Originally Posted by
Kacee
My opinion? There's no hope so long as present management remains in place. The fact that the board isn't doing anything to replace management suggests there's a big problem there as well.
I agree, I would even say the bigger problem is the board's composition and inaction. To be fair, we don't see what happens at board meetings but they have allowed the company to underperform for going on 10 years.
Originally Posted by
joeyE
If this was really the case, then they should uncover ways to start taking advantage at locations where AA could be vulnerable in 5 years. Open a hub in Florida. Open up and expand partnerships at JFK. Expand at National and Phoenix.
I don't like Kirby's style of talking smack, but he makes really good points.
DL and UA reconfigured their hubs structures dropping at least one during their last mergers. AA has a few strong performers- MIA for Latin America, DFW strong for domestic and international and CLT, but the network overall has no strategic thought put into it. Not far north of CLT there are the runt hubs all clustered too closely together looking for a defined mission to fill: DCA, PHL, JFK.
On the West Coast you have two more hubs situated too closely together- a stunted LAX with every major competitor and PHX without any real international service from AA despite their seemingly commanding position. AA states their best
transpacific hub is, wait for it, DFW. What the hey?
AA seemed to recognize the West Coast Problem and 8 years said they would develop SEA as a major transpacific gateway working with AS. Somehow that mission is being fulfilled by the recent arrival of DL but while competing with AS. This clearly did not work out for AA.
On the East Coast they seem to realize that JFK does not have enough domestic feed to operate as a transfer hub for their international flights and announced a tie-up with B6, stumble again and it is UA now partnering with B6. Not that UA needs it, they are just blocking and tackling AA.
This is why Kirby says AA is getting boxed in from further growth. Combine this network fumbling with few aircraft on order while UA has hundreds of widebodies coming in and DL larger planes than AA as well, where and how can AA grow? AA used to say they have the newest fleet so their maintenance costs are lower than DL and UA. On the last earnings call they blamed having newer plans and financing costs for their higher operational costs. So which is it and what is the real picture? Does anyone at AA even know?
ORD deserves a brief mention, slowly being deprived of flights resulting in losing gates. Which they managed to do at JFK as well,
I've sat on many board meetings and none of this would fly (pardon the pun). I just cannot imagine how this board operates.