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onwFan
Posts: 440
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 5:18 pm

tphuang wrote:
onwFan wrote:
tphuang wrote:
At this point, I think AS and AA can all fit in T4 + T5. I'm sure they want most of T4 to 6, but they really don't need it. AA will probably be at most 150 flights in the near to medium term and AS will be around 70 to 90.

AA's operations at LAX were already extremely gate-constrained, leading to heavy delays on almost ever singe flight. Plus, there was literally no room for even people to walk, unless you want to walk through them. If they plan to move over the operations from the 9 American Eagle satellite gates, they will definitely need both T4 and T5. Plus, T5 will be a buffer for their operations if they go ahead with the T4 modernization project. They might not need those TBIT gates. I also see AS capitalizing on some of the availability in T5/T6. In any case, with MSC opening up and the smaller carriers moving over, there will be space at T5. I don't see DL wanting to come back to T5 (or anywhere on the South side) for split operations. Nor do I see UA expanding, nor WN. So who exactly is going to want T5 in the near future?


There won't be any expanding. Again, largest cuts in mainline FAs are at PHX, LAX and MIA. Of those 3, LAX was the smallest hub pre-COVID, so the shrink in terms of percentage is probably the largest. At the same time, I see a lot of those Eagle flights going away if AS ends up carrying that load. So, it f you have a large reduction in mainline and regional, you will have a large reduction over all.

AS at best scenario will recover to pre-COVID size sometimes next year in number of flights but in shorter stage length. There is a pretty good chance AS will close its LAX A320 base. So I anticipate we will see a lot more regional and less mainline from AS out of LAX.

Is AA really in a position to make continued investment in T4+5? I don't see it. It's priority coming out of this is basically DFW + CLT.

Time will tell. But T4+T5 for AA & AS combined sounds hardly sufficient, with little to no flexibility to grow anytime ever in the future.
 
MAH4546
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 5:18 pm

tphuang wrote:
onwFan wrote:
tphuang wrote:
At this point, I think AS and AA can all fit in T4 + T5. I'm sure they want most of T4 to 6, but they really don't need it. AA will probably be at most 150 flights in the near to medium term and AS will be around 70 to 90.

AA's operations at LAX were already extremely gate-constrained, leading to heavy delays on almost ever singe flight. Plus, there was literally no room for even people to walk, unless you want to walk through them. If they plan to move over the operations from the 9 American Eagle satellite gates, they will definitely need both T4 and T5. Plus, T5 will be a buffer for their operations if they go ahead with the T4 modernization project. They might not need those TBIT gates. I also see AS capitalizing on some of the availability in T5/T6. In any case, with MSC opening up and the smaller carriers moving over, there will be space at T5. I don't see DL wanting to come back to T5 (or anywhere on the South side) for split operations. Nor do I see UA expanding, nor WN. So who exactly is going to want T5 in the near future?


There won't be any expanding. Again, largest cuts in mainline FAs are at PHX, LAX and MIA. Of those 3, LAX was the smallest hub pre-COVID, so the shrink in terms of percentage is probably the largest. At the same time, I see a lot of those Eagle flights going away if AS ends up carrying that load. So, it f you have a large reduction in mainline and regional, you will have a large reduction over all.

AS at best scenario will recover to pre-COVID size sometimes next year in number of flights but in shorter stage length. There is a pretty good chance AS will close its LAX A320 base. So I anticipate we will see a lot more regional and less mainline from AS out of LAX.

Is AA really in a position to make continued investment in T4+5? I don't see it. It's priority coming out of this is basically DFW + CLT.


International staffing is being cut significantly and LAX is also losing roughly half of its long haul. That tefekects the deeper cuts at MIA and LAX, not necessarily proportionally more reduced flying. AA is very strong domestic at LAX and does not rely heavily on China/HK feed for those flights whatsoever. It will adjust its LAX domestic network accordingly despite those cancellations, not because of.
a.
 
AmericanAir88
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 5:29 pm

AA won’t cut JFK. T8 will become a oneworld powerhouse with BA/AA/AS.

Also, AA has to keep up with DL as they share similar tastes in NYC airports: High output at LGA and JFK; hub routes and a few extras at EWR. B6 kind of stole the Caribbean thunder from AA, but AA/AS have taken the throne for west coast travel. I see JFK being great for AA.
 
tphuang
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 5:32 pm

AmericanAir88 wrote:
AA won’t cut JFK. T8 will become a oneworld powerhouse with BA/AA/AS.

Also, AA has to keep up with DL as they share similar tastes in NYC airports: High output at LGA and JFK; hub routes and a few extras at EWR. B6 kind of stole the Caribbean thunder from AA, but AA/AS have taken the throne for west coast travel. I see JFK being great for AA.

well, 70 slots apparently got returned at JFK. I would venture to guess most if not all or that is from AA. And they are definitely not taking any through for west coast travel if you look at the number of scheduled flights to west coast from JFK.
 
AmericanAir88
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 5:36 pm

tphuang wrote:
AmericanAir88 wrote:
AA won’t cut JFK. T8 will become a oneworld powerhouse with BA/AA/AS.

Also, AA has to keep up with DL as they share similar tastes in NYC airports: High output at LGA and JFK; hub routes and a few extras at EWR. B6 kind of stole the Caribbean thunder from AA, but AA/AS have taken the throne for west coast travel. I see JFK being great for AA.

well, 70 slots apparently got returned at JFK. I would venture to guess most if not all or that is from AA. And they are definitely not taking any through for west coast travel if you look at the number of scheduled flights to west coast from JFK.


Those slots are probably mostly AA, but I think DL will give some up as well.

As for west coast travel, I was referring to AA/AS working together. When travel returns, AA will follow.
 
chonetsao
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 5:51 pm

Unfortunately JFK will remain an oneworld hub, just not an AA hub in tradition meanings. For AA, JFK will be an O&D heavy Focus City that is complementary to LGA. Together, LGA and JFK will form AA's NYC hub strategy. As a standing alone airport, JFK is an oneworld hub, an AA O&D focus airport. Sorry for repeating the line twice, but I don't know how to present the issue more clearly.
 
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BA744PHX
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 5:54 pm

jfklganyc wrote:
Cointrin330 wrote:
chonetsao wrote:

Right size ORD, YES. Drop the hub? I am not so sure.


Agreed. Clearly, ORD isn't a focus for AA for long haul, notably post-COVID19, but as a domestic trunk hub, it still has a relevant role to play and can't be subbed out with more capacity thrown at DFW. Without ORD, AA would have no mid-continent hub (DFW is too far south for the midwest markets and feed). AA will retain ORD, but it will just continue to exist as a domestic focused operation, with LHR year round and if and when the industry recovers, a slight bounce for TATL seasonals, selectively though. I do not see East Europe ever being launched or anything else that can be easily served from PHL except for a small # of big markets.


There’s no way American would drop ORD.

Northern, mid continent connecting hub in the most important city in that region

They will drop JFK LAX and PHX first.


This is such a tired argument! PHX, ORD & PHL are doing fine and remain in the middle or estimated profit margins, with LAX, LGA, JFK & MIA at the bottom they would logically be dropped.

PHX has been overstaffed for many years, it's no surprise they are reducing as FA were used to support LAX flying.

Estimated operating profit margin for AA Hubs
8.11% average

https://i.imgur.com/fZ6Y4Jb.png
CLT 14.3%
DCA 13.6%
DFW 12.7%
ORD 11.4%
PHL 11.4%
PHX 9.6%
MIA 6.7%
JFK 3.1%
LGA -0.8%
LAX - 0.9%

AA is/has already dropped Asia flying from ORD and now LAX, I wouldn't put it pass them to reduced a lot of this "profitable" Latin America flying from MIA as they are bleeding money from that hub

JFK only recently got out of the red after they reduced and eliminated a lot of JFK LH flying
 
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BA744PHX
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 5:58 pm

FSDan wrote:
Cointrin330 wrote:
PHX is squeezed margin wise due to WN and there is not enough corporate traffic at PHX to ensure its viability.


Haven't we seen hub margin estimates showing PHX as not too different from ORD, MIA, etc.? Somewhere near 10%? Also, while there may not be as much corporate traffic as other top-15 metro areas, that's not to say that what's there isn't worthwhile. There are quite a few major corporations with HQs or major operations in the Phoenix area (Avnet, Freeport-McMoRan, NortonLifeLock, Honeywell, Intel, ON Semiconductor, State Farm, etc.), and it's growing in the tech sector especially. Of the leisure traffic, a chunk of that is high end tourism to all the luxury resorts and spas in the area. I doubt AA wants to hand all that to WN on a silver platter.

An additional thing going for PHX is its inverse peak season. When AA severely cuts back ORD in the winter, they can reallocate some of that spare capacity to PHX rather than just parking a bunch of aircraft for a few months.

Maybe AA will decide they can lop off a bank or two from PHX without cutting into their local traffic too much, but I sincerely hope they'll keep it around as more than a focus city. Does anyone know what sort of lease arrangement they have in Terminal 4?


I just posted the details above
 
joeblow10
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 6:06 pm

I find it very surprising that MIA would be so low on the list. Is it really all the Latin flying that is bringing the margin down so low? I would think the CONUS flying should be very profitable
 
MAH4546
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 7:08 pm

joeblow10 wrote:
I find it very surprising that MIA would be so low on the list. Is it really all the Latin flying that is bringing the margin down so low? I would think the CONUS flying should be very profitable


Miami is a hyper competitive market, so it's not going to have the margins of something with less competition. But the assertion that poster made that it is "bleeding money" is laughable and hard to take somebody seriously when they make such a ridiculous statement and can't back it up.

Obviously though, international hubs are probably in worse shape today than they were pre-COVID, MIA included.

Also, people need to stop literally referring to this list profit margin list like its god. It's oversimplified and does not take into account the large complexities of airline route networks. It is literally a worthless measure in the grand scheme of things. It's not easy for airlines to simply hone in one defintiion fo what is profitable. For example, MIA-MCO might lose money and MIA-GRU might lose money, but MCO-GRU might be super profitable and it's carried through MIA. So how do you distribute the "profits?" Is MIA unprofitable because each pair loses money, or is it profitable because the traffic that flows through it makes money?

There's a lot of different accounting principals that can be used, and we can't use one simplified list as the be all end all of how profitable a hub is and what it contributes to the airline's network as a whole. The list is literally worthless other than giving us one little slice of information.
Last edited by MAH4546 on Tue Jul 07, 2020 7:29 pm, edited 2 times in total.
a.
 
illinicmi
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 7:13 pm

I think it'll be hard for them to chop too hard at both LAX and PHX. That really leaves them with little west coast of their own. Chopping at LAX has already started and makes a little more sense due to the new partnership with AS, who is not weak at LAX. However, AS is still pretty weak at PHX, so if they "gave" the west coast to AS, there would need to be some pretty major scale-up there.

I think it's most likely LAX will be mainly O&D for AA to their hubs, with AS doing the rest. PHX can probably be right-sized as some have indicated here, but will still have value as a smaller west coast hub, combined with O&D (big seasonal).
Last edited by illinicmi on Tue Jul 07, 2020 7:14 pm, edited 1 time in total.
 
Cointrin330
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 7:13 pm

chonetsao wrote:
Unfortunately JFK will remain an oneworld hub, just not an AA hub in tradition meanings. For AA, JFK will be an O&D heavy Focus City that is complementary to LGA. Together, LGA and JFK will form AA's NYC hub strategy. As a standing alone airport, JFK is an oneworld hub, an AA O&D focus airport. Sorry for repeating the line twice, but I don't know how to present the issue more clearly.


Agreed and that's the right way to look at it. Putting COVID19 aside for a moment and its impact on aviation and NY in particular, NY remains the single largest origin and destination market in the US and likely the world. WIth BA and AA co-locating at JFK (and LHR too, though that may be temporary), with the major OW carriers at JFK already at T8 (QF, CX) and American's corporate contracts to/from New York, which aren't insignificant, AA's footprint, though getting smaller, isn't going to change much at JFK, other than a likely cutting of regional flying and a focus on long hauls, hub markets, and a slight uptick in transcons. There's a widely held belief across this forum that AA will simply close down NY entirely (and a wish that they do by many). That's not going to happen. JFK will settle somewhere in the vicinity of 40-80 daily departures on AA metal, it will remain #2 at LGA, and retain a token presence at EWR to the hubs. There is a fantasy here that AA somehow had this megahub at JFK and gave it up. That's not quite true. B6 essentially pushed AA out of JFK on Caribbean routes, that's true, with a better product, frequency, and lower costs. DL built JFK around AA and ate some of its bread and butter routes across the ATL, but they can co-exist, particularly in the new world.
 
Cointrin330
Posts: 2004
Joined: Sat Jul 16, 2016 12:23 pm

Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 7:18 pm

BA744PHX wrote:
jfklganyc wrote:
Cointrin330 wrote:

Agreed. Clearly, ORD isn't a focus for AA for long haul, notably post-COVID19, but as a domestic trunk hub, it still has a relevant role to play and can't be subbed out with more capacity thrown at DFW. Without ORD, AA would have no mid-continent hub (DFW is too far south for the midwest markets and feed). AA will retain ORD, but it will just continue to exist as a domestic focused operation, with LHR year round and if and when the industry recovers, a slight bounce for TATL seasonals, selectively though. I do not see East Europe ever being launched or anything else that can be easily served from PHL except for a small # of big markets.


There’s no way American would drop ORD.

Northern, mid continent connecting hub in the most important city in that region

They will drop JFK LAX and PHX first.


This is such a tired argument! PHX, ORD & PHL are doing fine and remain in the middle or estimated profit margins, with LAX, LGA, JFK & MIA at the bottom they would logically be dropped.

PHX has been overstaffed for many years, it's no surprise they are reducing as FA were used to support LAX flying.

Estimated operating profit margin for AA Hubs
8.11% average

https://i.imgur.com/fZ6Y4Jb.png
CLT 14.3%
DCA 13.6%
DFW 12.7%
ORD 11.4%
PHL 11.4%
PHX 9.6%
MIA 6.7%
JFK 3.1%
LGA -0.8%
LAX - 0.9%

AA is/has already dropped Asia flying from ORD and now LAX, I wouldn't put it pass them to reduced a lot of this "profitable" Latin America flying from MIA as they are bleeding money from that hub

JFK only recently got out of the red after they reduced and eliminated a lot of JFK LH flying


JFK turned profitable in 2018-2019 because AA transitioned its long hauls that remained to all 777 service, and finally got rid of the unreliable, maintenance prone 763s that were flying some key routes, like CDG. With an all 777 service on LHR, GRU, GIG, EZE, MXP, FCO (seasonal), MAD, BCN and CDG, AA has a solid, if not very exciting business class product (yes the rocking seats are not as good as the diamond ones), a great Flagship Lounge product there, and good cargo capacity on those 777s. AA has not eliminated "a lot of JFK LH flying" as you say. That simply isn't true. They've just pared back a lot of stuff incrementally over the years (BRU, ZRH, EDI, MAN, BHX, and if you want to go even further back, FRA, LYS) to core markets. As a regular traveler on AA to Europe and Latin America out of JFK, I can tell you T8 is a joy to fly through, with more space, a bit less crowding, good premium lounges, and customs and immigration facilities that move quickly to process arrivals. AA doesn't want to be #1 at JFK and has not for decades. It's not about that. It's about the customer base they serve and with PHL down the road, different market entirely, there's just no need to operate dual TATL hubs with 200 miles of each other.
 
MAH4546
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 7:28 pm

illinicmi wrote:
I think it'll be hard for them to chop too hard at both LAX and PHX. That really leaves them with little west coast of their own. Chopping at LAX has already started and makes a little more sense due to the new partnership with AS, who is not weak at LAX. However, AS is still pretty weak at PHX, so if they "gave" the west coast to AS, there would need to be some pretty major scale-up there.

I think it's most likely LAX will be mainly O&D for AA to their hubs, with AS doing the rest. PHX can probably be right-sized as some have indicated here, but will still have value as a smaller west coast hub, combined with O&D (big seasonal).


Any assertion that LAX is just going to be a bunch of routes to the domestic hubs is absolutely ridiculous. A lot of AA's LAX network existed back when the only long-hauls were London and Tokyo. AA still has an international hub at LAX and AA is still the largest international operation at LAX even after the cut of four daily long-haul flights.
a.
 
illinicmi
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Joined: Wed Aug 19, 2009 4:21 pm

Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 8:08 pm

MAH4546 wrote:
illinicmi wrote:
I think it'll be hard for them to chop too hard at both LAX and PHX. That really leaves them with little west coast of their own. Chopping at LAX has already started and makes a little more sense due to the new partnership with AS, who is not weak at LAX. However, AS is still pretty weak at PHX, so if they "gave" the west coast to AS, there would need to be some pretty major scale-up there.

I think it's most likely LAX will be mainly O&D for AA to their hubs, with AS doing the rest. PHX can probably be right-sized as some have indicated here, but will still have value as a smaller west coast hub, combined with O&D (big seasonal).


Any assertion that LAX is just going to be a bunch of routes to the domestic hubs is absolutely ridiculous. A lot of AA's LAX network existed back when the only long-hauls were London and Tokyo. AA still has an international hub at LAX and AA is still the largest international operation at LAX even after the cut of four daily long-haul flights.


Wow, struck a nerve.

I was suggesting that IF AA decides to make major cuts to the west coast, it makes more sense to cut where AS can pick up the slack. AS can help feed LAX, if AA chose to go that way.
 
usflyer msp
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 8:14 pm

MAH4546 wrote:
joeblow10 wrote:
I find it very surprising that MIA would be so low on the list. Is it really all the Latin flying that is bringing the margin down so low? I would think the CONUS flying should be very profitable


Miami is a hyper competitive market, so it's not going to have the margins of something with less competition. But the assertion that poster made that it is "bleeding money" is laughable and hard to take somebody seriously when they make such a ridiculous statement and can't back it up.

Obviously though, international hubs are probably in worse shape today than they were pre-COVID, MIA included.

Also, people need to stop literally referring to this list profit margin list like its god. It's oversimplified and does not take into account the large complexities of airline route networks. It is literally a worthless measure in the grand scheme of things. It's not easy for airlines to simply hone in one defintiion fo what is profitable. For example, MIA-MCO might lose money and MIA-GRU might lose money, but MCO-GRU might be super profitable and it's carried through MIA. So how do you distribute the "profits?" Is MIA unprofitable because each pair loses money, or is it profitable because the traffic that flows through it makes money?

There's a lot of different accounting principals that can be used, and we can't use one simplified list as the be all end all of how profitable a hub is and what it contributes to the airline's network as a whole. The list is literally worthless other than giving us one little slice of information.


WN and B6 pulling back at FLL should help MIA's margins.
 
Cointrin330
Posts: 2004
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 9:23 pm

AmericanAir88 wrote:
AA won’t cut JFK. T8 will become a oneworld powerhouse with BA/AA/AS.

Also, AA has to keep up with DL as they share similar tastes in NYC airports: High output at LGA and JFK; hub routes and a few extras at EWR. B6 kind of stole the Caribbean thunder from AA, but AA/AS have taken the throne for west coast travel. I see JFK being great for AA.


Agree that AA won't cut JFK, but keeping up with DL isn't what AA is focused on. We're long past that. AA is the strongest of the US3 to LHR, thanks to the AA/BA partnership, and they'll eventually have the majority of OW under one roof at JFK (QF, RJ, FI, and CX are already at T8) and I would expect JL to move if and when T1 closes down. IB will move when BA does. That, plus AS, which I can see cutting back a lot of its transcontinental flying at JFK to LAX and SFO (or maybe not, and just help with frequency), with AA possibly restarting SAN, SEA, and adding PDX is about all it will be. AA and DL have diverging strategies in NYC.
 
chonetsao
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 9:25 pm

MAH4546 wrote:
Any assertion that LAX is just going to be a bunch of routes to the domestic hubs is absolutely ridiculous. A lot of AA's LAX network existed back when the only long-hauls were London and Tokyo. AA still has an international hub at LAX and AA is still the largest international operation at LAX even after the cut of four daily long-haul flights.


And don't forget QF. AA/QF JV has a clear strategy building a transit hub in LAX.
 
onwFan
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 10:31 pm

If we are to look at S21 schedules, the following are the routes at LAX that don’t seem to be resuming:-

LAX-FAT
LAX-STS
LAX-RDM
LAX-MFR
LAX-SDF

3 out of 4 flights on LAX-SEA upgauged to mainline.
 
FSDan
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 10:38 pm

Here's my opinion, focused around the fact that AA reportedly does very well with the massive L.A. entertainment industry.

Routes AA should definitely keep from LAX:
SFO - important entertainment industry market
SAN - important connecting market (especially for international)
LAS - important leisure market
PHX - AA hub
ASE - important leisure market
AUS - strong AA market
DFW - AA megahub
ORD - AA hub
BNA - strong AA market, important entertainment industry market
MIA - AA hub, important entertainment industry market
MCO - important entertainment industry market
ATL - important entertainment industry market
CLT - AA hub
DCA - AA hub
PHL - AA hub
JFK - AA focus city, VERY important entertainment industry market
BOS - AA focus city
LHR - JV hub
LIH - logical connecting market
HNL - logical connecting market
OGG - logical connecting market
KOA - logical connecting market
HND - JV hub
SYD - JV hub, logical connecting market

Routes AA should probably keep from LAX:
YVR - important entertainment industry market
SEA - AS hub
SMF - strong AA market
FAT - strong AA market
RNO - strong AA market
TUS - strong AA market
EGE - strong AA leisure market
ABQ - strong AA market
ELP - strong AA market
SAT - strong AA market
IAH - strong AA market
OKC - strong AA market
TUL - strong AA market
STL - strong AA market
XNA - strong AA market
IND - strong AA market
CMH - strong AA market
RDU - strong AA market
BDL - strong AA market, no competition
MEX - strong AA market
AKL - logical JV connecting market
CHC - logical JV connecting market

Routes AA should probably drop from LAX:
PDX - can codeshare with AS
FCA - weakest link out of US3
BZN - weakest link out of US3
SJC - can codeshare with AS
SLC - too much competition
MTJ - weaker than UA here
DEN - too much competition
OMA - relatively long and thin
MSY - too much competition
SDF - long and thin
IAD - focus on DCA
SJD - codeshare with AS
MZT - codeshare with AS
PVR - codeshare with AS
BZE - long and thin

Routes AA should definitely drop from LAX:
ANC - codeshare with AS
EUG - let AS fly this if they want to
MFR - let AS fly this if they want to
RDM - codeshare with AS
DRO - no need to compete with UA on this one

I'm on the fence about a few of those, like keeping IND and CMH and dropping SLC and DEN. But that's my gut instinct based on perceived areas of strength for the US3 and AS, past history of adds/drops/upgauges/downgauges, etc.
This is my signature until I think of a better one.
 
Ishrion
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 10:39 pm

onwFan wrote:
If we are to look at S21 schedules, the following are the routes at LAX that don’t seem to be resuming:-

LAX-FAT
LAX-STS
LAX-RDM
LAX-MFR
LAX-SDF


LAX-STS is still available from May 6, 2021.
 
onwFan
Posts: 440
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 10:52 pm

Ishrion wrote:
onwFan wrote:
If we are to look at S21 schedules, the following are the routes at LAX that don’t seem to be resuming:-

LAX-FAT
LAX-STS
LAX-RDM
LAX-MFR
LAX-SDF


LAX-STS is still available from May 6, 2021.

I see. I went by Mar 28 - not sure why the one month hiatus...
 
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LAXintl
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 11:11 pm

chonetsao wrote:

And don't forget QF. AA/QF JV has a clear strategy building a transit hub in LAX.


With significant fleet cuts at QF, I don't think we are going to see the QF of the past at LAX with 4 aircraft on the ground simultaneously with lots of feed to/from AA.

An optimistic case might be two flights a day to LAX, but likely looking at a single service once if things resume in 2021 imo.
From the desert to the sea, to all of Southern California
 
onwFan
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Re: American Airlines Network Thread - 2020

Tue Jul 07, 2020 11:18 pm

LAXintl wrote:
chonetsao wrote:

And don't forget QF. AA/QF JV has a clear strategy building a transit hub in LAX.


With significant fleet cuts at QF, I don't think we are going to see the QF of the past at LAX with 4 aircraft on the ground simultaneously with lots of feed to/from AA.

An optimistic case might be two flights a day to LAX, but likely looking at a single service once if things resume in 2021 imo.

There is no way QF is going to sit and watch UA and DL eat its lunch at LAX, if that’s what you mean.
 
OneAA
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 12:03 am

MAH4546 wrote:
joeblow10 wrote:
I find it very surprising that MIA would be so low on the list. Is it really all the Latin flying that is bringing the margin down so low? I would think the CONUS flying should be very profitable


Miami is a hyper competitive market, so it's not going to have the margins of something with less competition. But the assertion that poster made that it is "bleeding money" is laughable and hard to take somebody seriously when they make such a ridiculous statement and can't back it up.

Obviously though, international hubs are probably in worse shape today than they were pre-COVID, MIA included.

Also, people need to stop literally referring to this list profit margin list like its god. It's oversimplified and does not take into account the large complexities of airline route networks. It is literally a worthless measure in the grand scheme of things. It's not easy for airlines to simply hone in one defintiion fo what is profitable. For example, MIA-MCO might lose money and MIA-GRU might lose money, but MCO-GRU might be super profitable and it's carried through MIA. So how do you distribute the "profits?" Is MIA unprofitable because each pair loses money, or is it profitable because the traffic that flows through it makes money?

There's a lot of different accounting principals that can be used, and we can't use one simplified list as the be all end all of how profitable a hub is and what it contributes to the airline's network as a whole. The list is literally worthless other than giving us one little slice of information.


Great post!! Profit “margin” means nothing. Pure profit / total dollars means everything.
As regards margin, assuming cost are equal between two hubs:

Hub A has a high 15% margin, but must compete with several low cost carriers, so the average ticket price is 100.00. The airline makes 15 dollars on every ticket that connects through here.

Hub B only has an average 10% margin, but is a major business center and lots of international flights so the average ticket price is 200.00. The airline makes 20 dollars on every ticket that connects through here.

Which hub makes the airline more money? Hub B of course....the one with the lower margin.
 
FSDan
Posts: 3325
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 12:17 am

OneAA wrote:
MAH4546 wrote:
joeblow10 wrote:
I find it very surprising that MIA would be so low on the list. Is it really all the Latin flying that is bringing the margin down so low? I would think the CONUS flying should be very profitable


Miami is a hyper competitive market, so it's not going to have the margins of something with less competition. But the assertion that poster made that it is "bleeding money" is laughable and hard to take somebody seriously when they make such a ridiculous statement and can't back it up.

Obviously though, international hubs are probably in worse shape today than they were pre-COVID, MIA included.

Also, people need to stop literally referring to this list profit margin list like its god. It's oversimplified and does not take into account the large complexities of airline route networks. It is literally a worthless measure in the grand scheme of things. It's not easy for airlines to simply hone in one defintiion fo what is profitable. For example, MIA-MCO might lose money and MIA-GRU might lose money, but MCO-GRU might be super profitable and it's carried through MIA. So how do you distribute the "profits?" Is MIA unprofitable because each pair loses money, or is it profitable because the traffic that flows through it makes money?

There's a lot of different accounting principals that can be used, and we can't use one simplified list as the be all end all of how profitable a hub is and what it contributes to the airline's network as a whole. The list is literally worthless other than giving us one little slice of information.


Great post!! Profit “margin” means nothing. Pure profit / total dollars means everything.
As regards margin, assuming cost are equal between two hubs:

Hub A has a high 15% margin, but must compete with several low cost carriers, so the average ticket price is 100.00. The airline makes 15 dollars on every ticket that connects through here.

Hub B only has an average 10% margin, but is a major business center and lots of international flights so the average ticket price is 200.00. The airline makes 20 dollars on every ticket that connects through here.

Which hub makes the airline more money? Hub B of course....the one with the lower margin.


I think what's getting lost here is that the margin stats were posted after a user claimed that PHX is "squeezed margin wise by WN". While PHX likely doesn't make more money overall for AA than a significantly larger hub like MIA, even with the latter having lower margins, the margins at PHX don't appear to be a major problem.
This is my signature until I think of a better one.
 
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mercure1
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 12:33 am

onwFan wrote:
There is no way QF is going to sit and watch UA and DL eat its lunch at LAX, if that’s what you mean.


Qantas longhaul will be significantly smaller for years to come for the simple fact that the airline will not have enough frames. 747s are gone, A380s headed to long term storage, while 787 deliveries deferred.

The current 11 787-9s will need to carry everything from Europe to Asia, and Americas.

QF as even said they don't believe they will recommence international services (sans NZ) until possibly mid 2021.

So the future QF will have smaller footprint, and things like the AA JBA are hardly top priority to deal with.
mercure f-wtcc
 
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wxman11
Posts: 89
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Re: American adds more Asia to SEA, and other long-haul changes

Wed Jul 08, 2020 12:53 am

enilria wrote:
Presently PHL cannot legally accept any intl flights per U.S. restrictions.


I'm curious to know what those restrictions are or as a historian would ask, why??
 
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Rookie87
Posts: 282
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 12:54 am

I'm baffled...routes are being cut due to the clear lack of demand due to covid yet users are acting like the sky is falling and AA is failing at LAX blah blah blah...what am I missing? They should fly empty widebodies on these long haul markets because that's success??? Jesus Christ. AA looks like it's reacting quickly to these changes based on the stats that they have available. HK last I checked is falling apart, one flight from DFW seems more than enough. China is China so what did y'all expect?
Latin America is having it's own issues with covid and their economy so the cuts make sense. Last I remember, AA had announced multiple frequency additions to Latin America, had upgraded HND to the 77W that has first class and announced a myriad of new routes to New Zealand and POSSIBLY, upgrading SYD back to the 77W and then covid hit, countries closed their borders and the US lit on fire...people are hunkered down at home even more so now due to the uptick in cases, Europe closed their borders to the US again starting July 1st and AA announced adjustments and ... seriously what am I missing ???

AS partnership makes the announcements in SEA make a ton of sense.
Cutting routes in LAX, MIA make sense due to demand being rock bottom for international
PHX was overstaffed so this was coming.
How is any of these decisions a failure based on what is going on in the world?????
 
DMPHL
Posts: 32
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Re: American adds more Asia to SEA, and other long-haul changes

Wed Jul 08, 2020 12:58 am

wxman11 wrote:
enilria wrote:
Presently PHL cannot legally accept any intl flights per U.S. restrictions.


I'm curious to know what those restrictions are or as a historian would ask, why??


There were "funnel" airports for arriving international flights designated in March, that were supposed to have increased screening, health inspection, and quarantine protocols for passengers entering the country. PHL just wasn't one of them.
 
graham697
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 1:08 am

I’m curious what may happen to the beyond perimeter slots at DCA. If AA/AS get as cozy as it seems, maybe we see a shift in destination mixes. I don’t think each slot is tied to a specific destination. Although, some are.
 
ericm2031
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 1:21 am

graham697 wrote:
I’m curious what may happen to the beyond perimeter slots at DCA. If AA/AS get as cozy as it seems, maybe we see a shift in destination mixes. I don’t think each slot is tied to a specific destination. Although, some are.


I could maybe see LAS or one of the LAX frequencies moved back to SAN, but other than that they have each other's hubs/focus cities pretty well covered.
 
MIflyer12
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 1:54 am

graham697 wrote:
I’m curious what may happen to the beyond perimeter slots at DCA. If AA/AS get as cozy as it seems, maybe we see a shift in destination mixes. I don’t think each slot is tied to a specific destination. Although, some are.

They can't get cozy and discuss use of slots without antitrust immunity- which they are unlikely to get.
 
MAH4546
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 1:56 am

graham697 wrote:
I’m curious what may happen to the beyond perimeter slots at DCA. If AA/AS get as cozy as it seems, maybe we see a shift in destination mixes. I don’t think each slot is tied to a specific destination. Although, some are.


That’s illegal antitrust. They aren’t getting that cozy.
a.
 
bigb
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 1:57 am

Rookie87 wrote:
I'm baffled...routes are being cut due to the clear lack of demand due to covid yet users are acting like the sky is falling and AA is failing at LAX blah blah blah...what am I missing? They should fly empty widebodies on these long haul markets because that's success??? Jesus Christ. AA looks like it's reacting quickly to these changes based on the stats that they have available. HK last I checked is falling apart, one flight from DFW seems more than enough. China is China so what did y'all expect?
Latin America is having it's own issues with covid and their economy so the cuts make sense. Last I remember, AA had announced multiple frequency additions to Latin America, had upgraded HND to the 77W that has first class and announced a myriad of new routes to New Zealand and POSSIBLY, upgrading SYD back to the 77W and then covid hit, countries closed their borders and the US lit on fire...people are hunkered down at home even more so now due to the uptick in cases, Europe closed their borders to the US again starting July 1st and AA announced adjustments and ... seriously what am I missing ???

AS partnership makes the announcements in SEA make a ton of sense.
Cutting routes in LAX, MIA make sense due to demand being rock bottom for international
PHX was overstaffed so this was coming.
How is any of these decisions a failure based on what is going on in the world?????


Thank you for the voice of reason....
 
USAirALB
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 2:48 am

FSDan wrote:
Here's my opinion, focused around the fact that AA reportedly does very well with the massive L.A. entertainment industry.

Routes AA should probably drop from LAX:
PDX - can codeshare with AS
FCA - weakest link out of US3
BZN - weakest link out of US3
SJC - can codeshare with AS
SLC - too much competition
MTJ - weaker than UA here
DEN - too much competition
OMA - relatively long and thin
MSY - too much competition
SDF - long and thin
IAD - focus on DCA
SJD - codeshare with AS
MZT - codeshare with AS
PVR - codeshare with AS
BZE - long and thin
I'm on the fence about a few of those, like keeping IND and CMH and dropping SLC and DEN. But that's my gut instinct based on perceived areas of strength for the US3 and AS, past history of adds/drops/upgauges/downgauges, etc.

Largely agree with you except for the following:
MSY I view as necessary for the entertainment industry. AA has been serving LAX-DEN for years and it is somewhat of an important market that I can't see them dropping. SJC I would say would likely be kept as well given the historic strength of AA in the market.

IAD-LAX is extremely high-yielding, and there are a good number of AA frequent flyers in NoVa that prefer IAD over DCA. One of the 2x 738s was due to be upguaged to an A321 this summer pre-Covid and the evening LAX-IAD flight is the only LAX-DC redeye on AA.
RJ85, F70, E135, E140, E145, E70, E75, E90, CR2, CR7, CR9, 717, 732, 733, 734, 735, 73G, 738, 739, 744ER, 752, 753, 762, 772, 77E, 77W, 789, 319, 320, 321, 332, 333, 343, 359, 388
 
USAirALB
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Re: American adds more Asia to SEA, and other long-haul changes

Wed Jul 08, 2020 2:58 am

The funnel airports make no sense to me. CLT is not a designated airport, but is currently serving flights that need FIS upon arrival.

AA has resumed all Mexico flying ex CLT (SJD/CZM/CUN/MEX) along with some Caribbean flying, and Volaris has also resumed GDL-CLT. What's stopping someone from flying MAD-MEX-CLT?
RJ85, F70, E135, E140, E145, E70, E75, E90, CR2, CR7, CR9, 717, 732, 733, 734, 735, 73G, 738, 739, 744ER, 752, 753, 762, 772, 77E, 77W, 789, 319, 320, 321, 332, 333, 343, 359, 388
 
usflyer msp
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 3:08 am

FSDan wrote:
Here's my opinion, focused around the fact that AA reportedly does very well with the massive L.A. entertainment industry.

Routes AA should probably drop from LAX:
FCA - weakest link out of US3
BZN - weakest link out of US3
MTJ - weaker than UA here
SJD - codeshare with AS
MZT - codeshare with AS
PVR - codeshare with AS
BZE - long and thin


I disagree on these leisure routes. Entertainment industry workers are exactly whom is vacationing in these spots. BZE is a major VFR market from LAX. The cab driver I use in Belize grew up in Los Angeles but lived a life of crime and got deported as an adult.
 
FSDan
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 3:17 am

USAirALB wrote:
FSDan wrote:
Here's my opinion, focused around the fact that AA reportedly does very well with the massive L.A. entertainment industry.

Routes AA should probably drop from LAX:
PDX - can codeshare with AS
FCA - weakest link out of US3
BZN - weakest link out of US3
SJC - can codeshare with AS
SLC - too much competition
MTJ - weaker than UA here
DEN - too much competition
OMA - relatively long and thin
MSY - too much competition
SDF - long and thin
IAD - focus on DCA
SJD - codeshare with AS
MZT - codeshare with AS
PVR - codeshare with AS
BZE - long and thin
I'm on the fence about a few of those, like keeping IND and CMH and dropping SLC and DEN. But that's my gut instinct based on perceived areas of strength for the US3 and AS, past history of adds/drops/upgauges/downgauges, etc.

Largely agree with you except for the following:
MSY I view as necessary for the entertainment industry. AA has been serving LAX-DEN for years and it is somewhat of an important market that I can't see them dropping. SJC I would say would likely be kept as well given the historic strength of AA in the market.

IAD-LAX is extremely high-yielding, and there are a good number of AA frequent flyers in NoVa that prefer IAD over DCA. One of the 2x 738s was due to be upguaged to an A321 this summer pre-Covid and the evening LAX-IAD flight is the only LAX-DC redeye on AA.


Fair points. Based on your comment about MSY I assume New Orleans is still seeing quite a lot of film production (or was before COVID, anyway)?

LAX-SJC might be one of the markets where AA and AS have to step on each others toes a bit unless either of them decides to cede the market to the other. But with WN dominant and DL also generally matching or exceeding each of AA and AS on frequency, it's definitely a crowded route. With AS's current relative strength on both ends of the route, I don't see them wanting to drop this one.

I was definitely on the fence about LAX-DEN. It does seem important (and it's not like AA is weak at DEN or anything, even though I don't typically have it come to mind as a "strong AA market"), but with WN, UA, DL, AA, and F9 (and maybe NK seasonally?) in the market, the yields can't be good.

And that makes sense about D.C. I suppose with extremely limited opportunities to fly LAX-DCA it makes sense for AA to maintain a presence from IAD as well.
This is my signature until I think of a better one.
 
n7371f
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Re: American adds more Asia to SEA, and other long-haul changes

Wed Jul 08, 2020 3:28 am

Industry, at least competitor expectation, is AA won't be adding domestic SEA with rare exception. Plan is to rely nearly exclusively on AS feed.

Of course that was the DL/AS plan too until AS announced an enhanced codeshare with AA a month later and Richard Anderson went to the board for approval of the back-up plan to hub Seattle.

So who knows...maybe AS decides to partner with B6 shortly after AA adds the international:-)

rjbesikof wrote:
raylee67 wrote:
Curious there is no mention of CHC, Seoul, Tokyo and Osaka, and also DFW-HKG

Seems AA is going to move the trans-Pac hub to SEA too, with so many canceled LAX routes. With AS as its partner, it may have more success than DL and will provide a very strong competition. SEA cannot sustain as trans-Pac hub for both AA/AS and DL. One of them will be forced out.


Given that AA is planning to launch 3 new long hauls out of SEA (Bangalore, London, and Shanghai), could we see new domestic routes added out of SEA (on AA metal)?
 
flyfresno
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 3:35 am

onwFan wrote:
If we are to look at S21 schedules, the following are the routes at LAX that don’t seem to be resuming:-

LAX-FAT
LAX-STS
LAX-RDM
LAX-MFR
LAX-SDF

3 out of 4 flights on LAX-SEA upgauged to mainline.


AS announced FAT-LAX a few weeks ago, guess this is why. Also, AA is upguaging two PHX flights to mainline and (maybe) adding a 5th to DFW.
All that together will easily make up for the loss of seats.
 
MAH4546
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 3:54 am

flyfresno wrote:
onwFan wrote:
If we are to look at S21 schedules, the following are the routes at LAX that don’t seem to be resuming:-

LAX-FAT
LAX-STS
LAX-RDM
LAX-MFR
LAX-SDF

3 out of 4 flights on LAX-SEA upgauged to mainline.


AS announced FAT-LAX a few weeks ago, guess this is why. Also, AA is upguaging two PHX flights to mainline and (maybe) adding a 5th to DFW.
All that together will easily make up for the loss of seats.


AA simply has for some reason failed to loaded some flights past March 27th. None of these are discontinued.

AA and AS can not coordinate on LAXFAT. They would be sued.
a.
 
jfk777
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Re: AA releases June Load Factor, announces New Cuts

Wed Jul 08, 2020 10:52 am

SESGDL wrote:
kavok wrote:
FSDan wrote:

In my opinion, the cuts to recently added less-than-daily markets like DFW-SAP/TGU/UIO/GYE aren't at all surprising. For whatever reason (probably the size of local immigrant communities?), Houston seems to do a lot better with these markets.


In addition to strong local O/D and being the only hub in United’s network that works well for Latin America, IAH benefits from being a United hub (as opposed to DFW being a hub for AA). The reason that is significant is Texas is better suited geographically to connect West Coast pax onward to Latin America, just as MIA is best suited geographically to connect East Coast pax to Latin America. Given that United is the strongest legacy airline in the West, and American the weakest, it would only make sense that a United hub in Texas would do better than an American hub in connecting west coast pax to Latin America. Hence the success of IAH.


This simply isn't true. For connection flows, there are few examples where IAH functions as a better connecting hub than DFW. The reason IAH is a better hub to Latin America and has more service is a simple function of IAH being a much larger international O&D market. This is the same reason that IAH has more international service to all regions of the world than DFW. IAH is an economic powerhouse internationally whereas DFW is a larger domestic market. But it has nothing to do with UA being stronger in the West than AA and IAH somehow being a better hub to the West to connect through to Latin America; DFW has FAR more service to the West Coast than IAH, yet IAH is able to make many Latin American markets work that DFW can't, in spite of being the much smaller hub. IAH is just a dramatically larger international market.

Jeremy


For decades Houston has been flown by KLM & Air France, long before they merged. Houston was also the first destination for British Caledonian back in the day starting with 707 moving to a Dc-10-30. Most European flying at DFW started with Braniff moving to AA, many foreign airlines flying to DFW have some type of AA partnership. Always interesting to see the see saw between IAH & DFW.
 
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Midwestindy
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 12:59 pm

FSDan wrote:
Here's my opinion, focused around the fact that AA reportedly does very well with the massive L.A. entertainment industry.

Routes AA should definitely keep from LAX:
SFO - important entertainment industry market
SAN - important connecting market (especially for international)
LAS - important leisure market
PHX - AA hub
ASE - important leisure market
AUS - strong AA market
DFW - AA megahub
ORD - AA hub
BNA - strong AA market, important entertainment industry market
MIA - AA hub, important entertainment industry market
MCO - important entertainment industry market
ATL - important entertainment industry market
CLT - AA hub
DCA - AA hub
PHL - AA hub
JFK - AA focus city, VERY important entertainment industry market
BOS - AA focus city
LHR - JV hub
LIH - logical connecting market
HNL - logical connecting market
OGG - logical connecting market
KOA - logical connecting market
HND - JV hub
SYD - JV hub, logical connecting market

Routes AA should probably keep from LAX:
YVR - important entertainment industry market
SEA - AS hub
SMF - strong AA market
FAT - strong AA market
RNO - strong AA market
TUS - strong AA market
EGE - strong AA leisure market
ABQ - strong AA market
ELP - strong AA market
SAT - strong AA market
IAH - strong AA market
OKC - strong AA market
TUL - strong AA market
STL - strong AA market
XNA - strong AA market
IND - strong AA market
CMH - strong AA market
RDU - strong AA market
BDL - strong AA market, no competition
MEX - strong AA market
AKL - logical JV connecting market
CHC - logical JV connecting market

Routes AA should probably drop from LAX:
PDX - can codeshare with AS
FCA - weakest link out of US3
BZN - weakest link out of US3
SJC - can codeshare with AS
SLC - too much competition
MTJ - weaker than UA here
DEN - too much competition
OMA - relatively long and thin
MSY - too much competition
SDF - long and thin
IAD - focus on DCA
SJD - codeshare with AS
MZT - codeshare with AS
PVR - codeshare with AS
BZE - long and thin

Routes AA should definitely drop from LAX:
ANC - codeshare with AS
EUG - let AS fly this if they want to
MFR - let AS fly this if they want to
RDM - codeshare with AS
DRO - no need to compete with UA on this one

I'm on the fence about a few of those, like keeping IND and CMH and dropping SLC and DEN. But that's my gut instinct based on perceived areas of strength for the US3 and AS, past history of adds/drops/upgauges/downgauges, etc.


The problem is there is a lot more to LA than the entertainment industry, it's effectively the 2nd-4th largest US business travel market depending on who you ask.

The Aerospace/Defense industry is massive, I believe Northrop Grumman actually employs significantly more people than Disney or NBC Universal in LA county, not to mention SpaceX, Boeing, Raytheon, Honeywell, Aerojet, Lockheed, e.t.c each employing thousands.

Biotech has Amgen, Boston Scientific, Medtronic, Gilead, Abbott, e.t.c each with over 1,000 employees

Without diving into specifics, banking, retail, tech, & manufacturing are large as well

From late 2017:
"I will tell you the opposite of it being expensive to operate. It’s expensive not to operate here. It’s the third largest corporate market in the United States. It is probably one of the two, if anybody outside the US comes to the US for the first time, they either come to LA or New York. We capture that business market, but we also capture leisure here."
https://crankyflier.com/2017/10/31/amer ... -the-city/

Effectively LA is a major base for a majority of the Corporate Travel 100 list, meaning a weakened presence in LA has ripple effects across its network in terms of corporate contracts: https://www.businesstravelnews.com/Corp ... l-100/2019

Not to say shrinkage isn't viable, but with an already smaller NYC presence, I'm not sure how much AA will be willing to shrink domestically in LA without corporate demand implications & given their #1 position.
Status for 2019/2020: AAdvantage Platinum, Delta Gold, Southwest A-List
 
Miamiairport
Posts: 665
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 1:40 pm

Corporate America is about to make a huge shift. Less travel (because Zoom may be inferior to in person but it's a hella of lot cheaper and that makes the suits happy), closing of office spaces and moving from certain major cities to smaller cities or no office space at all. Leasing office space in NYC or LA is expensive and now there's the fear factor with COVID 19 and violence/crime. All of this will shake up the travel, hospitality and commercial real estate industry.

We are not going back to 1/1/2020. If the economy goes the way I think it will go (when all the free money from the Fed is stopped) there will be massive changes in travel. Predicting this future is nearly impossible.
 
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LAXintl
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 5:17 pm

Midwestindy wrote:

The problem is there is a lot more to LA than the entertainment industry, it's effectively the 2nd-4th largest US business travel market depending on who you ask.

The Aerospace/Defense industry is massive, I believe Northrop Grumman actually employs significantly more people than Disney or NBC Universal in LA county, not to mention SpaceX, Boeing, Raytheon, Honeywell, Aerojet, Lockheed, e.t.c each employing thousands.

Biotech has Amgen, Boston Scientific, Medtronic, Gilead, Abbott, e.t.c each with over 1,000 employees

Without diving into specifics, banking, retail, tech, & manufacturing are large as well

From late 2017:
"I will tell you the opposite of it being expensive to operate. It’s expensive not to operate here. It’s the third largest corporate market in the United States. It is probably one of the two, if anybody outside the US comes to the US for the first time, they either come to LA or New York. We capture that business market, but we also capture leisure here."
https://crankyflier.com/2017/10/31/amer ... -the-city/

Effectively LA is a major base for a majority of the Corporate Travel 100 list, meaning a weakened presence in LA has ripple effects across its network in terms of corporate contracts: https://www.businesstravelnews.com/Corp ... l-100/2019

Not to say shrinkage isn't viable, but with an already smaller NYC presence, I'm not sure how much AA will be willing to shrink domestically in LA without corporate demand implications & given their #1 position.


:checkmark:

A few moons ago had the opportunity to chat with senior Delta leader about their multiple attempts to grow in LA.

The basic point he made was that its was not about trying to win Angelenos over to fly DL, but instead critical to offer the choice for existing DL customers in other markets the ability to access LA which is a major global market anyway you slice it. The inability to offer a robust LA network ended up hurting DL standing in other markets including with many corporate accounts which list LA as a top 3, 5, or 10 destination market.
From the desert to the sea, to all of Southern California
 
MIflyer12
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Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 5:28 pm

Retreating to dominant hubs is not going to make AA the #1 U.S. carrier - not in revenues, not in profits. Strength at MIA isn't going to make AA dominate South Florida - there's too much LCC competition at FLL. AA is a fading #2 in CHI. PHL and CLT aren't particularly large O&D markets. (Yes, DFW is great, but WN puts a lot of seats into the DAL market.) If you're relying on hubs for connecting traffic you're in competition with all of the other 1-stop services, and at a significant deficit to carriers offering non-stops. AA has all but conceded NYC; it can't very well concede LAX, too.
 
FSDan
Posts: 3325
Joined: Mon Jan 03, 2011 5:27 pm

Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 6:00 pm

Midwestindy wrote:
FSDan wrote:
Here's my opinion, focused around the fact that AA reportedly does very well with the massive L.A. entertainment industry.

Routes AA should definitely keep from LAX:
SFO - important entertainment industry market
SAN - important connecting market (especially for international)
LAS - important leisure market
PHX - AA hub
ASE - important leisure market
AUS - strong AA market
DFW - AA megahub
ORD - AA hub
BNA - strong AA market, important entertainment industry market
MIA - AA hub, important entertainment industry market
MCO - important entertainment industry market
ATL - important entertainment industry market
CLT - AA hub
DCA - AA hub
PHL - AA hub
JFK - AA focus city, VERY important entertainment industry market
BOS - AA focus city
LHR - JV hub
LIH - logical connecting market
HNL - logical connecting market
OGG - logical connecting market
KOA - logical connecting market
HND - JV hub
SYD - JV hub, logical connecting market

Routes AA should probably keep from LAX:
YVR - important entertainment industry market
SEA - AS hub
SMF - strong AA market
FAT - strong AA market
RNO - strong AA market
TUS - strong AA market
EGE - strong AA leisure market
ABQ - strong AA market
ELP - strong AA market
SAT - strong AA market
IAH - strong AA market
OKC - strong AA market
TUL - strong AA market
STL - strong AA market
XNA - strong AA market
IND - strong AA market
CMH - strong AA market
RDU - strong AA market
BDL - strong AA market, no competition
MEX - strong AA market
AKL - logical JV connecting market
CHC - logical JV connecting market

Routes AA should probably drop from LAX:
PDX - can codeshare with AS
FCA - weakest link out of US3
BZN - weakest link out of US3
SJC - can codeshare with AS
SLC - too much competition
MTJ - weaker than UA here
DEN - too much competition
OMA - relatively long and thin
MSY - too much competition
SDF - long and thin
IAD - focus on DCA
SJD - codeshare with AS
MZT - codeshare with AS
PVR - codeshare with AS
BZE - long and thin

Routes AA should definitely drop from LAX:
ANC - codeshare with AS
EUG - let AS fly this if they want to
MFR - let AS fly this if they want to
RDM - codeshare with AS
DRO - no need to compete with UA on this one

I'm on the fence about a few of those, like keeping IND and CMH and dropping SLC and DEN. But that's my gut instinct based on perceived areas of strength for the US3 and AS, past history of adds/drops/upgauges/downgauges, etc.


The problem is there is a lot more to LA than the entertainment industry, it's effectively the 2nd-4th largest US business travel market depending on who you ask.

The Aerospace/Defense industry is massive, I believe Northrop Grumman actually employs significantly more people than Disney or NBC Universal in LA county, not to mention SpaceX, Boeing, Raytheon, Honeywell, Aerojet, Lockheed, e.t.c each employing thousands.

Biotech has Amgen, Boston Scientific, Medtronic, Gilead, Abbott, e.t.c each with over 1,000 employees

Without diving into specifics, banking, retail, tech, & manufacturing are large as well

From late 2017:
"I will tell you the opposite of it being expensive to operate. It’s expensive not to operate here. It’s the third largest corporate market in the United States. It is probably one of the two, if anybody outside the US comes to the US for the first time, they either come to LA or New York. We capture that business market, but we also capture leisure here."
https://crankyflier.com/2017/10/31/amer ... -the-city/

Effectively LA is a major base for a majority of the Corporate Travel 100 list, meaning a weakened presence in LA has ripple effects across its network in terms of corporate contracts: https://www.businesstravelnews.com/Corp ... l-100/2019

Not to say shrinkage isn't viable, but with an already smaller NYC presence, I'm not sure how much AA will be willing to shrink domestically in LA without corporate demand implications & given their #1 position.


I'm well aware that L.A. is an incredibly diverse economy. But a lot of the destinations that would be considered important for other major L.A. industries happen to also be important for the entertainment industry (or are AA hubs), so I felt that industry was a decent proxy for the service that AA needs to keep around. Would cutting EUG/MFR/RDM/FCA/BZN/DRO/MTJ/OMA/SDF/SJD/MZT/PVR/BZE, etc. hurt AA's corporate travel among aerospace, finance, or biotech industry clients? Unlikely. Serving SEA, SFO, DFW, ORD, DCA, JFK, BOS, etc. is much more important. And I proposed keeping service to a lot of cities where AA is strong such as SAT, AUS, STL, CMH, BNA, RDU, BDL, etc. precisely for the reasons that LAXintl mentioned above.
This is my signature until I think of a better one.
 
tphuang
Posts: 5212
Joined: Tue Mar 14, 2017 2:04 pm

Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 6:33 pm

AA has so much debt to pay off. Their only path out of this is through their fortress hubs. If they are going to be 30% smaller next year and bring back DFW/CLT/DCA to close to pre-COVID size, it's inconceivable how they could do that without major cuts elsewhere. LAX is going to get huge cuts. They likely have already returned most of their unused slots at JFK. LGA will be much smaller. MIA will be smaller. PHL will be smaller. PHX will be a lot smaller.

Keep in mind that they are already scheduling in a 45 to 50% schedule for July. See how many flights they have going out of LAX for July. Now think about how much more flights they can add if they are going to be 50% larger than this a year from now and that's probably what LAX will look like for them.

If DL can have a competitive network out of LAX without flights to ORD/IAD/CLT, AA's network out of LAX can go without one or two of ATL/MCO/BOS/IAD.
 
MAH4546
Posts: 26222
Joined: Wed Jan 24, 2001 1:44 pm

Re: American Airlines Network Thread - 2020

Wed Jul 08, 2020 6:38 pm

tphuang wrote:
AA has so much debt to pay off. Their only path out of this is through their fortress hubs. If they are going to be 30% smaller next year and bring back DFW/CLT/DCA to close to pre-COVID size, it's inconceivable how they could do that without major cuts elsewhere. LAX is going to get huge cuts. They likely have already returned most of their unused slots at JFK. LGA will be much smaller. MIA will be smaller. PHL will be smaller. PHX will be a lot smaller.

Keep in mind that they are already scheduling in a 45 to 50% schedule for July. See how many flights they have going out of LAX for July. Now think about how much more flights they can add if they are going to be 50% larger than this a year from now and that's probably what LAX will look like for them.

If DL can have a competitive network out of LAX without flights to ORD/IAD/CLT, AA's network out of LAX can go without one or two of ATL/MCO/BOS/IAD.


More baseless armchair CEO quarterbacking. AA is the largest airline in LAX-MCO/BOS, routes it has flown for 30+ years that predate any of the hub that exists today. With Compass gone AA has already started planning the re-ramp of LAX routes using Skywest CRJ-700s (definite passenger downgrade) and putting mainline in some markets as well (LAXIAH is switching entirely from all-Eagle to all-mainline; LAXOKC will get mainline for the first time and mainline returning to LAXSFO).

Nobody is saying AA isn't going to make cuts at LAX, but implying routes like LAX-BOS are going to be gone? Inane. AA will make cuts appropriately based on travel patterns as it sees fit. AA is very strong at LAX domestically, does not rely on international feed for a lot of its domestic flying, and will see how demand for those markets themselves comes back (or does not). MIA is an early look at this - there has been barely any international operations from MIA, yet AA still continues to operate "feeder" routes like MIATYS and MIAXNA at strong load factors. It's shocking to me but AA is actually operating roughly 75% of it's pre-COVID domestic capacity and a complete 100% of it's pre-COVID domestic route network from MIA right now.

You also keep spreading this baseless fiction about returning JFK slots that you have not been able to prove. Not saying AA isn't doing it, there is a ton of domestic flying that mainly serves the purpose of feeding international, but source this claim.
Last edited by MAH4546 on Wed Jul 08, 2020 6:55 pm, edited 1 time in total.
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