Take 2 for Delta and Its Low-Cost Carrier
Delta Air Lines said yesterday that its new low-cost carrier, Song, would start service on April 15 by flying between New York and West Palm Beach, Fla.
Service will gradually expand until November, Delta said, when Song will be operating 144 daily flights with a fleet of 36 Boeing 757's that connect three Northeast cities and Washington with five Florida cities. Executives said the airline's fares would compete with those of other low-cost carriers and that passengers would be asked to pay extra for optional food and entertainment, like limited access to the Internet.
But the market has not been kind to low-cost subsidiaries run by big airlines. United Airlines, Continental Airlines and US Airways have all tried and failed at operating smaller carriers with supposedly lower costs. Delta's own Delta Express, which will be shut down with the start of Song, is considered a failure by analysts.
The president of Song, John Selvaggio, said his operation would have a competitive cost structure because it would try to use its planes and workers more hours each day than Delta does now. The 757's will be used an average of 13.2 hours a day, he said, and will have a turnaround time of about 50 minutes. Workers will be expected to be more productive, Mr. Selvaggio said, since there will be less downtime than in hub-and-spoke operations.
''They will spend more of their duty day flying than sitting,'' he said.
Song is Delta's latest effort at stanching the flow of East Coast passengers to popular low-cost carriers like JetBlue Airways and AirTran Airways, which reported a fourth-quarter net profit of $7.5 million yesterday. Both airlines serve the popular Florida leisure market from the Northeast.
JetBlue runs direct flights, while AirTran has one-stop flights through airports in Atlanta and Newport News, Va.
''JetBlue is really a formidable competitor,'' said Darryl Jenkins, director of the Aviation Institute at George Washington University. ''These guys are very good at what they do. This will be very good competition for JetBlue.''
Tad Hutcheson, marketing director for AirTran, said he thought that travelers would be drawn to AirTran over Song. He said that AirTran had 12-seat business-class cabins and that its seat configuration was such that few passengers on its Boeing 717's would end up in middle seats.
Song's planes will have all-coach-class seating. Each plane will have 199 seats, and Delta said that the pitch of the seats -- the distance between two points on back-to-back seats -- will be 33 inches, the biggest of any low-cost carrier.
After its initial flight from Kennedy International Airport on April 15, Song will expand its schedule by adding one plane a week until November. The operation will first grow into all three airports in the New York area, then expand to Boston by the end of May.
The planes will not be imprinted with a Delta logo or Delta colors. Instead, the bodies will be painted with swirls of green and white, and the tails with the Song logo, which consists of a squiggly white object resembling a spermatozoid on a green background.
Delta has had little success with Delta Express. Robert W. Mann, an airline consultant, said one problem with Delta Express was that Delta did not manage to wring enough productivity out of the workers and planes, and so costs remained high. The fact that the spartan Delta Express was linked so closely to the mainline operations at Delta also confused passengers, Mr. Mann said, because travelers would not know what to expect when they flew Delta.
''It's very difficult for big companies to operate like smaller companies,'' he said, referring to the failures of large carriers to emulate Southwest Airlines. ''The success of Southwest and some of their imitators is that they've never looked at adding expense at all for any reason. It should be interesting to see how this plays out.''