Delta Air Lines has shown its hand for the first time concerning its plans for London Heathrow, following today”s joint venture agreement with Air France to start new transatlantic services.
Pressure from high-speed rail services between London and Paris ” details to follow shortly - has led Air France to drop four services between Heathrow and Charles de Gaulle and free up space for Delta to begin flights.
Announcing the new venture and services this morning (17 October), at a Paris press conference, Air France revealed that three of its Heathrow slots will now transfer to Delta. Both carriers will share revenues and costs on transatlantic routes.
The deal means that Delta has broken cover for the first time on its Heathrow ambitions ” an airport that it has long sought to enter but was prevented from doing so by the existing US-UK bilateral deal. Now that Open Skies is less than six months away, the US carrier has revealed its full intentions to serve American destinations from the premier British gateway.
The JV will be spread across two phases beginning in April next year and will include all non-stop services operated by Air France and Delta between Charles de Gaulle, Orly, Lyon and Atlanta, New York JFK, Cincinnati and Salt Lake City.
Combined revenue is expected to reach around $1.5bn annually during the first stage and more than $8bn in the second.
Specifically, Delta will operate two Heathrow-JFK (29 March) rotations, one Heathrow-Atlanta (29 March) service and one Charles de Gaulle-Salt Lake City (2 June), flight, while Air France is to start a Los Angeles service from the London hub in April next year.
The American carrier is also significantly increasing its French operation, with new services from Paris Orly to JFK (2 June), as well as a Charles de Gaulle-Salt Lake City flight. Delta will also return to Lyon from JFK ” a city it left in 2001 - with a first flight on 15 July.
”We are seizing the opportunity by signing this transatlantic agreement,” said Air France KLM chairman and CEO, Jean-Cyril Spinetta, adding: ”The big innovation here is the presence of Delta at Heathrow and Air France with a route from London to Los Angeles.”
The deal will add a major slice of capacity across the already burgeoning North Atlantic, with both airlines increasing transatlantic flights from 11 to 19 ” a 45% jump in offer to 4,500 seats.
Spinetta batted away suggestions that the increased availability would be a struggle, telling ABTN: ”We are not afraid of over-capacity on the North Atlantic ” there is new capacity because of the opening of Heathrow.”
By 2010, a second stage of the JV will kick in and encompass all transatlantic flights operated by Air France and Delta between Europe and North America, as well as services between Los Angeles and Tahiti.
Earlier this summer, Air France, KLM, Delta, Northwest, Alitalia and Czech Airlines, filed for expanded anti-trust immunity from the US Department of Transportation. Should this be forthcoming, the deal would allow further transatlantic integration.
