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Delta Air Lines (DAL - Analyst Report) entered into a purchase agreement with Canadian firm Bombardier Aerospace, whereby the former will buy 40 new CRJ900 two-class regional jets from the latter. Delta could buy up to 30 more CRJ900 aircraft, if it chooses to exercise the order to full. The purchase value of 70 jets is estimated to touch $3.29 billion.

This transaction highlights Delta’s restructuring initiatives under which it targets to replace the old and depleted 60 single-class 50-seat domestic aircraft with upgraded and superior two-class 76-seat aircraft. With the purchase, Delta will move closer to its goal of offering customers more first class seats compared to any other airline.

The CRJ900 aircrafts are designed with 12 seats in the first class cabin, 12 seats in Delta's popular Economy Comfort section and 52 seats in economy. The airplanes will have all-leather seats in a two-by-two arrangement with window and aisle position only. Flyers will be provided with in-flight Wi-Fi access, Delta's complimentary snacks and beverages plus meals for first-class on flights over 900 miles.

With the new jets, the company aims to have a cost-efficient business structure. The aircrafts will help the company trim fuel and maintenance expense but not at the cost of reducing passenger comfort or high-class services. The company will also launch the right-sized aircraft for each market, thus minimizing unproductive flying and bringing in well-organized capacity discipline.

Of late, Delta Air Lines added The Boeing Company’s (BA - Analyst Report) 88 Boeing 717-200 aircraft in place of the 50-seat aircraft and swapped Boeing’s 757 and 767 aircraft with 100 new 737-900ER jets from the same company.

The delivery of CRJ900, 717-200 and 737-900ER aircrafts are slated for the second half of 2013.

Atlanta, Georgia based Delta Air Lines is the second largest U.S. airline providing scheduled air transportation for passengers and cargo throughout the U.S. and around the globe. The company’s current regional fleet consists of 255 larger two-class regional jets, along with 101 CRJ900 aircraft.

We maintain our long-term Neutral recommendation on Delta Air Lines. This is supported by a Zacks #3 Rank (Hold rating for 1-3 months).
 

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