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Delta gains ground at Austin-Bergstrom amid competition with American Airlines

Delta gains ground at Austin-Bergstrom amid competition with American Airlines
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A commercial aviation competition is unfolding at Austin-Bergstrom International Airport (AUS), where Delta Air Lines and American Airlines are vying for dominance in a market largely controlled by Southwest Airlines. Southwest holds nearly half of the flights at AUS, while both legacy carriers have been working to establish Austin as a profitable focus city. Recent developments suggest Delta may be gaining an edge.

Austin has experienced significant growth over the past decade, with air traffic more than doubling from 10 million passengers in 2013 to 22 million in 2023. The existing Barbara Jordan Terminal, designed for only 15 million passengers, is over capacity. To address this issue, Austin plans to open a new 20-gate mid-field terminal by 2030. This expansion has sparked negotiations with airlines for long-term leases.

In March 2021, American Airlines announced ten new routes from Austin and expanded further with 14 additional routes by June of that year. Despite its rapid growth, American faced challenges with underperforming routes and financial difficulties. By late last year, American began reducing its presence in Austin, phasing out several domestic and international routes.

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Vasu Raja, then chief commercial officer of American Airlines, expressed optimism about the airline's expansion in Austin: “American is eager to expand in Austin alongside the region's exponential growth...These new routes create a competitive network that gets travelers in the door for entry into our frequent flier program."

Delta Air Lines observed these developments and began increasing its capacity as American retreated. Delta announced plans to boost its capacity by 20% in early 2024 and introduced five new routes from Austin set to begin between March and June next year.

Delta's strategy appears different from American's approach. Unlike American's rapid expansion without clear strategic goals, Delta is taking a measured approach with developmental flying ahead of terminal expansion planned for 2030.

Financially stronger than American, Delta can afford patience as it evaluates new routes. It maintains a commitment to making Austin a focus city and has invested in infrastructure such as a large Sky Club at AUS.

While speculation exists about whether Delta might turn Austin into its next hub, current airport capacity constraints make this unlikely soon. Instead, Delta may develop an extensive focus city operation similar to Raleigh–Durham until gate expansions allow further growth.

Organizations Included in this History
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