ATW Editor's Blog

The real reason Delta is pulling out of Dubai

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Delta Air Lines is back in the news again today, and this time it looks rather like route shenanigans.

The carrier has announced it will end its Atlanta-Dubai service in February. Not your average route announcement, the Atlanta airline says in its statement that the decision was made “amid overcapacity on US routes to the Middle East operated by government-owned and heavily subsidized airlines, and less than a month after Delta reduced service between the world’s busiest airport and the Middle East’s largest hub.”

In other words, Delta is blaming its pullout on the Gulf carriers on which it has waged war for many months over alleged subsidies and Open Skies compliance.

But hang on a moment… how many flights do Emirates, Etihad and Qatar Airways operate to Atlanta? The shocking answer is: zero. So Delta has exclusivity on Atlanta-Dubai, yet apparently can’t make a go of the route. How so?

At least part of the answer lies with these airline route maps: Delta route map and Emirates route map. Delta’s 777 will take you from Atlanta to Dubai, but from there (unless you transfer to Emirates), it’s a dead end. And, as Delta references in its statement today, the majority of people who fly from outside the Gulf states on one of three Gulf carriers are not going to Abu Dhabi, Doha or Dubai. They are transiting, and in ever larger numbers, their real destination is the sub-Indian continent: Bangladesh, India, Pakistan and so on, all places where, as the Emirates route map shows, the Dubai carrier offers multiple city destinations.

As is the golden rule with any airline, it’s all about the network. What Delta does not have is a sub-Indian continent network (nor do any of the US majors).

The Gulf carriers (and perhaps, more precisely, their state owners) saw an opportunity that their geographical location provided to create international hub-and-spoke operations that include the fast-growing sub-Indian continent market.

Atlanta Hartsfield is one of the largest and most successful US and global hub-and-spoke airports, but it doesn’t currently have any reach into the sub-Indian continent beyond Dubai.

That will change next year when Qatar Airways begins Doha-Atlanta service. Qatar, I fully expect, will make a go of the route not because there’s a pent-up demand for people to fly from the southern US to Doha, but because Qatar (along with its oneworld partners) will offer a far better network and easier connections to all the beyond places people do want to fly to.

Delta fully knows this, of course. So it’s making a silk purse from a sow’s ear and using its Dubai pullout announcement for some grand-standing on its favorite political campaign: those terrible, passenger-stealing Gulf carriers!

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