Delta this summer is marking the fifth anniversary of the startup of its Seattle hub – and trying to replicate the event in Boston.
Boston Logan International is the 16th busiest U.S. airport by passenger count – and the only one in the group that has a high proportion of business travel but lacks a global carrier’s hub. (Orlando and Las Vegas have more traffic, but they are primarily leisure destinations.)
From 2001 through 2009, American Airlines had the biggest market share at Logan. It offered as many as 100 daily departures, including seasonal flights to London and Paris.
In 2010 JetBlue took over as Logan’s leading carrier. JetBlue is the sixth largest U.S. airline, but it does not operate a global network, although it does fly from Boston to South America and it plans Boston-London service in 2021.
Delta sees room for a carrier that can fly non-stop or one-stop to most of the world’s major cities. In June, Delta designated Logan as a hub. In July, Delta said it will increase Logan departures to 200 within two years – the same total JetBlue is eyeing.
This summer, Delta offers 140 peak daily departures, including partner flights, while JetBlue has 175. Delta and its partners fly from Boston to 18 international destinations, including Amsterdam, Dublin Lisbon, Edinburgh, London and Seoul.
The comparison with Delta’s Seattle buildup is unavoidable.
In 2014, Seattle’s sole hub carrier was Alaska Airlines, which has a strong domestic presence but eschews long-haul international flying. Delta saw a chance to build a trans-Pacific hub in the continental U.S. airport that is closest to Asia.
Arguably, JetBlue in Boston resembles Alaska in Seattle. Periodically, although not recently, observers have suggested that the two carriers should merge.
An attraction for Delta in Boston is that it already has a terminal. Delta spent $500 million to redesign Terminal A, but it filed for bankruptcy protection six months after the remodeled facility opened in 2005. Subsequently, Delta shared nine of its 21 gates with other carriers. Now the gates are being returned.
Joe Esposito, Delta senior vice president for network planning, says access to the Terminal A gates means Delta can readily grow in markets where its corporate customers want to travel.
Top 25 markets where Delta does not yet have flights or plans include Baltimore, Charlotte, Dallas and Denver. All four markets have service on other carriers – Charlotte and Dallas have service on both American and JetBlue – but that is not what Esposito looks at.
“If our corporate customers want to go there, we would do it,” he said. “To me, when you’re building an opportunity in Boston, you work to be relevant to corporate customers.”
Esposito said Boston and Seattle are similar in that both “have very strong business corporate markets” and both airports represent well-situated international gateways.
Seattle, he said, “was built out of necessity” after Delta merged with Northwest in 2008. Delta acquired Northwest largely to gain access to Asia, but Northwest lacked a West Coast hub – a problem, he said, because most U.S. demand for Asia originates west of the Mississippi. “We had to have a West Coast gateway,” he said.
Alaska Airlines bitterly fought Delta’s West Coast growth, going to the extreme of briefly opening seven Salt Lake City routes to compete with Delta’s Salt Lake City hub. Today only two of the routes remain.
While it initially seemed alarmed by Delta, Alaska remains dominant at Seattle Tacoma International Airport, where it retains a 51% market share. Delta ranks second with a 23% share. But in international, Delta has a 30% share while Alaska has 21% despite not operating in the trans-Pacific. “There’s clearly room for both,” Esposito said.
At Logan, JetBlue has said it will expand to 30 gates in Terminal C by 2021, up from 24 Terminal C gates today. “Our latest phase of growth at Logan accelerates our goal of reaching 200 daily departures in the coming years,” spokeswoman Julianna Bryan said last month.
Logan statistics show that in 2000, Delta was the number one carrier with a 20% market share, while US Airways was second with 19% and American was third with 16%. In 2005, American was first with 20%, Delta second with 19% and US Airways third with 16%.
JetBlue joined the top three in 2009. By 2010, JetBlue was first with 19%, Delta second with 15% and American third with 14%. From 2011 through 2015, American was off the list, with JetBlue, Delta and US Airways consistently ranking as the top three. Then US Airways merged with American.
In 2018, JetBlue had 28%, Delta had 17% and American had 16%.