tismfu

First, I would just like to say thanks for this incredible resource. I was lucky enough to stumble across it a few days ago and have spent hours reading over the pages of helpful threads and information. My head is still spinning with all the abbreviations.

I love American Airlines and fly them almost exclusively. I am a paltry Gold (qualified for the first time in August) member who doesn't travel on business but instead just between college and home and various other trips throughout the year. I have aspirations of performing the Platinum Challenge later on this year but only if I am sure I can do it. I am sure I will need some assistance later on when I decide to sign up for it.

Now my question is, after this economic downturn and airline shuffle, is there any chance of AA becoming a Singapore Airlines type airline? As I am sure all flyers have noticed, AA has been cutting costs and the pleasure of flying has decreased somewhat over these past few months and years (save for MRTC). I had the pleasure of traveling on Singapore Airlines in Coach and First (long story, but we were ticketed for Coach and certainly didn't pay for F) and it was a first-rate experience all the way through.

First of all, Singapore flies first-class equipment with the latest in technology, and secondly, they have unparalleled customer service (at least while onboard). Yes, I know that AA is a monster in terms of size compared to SQ, but is there any hope of even a slight AA renaissance? The United States doesn't really have an airline that is above and beyond the others. I think with MRTC AA has a great base from which to start a premier airline.

So, am I crazy or just slightly crazy? Your thoughts and ideas are appreciated.


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And as an aside, could someone take the time to explain the different classes and fare classes? I tried searching but couldn�t find the answer.

As far as I can tell First class is F, Business is J, and Coach is Y. But what are the fare classes? Y is full-fare coach? What are the others? Thanks in advance for any explanation.


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tismfu

azmmza

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Shareholder

Welcome. In short, I'd answer: No.

Why? Because SQ -- and CX -- are somewhat curious global carriers who each fly from a small country [well, I know HKG isn't really a country] with little territory and a relatively affluent local population. Both are geographically propitious as connecting points between NAmerica and Asia and Europe. And neither must worry about competitive, low margin, extensive domestic networks. Thus they can each focus on providing exemplary service on generally long haul segments which can be quite profitable. Where they fly short distances, the volume of passengers, and limited competition, ensure stable prices that guarantee reasonable operating margins.

This is a highly oversimplified answer to a very complex question. But you must recognize that SQ and CX are very unique creatures of their happenstances. AA, like most other major carriers, is actually several airlines operating under the guise of a single carrier. AA operates domestic short, medium and long hauls, each with a different set of operating economics, and competitive forces. AA also operates a transborder network that goes into Canada, Mexico and the Caribban and Latin America, and also has its own unique market characteristics. And finally AA operates an intercontinental longhaul service, on which it is most likely to make a small profit, but on which it also faces price competition, as well as "luxury" competition. AA simply cannot be a SQ or CX as long as it must handle all these different types of service.

I could continue on at length expounding on this thesis, but I am more curious to read how others answer you, and how some may pull apart my analysis. Or yours.

As for your other question, life used to be so simple when there were just two fares: First and Coach. Then came Business. Than came advance purchase Coach, and the spiral began.

Each class has several sub-classes of fares and booking classes. These depend on the flexibiltiy of the fare paid: higher the fare, the more flexible the ticket becomes. This is why full Y comes with next to no restrictions, but Q or V or N or L or whatever, each have a range of restrictions. This one is as complex as the last one, so pardon my oversimplification, but I trust you get the gist.

Plato90s

Well, AA doesn't have a home market protected by high tariffs and restrictive landing rights to prevent other carriers like UA, DL, CO, NW, etc.. from competing.

AA also has to operate under regulations, including labor laws, that SQ does not.

So, no, I don't think there's much of a chance AA will become America's SQ.

ratnamg

So you are saying that Singapore's protectionism tactics have actually produced a great airline with good service.

Interesting...

Miles2go

Typical American answer? If somebody else is better, it's because they "cheat".

Seriously, some of the previous postings have given a better analysis...

They are better largely because of different economics, international routes that often have bilateral agreements to protect the margins of carriers, etc. -- BTW, US companies benefit from those same on many international routes where I'm sure they collect a handy profit (e.g., Singapore, Hongkong, Tokyo)

Plato90s

Does stereotyping actually change the validity of my answer?

If we opened Singapore up to the same kind of competition that US carriers face in every aspect of their domestic routes, I think it's a certainty that SQ won't be nearly as profitable.

ratnamg

Plato, you make a fairly interesting point. But the fact still remains that there are other coutries with protectionist Airline policies. SQ has been successful becuase of other reasons. Some of the earlier posts had a pretty good analysis.

We should also remember that the original poster talked about "Customer Service". Most of the US based airlines need to make significant improvements in this area. AA is ahead of most other US based airlines but SQ is much better.

venk

Singapore has domestic routes?

I am only half joking because you cannot change the geography to create domestic competition within Singapore. Now if you want to create cometition of flights to and fro Singapore airport for other international airlines, then of course that requires reciprocal rights at the home airports of these airlines.

So, what specifically are you asking for?

Would the US be willing to open up its domestic airports to SQ in return for whatever you are asking Singapore to do?

As an aside, interesting comment from AA's partner CX in

http://www.cathaypacific.com/sg/abou...-84422,00.html

I personally think that the biggest problem AA will have is to culturally align its FAs from being Inflight Safety Professionals to Inflight Customer Service Professionals. This has nothing to do with any protectionism.

Plato90s

Personally, I would be happy to let any international airline fly domestic US routes. I bet nobody would volunteer to do so.

SQ's service has to do with the lack of job security as well as American-style labor laws.

First, the selection criteria of SQ's flight attendants would be illegal in the US.

Secondly, American airlines have unions which prevent firings for not providing high service levels.

Third, the greater number of employment possibilities make an FA's salary less attractive and thus fewer candidates apply.

SQ-style customer service is impossible, and SQ-style profitability/route map is also impossible. Remember that US airlines used to have highly attractive flight attendants providing excellent service while wearing form-revealing uniforms. That went out along with the government-regulated artificially high air fares.

It's not that American carriers don't know how to run an airline like SQ does. The conditions just aren't there to allow them to do it even if they wanted to.

venk

Wow, the similarity of the above points to the discredited arguments against the success of Japanese imports and their reputation for quality in the 80s is astonishing. Of course, the former got discredited when the US auto manufacturers had their backs to the wall and forced to change and got their own manufacturing in shape and the Japanese set up shop inside US and turned out excellent products.

Similar government regulations, labor laws, high cost of living, etc., doesn't seem to have hurt LH in providing a high-level FC service at all.

Some of the points above (e.g., unions) are doings of the airlines themselves. The level of service is not limited to shape and dress of FAs. The function and role of FAs is institutionalized within the US airlines that comes against better service. This has nothing to do with labor laws or discrimination laws.

I do agree with the you that conditions are difficult for US airlines to be competitive with SQ. But despite the differences that exist between the two countries that cannot be changed, I do think it is entirely within the control of US airlines to create an equivalent product (not the same product) if they wanted to.

US airlines also have some advantages compared to SQ. In particular they have a captive audience which for familiarity reasons, corporate account reasons and loyalty program reasons will actually be biased towards giving their business to US airlines if they even came half way towards a comparable product.

With those type of advantages, it would be quite unfair to characterize the cultural and political differences between the countries and point a finger at Singapore as if they are the ones that need to change.

GibSpmuh

Take a look in Singapore any evening and you'll see plenty of competition lined up there - Qantas for starters flies head to head against Singapore to a number of destinations in Europe (London, Paris, Frankfurt and Rome) plus Hong Kong, Denpasar and of course all the major Australian cities. I don't think I've seen a route with more competition on it than the Singapore-Bangkok one either, yet Singapore can consistently charge more than their competitors and still fill their planes. So I think it's more than just protectionism that makes them a successful airline, the right attitude needs to be there as well.

Plato90s

Just using SIN-DPS as an example, because I looked into this for a trip in mid-March.

SQ has 4 daily non-stop flights listed on ITN. Garuda has 1.

Nobody else even flies that route.

And if you've never seen a route more competitive than SIN-BKK, you've obviously never heard of JFK-LAX or JFK-LHR.

ratnamg

Well it doesnt matter how many people apply, what matters is the focus on customer service - how is it that even within the US Southwest has better customer service than most other airlines? Why are the employee relations better there?

The attractiveness of the FA is the least important factor here. It is customer service and not Customer "Servicing". The problem with the industry right now is two fold - overcapacity and lost focus on the customer.

Miles2go

What domestic routes would you open up in Singapore? As for the US, any airline would certainly have the right only to fly international routes out of, say, LAX or JFK. And all international routes are covered by agreements similar to what SQ flies under. Some are bilateral open sky, most are somewhat managed.

As for stereotyping, I would consider your original answer being a prime example.