Speaker 1: It's Friday, February twelve. I'm Oscar Mrors from the Daily
Speaker 1: Dive podcast in Los Angeles, and this is reopening America.
Speaker 1: There's only one airline left where you can book a
Speaker 1: flight with no one in the middle seat at least
Speaker 1: until the end of April, and that's on Delta. Despite
Speaker 1: a pandemic, most people just want the cheapest fair possible,
Speaker 1: and Delta has even lost money with this plan, but
Speaker 1: they feel like they're building up some goodwill when business
Speaker 1: travelers come back. Scott McCartney, middle seat columnists at The
Speaker 1: Wall Street Journal, joins us for more. Thanks for joining, Scott.
Speaker 1: Good to be with you. I wanted to talk about
Speaker 1: the last airline who is still blocking the middle seats
Speaker 1: on flights. Delta announced that they're going to be extending
Speaker 1: their middle seat blockage for at least one more month,
Speaker 1: to the end of April. Now, a lot of the
Speaker 1: airlines were doing this throughout the pandemic. Most of them
Speaker 1: ended just at the tail end of last year. But
Speaker 1: Delta is kind of betting that they'll build up some
Speaker 1: good will and at least consumer confidence in them. But
Speaker 1: they're losing a lot of money. They're being beat out
Speaker 1: by cheaper flights. That still is king. Everybody wants that
Speaker 1: cheapest flight that they can get, so Scott tell us
Speaker 1: a little bit more about it. That's right, Delta's extended
Speaker 1: through the end of April. They're paying a huge financial
Speaker 1: penalty for this. It's very clear. Before the pandemic and
Speaker 1: the last half of two thousand nineteen, Delta was the
Speaker 1: most profitable airline in the US and then in the
Speaker 1: last half of two thousand twenty it had flipped to
Speaker 1: the airline with the biggest losses. Delta is getting a
Speaker 1: revenue premium, so the people who are flying Delta are
Speaker 1: paying more, and presumably that's because not having somebody in
Speaker 1: the middle seat is attractive to them, but there just
Speaker 1: aren't enough of them. The Delta's overall revenue is much
Speaker 1: weaker than other airlines, and you can see it. Delta
Speaker 1: has been filling about of its seats, Americans filling more
Speaker 1: than sixty percent of its seats, so Americans carrying a
Speaker 1: lot more people on each flight, and even though people
Speaker 1: are paying a little bit more to Delta doesn't nearly
Speaker 1: make up for it. We've all seen the pictures of
Speaker 1: really packed flights. Everybody with their masks on sitting really
Speaker 1: close to each other. Everybody kind of sees that and
Speaker 1: they say, wow, that's scary. Maybe we shouldn't be flying.
Speaker 1: But you know, that's not really how it played out
Speaker 1: in practicality. Delta lost a lot of business to other
Speaker 1: airlines with really cheap bears, like Spirit packing people in there.
Speaker 1: You know, the lesson of this is that people do
Speaker 1: want cheap fares, and that's really always been the lesson
Speaker 1: of the airline industry when airlines have tried on a
Speaker 1: large scale basis to offer more room more comfort. You know,
Speaker 1: years back, American did more room throughout coach and people
Speaker 1: just weren't willing to pay enough. People weren't willing to
Speaker 1: pay extra for it. I looked at some particular markets
Speaker 1: and it was fascinating. Um, Atlanta Chicago is a good
Speaker 1: market to look at. Its Delta is the biggest airline
Speaker 1: in that market, obviously because of its giant Atlanta hub,
Speaker 1: but United's in their Americans in there, so you have
Speaker 1: a lot of competition on that that route. And when
Speaker 1: you look at it for the third quarter prime time
Speaker 1: in the pandemic, Delta lost market share. It's fairs held
Speaker 1: up pretty well in that market compared to the other guys,
Speaker 1: But Spirits slashed it's fairs, and Spirit was nine of
Speaker 1: the market going in, and Spirits average fair one way
Speaker 1: was thirty four dollars, and you know, it's just sort
Speaker 1: of ridiculous, sixty eight dollar round trip tickets between Atlanta
Speaker 1: and Chicago. The Spirit was up of the market, and
Speaker 1: so it was pretty clear evidence that given the choice
Speaker 1: empty middle seat or cheap fair, more people were opting
Speaker 1: for cheap fair. So, I mean, it doesn't really seem
Speaker 1: like it's working out for them. Delta, for its part,
Speaker 1: says they're selling peace of mind to those people that
Speaker 1: kind of want to be a little more spaced out.
Speaker 1: What's their big bet that it's just going to come
Speaker 1: back once vaccines are in place and more people are
Speaker 1: traveling and all that. I think the way to look
Speaker 1: at it is that Delta is not worried about winning
Speaker 1: the pandemic. Delta is playing the long game here and
Speaker 1: really marketing to people who aren't traveling. And what they're
Speaker 1: saying is we will take care of you better than
Speaker 1: other airlines. And they think that when business travel does
Speaker 1: start to come back, when people who have been afraid
Speaker 1: to fly for the past year. Now when they start
Speaker 1: coming back that they will opt for Delta over other guys. So,
Speaker 1: you know, the pandemic is costing them a huge amount
Speaker 1: of money, but essentially they hope to get it back
Speaker 1: in a sense when things get better, by doing better
Speaker 1: than their competitors in the recovery. We've talked a little
Speaker 1: bit about this before, you know, just kind of the
Speaker 1: science of flying and and virus transmission. You know, a
Speaker 1: lot of people are saying, well, it's really safe because
Speaker 1: the planes have these really good ventilation systems, but there
Speaker 1: are studies that suggest that, you know, proximity matters. We've
Speaker 1: talked about this, you know, the people right in front
Speaker 1: of you, the people right in back of you. It's
Speaker 1: kind of a both sides. Whether more bodies in the
Speaker 1: plane could make you more susceptible to get into virus,
Speaker 1: there is a common sense logic to this. I think
Speaker 1: there's no doubt that more bodies in the airplane increase
Speaker 1: your chances of contracting the virus. On the other hand,
Speaker 1: the risk is very small to begin with, and it's
Speaker 1: small to begin with because of ventilation on airplanes. It's
Speaker 1: small to begin with because there are fairly rigid mask
Speaker 1: rules now, and that does make a difference. So what
Speaker 1: you're talking about is increased risk off a very small
Speaker 1: risk to begin with, And so airlines argue that's not significant.
Speaker 1: Other people have argued, well, it may be significant, but
Speaker 1: there is acknowledgement that it's still a small risk even
Speaker 1: with somebody in the middle seat. That said, I think
Speaker 1: being shoulder to shoulder with a stranger these days, you know,
Speaker 1: sort of flies in the face of common sense when
Speaker 1: we're told to socially distance since day six ft apart.
Speaker 1: And then so that's sort of what Delta is thinking.
Speaker 1: They say they're not doing this for safety, they're doing
Speaker 1: it because it's what customers, what they think customers want. Well,
Speaker 1: there you go. Delta is the only game in town
Speaker 1: if you want that middle seat blocked out at least
Speaker 1: until the end of April. Scott McCartney, middle seat calumnist
Speaker 1: at the Wall Street Journal, thank you very much for
Speaker 1: joining us. Always good to be with you. I'm Oscar
Speaker 1: Ramirez and this has been reopening America. Don't forget effort
Speaker 1: today's big news stories. You can check me out in
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