Daily Management Review

A Class Higher Than First Class Created by Delta AirA Class Higher Than First Class Created by Delta Air


10/26/2016




A Class Higher Than First Class Created by Delta AirA Class Higher Than First Class Created by Delta Air
A unique experiment in upgrades was unveiled by Delta Air last year. A chance to book a seat most can only dream of—on a private jet, was given by the airline for its very frequent flyers. The dream could become reality for a few hundred dollars more.
 
The carrier is now transforming it into the ultimate frequent flier point spend as it later backed away from the offer.
 
In a viable option when a customer’s travel plans aligned with the smaller aircraft’s journey, Delta briefly offered $300-$800 paid upgrades to private jets last summer. David Sneed, chief operating officer at Delta Private Jets said that the trouble with making this work was logistics.
 
Since movers and shakers summon a jet with little notice, the private aviation business works on short lead times. It means that the aircraft operator rarely has much of a heads-up when a plane will be flying back empty—typically 10 hours or less even though it’s a good business when there’s a paying customer. Delta Private Jets had sought to match with Delta passengers heading to the same destination as those empty legs. But most people need a tad more notice.  Additionally the upgrades were a heavy lift for staff to coordinate.
 
Sneed said that an empty leg, which constitute about 30 percent of overall private-jet flying time, the company has a very small window when it knows it has it. “We might not know until 10 p.m. the night before” that an empty flight will exist, he said.
 
But by getting time on private jets by cashing in miles, Delta created a new twist on how to move passengers to its private jet subsidiary. Equivalent to just over four hours in a smaller “light” private jet, Delta’s SkyMiles members can spend 2.5 million miles for a $25,000 jet card. Either with as many people as there are seats on the jet or solo, customers will be able to fly according to their choice. For longer flights or larger aircraft, larger mileage increments can also be used.
 
All of the roughly 5,000 airports at which DPJ now flies will be included in the program, Delta said.
 
It’s not a crazy amount for many business folks who fly virtually nonstop even as a balance of millions of miles may strike some as enormous. Karen Zachary, the program’s managing director said that Delta has thousands of SkyMiles members with balances above 1 million miles. Those with points that can be transferred to SkyMiles, such as American Express Membership Rewards points or those from Starwood’s Preferred Guest program, the potential customer audience also includes.
 
Another unique way to lure people to cash in miles, which airlines must count as a balance sheet liability, is also provided to Delta by the SkyMiles link. “This is really an enhancement to the SkyMiles program,” Zachary said. “We’ve worked hard on trying to make miles more useful.”

Delta Private Jets is a wholly owned subsidiary of Delta and is based at Delta’s former Cincinnati hub airport in Hebron, Ky. With its acquisition of Comair Inc., the former regional airline that had begun the charter business in the 1980s, the world’s second-largest carrier acquired the company in 1999. With hourly rates that are guaranteed for two years, Delta’s regular private-jet cards start with a minimum $100,000 deposit for those who actually pay to fly privately. The deposits are not refundable. In Delta’s frequent flier program, the highest level of status is received by Jet-card buyers.
 
(Source:www.bloomberg.com) 
 






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