Business | Aviation
Delta leads US carriers' slow return to Arab world
Seven years since the September 11 hijack attacks that rocked the airline industry, Delta Air Lines is leading a slow return to the Arab world by US carriers.
- Reuters
- Published: 00:05 June 8, 2008
Amman: Seven years since the September 11 hijack attacks that rocked the airline industry, Delta Air Lines is leading a slow return to the Arab world by US carriers.
International expansion has offered growth for some US airlines being squeezed by increasing competition at home, but Arab destinations have been overlooked in favour of surging markets such as China and India.
"The competition within the US is tougher and we believe in market growth in the world theatre and we want to be part of that," Tony Charaf, president of Delta Technical Operations, said.
On Friday, No 3 US carrier Delta started service linking New York and Amman, Jordan, marking only the second Arab route opened by a US airline since September 11.
One source of traffic in Amman comes from US contractors and others based in Iraq, a business which state carrier Royal Jordanian has benefitted from.
"There is a tremendous amount of growth in tourism, economy and educational between the United States and the Middle East and people need to travel," said Charaf.
Delta will operate four flights weekly between Amman and New York and in October will add Cairo-New York flights as well as service between Kuwait and Atlanta.
Two years ago it became the first US airline to resume regular flights to anywhere in the Middle East with service to Tel Aviv, followed by Dubai last year.
"Dubai is doing very well for us and it has encouraged us to continue our expansion in the Middle East," said Charaf.
Like rivals such as Continental Airlines, Delta is seeing international revenues grow in importance.
Charaf said over 40 per cent of Delta's revenues should come from international markets this year and that would rise to 50 per cent next year. "What we have done is to really shift our airline's strategy."
Adding capacity
Charaf said Delta had added more international capacity than any other major US airline in the last two years, shifting more than 20 wide-bodied aircraft to foreign routes.
The airline's search for growth to offset domestic competition will also see it open new routes in Africa, Latin America and Europe.
The hijack attacks of September 11 sparked a sharp slowdown for airlines and triggered the collapse of major carriers.
Job cut programme: Additional $103m charges
Delta Air Lines says it will record an additional $103 million (65 million euros) in charges related to job cuts and discontinued use of airport facilities.
The Atlanta-based company said in a Securities and Exchange Commission filing on Friday that the charges will be recorded in the second quarter, which ends June 30.
Delta said it expects to record a $95 million charge linked to work force reduction programmes and an $8 million charge related to the discontinued use of certain airport facilities.
Delta took a $16 million charge in the first quarter for the work force reduction programs, but has said it expected the charge to increase significantly once the voluntary reduction commitments were finalised, which occurred in May.
- AP
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