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LUS Management Shift to Building AA as a Premium Airline (?)
Gary Leff has a most interesting article, which details the weather change with the Parker administration from advocating and planning Low Cost Carrier operations to choosing improvements and further building a premium airline, though there seem to be some potholes in that path.
How US Airways Management Learned the Importance of a Premium American Airlines Product by Gary Leff on April 16, 2018 link The (at least most notable) good with some of my drop-in items) Retention of three class transcon A321T service - wishing they had more than ten Flagship,First seats Expansion of the longhaul Business product - selecting a true premium Super Diamond Solo business suite, rather than a BA-like trailing product (though much of this was serendipitous after the debacle of LAA staffers selecting a cheaper, skeletonized and failed Zodiac “Concept D” business suite) Expanding, refreshing and adding Admirals Clubs, Flagship Lounges and Flagship First Dining Adding Premium Economy to widebody aircraft (albeit trailing edge seats) The mistakes Paring back food and food quality (now recovering) The bad The “Oasis Project” (any desert and camel analogies here?} 737 MAX 8 / 7M8 and refitting of 737s and A320 family with the new microlavs and “More Sardines Throughout Coach” 30” Rockwell Collins Interior Design Meridian seating D0 and the diminution of the ability to use those refurbished lounges lest one lose Bin space, upgrades, etc. Recasting AA lowest fares as stripped down “Basic Economy” fares Doug Parker (DP’s conversion?) “No one is trying to take this company, the American Airlines brand, and turn it into US Airways. And I know that somehow that perception has come across, but it’s absolutely not true. I told you the major objective..was to have a world class product. Trust me, US Airways never would have had Flagship lounges like we have now at American. They never would have had the kind of aircraft we have now at American. They wouldn’t have the sales force that we put in place at American. Our objective is to have a world class product, and it’s nothing like what US Airways had and it’s better than what American had. That’s where we want to go and that’s where we’re moving. I want to make sure there’s no mistake about that. Nothing about this merger was meant to be ‘oh let’s go take the American product and move to the US Airways product.’ To the contrary – and again there may have been some of that at the start, I’ll be honest about that. When we came in, I know, some of us came from US Airways thought ‘Oh gosh there’s some stuff American does you don’t really need to do and you still get the same amount of revenue.’ We found all that to be not the case because it’s such a different airline. So indeed things like we came in early and took a bunch of meals out of airplanes, we’ve now gone and added back a lot more than either airline had before. Things like sales force, we came in and reduced a lot of the sales team, thinking US Airways didn’t have nearly as many as American we don’t need as many. We’ve now gone and added back a lot more than we ever had before. So to the extent that was true before, and I think it was overstated versus reality, it’s certainly not true now. Our objective is to go have a world class product… I know it’s better than it was a few years ago, and it’s gonna get better over time.” |
I will jump in and say that the argument strikes me as a little weak. The good (keeping 3-class service on ~18 321Ts) does not outweigh the bad (scrunching passengers on 300+ 738 and 7M8 and ripping out AVOD). Lounge investments? DL/AA/UA have those going on all the time. From the breathless descriptions one might expect a sliver of heaven, and the reality is a new pasta salad that's available 21 hours a week. Give me shower suites without wait at every airport that receives more than 4 AA redeyes.
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"Premium airline" - Creating premium economy was a step in the right direction, however the implementation of that has not been good
It seems most FA's seem to regard this a economy with a better seat. For the amount of money AA wants to charge for this seating, passengers are going to want much more than a better than economy seat. |
They are clueless. The food improved, then cut back again. FL improvements were done at the expense of regular Admirals Club (dramatically less space at LAX AC). Get a business class award on a partner, have to do the connecting flight in coach, maybe not even non stop. On a 737max.
Even CKs get stuck in the back sometimes. |
Let's just say I'm taking a "we'll see" attitude towards this..
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The difficulty here for me is that if their positioning is as 1) a premium airline and 2) a network airline, there is so much of their network that does not feel any of the effects of the supposed premiumization. Their focus on a select few hubs, international routes, and two domestic routes means that the vast bulk of their flights, on the vast bulk of their aircraft, even for their highest-value customers, will not feature any of these improvements.
Most transcons and long domestic routes are flown on LUS Airbus or LAA 737 aircraft, with very few widebodies in use and true business products rarely available. Transcon routes aside from the "sacred cows" of JFK-LAX/SFO do not receive lounge access or other perks in most instances. The economy is on fire, people are buying out premium products, and AA simply does not have any to offer for most of its flyers, even those who are willing to buy. As a simple personal example, I have DC-based colleagues on West-Coast travel projects who are loyal AA flyers but have gone elsewhere for their high-dollar J tickets because AA does not offer a true business product out of DC. My opinion is that AA has not created a premium airline; it has created a two-tiered airline, one of haves (JFK-LAX/SFO, Europe/Asia) and have nots (most domestic, LATAM, other). I think that if AA wants to strengthen its position, it needs to think about the offerings that it is giving to the bulk of its network. I realize that to the extent that this is equipment-based it is not a quick fix, but it should be considered in the long term strategy. |
Originally Posted by teemuflyer
(Post 29659949)
Let's just say I'm taking a "we'll see" attitude towards this..
Things like this take planning and you can’t just miracle it into existence, so “we’ll see” is a good approach to take. I have a feeling it is just another smoke filled speech in the dog and pony show, but “we’ll see.” |
I actually do believe that Doug Parker has come around. The problem is that people like Isolm and Kirby (When at AA) don’t/never saw this and took the airline towards the US model.
And their underlings still don’t get (and probably don’t have the budget for it) |
Originally Posted by beachfan
(Post 29659924)
Even CKs get stuck in the back sometimes.
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Originally Posted by arlflyer
(Post 29660022)
The difficulty here for me is that if their positioning is as 1) a premium airline and 2) a network airline, there is so much of their network that does not feel any of the effects of the supposed premiumization. Their focus on a select few hubs, international routes, and two domestic routes means that the vast bulk of their flights, on the vast bulk of their aircraft, even for their highest-value customers, will not feature any of these improvements.
Most transcons and long domestic routes are flown on LUS Airbus or LAA 737 aircraft, with very few widebodies in use and true business products rarely available. Transcon routes aside from the "sacred cows" of JFK-LAX/SFO do not receive lounge access or other perks in most instances. The economy is on fire, people are buying out premium products, and AA simply does not have any to offer for most of its flyers, even those who are willing to buy. As a simple personal example, I have DC-based colleagues on West-Coast travel projects who are loyal AA flyers but have gone elsewhere for their high-dollar J tickets because AA does not offer a true business product out of DC. My opinion is that AA has not created a premium airline; it has created a two-tiered airline, one of haves (JFK-LAX/SFO, Europe/Asia) and have nots (most domestic, LATAM, other). I think that if AA wants to strengthen its position, it needs to think about the offerings that it is giving to the bulk of its network. I realize that to the extent that this is equipment-based it is not a quick fix, but it should be considered in the long term strategy. Another part of his approach is to avoid aggressively competing where he can win/dominate (thus the current draw down in JFK/NYC). All that is new is that he is recognizing new areas that they can and must offer products in; mostly in the realm of high end luxury service |
This mirrors my experience with AA. They've been doing a good job, from this traveler's perspective, differentiating where it matters the most to me (longhaul international cabins and the associated products, ground and air).
Their domestic product still has me a little :rolleyes: Has Doug been on the LUS A320, A319? How about the MADMAX? I had a separate post on this and stand by it: I think AA is the best US-based longhaul carrier. If they can bring some more consistency and premium appeal to their domestic ops they'll definitely stand apart from WN, DL, UA. I'm not sure they're as compelled to be competitive in the domestic market, though. |
Sure AA, you keep saying words like "premium" to fool investors, but there are still reports on FT about inconsistent PDBs as a pretty basic thing they manage to mess up regularly.
I will say, the Flagship lounge in LAX is absolutely stunning and fantastic (I was just there a few weeks ago) but then my LAX-PHX Southwest flight was more comfortable than an AA 737 in Y, and I haven't even experienced the torture of a "MAX" configuration yet. |
AA is only premium in:
1) First and business class on long haul flights, and JFK-LAX/SFO (which a small minority of its customers experience) 2) Airfares |
Originally Posted by JDiver
(Post 29659847)
The “Oasis Project” (any desert and camel analogies here?} 747 MAX 8 and refitting of 737s and A320 ...
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Originally Posted by travellerK
(Post 29660215)
All that is new is that he is recognizing new areas that they can and must offer products in; mostly in the realm of high end luxury service
If a $100k/year CK gets off a fancy $8k J flight from Europe or Asia and steps onto a ratty old LUS/LAA narrowbody for a 3-hour flight to their home airport, on which they don't get a PDB, a decent meal, or anything resembling service, sit waiting for a gate for an hour, and have their work laptop die because there is no place to charge it, what experience will be most proximate in that customer's mind? The weak link isn't the big-ticket stuff on which management has been focusing, it's the many, many domestic flights that comprise the bulk of the passenger experience |
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