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Delta Air Lines decreasing Japan service as fuel costs increasing

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  • Wed, Mar 30, 2011 - 10:16am

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    gina_k

    gina_k

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    Delta Air Lines decreasing Japan service as fuel costs increasing

The earthquake and tsunami in Japan has caused ripples in the air travel industry, among other sectors, inducing Delta Air Lines to cut back service to Japan. Airline service to and from Japan is being reduced by airlines almost across the board, as increasing fuel costs and falling demand have forced the hand of the airline industry to intervene. Airlines worldwide are also feeling the pinch of rising costs of jet fuel. Article resource – Delta Air Lines reduces services to Japan as fuel prices rise by MoneyBlogNewz.

No more flights to Japan

The Japan flights have been reduced by most businesses. Bloomberg reports this is since the demand is not high enough and the costs are too high. Japan flights have been dropped by many main airlines because of the March 11 earthquake. These consist of Korean Air Lines, Cathay Pacific Airways, and Singapore Airlines and Qantas JetStar line. Delta, in accordance with Reuters, will reduce service levels 15 to 20 percent until May. Between $250 and $400 million will be lost because of the quake, tsunami and nuclear disaster for the company. However, American Airlines has not yet declared it will reduce its service to Japan, which is provided through a joint venture with Japan Airlines. More than 9 million individuals fly to the U.S. from Japan each year.

Flight prices soon to change with gas prices

Airlines worldwide have been contending for the past several months with increasing jet fuel prices. Rising oil prices due to unrest in Libya and the Middle East have been part of the increased cost of jet fuel, but harsh winter conditions during the past few months have also negatively impacted fuel costs and airline revenue. This is causing a rise in airfare. This is how corporations are dealing with it. This year, the air fare has been increased by Forbes already six times. This is regardless of the fact, reports Forbes, which since last year there was a 13 percent increase in Southwest passengers.

Expect summer getaway to cost a bit more

The increases in oil, gasoline and jet fuel costs have nothing to do with any actual shortage of supply brought on by unrest in Libya, which provides only 2 percent of world supply, in accordance with CNN. In fear of spreading unrest, several raise the prices. Installment loans could be needed to fund that summer trip due to this. An airplane ticket will end up costing more while gas costs are ridiculously high. The amount of increase in air travel is unknown. Nevertheless, it is anticipated to be much more expensive to vacation now.

Citations

Bloomberg

bloomberg.com/news/2011-03-22/delta-air-lines-cuts-japan-seats-up-to-20-amr-says-quake-damped-revenue.html

Reuters

reuters.com/article/2011/03/22/us-delta-idUSTRE72L3HG20110322

Forbes

forbes.com/feeds/ap/2011/03/22/business-industrials-us-southwest-outlook_8368679.html

CNN

money.cnn.com/2011/03/22/markets/oil_prices/index.htm

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