Delta to End LAX-Tokyo Service
Delta Air Lines, delivering the second blow to Los Angeles International Airport in two days, said Tuesday that it is ending its service from Los Angeles to Tokyo, effective Dec. 1.
Delta, the country’s third-largest airline, has been flying that route for more than 10 years. The Atlanta-based carrier also said it is scrapping its daily service from Los Angeles to Nagoya, Japan, and its New York-to-Tokyo service, which has been suspended since the terrorist attacks Sept.11.
The cuts follow confirmation by United Airlines on Monday that it is reducing its Los Angeles flight schedule at the end of this month, which will leave LAX’s largest airline with 40% fewer flights from the airport than it offered before the attack. United is a unit of UAL Corp.
Delta, which currently offers six flights a week from Los Angeles to Tokyo, indicated that the flights to Japan are unprofitable.
“The news for Delta and its Japan service over the past 12 months has not been good,” Paul Matsen, the carrier’s senior vice president for international service, said in a statement.
“We do not see economic conditions in both the United States and Japan becoming favorable in the foreseeable future,” and the airline expected “continued negative performance” from the three routes to Japan in the coming year, Matsen added.
The action will affect Delta employees in Los Angeles, Tokyo, Nagoya and other locations, though Delta spokeswoman Peggy Estes said the number of workers involved was not immediately known.
Employees will be offered various voluntary separation packages, Delta said, but if an insufficient number of people accept those options, layoffs will be necessary.
The flight cuts are part of a 15% overall reduction in operations that Delta announced Sept. 26, which will require 13,000 job cuts over the next several months.
Delta, like most major U.S. carriers, is slashing its capacity and work force to adapt to the plunge in air travel that followed the attacks.
In trading Tuesday, Delta shares lost 6 cents to close at $25.92 on the New York Stock Exchange.
United, the No. 2 carrier, should benefit from Delta’s move. United is one of the main U.S. airlines providing service from LAX to Tokyo, a route that also features stiff competition from a variety of foreign airlines, especially Japan Airlines and All Nippon Airways.
But United is in bad financial shape. UAL Chairman James Goodwin said in a letter to employees that the sharp drop in revenue since the attacks means “today we are literally hemorrhaging money.”
“Clearly this bleeding has to be stopped--and soon--or United will perish sometime next year,” Goodwin warned.
Separately, ailing Air Canada fired 10% of its managers, or 445 people, as it continues to slash costs in the face of slumping air travel.
Hurt by both the weak North American economy and the effects of the attacks, Air Canada overall has announced plans to cut 9,000 jobs.
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Bloomberg News and Associated Press were used in compiling this report.
