Delta Air Lines (DAL - Free Report) is collaborating with top brands like Malin+Goetz and Tumi Holdings, Inc. to offer travel luxuries to BusinessElite passengers. BusinessElite is Delta's intercontinental business class, is now offering amenity kits comprising skincare products by Malin+Goetz and travel accessories by Tumi. The new offer asserts Delta’s focus on attracting customers and promoting BusinessElite, which is a strong revenue driver.
Delta – the second largest airline company in the U.S. after United Continental (UAL - Free Report) – is progressing well on improving ancillary revenues by adding new features and new products to enhance passenger experience. The company launched Economy Comfort, to provide better personal on-demand entertainment systems, renovated the LaGuardia terminals, started a new international terminal at Atlanta as well as unveiled the new Delta website.
Recently, Delta launched its new Fly Delta application for iPad users. The offering, labeled Glass Bottom Jet, allows iPad users to access maps and social networking while flying on Delta’s Wi-Fi connected aircraft. The app will also help travelers book a trip as well as look up destination guides, flight check-in and updates on the next point of the journey.
Another attractive offering – flat-bed seat installation – will be completed for 85% of Delta’s international fleet by the end of 2013. Delta is investing more than $3 billion through 2013 in improved products, services and airport facilities in the air and on the ground.
Moreover, Delta is taking domestic fleet restructuring steps for higher revenue generation. The company plans to replace the older 50-seat regional inefficient aircraft with the new 110-seat Boeing 717-200 aircraft. The company has also entered into an agreement with SkyWest for 34
larger regional jets in exchange for 66 aircraft of 50 seats. This will enhance the company’s operational efficiency by trimming its non-fuel costs. In addition, Delta is expected to save $400 million from maintenance efficiencies.
We believe the addition of new and attractive features along with enhanced service offerings would place the company in an advantageous position compared to other industry players such as JetBlue Airways Corp. (JBLU - Free Report) .
Delta currently holds a Zacks Rank #3, implying a short-term Hold rating.