Whereas I’ve no inside info suggesting that this can occur, I can’t assist however level out how overdue it’s for Delta Air Strains and Etihad Airways to launch a partnership with each other. I discussed this in passing the opposite day when discussing the brand new three way partnership between Etihad and China Japanese, however needed to speak about it in additional element on this submit.
Present US & Gulf provider dynamics
It’s attention-grabbing to see how the relationships are evolving between the “massive three” US carriers and the “massive three” Gulf carriers. Going again a decade, the most important US carriers have been making an attempt to dam the most important Gulf carriers from rising in the USA, arguing that they supplied unfair competitors, and have been placing US jobs in danger.
Nonetheless, within the meantime, they’ve taken extra of the method of “when you can’t beat ’em, be part of ’em.” Whenever you have a look at the present state of affairs:
As you possibly can see, on the US aspect, American and United are in a superb place with these partnerships, whereas on the Gulf aspect, Qatar Airways and Emirates have good preparations. In the event you ask me, there’s a obviously apparent growth that we must always see…
Why Delta & Etihad can be a superb match
Delta is in fact an extremely worthwhile and strategic airline, but I’d argue that Delta wants Etihad greater than the opposite method round. Whenever you have a look at Delta’s lengthy haul community, the airline may be very invested in its joint ventures and fairness companions.
Delta’s two most essential business relationships are the transatlantic three way partnership (with Air France-KLM and Virgin Atlantic), in addition to the transpacific three way partnership (with Korean Air).
Arguably the largest hole in Delta’s lengthy haul community is the Indian subcontinent. Go to Delta’s web site and attempt to guide a ticket from Boston (BOS) to main cities in India, like Ahmedabad (AMD), Chennai (MAA), Hyderabad (HYD), Kolkata (COK), and many others. Or attempt to guide tickets to locations like Dhaka (DAC). The web site will let you know there are not any obtainable flights. It is a main gap in Delta’s community, in comparison with American and United:
- American has a partnership with Qatar Airways and Etihad for connectivity within the Center East, and likewise flies to India, and has a partnership with IndiGo, which is India’s largest airline
- United has a partnership with Emirates for connectivity within the Center East, and likewise flies to India, and has a partnership with Air India
In the meantime Delta has none of that:
- Delta and Saudia each belong to SkyTeam, however Delta doesn’t in any respect push its passengers on Saudia, and on prime of that, it’s not an airline that many Delta flyers need to journey with (it’s not a superb match — have you ever seen how a lot individuals drink in Sky Golf equipment?!)
- Delta doesn’t have any airline companions in India
- Delta doesn’t fly to India; whereas the airline was going to fly to Mumbai (BOM), that’s now not sensible, because of Russian airspace closures
- Whereas Delta’s partnerships with Air France-KLM and Virgin Atlantic supply connectivity to India’s few largest markets, that’s concerning the extent of it
- Even when Delta did fly to India, it’s not clear which airline Delta may companion with for connectivity there
It looks as if Delta’s greatest resolution so as to add protection within the area can be to launch a partnership with Etihad, and perhaps to even add a flight to Abu Dhabi (AUH), maybe from Atlanta (ATL) or Detroit (DTW). Then Etihad may present connectivity to so many locations which are presently gaps in Delta’s community.
What’s the upside to Etihad for dumping American and partnering with Delta?
- Arguably Etihad’s US route community is way more complementary to Delta’s; Etihad flies out of T4 in New York (JFK), which can also be Delta’s terminal, and even has US Pre-Clearance, so it could make connections really easy, and Etihad has additionally launched flights to Boston (BOS), which is one other Delta hub
- Etihad has second class standing with American, as American primarily tries to route passengers its personal flights or onto Qatar Airways flights
- These days Etihad appears to ship extra connecting passengers on JetBlue, however the airline doesn’t have a premium cabin on all flights, so isn’t essentially nice for connectivity
- Partnering with Delta may open up logical new US locations for Etihad; I may see Etihad flying to Atlanta or Detroit, with the previous being the perfect connecting level for a bigger portion of the nation, and with Detroit having a big inhabitants from the areas the place Etihad is the strongest
Let me say in fact that selfishly I’d hate to see this, since I really like redeeming AAdvantage miles on Etihad, and there’s no method Delta SkyMiles would supply good worth when redeeming on Etihad. However I’m additionally making an attempt to separate my common ideas on business partnerships from my need for sure award redemptions.
Would the economics of this make sense?
I think about one of many causes that Delta has been hesitant to launch a partnership with Etihad is as a result of Delta may be very targeted on launching partnerships which are a part of joint ventures, and/or with fairness companions.
I wouldn’t essentially count on Delta and Etihad to launch a three way partnership (since it could partly cannibalize the present transatlantic three way partnership), and I additionally wouldn’t count on Delta to put money into Etihad (regardless of Etihad executives inferring the airline is contemplating an IPO).
Nonetheless, when you ask me, this partnership is extra out of necessity of getting world entry, and serving one of many world’s largest areas. It’s not in contrast to how Delta has launched a partnership with EL AL, regardless that it’s pretty informal as of now, as there’s no three way partnership, and Delta hasn’t invested in EL AL.
May Etihad be part of the SkyTeam alliance as effectively?
Maybe the subsequent logical query is that if it could make sense for Etihad to affix the SkyTeam alliance. There’s a much bigger development occurring right here. Etihad is more and more cooperating with SkyTeam airways — Air France-KLM has a detailed partnership with Etihad, and China Japanese and Etihad are launching a three way partnership.
If Etihad and Delta have been to launch a partnership, would it not make sense for Etihad to additionally be part of the SkyTeam alliance?
Personally I may see it occurring, although I wouldn’t take into account it to be a positive wager. I do suppose world alliances are deemphasized a bit these days, given what number of members a number of the alliances have. Many airways are as an alternative targeted on particular person, strategic partnerships, so it may make sense for Etihad to proceed to do this, with out committing to an alliance.
Personally I believe the more than likely end result is that Delta and Etihad first launch a partnership, after which perhaps sooner or later Etihad joins SkyTeam… or perhaps not.
Backside line
Whereas there’s no indication that this can occur, I believe there’s advantage to Delta and Etihad launching a partnership. Delta desperately wants a companion offering entry to the Indian subcontinent, whereas Etihad may use a stronger full service companion in the USA. It’s simply wild to me what number of cities there are with 5-10 million individuals, the place delta.com returns an error message once you attempt to discover an itinerary…
What do you suppose — may we see a Delta and Etihad partnership?
