Delta Airlines: Navigating the Turbulence of Climate Change and Charting a Sustainable Course
By Simar Badwal, Elizabeth Baker, Christina Fleischer, and Samantha Wentworth
We have seen the evolution of climate patterns firsthand over the last few decades and have seen many industries evolve and change to not only continue to grow and modernize, but also to embrace sustainability. One of the most important sectors to do so is the airline industry. As more and more people choose air-travel over car, train, or more green public transportation options, we see many challenges in the aviation sector, including regulatory pressures and increasing costs. We will focus on industry leader, Delta Airlines, in this blog post, and discuss how the company has proactively changed its business model to navigate the changing times, through things like more fuel-efficient aircrafts, carbon offset programs, and other operational solutions. We will discuss all of this and more in the coming paragraphs, as well as discuss how Delta benchmark’s themselves in important climate change metrics and actions we believe they should implement to be a leader in sustainability in the aviation industry.
Delta was the pioneer for the hub and spoke network model. The company leverages decades worth of data to streamline connections, minimize delays, and maximize aircraft utilization resulting in efficient aircraft utilization, shorter turnaround times, and optimized schedules.
Beyond the network, Delta prioritizes the passenger experience. They prioritize customer satisfaction and offer various amenities like in-flight entertainment, Wi-Fi connectivity, complimentary snacks and beverages, and premium cabin options, while also focusing on employee training for a customer-centric approach.
Furthermore, Delta leverages the power of partnerships on three key levels. Airline alliances like SkyTeam grant global reach and benefits, while collaborations with hotels, credit cards, and travel organizations create a seamless travel experience. Finally, strategic joint ventures on key routes like the Transatlantic and Latin America optimize market presence and offer competitive fares.
Delta’s commitment extends beyond profit to include sustainability, as the company’s CEO Ed Bastian said, “By investing in innovation and leading the way in sustainability, we’re ensuring a brighter future for our company, our customers, and our planet”. One of the key steps taken by the company is fleet modernization which led to 20-30% fuel efficiency improvements per seat mile. Another element is their investment in Sustainable Aviation Fuel (SAF), a cleaner alternative to traditional jet fuel. In 2023, they committed to using 10% SAF by 2030, exceeding industry targets. Since SAF is more expensive than traditional jet fuel, the company co-founded the “OneSky” initiative with other airlines to accelerate SAF adoption. In addition, Delta invests in offsetting projects like forest conservation, renewable energy development, and carbon capture technologies. From a customer perspective, the company also offers passengers the option to purchase carbon offsets for their flights, allowing them to contribute to sustainability efforts.
Delta charts a promising course, exceeding pre-pandemic revenue expectations and eyeing 2024 profitability. Their optimized network, customer focus, and strategic partnerships fuel success. However, geopolitical tensions, fuel prices, and labor relations demand attention as competition remains fierce.
Each year, Delta releases a robust sustainability and ESG report to the public and shareholders. The company has a large goal of being net-zero carbon emissions by 2050, almost unheard of for a commercial airline company. They are also addressing climate change throughout their business by replacing fleet vehicles with electric options, using at least 10% sustainable aviation fuel, and building a fleet that is more sustainable. Last year, Delta had 69 new aircrafts that meant their new fuel-efficient goal of being 25% more efficient than 2019 models.
Not only is Delta taking on the challenge of being more sustainable, but they are also passing the challenge onto consumers. There is limited single use plastic for travelers on board, transition to biodegradable offerings, and even bedding is now made of recycled plastic bottles. In fact, we’ve been fortunate to witness some of these changes personally – our international meals have been served with recycled materials and wooden utensils, and we’ve noticed that flight attendants have been collecting beverage cups with the intent of recycling. Additionally, Delta has looked to partner with minority run businesses whenever possible. Premium air-amenity kids are from a Certified B Corporation, Someone Somewhere, and reduce even more plastic. As recently as July 2023, they even hired a brand new Chief Sustainability Officer, showcasing their commitment to sustainability at even the highest levels.
In their annual ESG report, Delta releases information on their carbon emissions and how they’re tracked. They calculate CO2 emissions generated from aircraft fuel by looking at flight distance, payload, and type of aircraft. They utilize the IATA Carbon Calculator to ensure consistency in tracking emissions across the board. They also verify with a third party and track any notices of violations they get. They are extremely transparent and offer this information publicly in their ESG report, even if it is not the most attractive for the company.
As mentioned above, it’s no secret that climate change has already had a major impact on the airline industry. From governmental regulations to consumer demand to turbulent weather and everything in between, Delta is taking on the challenge head-on. In recent years, there has been an increase in regulatory pressure and environmental laws – both domestically and globally – to reduce carbon emissions and adopt sustainable practices across the industry. The Environmental Protection Agency (EPA), the United Nation’s Sustainable Development Goals (SDGs), the International Civil Aviation Organization (ICAO), have set GHG standards and require net zero carbon emissions by 2050. As one of the largest airline companies in the world, Delta has a massive role in achieving this.
Additionally, the knowledge and impacts of climate change has led to shifts in consumer behavior and preferences. How an airline like Delta addresses sustainability will impact if a customer chooses to fly with them. On the extreme, people could stop traveling by planes altogether to reduce their carbon footprint. As a result, Delta’s market share and revenues could be reduced if they are not perceived as sustainable by consumers.
Furthermore – and most apparent – climate change is intensifying weather patterns and increasing extreme weather events, which can lead to flight delays, cancellations, scheduling complications, upset customers, and even a downstream effect of decreasing consumer demand for flights. As a result, climate change is increasing costs for Delta. These occurrences are unfortunately becoming more commonplace, and one of us recently had an experience where we were rerouted to St. Louis for the night due to a backlog of delayed planes at Hartsfield-Jackson. Not only was it an annoyance for customers, but it added more complications to Delta’s operation and required reimbursements.
On a positive note, climate change is encouraging Delta Airlines to innovate and think ahead for a more sustainable future, and Delta is well-positioned as a strategic industry leader for addressing climate change. Looking to the future, Delta needs to continue solving for aviation industry solutions to be pro-active in how they address climate change and continue on its path toward net-zero carbon emissions by 2050. As Delta has committed to replacing 10% of its jet fuel refined from fossil fuels with sustainable aviation fuels by 2030, what is the next goal? Delta needs to work with suppliers to establish a long-lasting and economic solution for sustainable aviation fuels.
Delta has an opportunity to encourage partners like food suppliers, facilities and construction companies, and other airline partners to continue evolving the entire aviation industry at every level to more sustainable practices. Due to their size and status as an industry leader, they have the ability to enact sustainable change across their entire supply chain.
Delta also has an opportunity to implement and perfect operational efficiency. If Delta could maximize operational efficiencies like having the right planes fly the most efficient routes without delays or scheduling issues, Delta would minimize aircraft taxing time (travel from gate to takeoff or landing), which would reduce fuel consumption and weight onboard and thus, reduce overall fuel usage.
Finally, aircraft design is an opportunity. When will Delta be able to use a completely sustainably designed fleet? Achieving a net-zero supply chain would support a net-zero carbon footprint, and we recommend that Delta strives to achieve this as part of their sustainability goals.
Overall, Delta and the airline industry as a whole are motivated to address climate change and do their part to reduce carbon emissions. It’s crucial for their future, their operations, and their customer’s safety to enact change, mitigate climate change, and strive for a more sustainable future.
