of water. The many a times I know other people who flew them in Business, they got broken seats, vomit on the seat next door and all sorts of trashy customer service.

And they blame the Middle Eastern carriers for throwing them out of India. Whereas in reality, Delta only operated 1 flight a day, a route they inherited from NWA. They also took away Virgin Atlantic’s planes to focus on the UK-USA market, forcing them to quit the Mumbai station again, and yet, they blame carriers who are operating 5 flights a day from Mumbai if not less for their non-presence in the Indian market?

And yes, he totally forgot that United still has flights from Mumbai and Delhi to NYC on a daily basis.

So, Delta, don’t blame others for your focus on profitability. Got it?

Anybody else think Delta is just being hypocritical here? An upgraded product, a good customer service attitude and more frequencies will be some of the things to get us on your plane, Richard.

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About Ajay Awtaney

Ajay is a financial services pro, working to bring order to the chaos of the financial industry on an everyday basis! Beyond that, he dons the hat of India's favourite frequent traveller, trying to help people elevate their travel experience via tips and tricks they never knew before, or introduce them to the world of miles and points. Armed with an MBA from MDI Gurgaon and graduate degree in computer science from the University of Delhi, Ajay brings a systematic and objective approach on the table for his audience in dissecting travel and loyalty programs in India and around the world, and how to benefit from them. Ajay has been quoted in various reputed traditional and online media including The Hindustan Times, Inside Flyer, Bloomberg, DNA India, Conde Nast Traveller, The Telegraph, Mumbai Mirror, Mint, MoneyLife and The USA Today.

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Comments

  1. American / European airlines provide worst service, its like they pick the most arrogant crew for their indian leg of journey. I would pick ME flights over American anytime.

  2. Etihad and Qatar each serve 12 cities in India; Emirates serves 10.  In contrast, only one US carrier, United, serves India today with its own aircraft, and their European JV partners fly to only a tiny handful of Indian cities.  The US Troika would have one believe that everyone travelling between India and the United States was already flying on them–on two- or three- or even four-stop connections–before the big bad Gulf carriers arrived on the scene and stole all their passengers away.  Give me a break:  this is absurd and an insult to the intelligence of America’s consumers.

    It is also contradicted by the independent–not paid for hire–academic analysis by Professor Dresner of the University of Maryland and a number of highly regarded transportation economists at other U.S. universities.  They found that the Gulf carriers had stimulated demand and that only a small portion of passengers who had been flying on U.S. carriers had shifted to Gulf carrier air services.  And prices for the flights had gone down as a consequence of the competitive alternative offered by the Gulf carriers.

    It’s time for the U.S. Troika to come clean and stop wasting their shareholders’ money on one ridiculous study after another.  The Troika and their European partners such as Lufthansa and Air France missed the boat and ignored the rapidly growing new markets in India, the Middle East and Africa.  The Gulf carriers did not.  Now the Troika want to cut off new Gulf carrier service but do you really believe that they will start up new non-stop flights to India, Pakistan, or countries in Africa?  No, they’re all too happy packing their trans-Atlantic flights with high-yield passengers flying between the U.S. and Europe.  It’s not in their financial interest to add capacity on the Atlantic to carry lower-yielding connecting passengers to points in the Indian subcontinent, Africa, and the Middle East.  They can get away with this travesty on consumers if but only if they can lock new and innovative carriers out of the market.  That’s why they’ve launched this campaign on the Gulf airlines and their broader war on Open Skies.

  3. Bankruptcy is not comparable to the current subsidies of the ME3: after bankruptcy, even though you can shed some debt, you have certain obligations (cuts etc).
    The ME3 get a check at the end of each year from their government to balance the books. They are more like the German train company (Deutsche Bahn).
    That in itself is not necessarily bad – but it makes it indeed impossible for the competitors in other countries to compete. Ever noticed that many of the nicest airlines in the world are government-supported or enjoy a near-monopoly in their country? Money doesn’t grow on trees. If Delta raises fares, everybody complains; if they cut costs, everybody complains. How would Delta be able to pay for a fleet of A380s, flying them half-empty around the world? The only way they could compete in terms of product, would be to raise fares drastically.
    Actually, their product stacks up pretty nicely against the ME3, all things considered. (all-aisle access in Business Class, lie-flat seats — Emirates doesn’t even offer that across the board)

    This is an example of a distortion of the marketplace. Either the ME3 should be shut out of certain markets (the US and Europe), or else the US government should provide similar subsidies to US airlines – every year, not during bankruptcy. That’s not a bad idea actually, it would make air travel a lot nicer for all of us 🙂

  4. As for DL’s Anderson, I think he knows the ME3 beat him on the marketshare from India. He probably did not foresee how strong the Indian market would be (especially linking Silicon Valley with Bangalore.) If it is possible to fly nonstop between SFO-BLR, which I believe is possible for 787 and a350, I think that would work.
    At the moment, it looks like Anderson is focusing on China’s potential growth and working on increasing focus on TPAC flights between USA and China (before the ME3 beat him to it.)

  5. I have been watching Anderson’s comments and the Big 3’s as well.
    I would not fly the American carriers even if they have pleanty of flights to India and these are the reasons

    1. Old crappy flights, that has been Delta’s strategy
    2. Bad service
    3. Bad mileage programmes (delta and United)

    It’s sad Anderson thinks that he can get market share in India if he doesn’t have middle eastern carriers. I would prefer Air India than the American carriers

  6. I agree with you. If DL made that flight ATL-BOM a nonstop flight, I bet they can compete with the Middle Eastern carriers. I’ve flown EWR-DEL on UA before and will admit I prefer that flight over any of the ME flights that will cause me to have a connecting flight.
    In addition, the ME3 carriers, especially Emirates, gradually increased their presence in India over several years, starting with the megacities first (BOM, DEL, MAA) and then adding nonstop DXB service to smaller regional cities India. Though I don’t live in India, I’d rather fly a nonstop flight from my hometown to DXB and then to my final destination versus going to BOM/DEL/MAA first.

  7. I live in Atlanta (Delta’s home town) and fly to Mumbai atleast 3 times a year. Loved the Delta ATL-BOM direct flight the short time it operated. That flight was always full the few times I flew it so not sure why they stopped it. I would pay more for non-stop access to India.

    It is ridiculous for AA, United & Delta to blame Middle Eastern airlines and governments for subsidies when all 3 of them extinguished their debts through bankruptcy multiple times, obtained financing through the US government and operate a sub-par product. What’s funny is despite these complaints they still partner with Etihad and Emirates.

  8. Anderson is in danger of being tuned out. He whines so much that his message is being lost whether he’s wrong or right at this point.
    Life isn’t fair. Deal with it.

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