Delta tells AirTran it is scuttling pact

Spurned carrier calls move `a major pain for the customer' and sign of rising rivalry

September 15, 2006|By Cox News Service

ATLANTA -- Delta Air Lines has told AirTran Airways that it plans to scuttle an agreement which enables the two rivals to handle each others' stranded passengers, and AirTran says the move points to an increasingly tense rivalry.

Delta says it sends about 30 delayed passengers a day to AirTran under the so-called "interline" agreement but can handle that number with its own planes or deals with other carriers. AirTran says a slightly smaller number of its passengers wind up on Delta because of flight problems.

Ending the interline pact also would mean Delta and AirTran wouldn't be listed together in multi-airline itineraries on travel Web sites, according to both airlines. Such bookings, which can produce lower fares than single-carrier itineraries, accounted for at least 60,000 passengers from January through August, according to AirTran figures.

Delta spokeswoman Gina Laughlin said Delta concluded that its interline deal with AirTran isn't cost-effective, and plans to end it Oct. 8. "This is not a Delta vs. AirTran ... event," she said.

But AirTran marketing chief Tad Hutcheson said ending the pact could mean "a major pain for the customer." He thinks Delta's move is part of a sharpening competition as Delta retools in bankruptcy court and AirTran continues to grow.

Delta lately has ratcheted up competition over routes, airport facilities, corporate sponsorships and marketing venues, said Hutcheson. "We're out there buying billboards. They're out there buying billboards right next to us," he said.

Interline agreements allow for streamlined rebooking of stranded passengers at a negotiated rate paid by the carrier whose customer was delayed. The deals enable multi-airline itineraries by facilitating baggage transfers between airlines without the passenger having to pick up bags and recheck them.

The accords are common among big airlines, although some discount carriers aren't party to them. Delta and AirTran, which both have hubs at Hartsfield-Jackson International Airport and jointly account for about 90 percent of its traffic, have had a deal since 2001.

Now Delta, which filed for bankruptcy protection a year ago, said it is ending the agreement to save money and because it no longer needs AirTran's help. Both AirTran and Delta say if the agreement dies, they can accommodate customers in their own operations or through similar deals with other carriers.

"We're confident that the extensive connecting opportunities we have will allow customers to reach their destination," Laughlin said.

While the number of affected travelers is relatively tiny, ending the deal may remove options that enable quicker rebookings of stranded passengers, said Ken Bernhardt, a professor of marketing at Georgia State University.

"It's certainly going to complicate the customer's life," said Bernhardt. "When you have a cancellation you want to have the most flexibility possible to take care of your customers."

Delta didn't offer specific numbers on interline traffic, other than saying fewer than 30 passengers a day flew on AirTran last year because of flight problems.

AirTran said it transported 54,656 Delta passengers this year through August - 10,453 because of irregular operations at Delta, or about 42 a day. AirTran said it sent 20,337 of its own passengers on Delta through July, with roughly 4,000 or just under 20 a day because of delays or cancellations. That works out to about 320 passengers a day flying because of the interline deal, including roughly 60 because of operational glitches.

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