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Delta Upgrading IFE, Cockpit Screens After Record-Setting Quarter

Coming off its strongest quarter ever, Delta has its sights set on overhauling its fleet and building its brand with new in-flight entertainment and connectivity technology to keep its momentum going.

Delta topped 2019’s Airline Quality Rankings for the first time in nearly two decades. It has a Net Promoter Score hovering around 50 — considered the benchmark for “excellent” on the -100 to 100 scale that measures customer perception of brands — and is up from 20 in 2011. The carrier is coming off the strongest quarter in its history, bringing in $12.5 billion in revenue, an 8.7% improvement over the same period in 2018.

The carrier often touts net promoter score as a guiding metric as it reshapes its fleet. That isn’t surprising, considering that it’s a measure of loyalty, which has been a Delta buzzword in recent years. CEO Ed Bastian said on the airline’s second-quarter earnings in July that the portion of flyers buying Delta tickets from third-party sellers, such as Expedia or Kayak, has dropped from about one-third to 10 or 15 percent over the last decade. Despite that, President Glenn Hauenstein said the company wouldn’t look to follow Southwest in pulling its tickets from those third-party sellers.

“Our strategy has been to build something that consumers want to buy and let them choose how they buy it,” Hauenstein said. “And that's led to a continuation of a migration towards Delta direct channels and Delta loyal customers... The question is, do you want to be more aggressive and say no to customers who might want to buy a product a certain way or distributors? And the answer is we would never want to do that.”

Delta is focused on improving the experience it can offer to its passengers, though. One way is through in-flight entertainment and connectivity (IFEC).

Bastian has set the goal of offering entirely free Wi-Fi on Delta flights as the next step in the operator’s IFEC strategy. In 2016, Delta began offering its seatback content for free. In 2017, Delta began offering free messaging. This May, Delta underwent a two-week test during which more than 700 flight segments — 55 per day — offered free internet for email, shopping and social media (though not content streaming).

"Customers are accustomed to having access to free Wi-Fi during nearly every other aspect of their journey, and Delta believes it should be free when flying, too," said Ekrem Dimbiloglu, Delta’s director of onboard product, at the time. "Testing will be key to getting this highly complex program right – this takes a lot more creativity, investment and planning to bring to lFE than a simple flip of a switch."

Bastian said that Delta learned a lot about customer usage and bandwidth requirements during the test. More testing will be required before Delta is ready to roll out the promised free Wi-Fi across its fleet and dates have not yet been announced.

Necessary for the free Wi-Fi initiative is reliable broadband. Delta has tasked Gogo with equipping its planes with the latter’s 2Ku service. So far, 60 percent of the mainline Delta fleet is equipped.

“It sounds basic, but the number one dissatisfier to a user is if it does not work consistently well,” said Jonathan Cobin, executive vice president for Gogo, in an interview with Avionics International earlier in the year. “If there’s an expectation of service and it wasn’t working, that is the biggest [problem.]”

Delta wants to personalize the IFECC experience, using data to aid in marketing and advertising as well as to streamline the passenger experience, according to Director of Supply Chain Management Technology Hamp Haucke, but hasn’t fully settled on how. The idea is that a more service-based relationship that is tailored to passengers’ needs can beat out a one-size fits-all product-based approach, but the airline must be cautious not to gather or use data in a way that makes customers feel uncomfortable.

A Delta pilot uses the airline’s weather viewer turbulence EFB application. Delta

To improve the flight experience, Delta is planning on putting new high-resolution seat-back displays ranging from 10.1 to 18.5 inches, depending on seat class, in its new A330-900neo. It also wants to improve navigability of its entertainment environment through comparing remaining flight times to length of movies and shows and incorporating real-time data from the flight deck to improve the in-flight seat-back map. There are no security concerns due to the one-way nature of the connection between the cockpit and the cabin, according to cybersecurity experts.

Outside of its connectivity initiatives, Delta is in a period that Bastian has described as “the most significant fleet evolution in Delta's history,” with plans to replace a third of its 900-plus aircraft fleet in the next five years. Fortunately for Delta, the airline did not order any of Boeing’s troubled 737 MAX aircraft, so its entire fleet is flying. Instead, Delta opted for Airbus’ A321neo in December 2017, though Bastian said it was “a close call.” Deliveries of up to 100 A321neos are scheduled to begin in 2020.

Delta has 20 A220s — formerly Bombardier CSeries — in its fleet with 75 more to come. Delta’s A220s feature new functionality to integrate pilot tablets into the aircraft’s avionics data bus as well as the newly certified CATIII Autoland, an upgrade to the autopilot software.

For its popular, long-haul flights, Delta has invested in the A330-900neo. The first of 35 was added to Delta’s fleet in May and the carrier will begin service with it in October, Delta said. In addition to the aforementioned seat-back displays, the new A330s will feature in-seat power ports, full-spectrum LED ambient lighting, spacious overhead bins and memory foam cushions throughout the aircraft.

Delta’s first A330-900neo takes a test flight in Toulouse. Airbus

Delta is also accelerating the retirement of its McDonnell Douglas MD-90s, aiming to finish in 2022, two years ahead of the original schedule.

There is still a potential hole in the future Delta fleet, between the new A321 and A330s. Currently, those routes are flown by older Boeing 757s and 767s, but Bastian has said that his company will look to replace nearly 200 of those planes in the next five years. In March, Bastian said Delta was interested in Boeing’s rumored new mid-market aircraft (NMA) to fill that gap. As a small widebody, it would hold more passengers and be more efficient than the A321 but fly shorter routes than intercontinental A330, slotting between the two in Delta’s lineup for busy short- and medium-range routes.

However, Boeing hasn’t committed to building the plane, and if it does, its timetable might not fit Delta’s. Struggles with the 737 MAX and a focus on getting it fixed and back in the air have delayed any plans for the NMA, which might force Delta to look elsewhere.

In the meantime, Delta is upgrading the cockpits of its 757s and 767s to move from outdated cathode-ray tube (CRT) to liquid-crystal displays (LCD). The only remaining CRT manufacturer supporting television and aviation applications, Toshiba, has said it will shutter its CRT factory in 2020, requiring any airlines using the legacy solution to make other arrangements. Delta has opted for the Thomas Global Systems-manufactured TFD-7000-series displays, which will replace Collins Aerospace EDU-776s CRTs.

These are the LCD screens from Thomas Global that Delta will use to replace the CRT screens across its fleet of Boeing 757s and 767s.Thomas Global

Revenues aren’t the only record Delta set this quarter, according to Bastian. The Atlanta-based carrier is up to 78 days without a cancellation in its system, a 30 percent improvement over 2018’s performance, which was itself a record at the time.

The reliability appears to be paying off. Delta’s system load factor of 88 percent in the quarter is a 1.3-point year-over-year improvement. Operating costs were up 5.7 percent despite a 4.4 percent decrease in fuel prices, but that hasn’t stopped Delta from making the most of its passengers. Adjusted for unrealized gains and losses, it reported 17.42 cents of total revenue per available seat mile, a 3.8 percent gain over the same period in 2018.

“This is a growing business. I think, for years, people wondered whether it was a mature business,” Bastian said. “I think technologies had a huge impact here, people are more aware of the world than ever before, people are more interested in seeing the world and connecting with the world than ever before. And as the best-performing airline in a market that's growing at a multiple of GDP, we're really well positioned to see this continue to grow into the future.”