I always found the Delta arrangement very interesting. The refinery took a $10 million loss which saved DL $100 million. [1] But it also saved rivals money.

I always found the Delta arrangement very interesting. The refinery took a $10 million loss which saved DL $100 million. [1] But it also saved rivals money. When they make cheaper jet fuel it doesn't just go to Delta. They have to sell the fuel into the Jet-A for the region. That means they subsidize all the other airlines too. So DL says, if we give each airline $90 million (# made up), our use and deployment of capital will be (is?) more efficient and therefore it's a net win for us. Or possibly in another thought-experiment, it's better that each airline has the money to invest in their businesses and products, such that the entire Aviation industry benefits, rather than giving that profit to an O&G company. [1] http://finance.yahoo.com/news/exclusive-deltas-refinery-sacrifices-profits-050817308.html http://finance.yahoo.com/news/exclusive-deltas-refinery-sacr...