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United Sells Delta Its Route from New York to London…Sort Of

Jul 31st, 2006 | By

Delta purchased the rights to serve London from New York’s JFK airport for $21 million.  United had served the route to Heathrow (after it purchased the route from Pan Am years ago), but Delta will have to fly into the less-desirable Gatwick.  United noted that the route had not been profitable for them, but that won’t stop Delta, which called the route the "crown jewel" of its JFK operation.  Crown jewels are usually flashy and cost too much.  Delta’s assuming, though, that the large feeder service it’s built at the airport will make it possible from them to make the route profitable when United couldn’t do it.  They face tough competition from British Airways, Virgin Atlantic, Continental, American, Air India and an assortment of others.  BA and Virgin have 19 daily flights between them.  Good luck!

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  1. Yeah, it’s hard for me to see how this route to Gatwick could be worth $21 million. While I certainly understand Delta’s desire to serve London from their expanding JFK base, I’d be surprised if they can recoup their investment in any reasonable period of time. As you note, there’s plenty of competition already, and Delta will be burdened by flying to less desirable Gatwick.

    FWIW, I’m sure the Brits will have no problem with this transaction because it further cements the LHR monopoly. But I’d look for CO to file some sort of petition demanding that UA’s LHR rights be transferred to THEM. Not sure of the legalities, but it’s not an entirely illogical argument, as there will now be only 1 US airline (AA) serving LHR from NYC.

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