Will Delta's $3.4 Billion LaGuardia Investment Pay Off?
A little more than two years ago, Delta Air Lines (NYSE: DAL) broke ground on a new $4 billion, 37-gate terminal at New York's LaGuardia Airport. Typically, airport construction projects are paid for by local airport authorities, with the costs eventually passed on to airlines and their customers in the form of higher landing fees, rental fees, and other charges. However, in this case, Delta agreed to shoulder most of the burden, putting $3.4 billion toward its new LaGuardia terminal.
Last week, Delta Air Lines celebrated the opening of the first of four concourses that will be built as part of this project. As the rest of the project comes on line over the next several years, Delta will be able to provide a better customer experience at LaGuardia while improving operational flexibility. But will the end result justify the high price tag?
In recent years, Delta Air Lines has been the largest airline at LaGuardia Airport, with more than 275 peak-day departures. Its operations have been spread across two terminals: Terminal C and Terminal D. It has occupied the latter for decades, while it expanded into the former following a 2012 slot swap that enabled it to pick up more than 100 additional LaGuardia slot pairs from US Airways.
Source Fool.com
