Airline Weekly

Delta Says It’s No. 1 in South America. American Says No Way

Delta Air Lines dominates many aspects of the U.S. airline industry. It makes the most money; it has set pilot wages; it has declared that Wi-Fi will be free. But does it dominate travel between the U.S. and South America?

Delta President Glen Hauenstein last week declared that Delta’s partnership with LATAM has made it the region’s leading carrier. Needless to say, his view is not shared by American Airlines, the leader in South America and Latin America since it bought Eastern Airlines’ Miami hub in 1989.

Hauenstein, speaking March 14 at a J.P. Morgan investor conference, declared, “In South America, when you put LATAM and Delta together, we go from a number three position as Delta to a number one position from U.S. to South America, and we’re gaining share, as we speak.“ In September, the Transportation Department granted anti-trust immunity to the joint venture between Delta and Santiago-based LATAM.

Dennis Tajer, spokesman for Allied Pilots Association, which represents American pilots, attended the conference with several other APA officials. They were perplexed. “It was like ‘really?’,” Tajer said.  “The pilots I was with were saying, ‘You expect them to brag on New York and Atlanta and maybe the transatlantic, but you do not expect them to say that they’re number one in South America.

“Delta is not number one in Latin America or South America,” Tajer said. “But the fact that they’re talking about it means they are coming after us.”  South America refers to the continent, while the term Latin America generally includes South America, Central America, Mexico and most islands of the Caribbean. 

On Tuesday, Jose Freig, American’s vice president of operations and commercial for Mexico, the Caribbean and Latin America, said, “American Airlines has connected travelers with South America for more than 30 years, and, today, we are proud to serve as the leading U.S. airline in the region, with more flights and seats to more destinations than any other single carrier or partnership. 

“Our current network includes service to 16 destinations in South America, including the only nonstop service from the U.S. to Montevideo, Uruguay and Pereira, Colombia,” Freig said in a prepared statement. “Together with our partner GOL, we are able to offer our customers an unparalleled network in the region, and we look forward to continued growth through our partnership with JetSMART.” American and Rio de Jainero-based GOL are codeshare partners: American is an investor in Santiago-based JetSMART.

What do the statistics say?

Mike Arnot, spokesman for Cirium, an aviation analytics company, said Hauenstein is correct when it comes to present and future available seat miles (ASM), which measure capacity, between the U.S. and South America.

“The combined schedules for Q1 and prospective for Q2 2023 put Delta and LATAM about 14% ahead of American on capacity,” Arnot said in an e-mail. “Those schedules could still change for Q2.” 

However, “looking at actual passenger revenue share for the full year ended 2022, American took around 27 percent of the market, whereas Delta and LATAM combined for 18 percent.”  Arnot said. “LATAM had 12.4% of the revenue while Delta had 5.8 percent”, he said.

In terms of ASMs for the 12-month-period ending in March 2023, American and GOL had 32 percent, while Delta and LATAM had 28 percent.  Another measure, counting seats instead of ASMs, benefits American, because Atlanta is farther from South American markets than Miami is, and thus accumulates more ASMs flying to the same destination. In terms of seats, for the year ending March 2023, American and GOL had 32% of seats, while Delta and LATAM had 22 percent.

American’s Miami hub has long been the focal point for service to South American and Latin America, although American serves Latin America from all of its hubs including Charlotte, a major hub for the Caribbean. Meanwhile, Delta is growing rapidly throughout the region, focusing on its Atlanta and New York hubs, and relying largely on LATAM for Miami service.

American said that from Miami, it offers up to 27 peak daily flights to 16 destinations in South America. Additionally, American offers up to 20 daily flights to 10 destinations in Central America, up to 12 daily flights to five destinations in Mexico and up to 84 flights to 40 destinations in the Caribbean.

Systemwide, American said, it offers up to 34 daily flights to 16 destinations in South America. It also offers up to 35 daily flights to 10 destinations in Central America, up to 117 daily flight daily flights to 25 destinations in Mexico and up to 171 flights to 40 Caribbean destinations including the British Virgin Islands starting in June.

As for Delta and LATAM, during March they offer 169,038 seats between the U.S. and South American joint venture countries (Brazil, Colombia, Chile, Peru, Paraguay, Uruguay). “That represents a 30 percent share of seats, and is larger than any other competitor,” said Delta spokesman Morgan Durrant. “Our network is built around where customers want to fly most, and demand to Latin America (including Caribbean) has been strong,” Durrant said. 

Last month, Delta said it will operate seasonal winter service between New York and Rio de Janeiro starting Dec. 16, the third new route announced with LATAM Group. The route “adds to Delta and LATAM’s position as the No. 1 joint venture partnership for service between NYC and South America,” Delta said.

Last week, Delta said it will operate its largest-ever winter holiday schedule to Latin America, with frequency increases on 16 routes from New York, Atlanta, Detroit and Minneapolis. The carrier will offer more than 25,000 daily outbound seats, a 20 percent increase compared to 2022, to 44 destinations.  The flights will operate seasonally from Dec. 16 through Jan. 7.

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