Delta CEO Dismisses Threat From Low-Cost Transatlantic Airlines
Photo Credit: Delta Air Lines CEO Ed Bastian said he is not concerned about discount airlines on transatlantic routes. Pictured is a Wow Air Airbus A321. Wow Air
Skift Take
European and U.S. airlines years ago underestimated the threat posed by short-haul discount airlines. Since then legacy carriers have treated transatlantic low-cost airlines as serious competitors. But there's reason to believe the low-cost model may not be as appropriate for longer routes. Legacy carriers might be OK this time.
Delta Air Lines CEO Ed Bastian on Wednesday dismissed threats posed by discount transatlantic airlines, saying carriers like Wow Air and Norwegian Air don't present a "meaningful risk" to established airlines, while asking whether long-haul discounters can continue to justify their models as fuel prices increase.
"I don't think that fuel prices, for example, are sustainable over time in the ultra low-cost markets," Bastian said at the Bernstein 34th Annual Strategic Decisions Conference. "Fuel prices have jumped 50 percent in the last year. It's causing a big impact on their business model and something that the bigger carriers, the more premium carriers, can actually afford and can invest against to be able to get the pricing where it needs to be."
Bastian is surprisingly confident considering the two most influential transatlantic discounters are flooding the U.S. market with capacity, not only from established markets, like New Yo
