Republic
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Crandall: Bigger Planes, Less Flights

Sat Sep 22, 2001 12:11 am

Here is an interesting comment from Robert Crandall, former CEO of American Airlines. He is basically saying that the days of high frequency are over. I do not agree. Do you think Crandall is correct in his vision of the future?

September 21, 2001


AIRLINE INDUSTRY
Aviation's path: bigger planes, fewer flights


by John Schmeltzer
Tribune staff reporter
Published September 20, 2001

As the nation's largest aircraft manufacturer and top airlines grapple with thousands of layoffs, airline executives said their business practices would change dramatically as a result of last week's terrorist attacks.

Airlines will fly fewer but larger planes. That will require fewer pilots and flight attendants. And for aircraft manufacturers like Chicago-based Boeing Co. and the European aircraft consortium Airbus Industrie, it will mean that fewer planes will be needed--and fewer workers.

No longer will the nation's top two airlines fly a combined 35 to 40 flights per day between Chicago and New York, the standard practice of American Airlines and United Airlines before last week.

"In the future it will be 20 to 25 flights per day," said Robert Crandall, former chief executive of AMR Corp., the parent of American Airlines. Crandall is credited with designing the small-jet, high-frequency plan that has dominated air travel for the past decade.

Crandall's comments on Wednesday came as American and Elk Grove Township-based UAL Corp. each said they would lay off 20,000 employees.

The two carriers' announcements were just the latest in their rapidly deteriorating industry. Late Tuesday, Chicago-based Boeing dropped an even bigger surprise: cuts of up to 30,000 jobs in its commercial jet unit by the end of 2002.

Observers say the nation's aviation industry could end up shedding more than 130,000 jobs. That could have painful repercussions for the rest of the economy, because the industry produces 10 percent of the country's gross domestic product.

In addition to American and United, Continental Airlines and US Airways--the nation's fifth- and sixth-largest carriers--have said they are cutting as many as 23,000 workers. Airline officials said layoff announcements could be going out to another 32,000 at Delta Air Lines and Northwest Airlines.

Along with a new economic climate that has spurred the job cuts has come the realization that the old ways of operating might have to change.

Joseph Schwieterman, chairman of the Chaddick Institute for Metropolitan Development at DePaul University, said events of the past week "have forced the industry to look at the proliferation of high-frequency, small-jet operations that were acclimated toward the business traveler" but made little economic sense.

Schwieterman, a member of a Federal Aviation Administration advisory committee, has long argued that the "intense competition for schedule frequency" is absurd.

That may be a concern of the past, however. Because of intensified security at the nation's airports, Crandall said, it wouldn't be physically possible to maintain the frequency that the airlines have been running.

He said that carriers will be forced to make fewer flights with planes like the Boeing 757, which seats 200 or more passengers, rather than Boeing 737s, MD-80s or Fokker 100s, which seat as few as 100 passengers.

Airline officials said as many as 1,000 of the 5,000 single-aisle and dual-aisle planes they have been flying will be idled.

U.S. airlines warn of looming bankruptcies unless the government acts swiftly to provide $17.5 billion in financial aid, but President Bush is proposing a much smaller package.

American and America West said they face imminent bankruptcy without assistance. American said its liabilities from the hijackings may exceed its financial resources."

In another troubling development, Lloyd's of London on Wednesday canceled the industry's war and terrorism insurance coverage, effective Monday. Without the coverage, airlines could be forced to temporarily ground their fleets until they obtain other insurance or government assistance.


Copyright © 2001, Chicago Tribune
 
atcboy73
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RE: Crandall: Bigger Planes, Less Flights

Sat Sep 22, 2001 12:42 am

Man I just posted a question about this on Planebusiness.com.

I do wonder if this is going to change how airlines operate.

It does make sence that if you are operating 16 flights one way on a route and your planes are half full that you should cut frequency. But when ever this is over and the business comes back wouldnt they go to thier old ways.

I guess the main question is, is it really that much more expensive to operate an hourly schedual if that is what your high fare paying customers want and will pay for.

Personlly I dont really think that a business traveler would notice if an airline ran a flight every 1:30 min as opposed to every hour.
 
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eta unknown
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Agree With Crandall

Sat Sep 22, 2001 1:20 am

Fully agree with Crandall. I would much rather see (and makes further economic sense) a 767 operating a route in place of 2-3 MD80's. In turn, this would mean one less bank of flights per day at hubs.

In addition, less delays and easier air traffic control conditions would be encountered- there comes a point (especially at La Guardia) where the slot lunacy has to stop and the airport just says "enough is enough" thereby placing a limit on the number of flights it can safely accommodate per day.
 
SuperG
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RE: Crandall: Bigger Planes, Less Flights

Sat Sep 22, 2001 1:38 am

I interesting that this should suggestion should come up. If memory serves me right, that is pretty much what was being said in the mid 60s when the "Airbus" (what the DC-10 and L-1011 were being called at the time) concept was first proposed. Larger planes with less frequency (1 Airbus vs. say 2 727s) from congested airports such as LaGuardia. An idea whose time has come again so it seems.
 
Guest

RE: Crandall: Bigger Planes, Less Flights

Sat Sep 22, 2001 1:54 am

Don't bet on it. Airlines have invested too heavily in smaller, more flexible aircraft to all of the sudden buy new widebody jets.

Besides, Crandal mentions 757s not widebodies. The real winner in this proposed strategy are 757s, 737-900s and A321s.

But it would be nice to see silver 767s at San Antonio again after 7-year absence.
 
Jaws707
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RE: Crandall: Bigger Planes, Less Flights

Sat Sep 22, 2001 2:16 am

I think that getting bigger jets and reducing frequency is a great idea. Some common sense will tell you that there is no need to fly 40 flights between ORD and New York between 2 carriers. With schedules the airlines were using they were basically asking for losses. Now this does not mean that they will go out and start dumping the smaller planes, but over time sales of planes like the 737 will begin to decrease with planes like the 757 and 767 taking more orders.
 
777D
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RE: Crandall: Bigger Planes, Less Flights

Sat Sep 22, 2001 2:20 am

I agree with Robert Crandall regarding this issue. SEA-SFO(OAK, SJC) or SFO-LAX(SNA, ONT, BUR) have a huge amount of flights. Reducing the flight by 25% and using larger air craft might such as 737-900, 757-300 and do I dare to say 767's would be a good move. A reduction might make the skies safer and for all of us. I remember about 6 years ago maybe even longer, I flew a DC-10 from SEA-SFO and it was full.

As someone posted, that the airlines would soon forget this idea when the economy improves and it will be business as usual. High frequencies, more complaints, and lousy service.
 
Guest

RE: Crandall: Bigger Planes, Less Flights

Sat Sep 22, 2001 4:09 am

This is truly bizarre. Two weeks ago, this forum was loaded with people talking up RJ's as the latest industry trend, allowing more service to more smaller airports. Now, after the attack, Crandall says the future is in fewer flights using bigger planes...but the same article credits him as the architect of the small-jet and high-frequency plan we have been heading toward. Intersting to note that the airlines who all have these biggest planes are the ones bleeding the most right now.

There is no doubt that the industry is changed and will change further. There is also no doubt that there is a substantial inefficiency in flying smaller planes at very high frequency between major hubs. But, I do not see a shift away from 737s and MD80s...except at those thick routes between the very biggest hubs. If anything, the present fleet surpluses and coming fire-sales should make it that much easier for new airlines to form built around cheap planes. The 737 is the last plane I expect to see mothballed in Arizona, awaiting the next business upturn.
 
sfointern
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RE: Crandall: Bigger Planes, Less Flights

Sat Sep 22, 2001 5:29 am

Lsjef... I know! It just gets stranger by the day...

The events of Sept. 11 have forced us to switch around our priorities. Business travel governed airline procedure and policy before; now --more than ever-- safety will come first. Bar none.
 
L1011
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RE: Crandall: Bigger Planes, Less Flights

Sat Sep 22, 2001 8:25 am

I think this is already happening. My AA MD-80 from LAS to DFW next month has now been changed to a 757, and some flights on that route have been removed from the schedule.

Bob Bradley
Richmond, VA
Fly Eastern's Golden Falcon DC-7B
 
tullamarine
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RE: Crandall: Bigger Planes, Less Flights

Sat Sep 22, 2001 11:04 am

What Crandall proposes is very much what has been the case in Australia for 20 years. Due to slot restrictions in SYD, services between MEL-SYD (which is the third busiest domestic route in the world after 2 Japanese routes) are almost always serviced with 767s. Now AN has closed down, QF are often using 744s on this 1 hour service. Services operate every 1/2 hour.
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milemaster
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RE: Crandall: Bigger Planes, Less Flights

Sat Sep 22, 2001 4:52 pm

Only competition will deal these cards. It's all about who reduces frequency 1st. AA? DL? UA?

It'll be interesting to see..

 
Tan Flyr
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RE: Crandall: Bigger Planes, Less Flights

Sun Sep 23, 2001 11:17 am

This is an idea that I have floated on this forum and others several months ago. Routes that used to be the province of widebodies (LAX-ORD) years ago, could and should go back to 767/757 type equipment. In the current enviornment this would be great way to cut costs, ie; a widebody every 90 min to 2 hrs rather than a 737/320 or whatever every hour.

It is rather interesting tho that Crandall takes this approach now, when on his watch at AA the fleet mix shifted substantially more in favor of narrowbodies. The errors that were made in the late 80's/early 90s were admitted to by an AA executive in a "Wall Street Journal" article a few years back.

This is different than the RJ argument tho...those open up new routes that would be unprofitable with 100-120 seat equipment, and now the public(like me) really likes those RJ's much better than any Saab, ATR, or Brasilia.

So, as we make our way into waters never travelled, we will see what decisions are made with common sense and result in economic sense.
 
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United_fan
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RE: Agree With Crandall

Sun Sep 23, 2001 2:32 pm

I agree! I hope,someday,we'll see an A^A 757 here in ROC.Currently,we see only MD80's and F100's.

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YoungDon
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RE: Agree With Crandall

Sun Sep 23, 2001 4:51 pm

AA had 767's in SAT? They had to have flown them from DFW, right?
 
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RayChuang
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RE: Crandall: Bigger Planes, Less Flights

Sun Sep 23, 2001 5:08 pm

If what Crandall suggested is true, then expect more 757-200, 757-300, 767-200, and 767-300 sales in the future.

Suddenly, the 757-300 makes sense for the USA market.
 
Guest

RE: Crandall: Bigger Planes, Less Flights

Sun Sep 23, 2001 9:43 pm

Yep, AA flew 767s into SAT on/off throughout the late 80s and into the 90s. At one point, a mix of 4 AA D10s/767s operated to DFW each day.

DL also provided 767 (and the odd L15) service in the 80s to DFW. Was at SAT when the "Spirit of DL" (?) the 767 purchased by DL employees, innuaguarted DL's San Antonio widebody flights. That was 1983.
 
Tan Flyr
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RE: Crandall: Bigger Planes, Less Flights

Sun Sep 23, 2001 9:43 pm

Young Don, yes they were to DFW. A long time ago, AA flew DC-10s to SAT & ELP from DFW. MAybe Austin also, not sure. I am not advocating going back to the CAB days, but at one time nearly all ORD-LAX/SFO flights were with DC-10s. So, what Ray suggests above is true...down the road we may see AA & others convert 7NG orders/options to 764's 753's for domestic service.
 
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chrisnh
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RE: Agree With Crandall

Sun Sep 23, 2001 9:44 pm

What goes around comes around.
Now that the last of the L-1011s and DC-10's are sent to the boneyard, they start looking pretty appealing right now as a surrogate for 2x MD-80s or 737s. If I were these carriers, I'd park 2 of these single-aisle jets for every widebody brought back into service.

Chris in NH
 
Republic
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RE: Crandall: Bigger Planes, Less Flights

Sun Sep 23, 2001 11:55 pm

To me, it seems this is all based on what the competition is doing. For instance, what if one carrier does not subscribe to the larger plane theory, and continues to run high frequency service, and the other runs low frequency service. Eventually, the business traveler will come back. Which service will the business traveler choose? And, then the low frequency carrier will have to go back to more frequencies to be competitive.

It seems there is no one correct way here. Really is interesting how this will play out.

Joe
 
AerLingus
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RE: Crandall: Bigger Planes, Less Flights

Mon Sep 24, 2001 1:22 am

This will be good news for future start up carriers. With a decrease in frequency, an availability of slots will be made available for smaller, newer carriers to pick up the slack from the majors.
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johnnybgoode
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RE: Crandall: Bigger Planes, Less Flights

Mon Sep 24, 2001 1:28 am

however it will come to be...

if there will be use of bigger aircraft and less frequency, except for the current cuts of about 20% at so many carriers, it would not only reduce slot constraints, but would be also more non-polluting...

rgds
daniel
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