“United’s one good plane” – you mean the 787/767/777? Not even a comparison between UA longhaul fleet compared to Deltas… what A350s, 330neos, and 767-400s? They still fly old 330s and 767-300s!!

And only 2 new D1 lounges opening in 2024… hopefully. Compared to Polaris lounges at 5 of their hubs.

I know that Delta flies longhaul out of more airports than JFK and LAX. Flying longhaul out of Atlanta, MSP, Detroit, Boston, etc? Have fun shoulder to shoulder with the guys in free w/ credit card access. Which credit card gives access to Polaris lounges? 😉

I ain’t even a Delta or United fanboy…

During covid, Delta tried to fill as many seats as possible and expanded profitable partnerships with AmEx, etc. in order to stay afloat. When things started getting back to normal, (1) and (2) customers started complaining that their experience was eroding because there were too many (3) customers taking up forward seats in planes and space in Sky Clubs. In response, Delta calculated that it would be better (more profitable in the long run) to risk some of their AmEx revenue and their lower-priority customers by kicking them out of Sky Clubs and making it harder for them to get good seats up front without paying for them like (1) & (2) customers.

Also, Senior Management did not wake up one day and say “Tom Brady is smart. Let’s hire him to advise us”. More likely it was something like “Our marketing people think we will get more $$ from rich Alpha types if Delta is associated with Rich Winners. Tom Brady is a Rich winner, available, and not too expensive. We can trot him out for publicity events and show him off when it suits us.”

The changes are undoubtedly a huge slap in the face and a message that they don’t care about the average traveler. As much as most of us would like to see delta face consequences, it’s not likely from a bookings perspective.

Continued “loyalty” is probably going to come more from market power than marginally better experience, but yeah, they’re not likely to suffer in bookings in the immediate term.

What I don’t understand is how this is going to help them meet their goal of doubling AMEX spend. The value proposition for the average traveler is nonexistent. The $250 card is now worthless -Yes it still earns SkyMiles but that is that worth more than cash redemptions on a travel portal? And getting status on the $550 card requires basically putting all your spending on it and the opportunity cost is huge.

Either you pay a lot for the privilege of earning worthless currency or you pay a ton for the privilege of hoping for an upgrade and getting some free cheese and crackers a few times a year.

Basically they made a statement that they don’t need to offer anything extra for the average traveler. That probably won’t affect bookings, but you’d have to be crazy to invest in the CC.

Not only are you are mixing apples and oranges, Delta’s revenue structure is built on a house of cards, predicated on zombified status-chasers putting otherwise non-market driven spend on AMEX co-branded cards. Even though “status” has been substantially devalued the last 10 years, folks chased it anyway because of (1) of odd physiological behavior, and (2) the ability to achieve it through gaming the MQM rollovers and boosts, MQD waivers and mileage/MQD runs.

These new changes are finally drastic enough to snap a whole bunch of folks out of this irrational status-driven trance, and back into reality.

So folks may very well continue to fly Delta on a regular basis because of the “product”, but without chasing the worthless “status”.

So the artificial, zombie-induced AMEX spend revenue takes a substantial hit, which then undercuts the ability to actually pay for the “superior” product going forward.

IMO, they should have kept the status-chasing zombies churning their AMEX spend and continued denying them any tangible benefits for reaching “status”. People will do very irrational things that line Delta’s pocket as long as they can call themselves as DM or PM. But when those levels simply become unreachable and beyond what the zombie can actually do, the zombie wakes up. You are now hearing a very loud chorus of Delta status zombies snapping back into reality.

Hence, I suspect the very profitable Delta/AMEX revenue model is now on the way to a significant decline, if not a collapse.

Agreed. We definetely fall in the midddle. Lots of flights but not always enough to hit platinum status without the card spend. We have the reserve card but qualify for the Business Platinum Amex that will give us lounge access regardless of which airline we fly. No longer feeling the need to be loyal Delta customers.

I 100% agree. Sure, I’ll still fly Delta if it’s convenient and priced right, but I’m cancelling my AmEx Reserve in January 2025 since there’s no longer an incentive to keep paying that hefty annual fee.

I think you’re underestimating the overall portfolio’s potential resentment. Since you understand CC economics, let me use an example from banking.

I used to work on a strategy team in a major US bank. One decision that had been made was to gut the various rewards of the “middle class” customers: those who had funds but weren’t 7+ figures. Top-end was fine, bottom end was fine. But they forgot that the bottom eventually becomes the middle and the middle become the top in a successful ecosystem. With no reason to add more business as their wealth grew, those former-bottom end customers went elsewhere. The result was bad enough that there was a massive restructuring of customer retention strategies. What you see across the more successful US banks are an outgrowth of those first mistakes circa the early 2000s.

Delta is gutting their middle class of customer (not “middle class customers”, but middle-spend). I don’t know that it will work out for them any better than for the banks.