Delta To Chop Low-Fare Discounts, Offer Web Fare Option

Delta Air Lines director of industry sales Dan Cupertino today confirmed that Delta is "reducing or eliminating" discounts on its lower fare classes for all corporate accounts. Delta today sent different letters to its national and small/midsized accounts indicating that Delta would "revise our discount structures for low fares in the Q, K, L, T and U inventories." The airline said buyers should clarify details with their sales reps.

Delta attributed the move to weak business-travel demand, general airline industry uncertainty and "domestic published fares falling 20 percent in last 20 months"--particularly in the lowest inventory classes. Delta told clients its top 85 accounts spent 35 percent less on airline tickets during the first quarter of 2002, compared with the first quarter of 2001. "As a result of the dramatic reductions in published fares, aggressive corporate discounting by Delta in low-end inventories is no longer practical," Delta wrote. Sources said the carrier already had implemented that policy in recent negotiations and that Delta only rarely had discounted certain low-fare classes in the past.

Delta is not going as far along these lines as Northwest Airlines, which in November eliminated all corporate discounts on lower bucket fares (BTN, Nov. 12). Other carriers, including Continental and United, have taken similar measures. "I really wasn't surprised, after Northwest," said one buyer who requested anonymity. According to another, "It's probably similar to the Northwest initiative."

Meanwhile, Delta also indicated that it is "exploring opportunities to offer you a new alternative by offering greater access to Delta Web fares. This cost-effective option will maximize your travel resources, drive cost savings, enforce travel policy compliance and will be tracked and credited to your performance goals."