Delta CEO Ed Bastian is thrilled with his airline’s new partnership with Scandinavian Airlines (SAS) and the prospect of flying nonstop to India again – as well as to the Saudi capital of Riyadh (RUH) – as soon as possible.
Two things he doesn’t love? Boeing and the Department of Transportation Secretary Pete Buttigieg.
That came out in shockingly (and refreshingly) candid remarks during a roundtable discussion with local business leaders in Minneapolis on Thursday that Thrifty Traveler attended. Intentional or not, Bastian broke a lot of news about potential new international routes, new airline partnerships, and the next Delta One Lounge locations.
Take a look.
The ‘Crowdstrike Outage' and Buttigieg’s Response
Delta executives have insisted they’re seeing no lingering impacts from the airline’s historic meltdown in July following a brief cybersecurity outage.
But clearly, the pain from the so-called “CrowdStrike outage” is still there. And Bastian didn’t hide his feelings toward Buttigieg.
“I got pretty annoyed with our Secretary of Transportation,” Bastian said, citing the department’s decision to deem disruptions stemming from the outage as “controllable.” That put airlines like Delta on the hook for covering additional costs like meals and transportation, among others.
“All that was just insane … Technology providers knock us out and then it's our fault?” Bastian said. “You’ve got politicians running some of the cabinet offices there, and they're doing it to make inroads and get name recognition.”
“You can imagine the conversation I had with him privately,” Bastian added to laughs.
While almost every airline in the country was initially affected by CrowdStrike's outage, it spiraled into a full-blown meltdown that lasted days for Delta – and only Delta. In a five-day span, Delta canceled more than 5,500 flights – more than in all of 2018 and 2019 combined.
Read more: How Delta Repeatedly Bungled its Worst Meltdown Ever
Bastian said Buttigieg's decision “raised the temperature in the airports,” leading not-so-frequent travelers to put the blame solely on Delta and flooding their call centers and airport queues with angry customers. And he said Delta went “way above” to make things right with customers, spending $100 million to cover rental cars, hotels, meals, and even flights on other airlines. Add in the financial toll of doling out refunds and lost ticket revenue, and the meltdown cost Delta more than $500 million.
Delta has threatened to sue Crowdstrike in a bid to recoup those costs. While attorneys for the airline, CrowdStrike, and even Microsfot have exchanged several scathing letters, no lawsuit has been filed more than two months later.
“We’re going to fight hard to get that money back,” Bastian reiterated later while speaking at the Minneapolis-St. Paul (MSP) “State of the Airport” event Thursday.
Aeromexico Joint Venture is Back On?
The DOT dealt Delta a blow earlier this year, saying the carrier must unwind its joint venture with Aeromexico.
That move could have forced both carriers to cut back on some of the flights across the border, including Aeromexico's recent expansion into more U.S. cities and Delta's own nonstop route between Minneapolis-St. Paul (MSP) and Mexico City (MEX) – an addition from 2019.
As 2024 draws to a close, things are suddenly looking up.
“We're expecting that we will get an order, which will be good news,” Peter Carter, Delta's executive vice president for external affairs, said. “We were expecting that they were going to terminate the joint venture, basically, by May. And our joint venture is alive and well.”
Plans for India, Saudi Arabia & Beyond
The Airbus A350-900 is Delta’s flagship aircraft, covering its longest routes throughout Asia, Australia and South Africa, among others. But a larger variant of that plane, the Airbus A350-1000, is on the way. And it can fly even further.
Bastian confirmed Delta intends to use that aircraft to resume nonstop service to India – a country Delta hasn't flown to since the start of the pandemic. Between the distance of the flight and bans on flying through the airspace of both Russia and Iran, Delta can't make it to cities like Delhi (DEL) or Mumbai (BOM) today – at least not without heavily restricting passengers or cargo. But the Airbus A350-1000 can make it a reality, Bastian said.
“We really want to serve that market directly,” Bastian said.
Delta's first Airbus A350-1000s are expected to arrive sometime late next year. That long-haul service from Delta is likely a linchpin for another development: Bastian said Thursday that Delta will soon announce a partnership with Indian low-cost carrier IndiGo.
Bastian did not share additional details about which routes to India the airline is considering nor what shape a pact with IndiGo would take. Later Thursday, he said customers can expect nonstops to India “within the next couple of years.”
That's not the only market Delta is targeting with its incoming long-haul jets.
The A350-1000 also plays into Delta's plans to commence nonstop flights to Riyadh (RUH) in conjunction with its new partnership with Riyadh Air. That partnership with a Saudi government-backed airline raised eyebrows given the longstanding concerns about Saudi Arabia's human rights abuses, including the murder of a Washington Post columnist in 2018.
But Bastian said it's a huge opportunity for an emerging tourism market.
“We all know Dubai … and its skyscrapers and all the luxuries, it looks like a very affluent part of the world,” Bastian said. “The city of Riyadh has three times the GDP as the city of Dubai has. That shows the opportunity there.”
Though it hasn’t operated a single flight yet, Bastian said Riyadh Air “is going to be the Gulf Carrier” – suggesting, without naming them, that it will eventually eclipse competitors like Emirates and Qatar Airways.
He also said the airline would use the Airbus A350-1000 to expand even “further into the Pacific,” but didn’t mention specific destinations.
On SAS & New Routes to Scandinavia
As of Sept. 1, Scandinavian Airlines (SAS) is now officially part of Delta’s Sky Team alliance. The ties between the two airlines are growing by the day.
After adding a nonstop to Atlanta (ATL) earlier this year, Scandinavian recently announced nonstop service between Seattle (SEA) and Copenhagen (CPH) will start next spring. Bastian thinks there’s room for more … including, perhaps, for Delta itself to start a route of its own from Minneapolis-St. Paul (MSP).
“I know this community has deep ties to that region of the world. Undoubtedly, you're going to see Delta flying with (SAS's) support on the other side. We're excited about it,” Bastian said.
SAS itself has already suggested that they'll put Minneapolis on their map, swapping their current flights to the United hub of Washington, D.C.-Dulles (IAD) to Delta's Midwestern stronghold instead. But that route hasn't materialized just yet.
“I'm sure they're interested in adding service,” Bastian said. “We'll be very interested in our own service as well.”
Bastian reiterated his goal of pulling the airline into their transatlantic joint venture with Air France, KLM, and Virgin Atlantic – a critical move that would allow them to closely coordinate both flight schedules and airfare pricing.
Future Delta One Lounge Locations?
Years after competitors offered exclusive business class lounges for top-paying passengers, Delta opened its first Delta One lounge in New York City (JFK) this past summer. More are coming fast.
A second Delta One will open in Los Angeles (LAX) on Oct. 10 the airline confirmed this week. A third is on tap in Boston (BOS) later this year while a fourth is planned in Seattle (SEA).
Bastian made clear that Minneapolis-St. Paul (MSP) is on the shortlist.
“We're working on it because I think this market needs a Delta One lounge,” Bastian said.
Bastian provided no timeline for when a Delta One Lounge in Minneapolis might be in the cards. Delta opened a stellar new Minneapolis Sky Club just over a year ago, which travelers (including yours truly) love. But that lounge lacks some of the extra-special amenities that set Delta One Lounges apart, like a sit-down restaurant and even shower suites.
The two hardest parts of building any lounge are finding the precious square footage in the cutthroat airport real estate market … and then dealing with the supply chain constraints to actually build it. Safe to say, a Delta One Lounge in Minneapolis – or other Delta hubs, for that matter – could be a year or more away.
Escaping Boeing's Woes
Not long ago, Delta’s fleet was heavy on Boeing aircraft – without a single Airbus plane in the hangar. After acquiring Northwest Airlines and ordering more over the ensuing decade, nearly 70% of Delta's fleet today is comprised of Airbus planes.
Given Boeing's enduring issues with labor and production, delivering aircraft on time to airlines, and lingering customer concerns about safety after several troubling accidents, Bastian is clearly grateful for it.
“It makes my head hurt every time I look at Boeing and see what problems they're having. I wish they'd get their act together,” he said. “Thank god we've been heavily oriented toward Airbus.”
While Delta has skewed toward Airbus over the last decade, the airline is still on Boeing's to-do list: The Atlanta-based carrier ordered 100 Boeing 737 Max 10 jets in 2022, with an option for another 30.
Those jets were originally expected to be delivered in 2025.