Skygod
Blue Member
- Joined
- May 12, 2003
- Posts
- 125
Delta Air Grounds Expansion Plans for Its Song Unit
Thursday February 5, 12:31 am ET
ATLANTA -- Delta Air Lines is playing a different tune with its low-fare Song unit, putting a much-anticipated expansion on hold as the company conducts an operational review to find more ways to cut costs companywide, Thursday's Wall Street Journal reported.
The nation's No. 3 carrier had promised a January cross-country rollout from New York of its stylish airline-within-an-airline experiment, as it faces an assault from low-fare carrier JetBlue Airways (JBLU) and other low-cost rivals. Song currently flies mostly from the Northeast to leisure destinations in Florida.
Those plans for Song have been shelved on orders from new Chief Executive Gerald Grinstein, who wants to determine whether pursuing that strategy makes sense, company officials said. The review, expected to be completed by June, extends across the entire loss-plagued Delta operation, officials say. Meanwhile, Delta is in tense talks with its powerful pilots union, seeking wage concessions that the company says it needs to stay competitive with rivals.
Launched last April, Song was formed to operate at lower costs while providing perks such as leather seats and in-flight entertainment. Some of the lower costs are achieved with shorter aircraft turnaround times at airports, borrowing a strategy from low-cost carriers that get greater use of their aircraft than so- called hub-and-spoke carriers such as mainline Delta.
Wall Street Journal Staff Reporter Evan Perez contributed to this report.
Thursday February 5, 12:31 am ET
ATLANTA -- Delta Air Lines is playing a different tune with its low-fare Song unit, putting a much-anticipated expansion on hold as the company conducts an operational review to find more ways to cut costs companywide, Thursday's Wall Street Journal reported.
The nation's No. 3 carrier had promised a January cross-country rollout from New York of its stylish airline-within-an-airline experiment, as it faces an assault from low-fare carrier JetBlue Airways (JBLU) and other low-cost rivals. Song currently flies mostly from the Northeast to leisure destinations in Florida.
Those plans for Song have been shelved on orders from new Chief Executive Gerald Grinstein, who wants to determine whether pursuing that strategy makes sense, company officials said. The review, expected to be completed by June, extends across the entire loss-plagued Delta operation, officials say. Meanwhile, Delta is in tense talks with its powerful pilots union, seeking wage concessions that the company says it needs to stay competitive with rivals.
Launched last April, Song was formed to operate at lower costs while providing perks such as leather seats and in-flight entertainment. Some of the lower costs are achieved with shorter aircraft turnaround times at airports, borrowing a strategy from low-cost carriers that get greater use of their aircraft than so- called hub-and-spoke carriers such as mainline Delta.
Wall Street Journal Staff Reporter Evan Perez contributed to this report.
