Change Your Altitude

Another One Bites the Dust: Delta To Close All Taipei Operations

Some not so great news coming out from Delta (DL) – and it’s a bit of an odd one coming off the great news that the airline made a handsome $6 billion dollar profit in the last half of 2016.

We’ve been seeing the rather slow and painful death of legacy Northwest’s – then Delta’s – iconic Tokyo Narita hub, as route by route continues to be either cut, bypassed or slated for future transfer to (shudder) Shanghai Pudong Airport and onwards to China Eastern. Delta does a lot (if not most) things right, but it’s looking more likely that their failure to entice Japan Airlines from American and jump ship to Delta some years ago might prove to be the death of their Narita hub. Haneda continues to be the preferred ‘premium’ airport for passengers flying between Tokyo and the United Sates, and Delta simply doesn’t have a viable partner at Narita to funnel and share traffic to other points beyond NRT – ANA is hot in bed with United and JAL is all cozied up with AA.

Northwest first started operations to Taipei nearly 70 years ago – now parent company Delta will end them come May this year.

The Scoop:

Delta Airlines will be terminating all services to Taipei Taoyuan International Airport (TPE), ending 67 years of operations by either Northwest or Delta into the country.

May 24 will be the last flight operated out of TPE, with Feb 14 being the day reservations for the route close and get zero’d out on all booking servers, included. It’s off that they’d close reservations so far out, but perhaps that’s a reflection of relatively strong bookings but perhaps on very low yield cheap fares. Indeed, Delta cited competition from low cost airlines as the main reason of them pulling out of the market all together.

Having started operations into the island nation in 1950, Delta currently operates a daily Boeing 767-300ER service from Narita to Taipei, feeding off all the early/mid afternoon arrivals from the US, leaving at 5pm local time and arriving at 8:35pm. The aircraft overnights in Taiwan and returns back at 11:05am to NRT at 3:35pm, connecting well with what remains of Delta’s trans-pacific operations at Narita.

Apparently it wasn’t enough.

*PS Delta One is the only class of service available for purchase for many days from hereon out till the closure of the route – make of that what you will.

No word yet from fellow SkyTeam partner China Airlines (CI) on whether they’ll pick up the slack and introduce some added or mirrored service to compensate for the loss of Delta to Taipei.

It remains unclear how fellow SkyTeam partner China Airlines will react to the cessation of the route by Delta.TPE

The Takeaway:

This is a blow for Delta to have to feel as though they need to pull out of the route. Obviously the numbers weren’t adding up fiscally despite load factors seeming not to be the problem. Our one hope is that DL builds out a suitable partnership with hometown airline CI. This just adds fuel to the baffling fire that is disaster that is the Delta-Korean Air relationship. United and ANA have a complete JV across the Pacific – it’s completely metal neutral. As in it doesn’t matter for me, the Star Alliance frequent flier whether I end up on either airline, it’s all the same – it’s as if they’re one. And the same goes for American and JAL.

Not so for Delta and Korean. In fact, they don’t even codeshare on many transpacific routes through Seoul.

The result? You end up either on the much more sub-optimal China Southern (CZ) or China Eastern (MU) through Guangzhou or Shanghai – both airports being very congested and subject to archaic Chinese military aviation rules (= delays, all the time).

This is a huge white elephant in Delta’s portfolio – their inability to make peace and play nice with Korean Air, their only actual world class Asian partner. Given the importance of the market, you’d think doing this would be high up on the airline’s agenda.

The other thing is a chicken and egg type scenario – as DL closes more further out Asian cities, the less feed they get into their Narita operations – the more they reduce Narita and shift over to Haneda, the less they can offer their connecting passengers. At this point Narita is no longer connected non-stop to either Los Angeles or New York – think about that for a second.

Having closed Bangkok, Hong Kong and now Taipei, Delta only retains Manila and Singapore from Narita – but for how long? If I’m a Skyteam elite based in Singapore, what are my options through Narita? SFO is a two stop process (where UA/SQ offers nonstop, ANA offers one stop and AA offers onestop via Cathay Pacific or JAL) – the same pretty much applies to much of South East Asia and onto other important hubs such as Los Angeles, Chicago and New York.

Once the pride of the Northwest route network, it does seem like we’re being ‘treated’ to the demise of that iconic Pacific Network.

But here’s the catch – Delta, unlike United lacks any aircraft to operate non-stop flights to important, high yielding business destinations such as Singapore. So bypassing Japan isn’t an option. Haneda slots are done, so that’s a non-starter. But then again what’s the use of the tag on flight through a non-existent Narita hub that connect you to anywhere beyond Seattle, Portland, Minneapolis or Detroit?

We expect Singapore as the next Delta destination to be axed – not because it doesn’t make money, but simply because the airline can no longer cater to the high end market that the city-state demands. More than one-stop from Singapore to the US is simply no longer acceptable anymore. If they could shift Singapore to via Seoul rather than Tokyo-Narita, then you’d have a chance. But because of internal politics, no.

Manila will likely stay on only because a: it’s a low yielding, high volume market so people will fly the route even if it means 3,4 or 5 connections to get where they need to be if it’s $50 cheaper – those flights will always be overbooked. B: it’s much cheaper for Delta to park those 747’s in Manila overnight than keep them in Tokyo and pay for those Narita fees. And I guess c: cargo. Fish, and stuff. Works both ways in this case, actually.

All this said, what we’re getting at is that as Delta continuously withdraws from ‘deeper’ Asia (aka not Japan, Korea or China), Star with United and partners win – especially with no clear Delta/SkyTeam framework in place with the region’s standout carriers in China Airlines and especially Korean Air – who could fill the void well and in a very economically sustainable manner.  Only if Delta can get over whatever is holding them back from making actual viable deals with them can this problem be resolved. If United can do it with their Star Alliance Asian partners, with American following suit with their own oneworld counterparts, why can’t Delta do it with their 2 or 3 ‘premium’ partners in Asia save for their Chinese partners, who routinely receive massively sub-par ratings from SkyTeam elites?

Given what we’ve seen from United and American and what they’ve been able to accomplish with their corresponding South East Asian partners, the main hurdle seems to be in Atlanta and not in Seoul, Taipei, or even Jakarta.

How do you feel about Delta’s Asia strategy thus far? Would you be happy to have either Guangzhou or Shanghai as a replacement hub for Tokyo Narita? How do you feel getting on a CZ or MU connecting Delta codeshare? As a Star guy I’d much prefer my ANA, Singapore Airlines, Asiana, Thai Airways or EVA Air connection 😉

  • Joey
    Posted at 16:03h, 15 January

    Let’s just hope no plans to throw MNL onto the chopping board materialize before my Asia trip later this year 😒