Atlanta the eye of the storm for Delta | www.ajc.com

Posted: August 30, 2012 in Uncategorized

By Kelly YamanouchiThe Atlanta Journal-ConstitutionAt Delta Air Lines headquarters near the Atlanta airport, a steady stream of employees move in and around the sprawling corporate campus, which now has a Starbucks, a medical clinic and even a small Wal-mart.Just next door at the airline’s flight hub, Delta’s 1,000 daily departures keep Hartsfield-Jackson International Airport the world’s busiest. Combined, the hub and headquarters host about 25,000 Delta employees, a number that has remained remarkably steady over the years.But at Delta’s hubs in Memphis, Minneapolis and Cincinnati, the story is bleaker. In those cities, Delta is significantly cutting jobs, making huge cutbacks in flights — or both.This summer Delta announced it will shut down regional flight subsidiary Comair, based near Cincinnati; shut down ground handling subsidiary Regional Elite Airline Services, based in the Minneapolis area; and move the headquarters of vacation package subsidiary MLT Vacations from the Twin Cities to Atlanta.Meanwhile, Delta has cut its Memphis flight schedule from about 240 daily flights a few years ago to about 125 this fall. And Pinnacle Airlines, a Memphis-based regional carrier for Delta and other airlines, is in bankruptcy protection, leaving Memphians concerned Pinnacle could move its headquarters away.Some of the cuts stem from Delta’s 2008 merger with Northwest Airlines, which was based near Minneapolis and also ran the Memphis hub. Other moves reflect restructuring amid high fuel costs that cut into the financial viability of smaller regional jets, the workhorses at such smaller hubs over the past 20 years.In Memphis the flight cuts and dissatisfaction with Delta have sparked a surge of campaigns.Exorbitant Delta fares are “devastating for the Memphis economy,” says the description of a Facebook group called “Delta Does Memphis,” which is critical of the airline. The group’s aims include “provoking a regionwide discussion about how Delta was enabled to make the Memphis airport a fortress hub.”The average round-trip domestic fare in Memphis of $520 was the second highest in the United States in the first quarter of this year, behind only fellow-Delta hub Cincinnati with an average of $526, according to the most recent report from the U.S. Bureau of Transportation Statistics.The Memphis airport in July began offering $1 million in incentives for airlines that add new direct service. Other big carriers serve it with only a couple of handfuls of flights a day or fewer. And civic leaders in Memphis started a campaign called “Come Fly Memphis!” saying, “we must fight for our share in the most competitive airport market America has ever seen.”To some, the rival in that competition starts with ATL. An editorial this month carrying the glum headline “Delta is better than no hub at all” in the Memphis Commercial Appeal newspaper said, “the economic reality is Delta will continue to rely more on its Atlanta hub for international and nonstop service at the expense of Memphis.”Metro Atlanta Chamber president Sam Williams said Atlanta benefits from its role as a “global capital” when stacked up against Memphis and similar cities that are losing airline service.Atlanta is “globally positioned, and unfortunately they aren’t,” he said.The Atlanta hub also benefits from its enormity and revenue-generating power. When airlines shrink, they usually “shrink into [their] largest and strongest hubs,” said Greater Memphis Chamber CEO John Moore.To be sure, Atlanta is not immune to the cuts Delta has made amid high fuel costs and a tepid economy. Some of the company’s layoffs, buyouts and facilities consolidation have hit Atlanta. The airline has also cut some key Atlanta international flights.But where Atlanta lost select routes, Delta cut hundreds of flights in Cincinnati and pulled out of two concourses at the Cincinnati airport. On top of that came the Comair shutdown announcement, which prompted Kentucky Gov. Steve Beshear to issue a statement calling the news “terribly disappointing.”In the Twin Cities area, Delta has put up for sale Northwest’s former headquarters in Eagan, Minn..It had already moved flight attendant training, pilot training, and other operations from the Minneapolis area to Atlanta, before announcing the move of MLT Vacations.

via Atlanta the eye of the storm for Delta | www.ajc.com.

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