News

Delta to slow expansion despite profits surge

Delta Air Lines will pull back on expansion in 2016 in a bid to fill up more planes and sell more seats at higher fares.

Reuters reports that the US airline’s capacity would grow 2% next year, compared with almost 3% this year.

The move to stop expanding as quickly came as shares in the airline rose after it posted high-than-expected adjusted profits of $1.38 billion, up 36% from a year prior.

Earnings of US airlines have surged in the last year due to fuel costs plummeting.

Delta contributed the growing profits to its initiative to have fares that are priced based on the different experiences they bring, such as priority boarding. Delta said this had contributed $75 million to its revenue of $11.11 billion in the third quarter.

Revenue fell 0.6% from a year earlier.

Delta bosses said that in the fourth quarter the airline would keep capacity flat to slow the decline in passenger revenue.

Chief executive Richard Anderson said: “We have consistently achieved our long-term goals and will continue to do so regardless of the direction of fuel prices.”

Share article

View Comments

Jacobs Media is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.