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Delta: No decision on precise route cuts

April 16, 2015 at 3:49PM
A Delta Air Lines 747-400
A Delta Air Lines 747-400 (Associated Press/The Minnesota Star Tribune)

Delta Air Lines said Thursday it has made no announcements about specific international routes it will cut later this year.

The airline, which along with its partners accounts for 74 percent of the passenger market at Minneapolis-St. Paul International Airport, said on Wednesday that the soaring value of the dollar is leading it to cut back some international routes that have become unprofitable.

Delta flies to London, Amsterdam and Tokyo daily from Minneapolis-St. Paul. It and several other airlines fly to destinations in Mexico and Canada from MSP.

Executives specifically said routes to Japan, parts of the Middle East and Russia are likely to be cut later this year.

"We face our toughest revenue environment in the Pacific, where unit revenues declined 9 percent, with roughly 7 points of the decline driven by foreign exchange," Ed Bastian, Delta's president, told analysts and investors Wednesday.

The effect of the stronger dollar and weaker yen reduced Delta's revenue by $40 million in the first three months of the year, despite the airline's hedging on currency fluctuations.

Delta said it would take 15 percent to 20 percent of its passenger capacity out of Japan later this year, including a 25 percent reduction in intra-Asia flights and seasonal flights to beach destinations. Delta said the move will also allow it to retire six more 747s by the end of the year.

Flights between MSP and Tokyo are often full and the airline, at times, has operated two flights a day between the cities. In recent years, however, Delta built up more flights to Asia from hubs in Detroit and Seattle.

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In a visit to Minneapolis last August, Delta chief executive Richard Anderson raised the prospect of adding another route between Asia and the Twin Cities, though not immediately. "My hope is that we are going to be able to have another nonstop into Asia in the next three to five years," Anderson said.

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about the writer

Evan Ramstad

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Evan Ramstad is a Star Tribune business columnist.

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