Mbj-11 From Jamaica, joined Aug 2000, 386 posts, RR: 1 Posted (8 years 1 month 1 week 2 days 21 hours ago) and read 6324 times:
Is AA too large or getting to large? I mean they basically are the Walmart of the skies on this side of the globe and that may not be too good a sign. I know they've been having labour issues and the talk surrounding a/c replacement has been hovering around the place, but somehow when I see them today I am reminded of Pan Am in their heyday.
Should they probably cut their operations into subsidiaries and do a GM style operation? Or are they good to keep going?
SW733 From United States of America, joined Feb 2004, 6489 posts, RR: 8
Reply 3, posted (8 years 1 month 1 week 2 days 21 hours ago) and read 6213 times:
As long as they can get me there on time, on safe planes, and with nice people, I don't give a darn how big they are...just means they can get me more places. They aren't my favorite airline, not even in the USA, but they're a good airline, and no, I don't think they are too big at all...odd question.
The Wal-Mart thing intrigues me too...
Quoting Mbj-11 (Thread starter): Should they probably cut their operations into subsidiaries and do a GM style operation?
Yep...if there is ever a model of financial success in the USA, it's GM...
STT757 From United States of America, joined Mar 2000, 17315 posts, RR: 50
Reply 5, posted (8 years 1 month 1 week 2 days 20 hours ago) and read 6095 times:
I think AA needs to be leaner but that does not mean they are too large, I just think they need to trim their fleet types and eliminate some point to point flying. I would also totally eliminate the STL focus City/hub, I know the STL folks don't want to hear that but it's probably in AA's best interest.
Given the fact that most "experts" say the industry needs consolidation, I don't see how one can consider AA too large.
On the other hand, I personally don't agree that consolidation needs to happen. Once a company reaches a certain size, it becomes next to impossible to consistently manage successfully so that everyone is on the same page, so to that extent I do see the point of your question.
Mbj-11 From Jamaica, joined Aug 2000, 386 posts, RR: 1
Reply 7, posted (8 years 1 month 1 week 2 days 20 hours ago) and read 6024 times:
Quoting Aa757first (Reply 1): I'm not sure how an airline gets too large. AA only has a 15% market share for domestic flying. And what do you mean by "Wal-Mart of the skies"?
In the sense that they have from what I understand the largest operations of any carrier this side of the globe. Am I wrong?
Correct me (without condition) if I am . Also, like Walmart they are able to stifle the competition while cornering the market.
UAL747 From , joined Dec 1969, posts, RR:
Reply 8, posted (8 years 1 month 1 week 2 days 20 hours ago) and read 6002 times:
AA has a good accounting department. They AREN'T as large in Capacity than Delta, they AREN'T as large in networking as UA, but they seem to utilize their aircraft well and offer more connections and connecting times than any other airline. Actually, I may be wrong about the capacity, but they are very comprehensive in what they do. They carefully pick out their routes and are generally VERY conservative with their future plans. They have a great partnership with BA and JL, so basically, you can get to any major city in the world with only one or two stops, transiting ORD, DFW, JFK, LAX, NRT or LHR.
They started the wave of having only twins in their fleet plan (other than WN, which is an entirely different airline) and they are trimming the subtypes in the fleet to only 3 or 4 types, as is their longterm plan.
HPAEAA From United States of America, joined May 2006, 1060 posts, RR: 1
Reply 14, posted (8 years 1 month 1 week 2 days 19 hours ago) and read 5760 times:
Quoting 1MillionFlyer (Reply 11): It's funny that WN pays their employees better than AA yet they have a bad reputation on anet for being cheap
It is funny that WN pays well, but what's no funny is that WN employees are some of the most productive ($$/hour vs Work units per hour) in the industry... I don't doubt that AA would pay more if they could gain more flexible work rules and higher productivity... bottom line AA pilots want the pay without any added work... just not going to happen imho...
Quoting 777STL (Reply 12): Care to elaborate? STL just turned the biggest revenue increase(%) out of any of AA's hubs. STL does well for AA.
your right.. from the Q3 conference call that is the case... the the question that was not posed or answered is where the base line was... for example, if ORD had base line RASM of 2.00 per ASM, but STL had base line RASM of 1.00 per ASM then STL would have to more than double the RASM per ASM just to keep pase with the system....
Is AA to Big? I'm not one to judge.. Personally I've always been impressed how diverse they are, and I think Arpey is right, that they need to evaluate each asset on an individual basis and it's NPV... while the stock holders may want immediate increase in stock price, perhaps they need to look forward at the fact that AMR is more diverse than any non government back airline in the world...
Albird87 From , joined Dec 1969, posts, RR:
Reply 18, posted (8 years 1 month 1 week 1 day 21 hours ago) and read 4278 times:
AA although may be big in amount of aircraft they have, they dont serve that many destinations outside there side of the world. You look at BA for instance and they fly to nearly every major place in the world.
AA i dont think are like Pan Am yet and never will be but they are very cautious on there routes. I think actually a big hand needs to be given to AA who were one of the only major carriers in the USA to not file for chapter 11 and i think that they were actually one of the biggest hit by 9/11 (as along with UA it was their planes that were in the incident).
To be fair the other carriers actually used Chapter 11 as a springboard there to get new aircraft and open up new routes and a new buisness plan when AA stuck it through and made a lot of cutbacks (and management mad a foolish move) but they have actually plowed through and are slowly making a comeback
I do think though that now we are seeing the drawbacks of AA doing this and as soon as they can get all this pilot/ FA legal stuff over and done with, AA will flurish again and i wouldnt be suprised to see a better service on board.
BrianDromey From Ireland, joined Dec 2006, 4088 posts, RR: 10
Reply 22, posted (8 years 1 month 1 week 1 day 7 hours ago) and read 3911 times:
I think people say get rid of STL, becasue its "too close to ORD" really mean "its not true AA".
Point to point flying is, IMHO a very good idea. There is a better chance that delays will be less and yield will be higher, versus a one-stop via a hub, P2P is also likely to increase RASM, increase utilisation of both aircraft and gates. Funnelling all traffic through a hub is not always a good idea, remember LHR and BA last Christmas?
The American fleet is not all that diverse, MD80, 738, 757, 767, 777.. In a fleet of 600+ aircraft this is sustainable. Just becasue an aircraft is "old" does not mean costs will be significantly more, as the asset will be more ikely to be owned, haven been depreciated. Also MX have a better chance to find 3rd pary parts vendors or refurbished parts, again reducing costs. Look at SAS, they fly AvroRJ,, F50, DHC8, 733,735,736,73G,738, MD80, A319,A321, A330 &A340, in a fleet of 170 aircraft.
A lot of broad, sweeping statements are made about airlines, like "commonality" too many hubs" and "duplication". Some aspects of AA are not ideal, sure, but to make these statements smacks of ignorance about the reality. Employees looking for increases is aloso somewhat premature, IMHO, its only a $175 million profit, its not like AA is awash with cash. A lot of airlines make similar money with a fleet a fraction of the size. Im sure the people of American work hard for thier money, but the money might be better spent on building a product people will actaully pay for.
Target the people who would fly AA for the the product, not those who will fly someone else to save $5. You dont see BA or SQ giving away ipgrades like confetti, thus their product has value and exclusivity, is suitably presented and priced to reflect this.
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