It happened so quietly that very few people seemed to notice, but over the holiday weekend, Delta ended its interline agreement with Emirates. I know, you’re completely surprised, aren’t you? I actually was surprised… that it hadn’t ended sooner.
An interline agreement is the most basic level of cooperation between airlines, and it generally means three things. In the case of Delta and Emirates, it meant this:
- Delta could sell tickets with Emirates flight segments on them (and vice versa)
- Delta could check bags through to Emirates flights (and vice versa)
- Delta could reaccommodate disrupted passengers by sending them to Emirates at an agreed upon rate (and vice versa)
The last time I wrote about an interline agreement ending, it was when Delta told American to pay a ton of money or get out. American walked away. In that case, the big issue was regarding reaccommodation. Delta and American benefited by being able to put stranded passengers on each other. While Emirates and Delta could do that as well, I can’t imagine that was a big part of the relationship. This was something different.
For Delta, the interline agreement should have been important, because it allowed Delta to flow people from its Atlanta-Dubai flight on to Emirates to go beyond Dubai. It could file a single fare, put Emirates flights on the same ticket, and check bags through to the final destination. For a flight that apparently struggled like the Atlanta-Dubai one did, this was a potential lifeline to fill some seats.
As the Middle East carriers started to grow quickly, however, Delta decided to cut off that lifeline. It looks like it was on July 9, 2014 that Delta made a little change to its rules. The example I looked at was Atlanta to Colombo in Sri Lanka. None of Delta’s Atlantic partners fly there except for Saudia and that’s not a good way to go. The easiest and best way for Delta to flow people was to send them to Dubai on a Delta aircraft and then on to Colombo on Emirates. That was possible on Delta fares until July 9. That day, Delta changed its fare rules to not allow Emirates flights on Delta fares.
At that point, Delta could still sell a ticket using Delta fares to Dubai and then Emirates fares from there to Sri Lanka, but that was going to be more expensive and less competitive. I suppose that was the point.
If Delta was going to fight Emirates, it apparently didn’t want to take advantage of market opportunities to send its passengers ON Emirates, at least not on its own fares. If the Dubai service was already underwater, this was like adding another few tons of weight on top to make it sink faster.
Delta did cut back Dubai service and now it will discontinue it entirely next February. At that point, what good is the interline agreement in Delta’s eyes?
Without Dubai service, the chances of Delta flowing passengers on to Emirates flights drops precipitously. Sure, it could fly someone to Europe and then put that person on Emirates to Dubai, but why? It has better ways to get people where they’re going.
Because of that, the interline agreement quickly became more beneficial to Emirates. If someone flew into New York from Bangalore on Emirates, that person could connect to Delta (maybe or maybe not on the same fare, but certainly on the same ticket) and go to, say, Columbus or somewhere else. Why would Delta want to allow Emirates to benefit in any way if it is dead-set on preventing this airline from expanding any further in the US? It wouldn’t.
And this is why it’s so surprising to me that the interline agreement has survived until now. I suppose Delta wanted to keep it around until the death of its Dubai route drew nearer, even though it severely curtailed the usefulness of the agreement more than a year ago. And really, this fight against the Middle East carriers should have pushed Delta to end this much earlier. But then again, it speaks from both sides of its mouth.
After all, Delta still has an interline agreement with Etihad, but that relationship is more much complex. After all, Etihad owns nearly half of Delta’s joint venture partner Alitalia. And Air France/KLM has a codesharing and frequent flier partnership with Etihad as well.
It’s quite the tangled web, but that’s not the case with Emirates, where a clean break was much easier. It’s just remarkable it didn’t happen earlier.
[Original bedroom photo via Shutterstock]