Southwest airlines 737 seat map4/12/2024 ![]() This completely refutes American’s rationale for going smaller. And believe it or not, the 100 markets after the top 25 have more service as a percentage of 2019 than those in the top 25. ![]() ![]() The idea that there are 200 markets with endless opportunity for American at the bottom end is silly and overstates the actual opportunity… mid-size cities.Īll those mid-size cities fall into the top-125. But at the bottom end you have all those essential air service markets and other abandoned little markets that simply are not ever going to be viable. To give you a sense, the largest of the “bottom 200” markets is Tallahassee followed by South Bend and Charlottesville (VA). But most of these are markets American will never serve and never can. Using the bottom 200 markets, then yes indeed, 2023 is at 89 percent of 2019. Just look at this chart it provided with a deceptively-designed Y axis.ĭata via Cirum, based on Continental US departing seats worldwide for 11 largest US carriers, ranked by 2019 seats The way American pitches its plan, it’s not clear that the airline understands that to be the case. (American says its will be gone by the end of the decade.) With that in mind, American needs mid-size markets with high fares to make this work. Also, smaller aircraft are just not being made, and 50-seaters are on their way out. For example, pilot costs have gone through the roof, and when you only have 65-76 seats to spread that expense out, unit cost problems creep up quickly. My two issues here are 1) I don’t think the opportunity is as big as American suggests it is and 2) Business travel is key for this market segment, and American has a self-inflicted disadvantage in competing for that traveler.Īmerican isn’t wrong that smaller cities have suffered since the pandemic with dwindling service, but some of that is due to structural issues that American can’t overcome. If Delta and United are going to zig, then American may be better off zagging. On the surface, this doesn’t sound like a bad idea. ![]() Though it is retiring its 50-seaters by the end of the decade, it wants more 65-76 seaters in a dual-class configuration that it can use to better serve these smaller markets and get all that high-dollar flying It is proud to say that it wants more regional aircraft, focusing on lower trip costs instead of lower unit costs. With Delta and United going to the bigger end and investing heavily in the customer, American thinks it should go the exact opposite way. With larger airplanes, unit costs go down, but of course, the number of people you need to fill an airplane goes up. In American’s view, this is being exacerbated by both Delta and United opting to upgauge their fleets to larger aircraft. Less competition and higher fares is the norm, and that has only accelerated as of late. Why on earth would American prefer smaller cities? People in those cities are generally held captive by fewer airlines. But what American showed yesterday is that it doesn’t want to focus on big cities in general, at least not outside of its fortress hubs. This has been very clear for quite some time. We already know that American is most interested in the southern half of the country where it has the biggest presence - primarily on domestic, short-haul flying - and that it will lean heavily on partners for long-haul flying. This is apparently now American’s strategy systemwide. Instead of trying to cater to New Yorkers with their plentiful alternatives, US Airways was trying to cater to the people of Charlottesville (VA) or elsewhere who didn’t have other options. When American didn’t know what to do with its remaining LaGuardia slot portfolio right after the US Airways merger, it used this exact plan. If I had to sum up the strategy based on the presentation, I’d say it is to use the network and AAdvantage to avoid competing and cater to those small city folks who don’t have other better options. Either way, it’s going to be a lot tougher to make work than American is letting on. The bad news is that it either doesn’t understand its own strategy or it’s just playing coy about it. The good news here is that American does now seem to have a coherent systemwide strategy. Instead Chief Commercial Officer Vasu Raja spoke about the only two things the airline thinks matter on the commercial side: the network and the AAdvantage frequent flier program. ![]() American didn’t talk at all about its product. American Airlines held its first investor day in years yesterday, and while several execs did a good job highlighting many of the changes going on around the airline, it was the commercial strategy that I found to be wild. ![]()
0 Comments
Leave a Reply.AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |