Delta hopes fliers think it's playing their Song
By Chris Woodyard, USA TODAY
LAKE BUENA VISTA, Fla. =97 For buttoned-down Delta Air Lines, a gaggle of=20
whooping and hollering flight attendants might seem out of place. But the=20
boss of Song, the airline Delta is launching Tuesday, wouldn't want them=20
any other way. Making flying fun is CEO John Selvaggio's mission. "Ever=20
think Song is going to be confused with Delta?" asks Selvaggio at a pep=20
rally at Walt Disney World outside Orlando. "No!" the flight attendants=20
roar back. Song may surprise fliers, too. In a closely watched experiment,=
=20
Delta has created a low-fare airline hellbent on upstaging the discounters=
=20
that are stealing passengers and profits from the biggest carriers.=20
All-coach Song will match Southwest's maximum fare and make funny flight=20
announcements. But the real target is JetBlue, the 2-year-old upstart that=
=20
has become a leading airline between New York and Florida. As JetBlue does=
=20
now, Song will offer 24 channels of free seatback television starting in=20
October. Unlike JetBlue, Song hopes to eventually offer on-demand movies=20
and audio. Song's flight attendants will wear yet-to-be-unveiled designer=20
uniforms. They will sell trendy sandwiches and entrees, eventually offering=
=20
creations such as Thai noodle salads or veggie soft tacos. There'll be=20
signature mixed drinks like Stolichnaya vodka cosmopolitans. The airline is=
=20
piling on enough coach extras =97 the entertainment system, more legroom=
than=20
on many Delta planes and branded merchandise =97 that it risks upstaging its=
=20
parent. Delta executives downplay the risk, saying Song will fly mostly=20
different routes and cater to a different customer.
Singing her tune
That target customer may come as a surprise to the=20
male-business-traveler-oriented airline world: It's upscale baby-boomer=20
women. Fares will be $79 to $299 one way anywhere Song flies. From=20
Tuesday's launch route of New York JFK to West Palm Beach, Fla., Song is=20
planning 144 daily flights on 28 routes by Dec. 1. Under Song's simplified=
=20
pricing, fares will be the same either one way or round trip. No=20
Saturday-night stays are required for the cheapest fares. Fliers earn Delta=
=20
frequent-flier miles. Major airlines have created separate low-fare brands=
=20
before. Continental, United, US Airways and Delta all tried, only to see=20
them flounder =97 all doomed by insurmountable costs. Song's debut marks the=
=20
first time a major airline has approached the low-fare challenge as an=20
opportunity to create a service substantially different from what=20
full-service airlines have done for decades. "This is going to be a=20
brand-loyalty war," says airline consultant Mike Boyd. "The key is to get=20
people to come back and fly you again." Song will grow slowly at first.=20
After West Palm Beach comes New York to Orlando, Tampa and Atlanta. In May,=
=20
it will fly from Boston to West Palm Beach and Tampa. In the West, flights=
=20
will run between Fort Lauderdale and Las Vegas.
If Song works, it might be a model for other big airlines seeking a=20
profitable formula to compete against the likes of Southwest, JetBlue,=20
AirTran and other discounters that now control 20% of domestic flying.=20
United, which is in bankruptcy reorganization, is planning a carrier=20
codenamed Starfish. Song could hit a sour note. Popularity doesn't=20
necessarily translate into profitability. Unionized Delta pilots, among the=
=20
industry's best paid, will fly all of Song's 36 jets. Captains earn as much=
=20
as $219,000 a year based on an average 75 hours of flying a month.=20
JetBlue's captains top out at $142,644 a year on an average 86 hours every=
=20
month. Song will have the challenge of trying to fill 199 seats on each of=
=20
its Boeing 757s =97 37 more than on JetBlue's Airbus A-320s. And Song makes=
=20
its debut to a nation distracted by war. Industry analysts are skeptical=20
about the latest "airline-within-an-airline." "It never worked before,"=20
observes Ray Neidl of Blaylock & Partners. UBS Warburg's Sam Buttrick says=
=20
low costs will be critical, and, "It's not exactly clear how adding=20
state-of-the-art in-flight entertainment ... reduces costs, because it=20
doesn't," he wrote in a March report.
Finding savings
Delta officials say they'll surprise the doomsayers. Song is going to be=20
22% cheaper to run than Delta's mainline operation, says Delta President=20
Fred Reid.
How Song plans to make a profit:
Song planes will fly almost 13 hours a day, squeezing two more hours of=20
daily revenue production than Delta gets.
Flight attendants, not unionized at Delta, will have to fly about four=20
hours more a month to make the same money.
Suitcases will be placed on a sliding carpet in the belly of the plane that=
=20
allows a single baggage handler to load or unload. Delta already has a=20
low-fare outfit, Delta Express, flying between the Northeast and Florida.=20
It made money for three years but slipped into losses in 2000 after Delta=20
pilots wouldn't continue wage concessions negotiated in prior years.
Delta wanted a low-cost replacement. And Selvaggio knew exactly what he=20
thought would work. From his days at American and US Airways, Selvaggio=20
knew women were becoming a powerful force in air travel. They book 70% of=20
leisure travel and research 90% of all leisure travel booked online. "This=
=20
is a huge population, and it's the only growing population" in a landscape=
=20
populated by airlines appealing primarily to male business passengers, he=20
says. To emphasize the differences with Delta's mainline service, Song=20
"auditioned" and chose some of the liveliest Delta flight attendants to=20
become "Song talent." How lively? A pair of them cross-dressed to model=20
their interim uniforms at one pep rally. At the rallies at a hotel outside=
=20
Orlando, they practiced making entertaining flight announcements over the=20
intercom. They learned how to sell everything from sandwiches to Snickers=20
bars from the cart. "Delta training was never like this," said flight=20
attendant Kelly Pruitt of Boston, who has flown for Delta for about four=
years.
Giving rivals the blues?
Though Song may sound cool, JetBlue is betting that the new airline will=20
come off as a bunch of wannabes. "It's kind of like a grandma trying to=20
retain her youth. It's all paint and facade," said JetBlue spokesman Gareth=
=20
Edmondson-Jones. "It's not getting to the heart of what made JetBlue a hit.=
=20
You can't pick up a press release without Song telling you how cool and hip=
=20
they are." But whether or not it's eventually successful, Song could damage=
=20
JetBlue. Though Song and JetBlue will compete directly on only four routes=
=20
by Dec. 1, "Song is the name, blue-bashing is the game," declared J.P.=20
Morgan analyst Jamie Baker in a report. He predicts a "modest defection" of=
=20
JetBlue passengers to the new carrier and that JetBlue will look outside=20
Song's Florida markets for growth. If Song draws passengers from other=20
airlines, Selvaggio says, it will be because they are getting a better=20
value rather than just lower fares. "Low costs aren't enough," he says.=20
"You have to have a great brand."
How Song, JetBlue compare
Song JetBlue
Lowest round-trip fare{1} $375 $265
Domestic fare range one way $79 to $299 $49 to $299
Free checked baggage allowance 2 up to 50 lbs. each 3 up to 70 lbs.=
each{2}
Seat spacing
(back of seat to back of seat) 33 in. 32 in.
Seat width 17 in. 18.5 in.
TV channels 24{3} 24
Cocktail prices $5 $4
1 =97 available last Friday for travel from New York JFK to West Palm Beach,=
=20
Fla., April 21-24 (including taxes and fees); 2 =97 two on Puerto Rico=
flights;
3 =97 when available in October
Sources: Song, JetBlue
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