Delta targets Seattle in westerly expansion

SEATTLE – Delta Air Lines Chief Executive Richard Anderson has ambitious plans to build up Seattle as the airline’s West Coast international gateway and its eighth domestic hub.

Delta will not only offer more flights out of Seattle – many of them in head-to-head competition with Alaska Airlines – but will also base more jobs here and spend heavily on facility improvements at Seattle-Tacoma International Airport.

The chief of the world’s third-largest airline is not shy about pushing assertively into a market where hometown favorite Alaska Air carries more than half of all passengers.

Some analysts see Delta exerting pressure for an end game in which the giant Atlanta-based enterprise swallows its smaller Pacific Northwest rival.

Anderson deflects talk of that possibility and insists Delta is here “to be successful unilaterally” in a rough-and-tumble industry.

“There’s no drama. It’s just business,” Anderson said. “Is Airbus tough with Boeing? Is Apple tough on Microsoft? It’s a competitive marketplace.”

On Monday, Delta, headquartered in Atlanta, Ga., inaugurated direct flights from Seattle to Hong Kong, bringing to 10 the number of its daily international nonstop routes out of the city, six to Asia and four to Europe.

Anderson said that adding such destinations from Seattle is “huge for the economic and cultural development of the community.”

Delta’s expansion requires building up its base at Sea-Tac. Anderson said the airline has about 2,800 employees based here now and will soon grow past 3,000.

“We’re in the process right now of hiring 1,400 flight attendants and 600 pilots,” he said. “A lot of those will end up based here.”

The Port of Seattle plans a new $350 million international-arrivals facility – the first phase is scheduled to open in 2018 – to be paid for by the airlines that use it.

“Given the sheer number of arrivals we’ll have there, the lion’s share of that will be Delta’s,” said Anderson. “We’re fully prepared to meet that obligation. . Seattle is a strategic priority for Delta.”

Delta is the most profitable airline in the world. Excluding special tax gains, it made $2.7 billion last year.

It handles much of its own maintenance in-house and has high operational reliability. The company’s profit-sharing scheme paid out just over $500 million to employees last year and labor relations are better than at most airlines. That helps ensure better service for passengers.

Bob Cortelyou, Delta’s vice president of network planning, said Seattle has the potential to be a big global travel gateway and yet lags behind cities such as nearby Vancouver, British Columbia, in international connections.

Seattle’s relative closeness to Asia, compared to the big California cities, offers Delta flexibility in the aircraft it can fly on trans-Pacific routes.

So Cortelyou’s opening new direct routes with smaller airplanes such as the Boeing 767 or 777, or the Airbus A330, rather than four-engine jumbo jets.

“Seattle has a strong corporate base, a strong economy and a relatively affluent population. It’s also a tremendous geographic location for flights to Asia,” Cortelyou said.

“It befuddles my mind why Vancouver is so much stronger. Seattle has all these great demographics and a smattering of service.

“That’s not right, and we’re fixing that.”

Of course, if Delta was solely creating an international gateway, that would be no threat to Alaska Air.

But it’s also been building a feeder network to bring its passengers from cities all along the West Coast and even Alaska.

This summer, it will grow to 86 departures out of Sea-Tac every day.

Delta’s Seattle routes to Los Angeles; San Francisco; San Jose, Calif.; San Diego; Las Vegas; Vancouver; and Anchorage and Juneau, Alaska, create head-to-head confrontations on Alaska Air’s bread-and-butter destinations.

And last month, Delta announced it will open service this winter to Maui in Hawaii and to Puerto Vallarta and Los Cabos in Mexico.

Those aren’t feeder routes to an Asian gateway. Delta is going after prime winter vacation traffic out of Seattle in direct competition with Alaska.

If that seems aggressive on Delta’s part, Alaska is not sitting back.

This month, Alaska opens seven non-Seattle routes out of Salt Lake City, which is a longstanding Delta hub.

And when Delta opened its direct flights from Seattle to London in March, Alaska announced a special double-miles offer to its frequent fliers who flew on British Airways, the only other carrier going direct to London.

In terms of airline competition, all these seem like moves in an undeclared war.

In that confrontation, Alaska for the moment is in a dominant position. For the year through April, Alaska carried just over half of all passengers out of Sea-Tac. Delta carried just over 13 percent.

Michael E. Levine, a former senior airline executive now on the faculty of New York University School of Law, said that to build a sustainable international hub at any airport requires a strong domestic feeder network.

“You can’t possibly build it at Seattle without Alaska,” said Levine, who worked with Anderson at Northwest Airlines and is a longtime friend of the Delta CEO.

Talk to us

More in Herald Business Journal

Roei Ganzarski, CEO of magniX, poses with a production electric engine, the magni500, at the  company's new office on Seaway Boulevard on Monday, Jan. 18, 2020 in Everett, Washington.  (Andy Bronson / The Herald)
Maker of electric airplane engines gets $74M NASA grant

MagniX of Everett is one of two companies tapped to advance electric propulsion systems to power aircraft.

Employees work on a Boeing 787 Dreamliner during final assembly of the airplane at the Boeing Co. factory in Everett, Wash., on May 28, 2013. MUST CREDIT: Bloomberg photo by Patrick T. Fallon.
Boeing finds faulty titanium parts in latest setback for 787

The FAA said it is in touch with Boeing over the issue and that it doesn’t affect immediate flight safety.

A Boeing 737 Max 10 prepares to take off in Seattle on June 18, 2021. MUST CREDIT: Bloomberg photo by Chona Kasinger.
Boeing cash shines while 787’s factory woes weigh on results

Restarting Dreamliner deliveries that have been halted for months is key to a financial turnaround.

Everett Farmer’s Market canceled Sunday due to weather

Organizers cited a high-wind advisory. It is to reopen Oct. 31 for the final market of the season.

David Simpson (left) and Scott Murphy.
Port of Everett candidates spar over transparency

An incumbent, David Simpson, is challenged by Everett City Councilmember Scott Murphy.

FILE - In this May 26, 2020, file photo, a sign at the headquarters for the Washington state Employment Security Department is shown at the Capitol in Olympia, Wash. Washington state's rush to get unemployment benefits to residents who lost jobs due to the coronavirus outbreak left it vulnerable to criminals who made off with hundreds of millions of dollars in fraudulent claims. (AP Photo/Ted S. Warren, File)
Washington’s unemployment rate in September was 4.9%

Employers added 17,600 jobs last month, a 7.3% increase over August.

Rendering of the new terminal that Propeller Airports plans to build at Paine Field in Everett. The terminal, which will serve the general aviation community, will replace Castle & Cooke Aviation's existing building at the Snohomish County-owned airport. (Propeller Airports LLC)
Propeller Airports to acquire Castle & Cooke at Paine Field

Propeller, which owns the nearby passenger terminal, plans a new complex for private aviation.

With the Olympic mountains in the background, the first passenger flight by Alaska Airlines Flight 2878 departs for Portland on opening day of the Paine Field Terminal on Monday, March 4, 2019 in Everett, Wash. (Andy Bronson / The Herald)
Alaska Airlines stalls plan for extra flights in Everett

Business has been sluggish, but the airline says it will offer 12 flights a day at Paine Field in the new year.

Hillside homes in Mukilteo are seen from the ferry line on Oct. 20. (Andrea Brown / The Herald)
Mukilteo asks for input on housing density, and it’s complicated

Here’s a guide to what voters should know about the advisory ballot measure. What does it actually do?

People hold signs in protest of the vaccine mandate after Boeing announced it would terminate workers who do not comply on Friday, Oct. 15, 2021 in Everett, Wa. (Olivia Vanni / The Herald)
Some Boeing workers protest in Everett over vaccine mandate

The Boeing Company announced earlier this week that its workers must be vaccinated by Dec. 8.

FILE - In this file photo dated Monday, March 11, 2019, rescuers work at the scene of an Ethiopian Airlines plane crash south of Addis Ababa, Ethiopia.  The number of deaths in major air crashes around the globe fell by more than half in 2019 according to a report released Wednesday Jan. 1, 2020, by the aviation consultancy To70, revealing the worst crash for the year was an Ethiopian Airlines Boeing 737 MAX on March 10 that lost 157 lives. (AP Photo/Mulugeta Ayene, FILE)
Former Boeing test pilot pleads not guilty in 737 Max case

He’s the first person to be charged with a crime in connection with the Indonesia and Ethiopia crashes.

FILE - In this March 14, 2019 file photo, Ethiopian relatives of crash victims mourn at the scene where the Ethiopian Airlines Boeing 737 Max 8 crashed shortly after takeoff killing all 157 on board, near Bishoftu, south-east of Addis Ababa, in Ethiopia. Relatives of some of the passengers who died in the crash will mark the two-year anniversary of the disaster on Wednesday, March 10, 2021, by seeking a reversal of government orders that let Boeing 737 Max jets fly again.  (AP Photo/Mulugeta Ayene, File)
Boeing pilot involved in Max testing is indicted in Texas

He’s accused of giving the FAA false information about systems that played a role in two deadly crashes.