Previously we looked into the SWOT Analysis Qantas, the world’s third-oldest airline. In this case study, we will analyse the SWOT Analysis of Delta.
Driven by its 80,000 employees worldwide, Delta continues to invest billions to provide the best travel experiences and industry-leading shareholder returns. Today, Delta is the world’s leading airline for total revenue.
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Before we dive into the SWOT Analysis of Delta, let’s take a look at the company, its history, finances, products, and opponents.
(Airline passengers in the times of American war, Source: Delta News Hub)
Delta Air Lines was founded 96 years ago by Collett Everman Woolman on 2nd March 1925. Under the name of Huff Daland Dusters, and started operations on 17 June 1929. The company originated in Atlanta, Georgia, USA.
Delta Air Lines is one of the world’s leading airlines in the United States for products, service, innovation, reliability, and customer experience.
Quick Stats About Delta
|Founder||C. E. Woolman|
|Origin||Macon, Georgia, United States|
|No. of Employees||80,000|
|Market Cap||$ 26.26 Billion (2021)|
|Annual Revenue||$ 17,095 (2020)|
|Net Income/ Profit||$ 4.767 Billion (2019)|
Products & Services Of Delta
Delta has invested heavily in auxiliary services to airlines in order to produce best services at low cost:
- Communications Hub Capabilities
- E-commerce Applications
- Operational Data and Events
- Passenger Vetting & Reservations
- Reseating, Seating & Flight Cancellation Capabilities
Competitors Of Delta
USA is the world most competitive airlines market, and Delta has to compete with giant such as:
- American Airlines
- Air France KLM
- JetBlue Airways
- Etihad Airways
- Spirit Airlines
- Southwest Airlines
Now that we know better about the company, let us start decoding the SWOT analysis of Delta Airlines.
SWOT Analysis Of Delta
SWOT analysis is a tool used to evaluate a company’s strengths, weaknesses, opportunities, and threats. This analysis gives us a very concrete idea of how the company functions and deals with internal and external factors.
SWOT analysis of Delta Air Lines, Inc. Delta is a hereditary airline owned by an American airline.
From the SWOT analysis of Delta, let us first begin by understanding the strengths of Delta.
Strengths of Delta
- A Massive Fleet: The number of aircraft owned by the company is huge. By the end of 2020, their fleet consisted of 750 aircraft. Their particular fleet of aircraft is the largest in the world.
- Brand Value and Image: Delta Air Lines has made a name for itself over the decades it has worked. They managed to enter other lists besides the Fortune 500. A strong brand image always helps the company stay in the market and lead other competitors.
- Alliances and Acquisitions: Delta Air Lines is currently in an alliance called sky team. It also has code-sharing agreements with various airlines, including Czech Airlines, Korean Air, Virgin Atlantic, Virgin Australia, and many others. Over the years, Delta has acquired many other airlines, including Northeast Airlines and Western Airlines, among others.
(Source: Travel + Leisure)
- Financial Situation: The airline does an excellent job of keeping its finances in check. They have multiple sources of income, which is a very sustainable way to maintain a steady cash flow. With different sources of income, they can achieve a good return on investment.
- Reward Programs: Delta offers rewards to their passengers who travel from their airlines. The Delta also currently has several award programs aimed at a variety of audiences. This leads to higher customer retention rates.
- Wide-ranging Routes: Any airline that offers flights to various destinations around the world is sure to be popular with customers. Delta currently offers flights to 325 destinations worldwide in many countries.
Weaknesses of Delta
- Dependence on the North American Market: As we know, Delta’s main market is North America. This can be very risky for the airline business due to the political, economic and social issues in the market. Companies need to expand their market by establishing centres in developing countries to reduce risk factors.
- Concerns with an Aircraft-Airbus A220: In the Airbus A220 engine, problems were identified, and the FAA introduced new guidelines for inspecting these aircraft. Delta owns numerous of these. Delta should reduce the risk posed by the engines before a major disaster strikes, making this a sore spot for the company.
- Gaps in the Marketing Department: Airlines sales look good, but there are still special gaps in the marketing of their products. For example, Delta adopted the right marketing strategy and developed a unique sales offer for each of its products. In this case, it can have a significant impact on sales and even increase them.
Opportunities for Delta
- Expanding Social Media Marketing: Digital and social media marketing offer Delta many opportunities to increase customer loyalty. Engagement feedback will provide an in-depth look at customer preferences, so airlines can better serve them. If you also don’t want to lose on such an opportunity then timely enrol in IIDE’s social media marketing course before it gets too late.
- Maintenance: Delta has a department called MRO: Maintenance, Repair and Overhaul. They are using this to get massive support from all over the world. This is an advantage for Delta to offer this service to other airlines as well.
- Millennials: Studies show that millennials are currently the largest airline users of all generations, and their share is expected to increase in the next few years. This is the perfect time for airlines to develop specific benefits and programs for millennials.
Threats to Delta
(Source: Google Image)
- Pandemic: This is a pretty obvious threat to any business today. The pandemic that hit all of us in 2019 has seriously hit businesses around the world, and airlines are no exception.
- Heavy Regulations: Airlines pay high taxes to the government. Besides, they are held by many regulations around the world. This has significantly escalated after the pandemic, making it a threat that Delta must constantly address.
- Competition in the Market: With every big name comes to a lot of competition. Such competition always keeps the brand afloat to maintain its position permanently. However, maintaining competition is an expensive task and Delta is expensive.
- Increase in Costs: The cost of fuel, labour, raw materials and other items increased rapidly, causing airlines to suffer financial problems. The more money used to cover these costs, the less profit they will make.
This ends our SWOT analysis of Delta. Let us conclude our learnings below.
After evaluating the SWOT Analysis of Delta Air Lines, it shows that they have forceful strengths which explain their dominance over the industry.
Some weaknesses and threats they face today also have very tangible solutions that once the company is up and running, can also be easily overcome. Overall, Delta is a big name in the airline industry which isn’t likely to lose its place any time soon.
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