Delta CEO Ed Bastian is optimistic that ally Air France will overcome its ongoing labor issues, and the carrier is ready to play its role in that recovery. Speaking last week at the BTN Group's The Beat Live conference in Atlanta, Bastian said he's confident new Air France-KLM CEO Benjamin Smith would "figure this out." Smith joined the carrier from Air Canada, and Bastian said he was involved in hiring Smith. Several days of strikes and canceled service this year amid failed contract negotiations delivered a large financial hit to Air France, which also resulted in the departure of former CEO Jean-Marc Janaillac.
Part of the problem was that Air France has launched side projects that "are pulling away from the core mission of Air France," Bastian said, including new subsidiaries like Millennial-focused Joon. "We have to develop a vision for that company the employees are going to be excited about," Bastian said. "They have to pull it all in and make the main thing the main thing, which is the Air France brand."
Bastian said Delta would help improve operations at Paris Charles de Gaulle Airport and is ironing out "technology seams" between the two companies. They're joint business partners, and Delta owns a 10 percent stake in Air France-KLM.
"We've decided for us, we can't effect change on behalf of your customers if you're sitting solely in a commercial relationship," Bastian said. "You have to have a seat inside the board to make the change happen and hold them accountable."
Reuters this week reported that Air France-KLM has offered French pilots and staff a 4 percent raise as a resolution to the labor dispute.
Asia Growth
Bastian said Korean Air has been a "fabulous partner" in their recent joint venture, particularly with the new terminal at Korea's Incheon International Airport that exclusively serves the carrier and its partners. As such, Delta continues to shift its Asia traffic away from Japan and toward Seoul.
At the time of its merger with Northwest, about 90 percent of Delta's Asia traffic went through Tokyo. That is down to about a third, and it "probably will be at zero at some point," Bastian said. Operations at Tokyo's Narita International Airport are "not sustainable," given that the international terminal at the closer-in Haneda Airport is opening in the last decade and that Delta lacks a partner in Japan; both United and American have Japan partners, he said.
The partnership with Korean Air has connected Delta to 80 destinations in Asia, including about 30 in China, while Narita connected Delta to only a handful of destinations, Bastian said.
Return to India
Delta will announce details of its revived service to Mumbai in the coming months, including whether service will fly from New York or Atlanta. Delta had pulled service from India about a decade ago because the service was not economically viable, but Bastian said the carrier's budding partnership with Jet Airways and recent agreements between the U.S. and each Qatar and the United Arab Emirates have changed that landscape. Even so, it's not entirely a financial decision, he said. "It's based on a larger strategy. You can't say, 'No one better connects to the world,' when you don't fly to one of the most populous nations in the world."
Free Wi-Fi?
Bastian made headlines last week with comments that Delta eventually would offer free Wi-Fi, though he has been making that pledge for some time now. That is still a few years off, as Delta is still exploring and refining its technology options. "We've first got to figure out how to do it, and then we are going to do it," Bastian said. "The first thing we need to do is make sure the technology works, and once we get past that point, then make it free."