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Delta wins kudos for safety, but will putting ‘people over profits’ pay off?

It’s the only major airline to call Boston a hub, so the question is of particular importance locally

Seats are blocked at a Delta Air Lines gate at Logan to encourage social distancing.Christopher Muther/Globe Staff

People over profits. Sounds like a great marketing slogan. But is it any way to run a publicly traded company?

Delta Air Lines chief executive Ed Bastian says it’s the only way.

Bastian and his industry peers face the toughest challenge of their careers: balancing the need to boost revenue while reassuring the crews and public of their safety during a pandemic. This is tougher than 9/11, tougher than the Great Recession.

The pace at which Delta regains its altitude is of particular importance to Logan Airport and to Boston. It was just last year when Delta declared Boston one of its hubs and publicly set its sights on offering 200 flights a day out of Logan by sometime in 2021. Delta was revving up to leave JetBlue, the longtime market leader at Logan, in its contrails.

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But wander through Terminal A, Delta’s Boston base, and it doesn’t feel like the hub for anyone or anything today. Delta had offered more than 140 flights each day from Logan in February, before the pandemic hit Boston, and as many as 160 last summer. Now? Fewer than 50. That 200 target seems farther than a trans-Atlantic destination now.

Logan will take longer to recover than other airports, in part because of the attributes that made Boston so attractive to Delta and others in the first place: the diverse mix of business travelers and the increasingly strong interest in international trips. Delta president Glen Hauenstein also cited local quarantine rules when he singled out New York and Boston on an Oct. 13 earnings call as cities that will be slow to rebound; Delta’s business in both places is just above 20 percent of pre-pandemic levels.

Charlie Schewe, Delta’s director of sales for New England, said the Atlanta-based airline remains committed to that 200-daily-flights goal for Logan. The timing, of course, remains up in the air.

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These days, Delta executives are far more focused on burnishing the airline’s reputation as the safest way to fly, via a regimen dubbed the “Delta CareStandard,” than they are on the high-profile expansions under way before the pandemic.

Most notably, Delta just became the only major US airline to continue blocking middle seats through the winter, calling it an important extra step to provide confidence to travelers. Essentially, it eliminates about a third of each jet’s passenger capacity. Southwest had been the other big airline to hold out, but will lift its capacity caps on Tuesday.

Delta takes a hard line with travelers who refuse to abide by mask-wearing rules. This zero-tolerance policy has banned at least 600 people from Delta flights. The company also instituted an electrostatic spraying protocol to rigorously disinfect all planes, part of an aggressive cleaning approach that adds an average of 15 minutes to the time it takes to prepare each jet for takeoff.

Other changes include a partnership with the Mayo Clinic for expert advice on preventing the spread of the virus, and filters that flush out nearly all of the air in the planes and gangways every two to three minutes.

Bastian said on the October earnings call that there have been no documented coronavirus transmissions traced to any Delta jets. (He also noted that fewer than 50 cases have been traced back to any aircraft, and nearly all were in the early months of the pandemic before mask-wearing and revised safety protocols.)

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Delta’s focus on safety has not gone unnoticed. Influential blog The Points Guy just handed Delta its “Spotlight on Safety” editor’s choice award, saying no airline has moved as swiftly or aggressively as Delta in this regard. It received the highest safety ranking of any US airline by the travel advisory firm VIDEC. And corporate travel buyers rated Delta the top airline for the 10th year in a row in the latest survey by Business Travel News.

Morningstar aerospace analyst Burkett Huey said Delta risks losing revenue in the short-term with the middle-seat block. That translates to losing more money per flight. For now, though, it’s an investment in the brand.

Investors aren’t looking for airlines to make money right now, Huey said. Instead, Wall Street wants to see airlines with enough capital to get through this year and next. Bastian said Delta easily passes this test. On that earnings call, Bastian said Delta expects to finish the year with at least $16 billion in cash on hand. The airline burned through $18 million a day in September. That burn rate should be down to $10 million a day in December, Bastian said, and Delta should turn cash-flow positive by mid-2021.

Larry Gulko, a local brand strategist, expects Delta will reap the benefits of its approach when the pandemic is finally over. The airline, Gulko said, is selling trust and confidence. That’s an important distinction from those selling discounted vacations to the tropics. Putting people over profits is not PR spin, he said, but integral to Delta’s culture.

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Going the extra mile will cost Delta in the short term. But the investment might pay off in a big way once everyone feels free to move about the cabin again.


Jon Chesto can be reached at jon.chesto@globe.com. Follow him on Twitter @jonchesto.