AA To End PHL-TLV

calpsafltskeds · Thu Aug 20, 2015 6:46 pm

UA will probably stay with 2 EWR-TLV flights. I thought the future 77W aircraft will be placed in TLV, adding a lot of seats

IrishAyes · Thu Aug 20, 2015 6:47 pm

I'm going to play devil's advocate here and side with the team that believes this has less to do with finances and more to do with politics, although I was under the impression that the AA settlement with TWA workers was in the past.

Knowing DP and the way he ran L-US, unprofitable LH routes were not kept around for six years. Notice how the short-lived summer-seasonal TATL routes out of CLT (MAN/BRU/LIS) did not return, although BCN was kept.

If PHLTLV was not a barn-burner, US would have pulled the route and used their authorities to launch PEK and DEL, where they had the authorities and also with extra slack in their widebody fleet with the 767s.

ORD Boy 2 · Thu Aug 20, 2015 6:48 pm

Quoting United787 (Reply 48):

Quoting United787 (Reply 48):
I think AA would do better by moving the flight to ORD but I can't see them going for something that "ballsy" out of ORD. Would like to see UA do ORD-TLV since they already have a presence at TLV, the costs shouldn't be nearly as high as AA would be. Plus, UA has a ton more feed at ORD.

What are the odds UA even expands TLV beyond EWR (and I have been a champion of it for a while)?
ORD, IAD, SFO in order of likelihood...

codc10 · Thu Aug 20, 2015 7:02 pm

Quoting ORD+Boy+2" class="quote" target="_blank">ORD Boy 2 (Reply 52):

What are the odds UA even expands TLV beyond EWR (and I have been a champion of it for a while)?
ORD, IAD, SFO in order of likelihood...

UA is probably pleased that US is exiting, as it likely was when DL took 80 or so daily seats out of the market, each direction.

dirtyfrankd · Thu Aug 20, 2015 7:05 pm

Looks like it is official now, saw a link to an article from yahoo finance:

http://www.thestreet.com/story/13262...israel.html?puc=yahoo&cm_ven=YAHOO

usairways85 · Thu Aug 20, 2015 7:43 pm

Officially zero'd out.

CLT-DUB S16 downgraded to 752

GSP psgr · Thu Aug 20, 2015 7:46 pm

Well, you can't blame this one on the ME3, that's for sure.

tortugamon · Thu Aug 20, 2015 8:16 pm

"WASHINGTON—Congressman Chaka Fattah (PA-02), released a statement after the announcement by American Airlines today that they will stop service on their nonstop route between Philadelphia and Tel Aviv effective January 4:

“I am strongly opposed to the decision announced today by American Airlines to cancel this flight route. It is a critically important route, both for the constituents in my district who travel between Philadelphia and Tel Aviv, and also for the growing business relationship between our city and Israel. The effects of this decision will not only hurt tourism between our two countries, it will have a negative impact on our economies. The ease and accessibility offered by this flight had significant long-term potential to stimulate growth and communication.

“I hope to work with American Airlines to see if there is an alternative solution to cancelling the route and will seek a meeting with the appropriate officials in the coming weeks to discuss options to keep this flight operating.”"

http://fattah.house.gov/press/congre...ght-from-philadelphia-to-tel-aviv/

Good to see him doing something positive instead of facing racketeering charges.

tortugamon

wn676 · Thu Aug 20, 2015 8:17 pm

Quoting usairways85 (Reply 55):
CLT-DUB S16 downgraded to 752

Is that official or just a placeholder? Thought they usually didn't finalize equipment types until about 5 months out for TATL.

Schedule shows it operating with an A332 when it resumes in May, FWIW.

usairways85 · Thu Aug 20, 2015 8:19 pm

Quoting tortugamon (Reply 57):
Good to see him doing something positive instead of facing racketeering charges.

I wish it was the mayor or anyone else who made the statement. Though Fattah is in damage control and had to pounce on this one, not that it's going to do anything.

gilesdavies · Thu Aug 20, 2015 8:36 pm

Im struggling to believe the route was dropped, simply because it was not profitable...

US Airways put their all into this route, and was a completely different animal to how they operated all their other European Routes...

The airline had to dedicate two A330-200's to the route to enable it to operate daily, while all of the airlines other long haul European routes could be operated there and back in 24 hrs.

Surely an airline would not have committed their brand new A330-200's (at the time they were new), on a route like this for six years if it was not profitable.

They also kept and extended their 767-200 leases for an additional few years, as they were originally due to leave around 2012, surely in this time these two A330's would have replaced the 767 like for like, instead of continuing to use them on such this route.

Also the US Airways in the latter years of its life, was a very shrewd business and if a long haul route didn't work they simply dropped it! This is exactly what happened to a few Scandanavian routes and PHL-BHX.

777way · Thu Aug 20, 2015 8:47 pm

It sounds like one of those political routes that state owned carriers fly to keep friends happy.

N1120A · Thu Aug 20, 2015 8:47 pm

Quoting usairways85 (Reply 55):
CLT-DUB S16 downgraded to 752

I don't see that as a horrible move, especially with the international 752 fleet growing a bit and getting new cabins.

Qantas744er · Thu Aug 20, 2015 8:50 pm

Quoting GSP psgr (Reply 56):
Well, you can't blame this one on the ME3, that's for sure.

Reply of the year!

mayor · Thu Aug 20, 2015 9:06 pm

Quoting 777way (Reply 61):

It sounds like one of those political routes that state owned carriers fly to keep friends happy.

Not if it's as full as everyone seems to think. DL's flight always seemed like a way to print money.......don't see why AA's route shouldn't have been the same way.

uberflieger · Thu Aug 20, 2015 9:07 pm

Quoting 910A (Reply 26):
Scott Kirby himself confirmed this prior to the merger at a speech of Phoenix Business leaders

Businesses regularly embellish. You don't want your competitors to know you're losing money.

The route is now covered under TATL ATI, and the decision to cancel was most certainly taken together with British Airways (IAG). It's a powerful partnership, which looks at overall network impact & profits.

IADCA · Thu Aug 20, 2015 9:14 pm

Quoting strfyr51 (Reply 42):
DID YOU HUYS miss SOMETHING?? cODE SHARE WITH "EL AL"?? American isn't giving up JACK!! They're getting RID of the cost of plane and crews,Maintenance, customer Service, Rampers Baggage handling and customs added to facilities and code sharing with EL AL. They're getting money for Nothing !! Brilliant!! Meanwhikle We're still Sluggin' it out!!
at United.

YEAH, I mISSED "THE TIME" when CODE SHARES BECAME THE SANE AS JVS!! They're not the Same Thinklg!! And "EL AL" does not flie PHL to anyway!!

Seriously, there's a huge difference between code-sharing and a metal-neutral JV like AA has with BA, and LY doesn't fly to Philly. They're not getting money for nothing. They're cutting a route.

Flighty · Thu Aug 20, 2015 9:31 pm

Quoting gilesdavies (Reply 60):
Im struggling to believe the route was dropped, simply because it was not profitable...

Quoting gilesdavies (Reply 60):
Also the US Airways in the latter years of its life, was a very shrewd business and if a long haul route didn't work they simply dropped it!

Exactly right.

The reverse lie is of course much more common -- that, despite being profitable, an airline is "simply too busy" to continue to fly it.

This is a political negotiation with Israel about... that thing or whatever.

[Edited 2015-08-20 14:36:49]

bourbon · Thu Aug 20, 2015 9:39 pm

This is 100% to do with politics. I wouldn't be surprised to see UA and DL keep current capacity either and just watch yields rise. Thanks AA!

Prost · Thu Aug 20, 2015 9:48 pm

If it is a ploy by American Airlines to gain some 'advantage' with Israel as some have said in here, why would American Airlines do this? Cancel a route that is making them money to make a point to Israel?

I understand people are upset as this was/is a prestige route for legacy US Airways. I imagine this route was coveted by many crew members, but I don't believe that concept of American Airlines management canceling it as a negotiation ploy.

ORDTLV2414 · Thu Aug 20, 2015 9:55 pm

Quoting tortugamon (Reply 57):

"WASHINGTON—Congressman Chaka Fattah (PA-02), released a statement after the announcement by American Airlines today that they will stop service on their nonstop route between Philadelphia and Tel Aviv effective January 4:

“I am strongly opposed to the decision announced today by American Airlines to cancel this flight route. It is a critically important route, both for the constituents in my district who travel between Philadelphia and Tel Aviv, and also for the growing business relationship between our city and Israel. The effects of this decision will not only hurt tourism between our two countries, it will have a negative impact on our economies. The ease and accessibility offered by this flight had significant long-term potential to stimulate growth and communication.

“I hope to work with American Airlines to see if there is an alternative solution to cancelling the route and will seek a meeting with the appropriate officials in the coming weeks to discuss options to keep this flight operating.”"

I'm sad that AA is closing TLV as well but for a politician to get involved??? This is a business decision pure and simple, no political motivations involved.

csavel · Thu Aug 20, 2015 10:24 pm

Quoting Prost (Reply 69):
If it is a ploy by American Airlines to gain some 'advantage' with Israel as some have said in here, why would American Airlines do this? Cancel a route that is making them money to make a point to Israel?

I think it is that issue that has been discussed, that I frankly don't know all the details, but when TWA bailed on Israel, American as the successor supposedly screwed over Israeli employees of TWA, such that there is, or might be a financial liability for any AA assets in Israel. **Please more knowledgeable people chime in, esp if I am not getting details right**
So the question is AA doing this as leverage in any negotions with Israel regarding that issue.

Quoting gilesdavies (Reply 60):
US Airways put their all into this route, and was a completely different animal to how they operated all their other European Routes...

But perhaps since PHL was their North Eastern gateway whereas now it is overlapping with JFK, AA decided to bail. WHy they don't move to JFK is probably slots, and also fierce competition from "big Vered" (El Al) (at both JFK and EWR) Delta,and UAL.
Also loads might be good but how are the margins?

ripcordd · Thu Aug 20, 2015 10:39 pm

Ok TWA didn't bail on TLV they went BK and AA didn't screw the employees over AA bought pieces of TWA in BK they did not buy the TLV operation and why should they if they had no intention of serving the market.?

tortugamon · Thu Aug 20, 2015 10:44 pm

Quoting ORDTLV2414 (Reply 70):
I'm sad that AA is closing TLV as well but for a politician to get involved??? This is a business decision pure and simple, no political motivations involved.

The politician is supposed to use his influence to benefit his people. If the theories can be trusted there are businesses and people in the Philly area that will be hurt by dropping this right so he should fight. Not sure if he can do enough but he can try.

He can go to the Philly city council or maybe state funds to help subsidize the route. He can go to the airport commission to try to reduce landing fees on the route. He can raise awareness of any local businesses that say they will be hurt in order to gain attention and influence....there are things he can do and if it is important to his constituents then he should in my opinion. I don't know how successful he will be....

tortugamon

csavel · Thu Aug 20, 2015 10:49 pm

Quoting ripcordd (Reply 72):
Ok TWA didn't bail on TLV they went BK and AA didn't screw the employees over AA bought pieces of TWA in BK they did not buy the TLV operation and why should they if they had no intention of serving the market.?

Then why do I hear on these boards about some legacy legal issue wrt AA & Israel? After all the thread starter mentioned it.

Quoting apodino (Thread starter):
I also have to wonder how much of this came as a result of the TWA thing..

Also this thread which was enlightening.
https://www.airliners.net/aviation-forums/general_aviation/read.main/5444674/

Also wouldn't it be more accurate to say that AA bought the bankrupt TWA? It wasn't like a judge or someone appointed by a bankruptcy court was liquidating TWA's assets.

Not contradicting you. I'm frankly totally ignorant about the whole thing. IIR It was something about not paying severance or similar for TWA staff after AA took it over? Perhaps Israeli laws regarding bankruptcy and employees are different and more strict than US laws?

mayor · Thu Aug 20, 2015 10:54 pm

Well, now it's time for DL to sue TWA (via AA) for property theft. Ya see, it's this way.....when I was there in '91, doing the PA transition, we had all sorts of promotions going on, promoting DL's "new" service. We even had a model airplane, in the lobby of our hotel and all in all, the TWA folks didn't like it very much. One morning, we came downstairs and the model airplane was missing out of its display case. I don't think they ever found out who did it, but someone from TW seems like the most likely suspect.

rta · Thu Aug 20, 2015 11:00 pm

Quoting csavel (Reply 74):
Perhaps Israeli laws regarding bankruptcy and employees are different and more strict than US laws?

Correct. Under US law AA wouldn't have had to assume TWA's debts/liabilities, but in Israel the court ruled that AA were responsible. In any case, if this TWA thing is still an issue, and AA wanted to serve TLV, they'd just pay the 60 million shekels and get on with it.

usairways85 · Thu Aug 20, 2015 11:12 pm

Quoting csavel (Reply 71):
But perhaps since PHL was their North Eastern gateway whereas now it is overlapping with JFK, AA decided to bail. WHy they don't move to JFK is probably slots, and also fierce competition from "big Vered" (El Al) (at both JFK and EWR) Delta,and UAL.
Also loads might be good but how are the margins?

Since AA is ending TLV completely, I don't see this as an overlapping issue, otherwise it would have been transitioned just like EDI was. AA is essentially saying PHL-TLV bled a ton of money and in the current market dynamics we do not expect that ORD/JFK/MIA-TLV would fair much better.

777way · Thu Aug 20, 2015 11:15 pm

Quoting ripcordd (Reply 72):

Was it the same for Cairo and Riyadh, two other TW routes at the time?

usairways85 · Thu Aug 20, 2015 11:28 pm

Quoting wn676 (Reply 58):

Schedule shows it operating with an A332 when it resumes in May, FWIW.

The AA timetable and reservation page show a 752 on 6/27. There is obviously still plenty of time for it to change but it has definitely gone from a 332 place holder to a 752.

YYZAMS · Thu Aug 20, 2015 11:45 pm

I am not surprised of the pullout of AA, more surprised people are "shocked". As soon as the merger happened my intuition told me they would be gone out of TLV. Now the question is which city will be gone next that they have said "we are committed to xxx"?

mayor · Thu Aug 20, 2015 11:59 pm

Quoting usairways85 (Reply 79):
The AA timetable and reservation page show a 752 on 6/27. There is obviously still plenty of time for it to change but it has definitely gone from a 332 place holder to a 752.

Does a 752 have the range for that route?

ripcordd · Fri Aug 21, 2015 12:04 am

The next city is a big ? cause Arpey's plan for AA was to fly OW hubs in Europe and let people connect onto OW partners from there, DP even with Star was to still try and fly has many places and not depend on Star hubs. Question did AA ever pay out to TLV?

bourbon · Fri Aug 21, 2015 12:04 am

Quoting YYZAMS (Reply 80):

AA pulled out of TLV for political reasons

usairways85 · Fri Aug 21, 2015 12:05 am

Quoting mayor (Reply 81):
Does a 752 have the range for that route?

Yes. It operates the route in October before the winter suspension.

MKIAZ · Fri Aug 21, 2015 12:07 am

I'm pretty sure the route was profitable. Even if it wasn't at PM-US, adding all of the OW and AA loyal fliers to the mix and still keeping only the one flight would have ensured it was packed to the gills (and profitable) every day.

They probably mean continuing to operate the flight (and paying the required settlement) would not be profitable. You can't really blame them either. $60 million is alot of cash and they can always sell tickets via LHR on BA and make some money with the JV.

enilria · Fri Aug 21, 2015 12:11 am

One thing is for sure, this is certainly an example of how the ME3 are making it impossible to operate profitable long-haul flights from the USA to the MidEast.

uberflieger · Fri Aug 21, 2015 12:13 am

Quoting bourbon (Reply 83):
AA pulled out of TLV for political reasons

AA pulled out of TLV for financial reasons. They looked at the numbers & they didn't add up. Had it been such a fabulously profitable station, they would most certainly still be flying there.

BoeingGuy · Fri Aug 21, 2015 12:15 am

Quoting YYZAMS (Reply 80):
Now the question is which city will be gone next that they have said "we are committed to xxx"?

This happens every merger. The airline says "we have no plans to eliminate xxx hub", "we have no plans to lay anyone off", "we are committed to xxx route", etc. "We'll expand xxx".

The DOJ and many A.netters buy it hook line and sinker. Every time.

While not merger related, I remember AA issuing a press release talking about how they were committed to SJC-NRT and they had just renewed some kind of lease to ensure the route remains. A few months later they announced they were discontinuing the route.

jmc1975 · Fri Aug 21, 2015 12:16 am

Quoting Ammad (Reply 33):
Good decision by AA. If route is in loss, it should be lost.

Interesting..and obvious to boot. Could there be any kind of negative bias behind this comment?

panamair · Fri Aug 21, 2015 12:19 am

Quoting MKIAZ (Reply 85):
$60 million is alot of cash

I believe it's not 60million USD, but 60 million ILS (Israeli New Shekels), which is roughly US$16 million. If it was profitable, AA would have gladly paid that off.

I don't understand why people find it so hard to believe that it could have been losing money all these years. Here's a bit more color on the subject, including quotes from AA spokespeople:

http://www.philly.com/philly/busines...m_Philly_to_Israel_in_January.html

"......"The flights were full for the most part," Workman said. "But that's not an indicator of profitability. It depends on what yield you are getting from your customers. Any airline can fill any flight full if you drop your price low enough. We were not getting the revenue from the passenger side of the aircraft that we needed to make this flight profitable."

[Edited 2015-08-20 17:21:40]

superjeff · Fri Aug 21, 2015 12:24 am

Quoting csavel (Reply 74):
Also wouldn't it be more accurate to say that AA bought the bankrupt TWA? It wasn't like a judge or someone appointed by a bankruptcy court was liquidating TWA's assets.

Not contradicting you. I'm frankly totally ignorant about the whole thing. IIR It was something about not paying severance or similar for TWA staff after AA took it over? Perhaps Israeli laws regarding bankruptcy and employees are different and more strict than US laws?

Actually, that's exactly what happened. American bought certain TWA assets out of bankruptcy. There was an effort to auction off pieces of TWA, but the Bankruptcy Court ruled AA's offer was the best one for (a) TWA's creditors, and (b) TWA's employees. AA was technically not, under US law, responsible for pensions due the Israeli employees. However, Israeli law is the reverse and held AA liable as the "successor" of TWA. That's why AA stayed away for years. It went all the way through the Israeli court system and American lost.

jetblue1965 · Fri Aug 21, 2015 12:40 am

Quoting superjeff (Reply 91):

Exactly... The only opinion that matters is the Israeli court ruling

LAX772LR · Fri Aug 21, 2015 1:31 am

Quoting ORD Boy 2 (Reply 37):
So, the question is, can the capacity from North America be made up by UA, LY or DL

Can it? Of course it can.
The real question is: would they want to? That's not so sure.

Quoting Flighty (Reply 67):
The reverse lie is of course much more common -- that, despite being profitable, an airline is "simply too busy" to continue to fly it.

What airline has ever claimed such a thing?

I'm guessing you're just confusing that with a simple opportunity cost comparison.

Sure a station1 can be profitable, but if station1 is making $X per flight and station2 would be making $X+N, then in a limited aircraft environment, the airline is losing N in opportunity cost despite being profitable at station1.

PEK777 · Fri Aug 21, 2015 1:35 am

Would it be considered racist to make the light-heart assumption that because it goes to the Jewish country they managed to beat them down on the airfare every time, thus trashing the yields? I have many Jewish friends and somehow they always seem to sniff out/ get the best deal.

Sorry

ckfred · Fri Aug 21, 2015 1:42 am

If the flight never made money, going back to its start in 2009, then how did it stick around for 6 years? Parker and Kirby don't come across as the kind of managers who will give a significant amount of time for assets (namely an A330) to create profits. Either the route shows promise and some profit over time, or it gets cut.

Bob Crandall certainly wouldn't keep flying a route, if it lost money for 6 years. I remember when AA started flying Chicago-Stansted. It lasted about 6 months, because AA was also flying ORD-LHR, and Heathrow, despite its being delay-prone, is the preferred airport.

When the U.S. and Canada entered into their open skies treaty, AA started flying ORD to Ottawa, Winnipeg, and Calgary. Winnipeg didn't last that long, because it didn't make money. Service to YOW and YYC was profitable, and those routes lasted much longer.

By the same token, saying a flight hasn't made money, when there are earlier accounts that the flight did make money, could be playing with fire. Federal regulators don't care for employees of publicly-traded companies making statements that aren't accurate.

That said, I do wonder if ORD-TLV could work. Granted, the passenger traffic would skew towards leisure, but no one is flying the route. El Al dropped ORD-TLV a while back. If you go to the El Al website, travel on ORD-TLV requires flying the B6 code share between ORD and JFK.

LimaNiner · Fri Aug 21, 2015 2:39 am

Let LY fly it and show that the route can be profitable. Why should NASDAQ:AAL shareholders subsidize the route?

[Edited 2015-08-20 19:41:45]

peanuts · Fri Aug 21, 2015 3:16 am

I take back what I said in post 34. This is not just "unwillingness" or ineptitude. It's also a shameless management style from the top. I've seen it with my own eyes at DL.
The current crop of top level airline industry executives is good. And I mean goooooooooooood. As in: shamelessly good. They don't care HOW it gets done anymore, as long as it gets done. The result is what counts. If they look bad in the process, they don't care. It's the result they're after. So naturally, there will be more to this TLV saga.

Giving up TLV is just too easy. AA isn't about that. That would only empower DL more of "owning NY". It's not going to happen like this.

What we read today about AA/TLV is just the temporary "pain" of a hardcore management style. There's way more to this story. It will reveal itself over time.

[Edited 2015-08-20 20:28:14]

Miami · Fri Aug 21, 2015 3:19 am

Airlineroute confirms:

Quote:
American Airlines starting 05JAN16 (US departure) is cancelling service to Israel, as reservation for the Philadelphia – Tel Aviv route being closed on Thursday (20AUG15) night, Eastern time. At time this post goes to press, reservation for travel is open until 04JAN16 from PHL, 05JAN16 from TLV. This route is operated by US Airways A330-200 aircraft.

http://airlineroute.net/2015/08/21/aa-tlv-jan16cxld/

klwright69 · Fri Aug 21, 2015 3:31 am

This is an interesting topic. The whole 6 years the flight has operated, it has been taken as an article of faith on a.net that this route was an absolute spectacular success. It was one of the star performers of the entire US network. Challenging and disputing this statement would really get you flamed here big time and get yelled at. It will be history soon.

If you google it and look for very old articles on the TW/AA merger, the official position of AA was that they were not keeping TLV because it wasn't viable economically. No one really cared that much about CAI and RUH, TW's middle eastern novelties. But apparently TW had a loyal following to Israel and Israel and the US were special friends anyway. This moved shocked and angered folks then. When CO entered the TLV market, it was just Tower Air and TWA and El Al from the New York area nonstop. Anyway I digress. CO didn't wait very long to add the 2nd daily nonstop. This was a very long long time ago. But CO wasted no time in making a big splash and quickly.

Of course DL was interested in TLV as well. But I think it's very telling that AA and UA (premerger) had no interest in TLV. Zero. That should say something.

Anyway I digress. AA's official reason is the same now as it was then. Not viable financially. The reality? I am not sure.

I was always very dismissive of all people here who love to speculate that UA is about to add IAD, IAH, SFO, or ORD to TLV because they have so much lift there already.

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