The basic question to ask is what you would change to get the airline to survive, and as a lot of people have said it's a tall order. My inclination is that they probably had a decent chance of survival with GOOD management and planning combined with decent foresight at least until they bought National... After the merger it really was all over. I've also gotta think that almost no matter what there is going to have to be a chapter 11 process at some point in the 80s or 90s to sort out the union problems they had, and getting an outcome good enough to save the company here is the hardest thing. Nontheless I love alternate history, so I'll make a suggestion as to how I might approach trying to save the company (and doing it in a way that gets an airline something like "the airline of Juan Trippe"). No explanation given for where you might find the management team willing to take this approach, but that's a problem I really don't even want to begin addressing this late at night.
I'm not sure about what dates the 707s entered and exited the fleet en masse, but I would definitely agree that the 747 purchase (while not NECESSARILY fatal) was one hell of a cock up. While regulation remains in place the airline is committed to low frequencies and does have limited competition so I wouldn't cancel the order completely, especially with the range advantages they had at the time, but certainly no more than 25 aircraft, and probably fewer. I'd suggest that this could well be justified by a company that also goes ahead with buying about a dozen Concordes as a preliminary to the expected SST takeover (if I was writing this as a fully fleshed out piece for alternatehistory.com I'd explain the logic in more detail, but I think I might justify this by having an airline that was just a bit more progressive historically, jumping, for example, on the Comet and Britannia when given the chance). Even Concorde as it was built, and certainly as a second group of aircraft would have been would have allowed a service at LEAST from the west coast to Hawaii and on to Australia and New Zealand via Fiji, as well as Asia via Guam or Anchorage (the Anchorage Tokyo leg is theoretically in range, but problematic, especially as the aircraft were delivered as well as the reality that while over the ocean a supersonic route up the US coast is likely to prove controversial). A round the world flight might even be possible depending on Australia's cooperation with overflight of the outback, but this would unquestionably be a prestige route, and certainly doomed long term.
Realistically the inevitable Concorde operations on the Atlantic probably just make the aircraft's finances even worse between the three operators, but the Pacific, particularly West Coast to Hawaii and West Coast to Japan has potential to do reasonably well financially (by the standards of Concorde that is). It is an interesting thought that even one more operator (and a significantly larger number of frames given Pan Ams potential routes), combined with opening up the Pacific could well result in a few more Concordes being sold to airlines feeling less able to ignore the Concorde as a purely prestige based project. I could well see some of Lufthansa, Qantas, JAL, Branniff (along with the other American majors, but this is the one that came closest in the real world) and Singapore getting a few frames at least for a while (and more outlandishly some smaller companies might carry through, thinking things like Iranian, Canadian Pacific (interesting potential for a
YVR-
YFB-
LHR/
AMS route here), South African and Air India here) but that's really out of the scope of what I'm writing here.
In any case, the major change that fewer 747s leads to is more 707s staying in service longer. While there are going to be more L1011s ordered to fill some of the gaps of a smaller fleet my approach to fleet planning in the late 60s and early 70s would be to provide the capacity routes actually demand, irrespective of the apparent prestige of the aircraft. Heading toward deregulation and greater competition I would want to put a lot of pressure on Boeing to launch the 707-700 (CFM56 re-engining program which flew a prototype in 1979 but was cancelled for lack of interest and potential in house competition with the 757) and combine the re-engining with a complete overhaul of the 707 fleet. The idea would be a more concerted brand re-launch around the time the new livery was introduced, with a first and business class product very much designed to be in keeping with Pan Am's traditional image (as in a damn good premium product); coach marketing would really just be about avoiding the image of ragged twenty something aircraft for a few more years. I'm not sure how difficult Boeing really would be to convince to re-engine 707s, but if some part of the negotiations included an early commitment to launch the 757 this would fit very well into the airline's fleet plan IMO even pre ETOPS.
On deregulation Pan Am is still left with all the problems as in reality, and doesn't necessarily have a whole lot more in the way of liquid assets available given that there has still been a lot of fleet investment, but the over capacity of the network is less pronounced, and with some luck the overall product is on the way to being rejuvenated. An early move into the package vacation market with an emphasis on "exotic" Asian and Middle Eastern destinations would seem a good move given the ownership of InterContinental Hotels and the need to fill seats while the network is reworked to handle the new competition. While the hotels were sold around this time that looks like a big mistake to me given the potential uses of the chain; there are other assets to sell first, and hopefully without buying National at such an inflated price the need to be dumping major parts of the company can be largely averted. As soon as price controls are removed I would have the airline launch a discount coach project. I see this as a response to a realization that the company has no domestic linkages, growing competition and over capacity for even the regulated market; this could also be a decent opportunity to start looking at concessions from the unions, although that opens up the ugly prospect of repeated and extended strike actions.
In any case, while Pan Am very clearly needs a domestic route network ASAP attempting to purchase one whole would seem to be the single largest mistake the company ever made. While the fleet would be stretched very much to its limits, along with the company's finances if new aircraft are needed I think building a new hub based network from scratch, and initially focussing very tightly on delivering passengers to the existing international gateways at a low price is the way to go. To me this means focussing on the longer routes to larger destinations and operating lower than fully competitive frequencies; essentially limiting destinations to those best able to be served by the wide bodies and 707s for now (thinking something like double daily from the existing hubs to Chicago, Salt Lake, Denver, Dallas, Houston and Atlanta to begin with, as well as more frequencies BETWEEN the hubs and mostly shifting the L1011s (no DC-10s without national, but likely more than in reality given fewer 747s) to domestic service). Given the way deregulation happened SOME airline will need to be purchased to get the operating authority for domestic services (other airlines were given international operating rights years before Pan Am was domestic, partially explaining the desperation for a partner/victim in creating a domestic network). I'd suggest the best approach would be to overpay for a small but well structured company that comes in well under the cost of National but allows Pan Am to start building its own network. Something along the lines of Alaska (bear in mind just how small they were around 1980) would seem promising (and could help bring fresh, well proven, blood into Pan Am management right when it's needed most.
Going forward into deregulation there is going to be a serious need for aircraft to get the domestic network going, especially if something like the Shuttle is also wanted (and I think that Shuttle was one of the few really good moves Pan Am made in this era, though showing up Eastern by also serving Chicago, or even conceivably adding the
JFK-
MIA and
JFK-
LAX if aircraft can be found to the shuttle system would seem like options with some decent potential returns). While buying Braniff when it collapses would amount to one over unionised (not exactly an attack on the unions for the record, but there were undoubtedly big labour problems at both companies) basket case picking up another there could well be a good opportunity to get parts of the fleet cheaply and quickly, giving a nice boost to the fledgling Pan Am domestic network.
Farther into the eighties the outcome of my changes starts to get murkier, but I tend to lean against the Airbus widebodies. While I very much see their appeal, and agree that an ETOPS aircraft is needed ASAP without the National fleet being picked up the tri-jets are not in quite as untenable position in the fleet, the 707s are very much in desperate need of replacement between age and fuel prices re-engined or not and more aircraft suitable for domestic service are very much needed. In all ways this leads me to believe that a big order (thinking 80ish, but I would need to look at the historical fleet and network more closely) or 757s would be the perfect route for Pan Am, especially if ETOPS can be achieved quickly. Once the company is looking at 757s I think that there isn't much of a case to be made for A300/310s even if they are available a few years sooner, and Pan Am should be a launch customer for the 767 as well. It's not at all clear to me what narrow body fleet would look like at this point between mergers and miscellaneous acquisitions, particularly in how many 727s, 737s and even DC-9s may have appeared, but the 757 was very much played up as a 727 replacement for American domestic use, and I think Pan Am should take that at face value. While the A320 WAS be the right aircraft for Pan Am if they could have gotten them into service I have a hard time seeing the company come to the decision to order them at this stage alongside 757s and 767s and without having purchased the A300/310s.
Heading into the ETOPS era the state of the company starts to look murkier to me. Assuming my marketing and early fleet changes were successful they are probably on a somewhat better financial footing, though I would expect the Pan Am building got sold more or less as in reality to raise funds for fleet expansion. A lot depends on what aircraft can be had in the early 80s, and how well the domestic network ends up being accepted. There's also the no insignificant issue that the company would be operating distinctly old 707s at least until the 757 appears, and what this would to to both company image and finances given the age and fuel requirements of the aircraft (that said, re-engined 707s WERE in domestic US service this long, and the re-engining will make second hand aircraft considerably more valuable for cargo operators). In any case, but the end of the eighties Pan Am is looking at a relatively new fleet of Boeing twins focussed on the 757 domestically and wherever ETOPS will allow it, L1011s filling a good deal of the long range over ocean routes but essentially gone domestically as soon as the 767s appear on the way out in general, an indeterminate number of 747-100s that have caused perennial problems with load factors and are probably still operating some 747SPs in the Pacifc and 737s in the Caribbean. There may or may not also be some sort of Concorde network operating out of
JFK,
IAD,
LAX and
SFO with pacific tech stops in
ANC,
HNL, GUM and
NAN.
What happens next has a lot to do with what the financial situation actually is. I grant that there is a distinct possibility that none of this is enough to change things drastically, and that the company collapses more or less as historically. The modified domestic network itself could help or hinder somewhat either way, either allowing more cash reserves to stretch out the inevitable or eating what few resources the company does have but I have no real idea of predicting on the sport how that network would have performed in reality. If the company is fairly strong I could see the airline being an early customer for the 747-400 to dispose of the SPs and 100s without losing the prestige they will probably continue to associate with the type. There would also likely be dissatisfaction with the 757 as a domestic type combined with surprise at its distinctly impressive performance long haul, quite possibly leading to an A320 order very soon after the type enters service, largely sized in response to the performance of the domestic network and how aggressively the company intends to expand it. 777s would be ideal for this network, but I'm not sure whether they would be acquired early, or in large numbers given the likely commitment to 747-400s. Perhaps most likely in my view is that the company struggles on into the nineties with little in the way of resources and a distinctly unclear future, unable to dispose entirely of its older 747s, and possibly not even getting enough 757s and 767s to displace all the L1011s. In this case the historical sell off of chunks of the company seems pretty likely, and my view is that especially with the domestic network upsetting the other carriers there is even less hope for a solution like Pan Am
II working; I could very well see a Braniff like collapse in the works sometime in the 90s.
If the company is still around today they are probably flying a still heavily hub and likely budget oriented domestic network. The premium product may well continue to be on par with other majors, and potentially (though questionable that a strategy launched in 1980 would last that long) with somewhat higher standards than other American majors. The overseas routes seem likely to remain the heart and soul of the company, though they have probably been pruned over the years. Around the world may have lasted longer than historically, and there is a very good possibility that around the world charter packages are offered, but scheduled services won't have made it into the nineties. The domestic routes are either operated largely by 757s with the company constantly trying to find a more economical aircraft, but more likely have been replaced by either A320s or 737NGs (I think that the A320 would be the choice if funds were available early, but given the companies history, especially in this timeline they are very likely to stick with Boeing once the
NG is available). If the package vacation program from the 80s worked out (and really it working well is the only way I see the company getting the financial resources to pull off a lot of the other bits of this plan) they are probably a significant charter and vacation operator, and likely still own the InterContinental hotel chain, though it may well have been repositioned into an overall smaller brand focussed more on vacationers and all inclusive resorts than the traditional somewhat luxury/business orientation of the chain. Given the vertical integration here what I WOULDN'T expect to see is anything like Pan Am flying charters for cruise ships in the Caribean given that they would be a direct competitor in their own right (though I could almost see Pan Am branded ships (problematic in terms of anti trust laws in the US) or a direct partnership with a cruise operator between Pan Am and someone like Carnival if the airlines finances are VERY good).
There probably are some 747 floating around the network, by now I would expect them to be an all or mostly economy configuration except potentially on a few direct transpacific routes funds are never founds for 777s. The scheduled system would seem likely to be very 757 heavy with a smattering of 767s to Europe and South America and a reasonably high percentage of 777s in the Pacific (I would expect more 767s and some 747s in the Pacific rather than 777s if the airline doesn't perform well from about 1988-1998). African service is probably largely gone except for South Africa (which is quite possibly routed through western Europe) and Middle East destinations are an open question in terms of numbers and direct vs connections.
Overall the future is still probably murky for the airline in any case. Even if the financials have been reasonable I think it likely that they have all the problems associated with companies like Northwest and American over the last several years, and have probably had to declare bankruptcy more than once. The dream is that they are something of an American version of Emirates, flying everywhere, and being a reasonable choice for many passengers with destinations outside their home country and doing this with a very economy oriented coach cabin paying for very high end premium service that keeps up the image of the company and brings up yields. More likely they've turned themselves into just another struggling American major carrier that is if anything weaker than the others with a limited domestic route and even more boom/bust overseas routes than the others. That said, they may well have ended up benefiting overall from being in a position that limits their exposure to the regional market and short range domestic flying (though I'm sure something like Pan Am express would have happened at some point, but be considered a core part of the network, albeit much smaller than the affiliates of other major American carriers). I somewhat doubt that they would have been acquired outright by another carrier in this period if they can keep the company whole, being just a little too much to swallow whole at once, though once segments off the network start disappear all bets are off (though with the mega mergers of the last couple of years the more time passes the more likely acquisition becomes). Similarly, I doubt that they would have at any point after the early 80s been anything like solvent enough to seriously consider buying another carrier themselves, though discussions may well have happened, particularly in regards to Northwest.
Good god, this got way longer than I intended. I'm going to post now, but will revisit in the morning to see if I wrote anything really insane given how late it got while I typed. In any case I'm going to cross post this to an alternate history forum I mentioned earlier since it got so long and will report back if anyone there has interesting feedback. So let me know what you think of this scenario... Within reason? Missing something that makes it obviously going to fail? Or possibly just requiring Alien Space Bat intervention to actually arrange for without hindsight?
tl;dr
giant bit of speculation as to how Pan Am could have been saved, let me know what you think