mattya9

Just curious what the DL flyertalk community thinks of AA's move to partner up with B6 to beef up their presence in the NYC/BOS area. Does Delta need to retaliate somehow? Or is their foothold solid enough to weather this new storm coming their way? With everyone going through tough times, in my opinion, and with Delta's partners (VS, AM, TAM) going through bankruptcy/restructuring, part of me thinks DL needs to come up with something to counter this with. But then the other part of me says they need to just stay the course and that will be the best thing to do right now. What do you think?

OPS

rylan

Well prior to the pandemic, DL was on the attack in BOS and adding a lot of routes, while AA was getting beat down. So it was basically DL vs B6 in BOS. The teaming up will certainly help B6 to defend their routes and put more pressure on DL... and with the coronavirus I'm not sure if there really is ability or will for a response from DL.

Orange County Commuter

Why do they need to 'respond'?

Just because your competition does something doesn't mean you have to respond. You could be what they are responding too. Or they could be "freefall panic" and there's no need to join them there.

Duke787

Seems a curious move. What exactly is AA's strategy here?

They've outsourced the Northeast and coast-to-coast flying to B6/Mint. They've outsourced West Coast and Hawaii flying to Alaska. So now they are going to fight with DL for the South and fight with UA for the Midwest?? And they think that their international network be the thing that gives them a leg up against UA and DL in this model?

Please. UA has a dominant position for international travel from SFO and EWR, one that DL and AA can't match. DL has a strong corporate roster and has established themselves as the business traveler airlines with a focus on passenger experience (compared with AA who has been focused on Oasis and other projects that rip out IFE, cram more seats in the plane, and make the bathrooms the size of a small pantry). Plus B6 still isn't an international competitor for NYC so AA continues to cede NYC to DL/UA and are mostly reliant on JFK - LHR rev share with BA.

Plus AA is saddled with debt -- the international market, while lucrative, is going to take far longer to return than the domestic market yet AA seems intent on moving to a strategy driven by international revenue and outsourced domestic travel which means they'll have to share domestic revenue on these routes (including the lucrative JFK - LAX and JFK - SFO routes) at a time when they desperately need positive cash flow.

I don't think UA or DL have anything to worry about here. If anything they may actually benefit from this combination -- in the short-term it takes an AS/B6 merger off the table and instead keeps them with split portfolios spread among AS/AA/B6. I think UA/DL would be much more concerned if AS/B6 tied up to become a premium domestic carrier with limited short-term international exposure but the flexibility in their fleet to expand as travel comes back (and take advantage of potential slots opening up through bankruptcy).

VFR

Farm out the west coast and east coast flying in competitive markets to AS/B6 who are "hometown carriers" that people have better feelings for, and connect all of their passengers through their fortress hubs in DFW and CLT. They have fewer bona fide fortress hubs than DL (ATL, DTW, MSP, and SLC), so they had to figure out something to do. For long-haul flying, they can't oversaturate DFW and CLT and they want to find a use for the 777s and 787s they have, so they got some geographically convenient hubs in SEA for Asia and India, JFK and BOS for Europe, and farm out the domestic flying to a partner. AA had been floundering on non-DFW long haul flights before COVID, so it's not obvious yet if this is a winning strategy.

As I understand it, DL makes about 80% of their passenger revenue domestically and 20% internationally. UA leans more toward international, and AA is somewhere in the middle (though with less revenue). Why is AA focusing more on international than domestic?

AANYC1981

AA & JetBlue already did this years ago......moving on

SOBE ER DOC

AA is growth constrained in NYC due to slot availability. They gave away too many slots (between US and AA) and now they cannot compete. B6 offers an option for them. The issue there is that B6 is all the way out at JFK so I;m guessing this is about feeding TATL traffic and trying to maintain some meaningful presence in the NY market. As for BOS, this is all about B6 protecting their turf. DL was coming on strong pre-COVID and they have / had the capital to wait this think out.

AA's strategy is rather smart. With AS about to become a full-fledged OW partner AA flyers up and down the west coast have good options and can maintain their relationship with AA. Meanwhile, AA can focus on DFW, CLT and defending themselves in MIA where DL is going to become an irritant soon.

HWGeeks

Delta doesn't need to respond, AA is going downhill and Jetblue is well a slightly better Spirit.

Nuhusky

Another way to look at this is what kind of credit card/loyalty point revenue will this drive. Given loyalty point earn airlines more in profits than flying butts this opens up a whole new market for aa

SJC ORD LDR

Sit back and watch one of them go into Bankruptcy.

VFR

Delta doesn't need to do anything, they know that they have a lot of strong reasons for folks to choose DL, and they have a lot of good flying out of their core hubs.

It's not obvious that B6 will be willing to pay a ton when their flights are credited to AA. Additionally, AA is going to have a tough time selling their credit card to folks that are going to be flying B6 or AS where the benefits don't apply.

bgasser

As a regular B6 flyer, I would be unhappy to get shifted to an AA flight. The seat pitch, width and service is substantially better on B6 than flying AA. AA economy is nothing more than flying Spirit Airlines.

readywhenyouare

There's not really anything they can do. It's what happens when you burn the bridge with every other US airline.

flyerCO

no, no they haven't.

Orange County Commuter

Honestly I am not sure why B6 is doing this. They seem to have a good reputation and rank fairly high in customer satisfaction. Same with AS. So why join youself to an airline that has not had that "reputation" over the past few years.