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-   -   American Carriers in decline? (https://www.flyertalk.com/forum/usa/1426520-american-carriers-decline.html)

ente_09 Jan 10, 13 9:46 pm

American Carriers in decline?
 
No American carrier purchased the A380, they did not get first crack at the 787 and the first/business classes of Asian and Mideast carriers blow the American products away.

Is this all part of a pattern or just separate issues with separate explanations?

sgold88 Jan 10, 13 10:38 pm

American Carriers in decline?
 
It's called no money. That simple.

rajsh Jan 11, 13 1:45 am

They've been in a decline for many many many years. Having said that though some of the, are starting to stabilize it seems as far as an operational viewpoint goes in generating income ... I.e. Delta comes to mind.

rjohnmurray Jan 11, 13 1:45 am

American Carriers in decline?
 
It's nothing to do with no money. It's the lack of vision. The US Airlines cater for the US Market and US Passengers who barely get out of their seats let alone their country. That's why Emirates have A380's because they listen to the demand worldwide. AA for example state they will have the newest and youngest fleet soon yet they continue to put old aircraft types on the fleet wit no real amenities on board. So they are spending the money but on the wrong aircraft

francophile Jan 11, 13 1:55 am


Originally Posted by ente_09 (Post 20022350)
they did not get first crack at the 787

Speaking of crack.....

http://www.nytimes.com/2013/01/12/bu...7.html?hp&_r=0

Excerpt:

Cracks Appear in Cockpit Window of Boeing 787

Cracks appeared Friday in the cockpit window of a 787 Dreamliner flying in Japan, the latest in a string of mishaps with Boeing’s newest and most sophisticated jet.

The plane was operated by All Nippon Airways and was heading from Tokyo to Matsuyama, in southern Japan. The flight, NH585, which was carrying 237 passengers , departed from Tokyo’s Haneda airport at 9:35 a.m. local time and landed safely. No one was injured, a spokeswoman for the Japanese carrier, Megumi Tezuka, said by phone from Tokyo. The return flight, NH590, which had been due to depart just before midday, was cancelled to allow for the screen to be replaced.

zpaul Jan 11, 13 7:15 am


Originally Posted by ente_09 (Post 20022350)
No American carrier purchased the A380, they did not get first crack at the 787 and the first/business classes of Asian and Mideast carriers blow the American products away.

Is this all part of a pattern or just separate issues with separate explanations?

I think it also has to do with the level of partnering that US airlines are doing now. Rather than buy their own A380, they code-share or partner with airlines that do fly it. Even before the advent of the A380, airlines like AA were code-sharing on Qantas services since AA didn't have any 747s of their own. Why buy your own when you can use someone else's?

Most of the US-based LCCs are also introducing premium products that are designed to rival the premium service of most other carriers (not to the extremes of suites in F, but to a reasonable approximation), recognizing that their international premium products were well below par for a very long time.

It's also good to remember that many of these airlines have been flying much longer than many of the other airlines out there, and they already have significant investments in their fleets that can't be disposed of very easily. They have to make due with what they have. AA does have new aircraft on the way, which include the 787, but they need to focus on replacing the aging AC in their current fleet more than expanding the fleet to include the A380.

I don't think that US airlines, as a whole, are in decline; I think that they have different priorities.

NFeldberg Jan 11, 13 10:12 am

Ill agree with Zpaul on many of those points. I would also like to add one thing to keep in mind and that is the fact their is a lot more competition in the U.S between the airlines. When you add that in with the constant demand for a $200 round trip ticket from JFK to LAX, eventually you get the current state of the industry. As most of us probably know, it is not cheap to run an airline. The profit these airlines make on one flight is well below where it should be. People love to gripe about how terrible the American airline industry is, but they need to realize, they are one of the main reasons for the decline.

As for the airplanes themselves. In order to keep up with that demand for cheap travel, the airlines choose to fly what they have until the airplane hits the age of retirement or until the cost of maintaining the airplane is no longer cost effective. Just about every legacy carrier (American, Delta, United, US Airways) are replacing older airplanes with newer ones. American Airlines will be getting brand new A321s soon and Delta is replacing their MD-88s and DC-9s with the 88 Boeing 717s they are leasing from Southwest.

As for the A380 being absent from any U.S carrier, the airlines weren't interested in the airplane. It had nothing to do with money. There wasn't a demand for it and only a few American airports can handle the airplane. If they want to buy a bigger airplane, the 747-800 or 777-300 would suffice their needs. As someone said, Americans rarely travel abroad. Personally, I have never been on a sold out international flight on any US carrier heading overseas.

All in all, I believe the industry here is slowly but surely beginning to improve (from the consumers stand point) Like someone said, Delta comes to mind as an airline looking to break the chains. One good thing they have finally realized is the use of 50 seat regional jets was costing them a fortune and they have started phasing them out completely. The regional jet thing is another story in the U.S. Its gotten to the point where most of the domestic flying here is done on a regional jet. Most of the routes flown by regional jets at one time, where flown by mainline. Thats lost revenue I hope to see them get back one day.

SeriouslyLost Jan 11, 13 10:18 am

I also don't think it's lack of money. They've got the cashflow. It's lack of management ability. Look at all the numbers over the last ~3 decades - their revenue per pax km hasn't been bad, their outright volumes have been fine, and they don't pay particularly high taxes.

Given they have every reason to succeed, the only thing that is ruining them is themselves. They do have very high operating costs, but again, IMO that's simply due to amazingly bad management and poor staff. They have bloated staff rosters at virtually every level, but especially the management level.

But that's US business overall, IMO: unnecessarily high inputs for average outputs, resulting in depressed profits over the medium to long term and excessive business fragility. On a completely unrelated note, it's the exact same situation in the US farm industry: inputs are simply too high and outputs too low.

cordelli Jan 11, 13 10:55 am

Why is there an assumption that just because they didn't buy a 380 they are in decline?

98103 Jan 11, 13 11:28 am

Have to agree with cordelli. There isn't a cause/effect here. They're in decline because of passenger demand. Passengers want $200RT fares on their transcon flights, or rather cheap fares on ANY flight they purchase...even where that would be financial idiocy on the part of any carrier that wants to make a profit. The fact that they want all the benefits at the same time is beside the point. They want both.

And thus, the American public gets what it asked for (cheap fares), rather than what it meant (cheap fares and all of the amenities). That said, this model can be done with an A380.

MiamiAirport Formerly NY George Jan 11, 13 11:38 am


Originally Posted by cordelli (Post 20025704)
Why is there an assumption that just because they didn't buy a 380 they are in decline?

There are only a relatively few number of routes that economically support large a/c (LHR, NRT, GRU, HKG). In many cases, UA, AA, and DL serve these airports from two or more hubs. Most of these destinations can be served with 767/A330/777s. A 747-800 or A380 would mean needing to fill the a/c with junk fares. The industry has finally turned away from having excess, unprofitable capacity just to dominate a certain route.

DL "might" at some future point look at large a/c to replace 747-400s down the road assuming those routes can be filled with productive capacity.

stifle Jan 11, 13 11:40 am

There was an interesting article about this in the Economist this week.

cordelli Jan 11, 13 12:11 pm

From USA Today

Will the A380 fly for U.S. airlines?

But while U.S.-based fliers can hop aboard the supersized jet in five cities, no U.S. airline currently flies it. And with U.S. airlines focused on boosting profits and flight frequency, some analysts doubt they'll add the superjumbo A380, or even more of Boeing's nearly as big 747s, to their fleets anytime soon.

"There's a reason that (U.S. airlines) are not adding 747s to their network," says Bob McAdoo, senior airline analyst at Avondale Partners, a Nashville-based institutional brokerage house. "They've all gotten rid of them because they've found other airplanes that are a better fit for the way they want to fly their routes," with smaller aircraft better able to make more frequent non-stop trips from U.S. cities.


http://usatoday30.usatoday.com/money...bus-a380_n.htm

Passmethesickbag Jan 11, 13 12:47 pm

I also suspect the lack of A380s also has something to do with the lack of successful international transit routes, which seems to be a major reason why EK and SQ, for example, do well with these planes. Partially, this is to do with the size and location of the United States. But it is also to do with the general requirement to pass through the increasingly onerous US Immigration and Customs to make such a transit. The US ought to be the major route between Europe and NZ, for example, and a competitive one between Europe and Australia, but it isn't.

Herb687 Jan 11, 13 6:02 pm


Originally Posted by NFeldberg (Post 20025403)
As someone said, Americans rarely travel abroad. Personally, I have never been on a sold out international flight on any US carrier heading overseas.

Such an absurd statement cannot go unchallenged. Americans rarely travel abroad yet a whole host of airplanes leave the USA on a daily basis for international destinations??

You think the majority of that business is international point-of-origin traffic returning home???

While you may have never been on a sold out international flight on a US carrier it would only take a cursory search of the Flyertalk board of ANY US airline flying international to find scores of Flyertalkers that have reported oversales/VDB on international flights.

Or, you could browse years worth of US carrier press releases, traffic reports, etc. and find international load factors higher than domestic ones...


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