After launching their first AC72 in July, Team New Zealand's performances in the ACWS events dropped away as the team struggled to balance their testing and development programme in the AC72 with staying race-sharp in the smaller boat.
Under the protocols governing the next America's Cup, Team New Zealand are required to take part in the pre-regattas but Dalton has a plan to circumvent the rules - he will send their youth team, led by Olympic silver medallist Peter Burling.
"The AC45s are not the main event any more, so it's a bit of a pain trying to juggle the two boats," said Dalton.
"There's two (ACWS events) towards the end of May, which is absolutely a distraction and although under the protocol we can't sail our 72 while the event is on, there's little chance that Dean (Barker) and co will do that regatta.
"The boat will - it has to - but we will likely send a youth team up there."
Team New Zealand will move their base and operations to San Francisco from April next year, three months before the Louis Vuitton challenger series starting on July 4. A four-week window while the boat is being shipped to the United States will allow Barker and his frontline crew to take part in the first world series event in mid-April, but after that the team will only sail their AC72.
Their refusal to send their top sailors to the lead-in events will further tarnish relations between Team New Zealand and event organisers, which broke down at this year's final event in San Francisco in October, after Dalton voiced his frustrations over a series of "unkept promises" around team base facilities. Dalton also claimed the lack of challengers was a result of Coutts failing to deliver on promises of reducing costs and making the event more accessible.
Coutts responded with a staggering admission that he tried to change the AC72 class rule to a smaller boat simpler in design in late 2010, but his efforts were blocked by Dalton, whose team were already well under way with the construction of their first boat.
Under the original plans for the America's Cup, the teams were only supposed to compete in the AC45s up until July this year, with the 2012-13 ACWS to be raced in the AC72s.
But with only three teams signed to challenge Oracle for the Auld Mug, the field for the world series events would be significantly reduced, not to mention only one team - Team New Zealand - had launched their AC72 by August, and they weren't even close to being ready to race it at that time.
By April, however, the teams should be ready to race their larger cats, but organisers have decided to stick with the AC45s.
That means the challenging teams won't line up against each other until three days out from the start of the Louis Vuitton Cup, with a series of fleet races scheduled in San Francisco as part of the opening festivities.
The Kiwi team have exhausted their 30 allowable sail days in their first AC72, but under protocol are unable to launch their second boat until February. During the downtime, the team will race against Luna Rossa.
