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usdcaguy
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Does America Deserve AA?

Sun Oct 07, 2012 10:21 am

Interesting commentary about AA and how its state seems to mirror America. Comments like this from industry "outsiders" always seem a little superficial; there's no analysis of why AA is in the shape it's in now. They just expect everything to be normal year after year without considering the fact that AA is late going through bankruptcy, which tends to create these types of scenarios. For example, NW had an HR snafu with "101 Ways to Save Money" when it started outsourcing a lot of the spoke stations. That's NORTHWEST Airlines by the way, not NORTHWESTERN, as stated in the article..obviously Al Lewis did not grow up in the Upper Midwest...

http://articles.marketwatch.com/2012...elta-airlines-american-and-america
 
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DeltaMD90
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RE: Does America Deserve AA?

Sun Oct 07, 2012 4:59 pm

Has the media forgotten how horrible of a shape UA, US, DL, and NW were just a few years ago? No, they are just having a slow news day and cashing in at AA's expense. Of course America doesn't "deserve" the state AA is in now which is fly they are in CH 11 and are rebuilding for the better. Results aren't instantaneous, let's make that assessment in a year or so
Ironically I have never flown a Delta MD-90 :)
 
727LOVER
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RE: Does America Deserve AA?

Sun Oct 07, 2012 5:14 pm

Correct me if I'm wrong......isn't AA in better financial shape while in Ch 11 than the others were?
"We must accept finite disappointment, but never lose infinite hope." - Martin Luther King, Jr.
 
ASFlyer
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RE: Does America Deserve AA?

Sun Oct 07, 2012 5:51 pm

What a stupid article. Seriously slow news day.
 
Prost
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RE: Does America Deserve AA?

Sun Oct 07, 2012 5:57 pm

As an employee who long had to suffer through insensitive comments about 'Northworst', I really feel for what the employees at AA are going through. I always make certain I have a kind word for any AA employee, and I hope at least they'll remember one nice person that day. It is very difficult to go to work under the conditions AA is operating under right now. I'm not taking sides, or laying blame, just stating the obvious. A kind word, a smile, or if your travels have become unbearable that day on AA, maybe just thinking about a way you can address your grievance assertively, rather than aggressively, will be appreciated by them.

I know that it won't be long before AA and their employees will be the fierce competitors they've always been.
 
AA94
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RE: Does America Deserve AA?

Sun Oct 07, 2012 6:07 pm

Quoting DeltaMD90 (Reply 1):
Has the media forgotten how horrible of a shape UA, US, DL, and NW were just a few years ago? No, they are just having a slow news day and cashing in at AA's expense. Of course America doesn't "deserve" the state AA is in now which is fly they are in CH 11 and are rebuilding for the better. Results aren't instantaneous, let's make that assessment in a year or so

  

Quoting Prost (Reply 4):
As an employee who long had to suffer through insensitive comments about 'Northworst', I really feel for what the employees at AA are going through. I always make certain I have a kind word for any AA employee, and I hope at least they'll remember one nice person that day. It is very difficult to go to work under the conditions AA is operating under right now. I'm not taking sides, or laying blame, just stating the obvious. A kind word, a smile, or if your travels have become unbearable that day on AA, maybe just thinking about a way you can address your grievance assertively, rather than aggressively, will be appreciated by them.

  
If you can't take the heat, you best get out of the kitchen
 
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kgaiflyer
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RE: Does America Deserve AA?

Sun Oct 07, 2012 6:40 pm

Quoting ASFlyer (Reply 3):
What a stupid article.

Not if you teach argumentation and rhetoric to adults. For that purpose, it's a goldmine.

Btw, last time I was eligible for a misconnect at DFW (8 days ago) because my originating flight was running late, my connecting flight showed up late also.

So at least AA is consistent.  
 
4engines4lnghll
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RE: Does America Deserve AA?

Sun Oct 07, 2012 6:49 pm

This question made me laugh. Its like asking if a car needs a steering wheel. American is going through a rough time but, honestly what airline hasnt? I strongly believe AA will come out of this stronger then ever unfortunately it will take some time. Until then ..... let the pathetic conclusions begin.....
4engines4lnghll
 
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IrishAyes
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RE: Does America Deserve AA?

Sun Oct 07, 2012 7:25 pm

Quoting ASFlyer (Reply 3):
What a stupid article. Seriously slow news day.

Agreed 100%.

In an excerpt from this article, notice the glaring error highlighted below...

American must be a well-run airline because it is only on its first bankruptcy, filed in November. Many other airlines, including Delta Airlines Inc., Northwestern Airlines, United Airlines, and US Airways, had already filed for bankruptcy twice. They are lucky they didn’t end up like Pan Am, or as the old joke goes, Pan Ain’t.

What the frack is Northwestern Airlines?????
confidence is silent. insecurities are loud.
 
ghifty
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RE: Does America Deserve AA?

Sun Oct 07, 2012 8:57 pm

Quoting IrishAyes (Reply 8):
They are lucky they didn’t end up like Pan Am, or as the old joke goes, Pan Ain’t.

That's an old joke? I've never heard that one before.

Quoting IrishAyes (Reply 8):
American must be a well-run airline because it is only on its first bankruptcy, filed in November.

What a fine business analysis this is.. sounds like elementary school logic.
Fly Delta (Wid)Jets
 
aeroblogger
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RE: Does America Deserve AA?

Sun Oct 07, 2012 9:52 pm

The criticism of AA itself may not be completely warranted, but this guy can write. I'm very impressed.
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EA CO AS
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RE: Does America Deserve AA?

Sun Oct 07, 2012 9:58 pm

Quoting IrishAyes (Reply 8):
In an excerpt from this article, notice the glaring error highlighted below...

American must be a well-run airline because it is only on its first bankruptcy, filed in November. Many other airlines, including Delta Airlines Inc., Northwestern Airlines, United Airlines, and US Airways, had already filed for bankruptcy twice.

And last I checked, DL and UA only had one turn each at Chaper 11...   
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PHX787
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RE: Does America Deserve AA?

Sun Oct 07, 2012 11:02 pm

Quoting DeltaMD90 (Reply 1):
Has the media forgotten how horrible of a shape UA, US, DL, and NW were just a few years ago?
Quoting EA CO AS (Reply 11):
And last I checked, DL and UA only had one turn each at Chaper 11...

I'm gonna play devil's advocate here: Weren't all those airlines in trouble at around the same time, and then they made it back out alive? Somehow these airlines, while combined with each other somehow, are doing fine, and AA is the one that is having issues here.
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IrishAyes
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RE: Does America Deserve AA?

Sun Oct 07, 2012 11:14 pm

Quoting PHX787 (Reply 12):
I'm gonna play devil's advocate here: Weren't all those airlines in trouble at around the same time, and then they made it back out alive? Somehow these airlines, while combined with each other somehow, are doing fine, and AA is the one that is having issues here.

If AA had filed for bankruptcy in 2003, arguably the picture would be VERY different today. Timing has not been their oyster. The past nine years have been precious periods wasted on repeating the same mistakes.
confidence is silent. insecurities are loud.
 
commavia
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RE: Does America Deserve AA?

Sun Oct 07, 2012 11:23 pm

Quoting DeltaMD90 (Reply 1):
Has the media forgotten how horrible of a shape UA, US, DL, and NW were just a few years ago?

The media is kicking AA right now while they are down, and as such the company is being barraged with a mountain of negativity - some of it justified and deserved, some of it not. It's the media - needless to say, I have very low expectations (with a few exceptions, like the Dallas Morning News Airline Business Blog) for their coverage of the airline industry.

Quoting DeltaMD90 (Reply 1):
Results aren't instantaneous, let's make that assessment in a year or so

I agree.

Things look really negative right now - and various constituencies, for a variety of reasons, want to continue to make things look as negative as possible for as long as possible in order to serve their own ends.

Nonetheless, only time will tell. Within 12-18 months, AA may well have exited bankruptcy, with new labor agreements in place, a fleet of tons of brand new 737s, A319s, A321s and 777s, new inflight products and interiors, new customer and employee technology resources, and a strengthened hub system and global network. All of that I think is entirely plausible. AA may well also have merged with USAirways, forming a larger carrier with new hubs, a more diversified network, and hopefully several of the other things already previously listed.

While I in no way say this to minimize or downplay the very real and very legitimate grievances that some AA employees (and unions) do have with AA management - it is amazing sometimes what the "look and feel" of a turnaround can do for peoples' feelings. A lot of AA employees today - many of them who came of age during the zenith of AA's power what it was an undisputed industry leader - feel downtrodden and demoralized by a decade of stagnation. But in 12-18 months, if many of them are to be working and/or flying on brand new planes, in and out of various nice new terminals, on a growing network, with perhaps new uniforms, upgraded amenities and products, new technology, etc. - that might make some feel somewhat better. I realize that higher pay will have to be part of that equation - it should be - but perhaps an upgraded airline would at least be a start towards making AA's workforce happier and more motivated again.

Only time will tell, but I am perhaps naively optimistic that things can turn out well at AA - I hope so for the sake of the thousands of good people working there who, regardless of what America "deserves" vis a vis the airline, do definitely themselves deserve a stronger, better and more stable place to work.

Quoting PHX787 (Reply 12):
Somehow these airlines, while combined with each other somehow, are doing fine, and AA is the one that is having issues here.

Indeed. Those airlines endured the pain early, and proactively. AA (management and the unions) - for a variety of reasons ranging from visionary foresight to narcissistic arrogance to naked self-interest - chose instead to try and restructure without bankruptcy.

AA's 2003 restructuring actually worked exactly as planned for 2-3 years until nearly all of AA's competitors aggressively leveraged bankruptcy (in some cases more than once) to lower their costs substantially below what AA achieved outside Chapter 11 in 2003. This set off a vicious cycle where AA fell further and further behind the competition, which starved AA of the capital to invest in its fleet, which further degraded AA's competitive position, and on and on. Plus, as Bob Crandall used to often say, in a commodity business (which air travel in some ways increasingly is), all else being equal, the lowest-cost producer will ultimately prevail.

[Edited 2012-10-07 16:34:06]
 
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DeltaMD90
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RE: Does America Deserve AA?

Sun Oct 07, 2012 11:51 pm

Quoting PHX787 (Reply 12):
Somehow these airlines, while combined with each other somehow, are doing fine, and AA is the one that is having issues here.

While the other airlines were crawling in agony, AA was limping away. The other airlines died (CH 11) and AA kept limping along. Eventually, its wounds took their toll (in addition to the revived competition beating them down) and AA is now in CH 11. Bad business decision to wait or not, I admire their decision to fight it out... they could have taken the easy way and screwed everyone right off the bat but they at least tried
Ironically I have never flown a Delta MD-90 :)
 
QANTASvJet
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RE: Does America Deserve AA?

Sun Oct 07, 2012 11:53 pm

Come off it guys.
1) American Airlines' management have declared the company bankrupt and have asked the courts to protect the business from its creditors. That's clear failure.
2) The author of the article also implies that the American nation is in much the same state - but since nations don't actually go bankrupt (just ask the Greeks) it's not such a clear failure.
3) He further implies that it's not just a coincidence - that management and unions at American Airlines are living in a fantasy world and failing to accept how bad the situation is, and that the same is true for American politicians (particularly, though he doesnt say so, those on the right).
3) Is the author correct with respect to 2) and 3)? There are some arguments for saying he is and some for saying he isn't. But on point 1) he is self-evidently correct.
4) The real question to ask the author (and ourselves) is why is he not drawing attention to the success of WN (amongst a few others) in his depiction of the state of the American economy. Which is actually the same question as asking why not just let AA fail, secure in the knowledge that better run carriers will pick up the business, and will also pick up those of the staff who are generally required.
5) Note that 4) is not a nice question, but that this is about facing reality, and about what is about to happen, unless management and unions wise-up and smell the coffee
 
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usdcaguy
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RE: Does America Deserve AA?

Mon Oct 08, 2012 1:04 am

Quoting DeltaMD90 (Reply 15):
Bad business decision to wait or not, I admire their decision to fight it out... they could have taken the easy way and screwed everyone right off the bat but they at least tried

I agree. They really did try however grim the prospects might have been. They probably should have gone into CH 11 the same day as DL/NW and merged with US at the same time, but hindsight really is 20/20 in this case. I still believe AA's alliance with BA and JL will help them immensely in the years to come while having CX in the same alliance is also an asset. The only thing they may not be able to get back is a better presence at ORD. I don't think there will be room for 3 hub carriers in Chicago in the years to come; something will have to give eventually.
 
Type-Rated
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RE: Does America Deserve AA?

Mon Oct 08, 2012 1:16 am

This has got to be one of the strangest thread titles I have ever seen.

Here is my take on it. Does America Deserve AA?

It all depends on how you look at AA. Are we deserving of it because it's a bad thing, or are we deserving of it because it's a good thing?
Fly North Central Airlines..The route of the Northliners!
 
XFSUgimpLB41X
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RE: Does America Deserve AA?

Mon Oct 08, 2012 1:18 am

Quoting IrishAyes (Reply 13):
If AA had filed for bankruptcy in 2003, arguably the picture would be VERY different today. Timing has not been their oyster. The past nine years have been precious periods wasted on repeating the same mistakes.

Not particularly directed at you, but it seems most people on this site have forgotten that CO didn't file bankruptcy then, either. They are doing just fine.

The fact is that AA has been very poorly run, squeaked by declaring bk by a hair thanks to major cuts taken by the employee groups with promises to be better run by management. They never came through....
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commavia
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RE: Does America Deserve AA?

Mon Oct 08, 2012 1:28 am

Quoting XFSUgimpLB41X (Reply 19):
but it seems most people on this site have forgotten that CO didn't file bankruptcy then, either

Continental didn't need to - it had already filed for bankruptcy twice in the decade leading up to that.

Quoting XFSUgimpLB41X (Reply 19):
The fact is that AA has been very poorly run, squeaked by declaring bk by a hair thanks to major cuts taken by the employee groups with promises to be better run by management. They never came through....

History is written by the winners, not the losers, and of course history will record Arpey as a failure, but I think it is overly simplistic and unfair to characterize his leadership as a complete "failure" considering that this "failure" consisted of keeping AA solvent for years longer than any peers, funding defined benefit pensions, with non-competitive labor contracts, given the wars, the fuel spikes, and the fact that most of their legacy competitors filed for bankruptcy 1-2 times each. AA employees suffered from stupid decisions, bad treatment and uninspiring leadership (among other things), but on the flip side Arpey's "failure" also meant that thousands of AA employees got to keep more of their money, and their pensions, if not their jobs altogether, for longer than their counterparts at other airlines. In this case I don't think it's a simple black or white.

Perhaps it's how we define "failure." Twenty years ago, bankruptcy - rather than the avoidance of it - was considered "failure," but nowadays its considered merely a strategy.

As for the labor cuts - those cuts were real, tangible, painful and admirable, but they were also insufficient, for a variety of reasons. Things only turned for the worse after Delta, Northwest, United and USAirways filed bankruptcy, got their costs down below AA's, were freed from many inflexibilities and strictures in their labor contracts, which rendered AA uncompetitive. All that being said, those 2003 concessions did work for several years, when AA was growing and outperforming its peers financially. I think the fairest leveling of "failure" at AA management - among many mistakes, stupid decisions and missed opportunities AA management made in the last decade - was AA management's refusal to accept reality and not file for bankruptcy sooner.

[Edited 2012-10-07 18:31:59]
 
strfyr51
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RE: Does America Deserve AA?

Mon Oct 08, 2012 3:18 am

American , United ,Delta ,Northwest ,Continental and US Air. all wound up in CH-11 because of an industry Correction, DAL,UAL,NWA used 9/11 as an excuse for CH-11, and in it they all wanted to end the pensions that they hadn't wanted to pay in the first place, they outsourced maintenance and re-rigged contracts to suit the new business model they envisioned. American's Management took to "Crowing" about how they were the ONLY USA major to avoid Bankruptcy and advertised it as such. American's management begged and got concessions and after doing so rewarded their senior managers with Bonus Pay for Sticking it TO the workers. Now 10 + years later the light comes on and they find they're at a disadvantage TO UAL and DAL because they both took the Hits and corrected their Business plan and AMR didn't. So Now EVERYBODY has joined the "club" and as painful as it's been for all the employees at LEAST whatever your Pension will be? It will be YOURS and not subject to the "Whims" of airline management. Unfortunately it will be at the Whim of Wall Street, Govt Regulations (or the lack thereof) and the forces of the market. I can honestly say that I'm actually glad to know on a daily basis if I so choose what my nest egg is doing and I can affect my performance by MY choices. Whether good or Bad depending on how you look at it Were I to have had the opportunity to get all my social security back with the interest paid Quarterly for the last 43 years of my working life I would BE a Millionaire. Unfortunately that "Ponzi" scheme was not of my choice and at some point the entire scheme should be rolled into an annuity plan backed by US Govt debt securities. I mean if you're going to sell debt to China at a good interest rate? Sell it to ME at a good interest rate!!

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