ord
Posts: 1356
Joined: Tue Jul 20, 1999 10:34 pm

AA's Mrtc Under Review

Fri Sep 24, 2004 2:59 am

It looks like MRTC may be on its way out in more AA aircraft. CEO Arpey gave a speech this morning and here is some of what he said. (Note: I thought the 737s still had MRTC?)

"BY ADDING SEATS BACK TO OUR 757, A300 AND 737 FLEETS -- THEREBY CORRECTING A MISMATCH THAT HAD DEVELOPED IN THOSE MARKETS BETWEEN WHAT WE WERE OFFERING, AND WHAT OUR CUSTOMERS WERE WILLING TO PAY FOR -- WE HAVE GENERATED OVER $60 MILLION IN INCREMENTAL REVENUE THIS YEAR.

"LOOKING FORWARD, WE ARE WELL ALONG IN EVALUATING WHETHER OR NOT IT MAKES SENSE TO CHANGE THE SEATING DENSITY ON ADDITIONAL AIRCRAFT.

"WE ARE OBVIOUSLY TRYING TO FIND THE RIGHT BALANCE BETWEEN WHAT OUR CUSTOMERS WOULD LIKE US TO DO, AND WHAT THEY ARE WILLING TO PAY FOR. WE SHOULD BE REACHING SOME CONCLUSIONS SHORTLY."



[Edited 2004-09-23 20:00:56]
 
ckfred
Posts: 4763
Joined: Wed Apr 25, 2001 12:50 pm

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 3:16 am

I'm an AMR shareholder, and this statement by Arpey is stupid. I know several AA employees, and they think that MRTC was the best idea management had in years.

I've yet to figure out why AA put 2 rows of coach back in the 757s. The 737s each got 2 more rows of coach, but lost a row of first class. So the 737s are still MRTC.

If teh 757s are flying "leisure" routes, than wouldn't it make sense to take out a row of first. After all, there shouldn't be a lot of road warriors trying for upgrades.

 
ssides
Posts: 3248
Joined: Fri Feb 09, 2001 12:57 am

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 3:42 am

If teh 757s are flying "leisure" routes, than wouldn't it make sense to take out a row of first. After all, there shouldn't be a lot of road warriors trying for upgrades.

Sure there are. The road warriors are the ones building up most of the upgrade points -- why not reward them on their vacation to Cancun by letting them upgrade?

I'm an AMR shareholder, and this statement by Arpey is stupid. I know several AA employees, and they think that MRTC was the best idea management had in years.

Can you point to MRTC producing a more profitable airline? If not, as a shareholder, you shouldn't complain. As a passenger, I love MRTC, but if fuel prices stay where they are, the extra revenue is going to have to come from somewhere.

For example, let's say that NW is charging $250 for its DFW-MSP route, with no MRTC. AA prices it at $280 with MRTC. If NW's load factor is higher, then customers are showing AA that MRTC isn't worth the extra 30 bucks. If this is the case, AA should drop MRTC. And remember, they're only evaluating the proposal.
"Lose" is not spelled with two o's!!!!
 
JAXpax
Posts: 463
Joined: Sat Sep 04, 2004 9:52 am

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 3:43 am

I'm mid-tier elite on AA.... and usually end up in First when available as the bulk of my AA travel is on ERJ/ATR.

However, MRTC is what got me flying AA to begin with. I'm glad I'm elite because most of the mainline aircraft I see anymore are B757s (connecting via MIA to domestic big cities). It's one of the few things distinguishing AA's coach product from the others (though AA's First is leaps ahead of most other US carriers, domestically).

If I've gotta ride coach with standard legroom and slave ship seating a'la US Airways B737s, then why go out of my way to fly American?
 
JAXpax
Posts: 463
Joined: Sat Sep 04, 2004 9:52 am

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 3:47 am

If teh 757s are flying "leisure" routes, than wouldn't it make sense to take out a row of first. After all, there shouldn't be a lot of road warriors trying for upgrades.

US Airways did this... the B757s only have eight First Class seats and are flying to mainly places like Las Vegas. It's an interesting situation.... you risk angering those who fly your airline basically for the benefit of upgrades.
 
MakeMinesLAX
Posts: 452
Joined: Thu Dec 18, 2003 4:22 am

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 4:26 am

UA's Economy Plus seems to be a decent compromise (although whether it's "working" is another matter). These seats are reserved mainly (but not exclusively; see below) for full-fare coach ticketholders, or those who have reached a certain Mileage Plus level.

On recent 757 flights LAX-EWR-LAX, I was presented with the opportunity to upgrade for $35 one-way (about a 25% premium). I declined (after multiplying by four), but I can see how this possibility might appeal to some travelers. BTW, the return flight was quite empty, so we were able to switch to the second exit row (row 16, which is the last in the EP section). I agree with seatguru.com - these are great seats.

Maybe EP is working, since UA is introducing on the p.s. configuration for transcon flights. Obviously, this won't work for every airline, since it entails having a dedicated fleet and particular route structure.
 
SNATH
Posts: 3049
Joined: Mon Mar 29, 2004 5:23 am

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 4:28 am

I really hope that they keep MRTC for at least their international long-haul routes.
I flew JFK-NRT on an AA777 twice during the last year. MTRC really made the
14h legs more bearable and I would get out of my way to fly AA again if I need
to do the same trip. Of course, if they remove it, I'll get out of my way NOT to fly
AA and fly UA instead and get on the Economy Plus seats.

Tony
Nikon: we don't want more pixels, we want better pixels.
 
acvitale
Posts: 1911
Joined: Sat Aug 18, 2001 8:25 am

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 4:44 am

In the example of 2 rows removed (6 seats) for 757s lets assume they are configured at 158 or 166 depending on if former TWA or AA original equipment. That means that you are looking at needing an incremental increase in revenue of .036 to .037 more. Meaning a 3-4% additional revenue increase. Hence if NW is $198.00 and you get $6-$7 more. Any thing over that is gravy. Of course that is before you factor how many seats go empty on average. If the load factor is 85% then you can reduce the incremental revenue number by 15%..

Anyhow that is one way of looking at it.

Of course the average yield is higher so you would factor it at the higher number the best way to calculate would be using ASMs Yield and calculate against the fleet type.

That is all before the goodwill and marketing value is calculated.

A C Vitale
 
Tan Flyr
Posts: 1579
Joined: Sat Aug 19, 2000 11:07 pm

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 5:46 am

As a shareholder and AAdvantage Platinum customer, I can see both sides of the issue. However, AA needs to be careful here that they do not be come as homogeneous as other carriers. If price is equal, schedules are equal, FF programs relatively equal, and seat pitch (cabin comfort) equal, then what advantage does AA ( or any other carrier) have over the others in a market? Prettier planes? Cleaner cabins? ( tho that might help a bit) what is it that would cause a customer to choose AA or anyone else?

Yes, as a shareholder I want the stock to get back up and the company to be financially secure. Business must be careful about always imitating the other guys. There are a lot of tall folks in the US that love the extra inches of MRTC. Taking it out pisses them off and could drive them to the cheapest carrier on any route. Then what have you gained??

During the changeover to MRTC a few years ago, the crew always made a big deal that "today's aircraft has just had 3 rows (or whatever it was) of seats taken out for your added comfort. What would they say during a 2 year changeover..Well folks enjoy the extra inches today, because this MD-80 is headed to Tulsa to have more rows of seats stuck back in so we can cram a few more sweaty bodies on!? Or..How about this...Welcome aboard our 737-800 today folks. This aircraft is just back from Tulsa with more rows added, that why the line to board was longer today for our 5 hr flight to LAX.

I'd support the idea of selling limited selections of sandwiches, entertainment, heck even magazines & morning newspapers.

AA needs to find more revenue for sure, but maybe finding more innovative ways to fill empty seats on flights would be better than throwing away the good will brought on with MRTC.(One idea might be in the biggest cities..Ads on TV at night.....American has 40 unsold seats tomorrow to LAX..Go online now to book yours at only $129.99, or whatever)

that's my 2 cents!

TF
 
ASTROJET707
Posts: 291
Joined: Sat Feb 14, 2004 9:39 am

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 6:31 am

Just had to jump in on this one. I live in Dallas and fly AA because business travel usually takes me on AA. As a result I have booked peronal travel on American as well. I hope they retain MRTC on the MD80/B763/B772. Very comfortable. We'll be hearing more about this in the coming days?weeks?


AJ707
 
moman
Posts: 708
Joined: Tue Aug 10, 2004 7:17 am

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 7:24 am

The route I generally fly TPA-STL has been moved from a Super80 with MRTC to a 757 with LRTC. I was quite sad to see this change happen and a previous poster mentioned, I think MRTC is a benefit for which I will pay.

Now I try to take connecting flights to get the MD80s. If AA removes MRTC, they will just muddle themselves in with the rest. Where is their differentiation?

Moman
AA Platinum Member - American Airlines Forever
 
JC5280
Posts: 523
Joined: Sat Oct 06, 2001 12:06 pm

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 10:42 am

AA is upset that UA's Economy Plus has provided more revenue that MRTC. On top of that, the new Economy Plus upsell has made more money than expected...and its gravy. I know that in the last 30 days, Econ + upsell has netted over $1.1mil.

Good planning by UA and will be even better if AA goes through with this.
 
HNL
Posts: 439
Joined: Mon Sep 20, 2004 1:51 am

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 10:59 am

I was a UA Premier Executive and had been pissed off on several instances when I could not get a seat in E+. I was thrilled to switch to AA with the addition of MRTC and in that time have been a a Plat or Gold (biz travel varies), plus I maintain a membership in the Admirals Club.

HEAR THIS AA Executives -- I will bail on you if you abandon MRTC. Ignore your bean counters.

$60 million annual incremental revenue for a multi-billion dollar company is small potatoes. Eliminating MRTC will anger your loyal flyers, and they will leave costing you more revenue.

All the airlines will honor the Elite status if the airline thinks they can steal a customer.
HNL - There's no place like it!
 
trickijedi
Posts: 3201
Joined: Sun May 13, 2001 4:35 pm

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 11:12 am

All the airlines will honor the Elite status if the airline thinks they can steal a customer.

True. And this is what AA has done for years to lure disgruntled road warriors to try and stay with MRTC. It's a more subtle version of the AA Platinum Challenge as if to dare you to try AA's cabin comfort and challenge you to return to your previous carrier. Most passengers of course stay with AA.
Its better to be on the ground wishing you were in the air than be in the air wishing you were on the ground. Fly safe!
 
ordflyer
Posts: 498
Joined: Tue Aug 03, 2004 2:08 pm

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 11:41 am

Unfortunately I have kinda expected this ever since they removed MRTC from 757s and A300s. I really hope they decide to keep MRTC...it has been one of the main reasons why most of my business in the past few years has gone to AA. They need to watch this situation carefully...they didn't hold back a bit when they were touting the introduction of MRTC a few years ago. People will definitely notice losing that extra legroom, and won't be happy!
 
CaptOveur
Posts: 6064
Joined: Thu May 06, 2004 3:13 am

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 10:52 pm

For example, let's say that NW is charging $250 for its DFW-MSP route, with no MRTC. AA prices it at $280 with MRTC. If NW's load factor is higher, then customers are showing AA that MRTC isn't worth the extra 30 bucks. If this is the case, AA should drop MRTC. And remember, they're only evaluating the proposal.

Speaking as an occasional customer of NW and AA with a frequent flyer card for both I have to tell you, I would happily pay a mere $30 more to fly on AA on the basis of MRTC. I am 6'4" if I am going anywhere more than an hour away I am going to be pretty uncomfortable shoehorned into a NW seat. The legroom on AA for a 2hr flight is easily worth $30 to me. I think AAs problem with MRTC might be the marketing of it. How many of your average travelers know that you get a little more room on AA? I think if people knew about it they would happily pay for it.

AA and NW are virtually the same on service domestically, they go the same places (mostly), they need something to differentiate their product from the rest. NW offers the opportunity to fly antique airliners (joking), AA offers more leg room. It is all about what people are willing to pay for. Is IFE worth $30 to me? No. That is what windows and books are for. Is better food on a 3hr flight worth $30 to me, maybe but given the choice between airline food and legroom I will take legroom.

I just wish AA would put a little more leg room on Eagle, I end up flying them more often than I would like and I hate being crammed into a CRJ or ERJ for almost 2hrs with no additional legroom. If I see the flight is going to have its longest leg on Eagle I would save my $30 and fly NW.
Things were better when it was two guys in a dorm room.
 
AAR90
Posts: 3140
Joined: Fri Jan 21, 2000 11:51 am

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 10:56 pm

The 737s each got 2 more rows of coach, but lost a row of first class. So the 737s are still MRTC.

Hasn't happened yet, but we were told a couple of months ago that this is "in the works."
*NO CARRIER* -- A Naval Aviator's worst nightmare!
 
NYCAAer
Posts: 601
Joined: Thu Jul 29, 2004 10:22 pm

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 11:30 pm

If the 738s are moved to Miami, most of the flying they will be assigned to is leisure traffic, such as the Caribbean, so I wouldn't be surprised. I still think AA would be wiser using the 738s to better compete on longer haul domestic routes, like DFW and ORD to the West Coast, or routes like BOS-DFW and LGA-DFW, but we'll see.
 
ord
Posts: 1356
Joined: Tue Jul 20, 1999 10:34 pm

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 11:32 pm

The 737s already have lost a row of first class - about a year ago. The seat count went from 20 to 16, and the closets between first class and coach were removed. I'm unsure though how many coach rows were added (based on previous posts it sounds like two).
 
JGPH1A
Posts: 15080
Joined: Thu Aug 14, 2003 4:36 pm

RE: AA's Mrtc Under Review

Fri Sep 24, 2004 11:51 pm

MRTC is a serious factor for me when buying transAtlantic tickets - AA 777 is always first choice if prices are reasonably close. I hope AA keep MRTC - its a real blessing.
Young and beautiful and thin and gorgeous AND BANNED ! Cya at airspaceonline.com, losers
 
ssides
Posts: 3248
Joined: Fri Feb 09, 2001 12:57 am

RE: AA's Mrtc Under Review

Sat Sep 25, 2004 12:11 am

The legroom on AA for a 2hr flight is easily worth $30 to me.

It's worth it to me, too. However, the question is whether the flying public at large is willing to fork this extra cash over (and remember, the $30 was just for the sake of the argument -- in many cases it could be much more). AA can't let a few people dictate its pricing practices; it must look to the market as a whole.

I think AAs problem with MRTC might be the marketing of it. How many of your average travelers know that you get a little more room on AA? I think if people knew about it they would happily pay for it.

Most people do. Everywhere you book, whether it's Expedia, Travelocity, Orbitz, or AA.com, the "More Room" logo shows up consistently. When I've called AA to book tickets, they remind me of the more room feature. People here are just price-conscious; the success of WN and other LCCs proves this. I really, really want AA to keep MRTC, but if they can't make money doing it, I don't expect them to keep it around.
"Lose" is not spelled with two o's!!!!
 
User avatar
Aaron747
Posts: 8560
Joined: Thu Aug 07, 2003 2:07 am

RE: AA's Mrtc Under Review

Sat Sep 25, 2004 1:08 am

All I know is there was nothing better for the 10 hours to NRT from SJC in March than 34" pitch way in the back of a 777. I'd pay top dollar economy fare for that any day of the week and twice on Sunday.
If you need someone to blame / throw a rock in the air / you'll hit someone guilty
 
burnsie28
Posts: 5042
Joined: Mon Aug 02, 2004 1:49 am

RE: AA's Mrtc Under Review

Sat Sep 25, 2004 2:30 am

I am 6' 4" also, I have never had a problem on either NW or DL coach seats, sit up strait and no problems, i have room to move, so I dont see why you are having such a problem with either seats.
 
CaptOveur
Posts: 6064
Joined: Thu May 06, 2004 3:13 am

Mrtc

Sat Sep 25, 2004 2:32 am

"the success of WN and other LCCs proves this."

Bull.. I have flown Southwest once in my life, because that is the ONLY time they have been cheaper than a legacy carrier roundtrip, and for less money, I found the service to be better. Jetblue also seems to have a reputation for being low cost in name only, at least that was my observation the times I have tried to fly them somewhere. Air Tran is actually cheap almost every time, unfortunantly for me they don't fly to either, meaning the only LCC I have as an option is WN.
Things were better when it was two guys in a dorm room.

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