Originally Posted by
uanj
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.
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.
Brilliantly said.
The only quibble is the timeline. AA has had rubber stamp boards that have overseen
decades of stupid in the C Suite. Carty, Arpey, Parker, Isom. That's nearly 30 years of weapons grade incompetence.
Originally Posted by
MrAndy1369
Warning: might be unpopular ideas.
Downsize JFK/CLT into focus cities. JFK keeps flagship transcons, LHR, and regional flights, then let OW pick the other international flights up. CLT can focus on transcon/regional with maybe 1-2 international flights a day.
Flex heavily into PHL. Make PHL the main East Coast hub with international, transcon, midcon, and regional. Pipe dream, but maybe do a full-scale, SLC-style reconstruction of PHL and hire better staff.
Why PHL? Lower costs, not as crowded or congested as JFK, and I'm sure PA will give AA tax credits/a sweetheart deal. NYC has just too much competition. CLT also wasn't built for the size of AA operations.
It's honestly the only way I can think of balancing out the proximity issues of the 4 hubs.
Leave ORD/MIA/DFW/AUS as is with small adjustments, dehub PHX, expand LAX, and add a small NW focus city/hub to balance things out. PDX, perhaps?
*cries in unpopular opinion/prepares to be flamed*
The fact that the LCC leadership (who basically retreat to their fortress at the first sign of trouble) keep trying to do anything but have PHL should tell us something. CLT is one of AA's most profitable hubs due to a low operating cost and prime location - it would be insane to throw that away.
Originally Posted by
Kacee
Um, it is the 5th largest city in the country. In order: (1) New York City, (2) Los Angeles, (3) Chicago, (4) Houston, (5) Phoenix. Look this up anywhere. (And relatedly, Maricopa County is the 4th largest county by population in the country.)
As already noted, Metropolitan Statistical Area measures something completely different. You could look that up as well. Or ask one of the AI engines to explain the difference between a "city" and a "metropolitan statistical area."
Yes, but the colloquial discussion of a city does not stop at the city boundaries. The catchment area is what is important.
While technically correct, IME, it isn't that relevant. Dallas isn't on that list, but the DFW area is far more important to AA and aviation than PHX.