AA applies for more Brazil service

[damajagua]

WT while I sometime find your posts somewhat arrogant I truly enjoy your insights and views about the industry and AA. Wether I like what you say or how you say it is irrelevant; I happen to agree with most of your views. I have said it before and I will say it again most employees @ AA from top to bottom are in total denial of the reality facing AMR. It's kind of hard thought to get the rank
behind you when you have executives taking millions of dollars and bankruptcy proof parachutes packages in their
compensation. Let's hope that "we" all wake up before it's too late. Sorry about posting something that had
nothing to do with the topic. I Hope both AA and DL are successful with the routes they are requesting in Brazil.

 

[eolesen]

You just don't get it, WT.... People might be able to focus if you weren't such a distraction.

You've had more than your fair share of the forum's time and bandwidth.

You've stated your case ad naseum. As in repeatedly. Dominating the conversation, even.

It's time for you to put your hand down and let some of the other kids give answers now.

 

[WorldTraveler]

Eric,
It is perfectly obvious that the real issue is that you can't stand it that someone else is in the kitchen and isn't willing to sit quietly on the sidelines and let you say what you want on this forum without being challenged.
Get over it, buddy.
This forum is not yours exclusively to use. If you want to create an invitation only discussion forum where you can get in the last word, create one on your blog. I don't read it and am not going to join in. I doubt that many people arei interested in that type of sanitized discussion anyway.
This forum is capable of handling far more posting activity than it currently gets; the owner(s) would be glad to see more activity - but neither your responses or mine are stopping anyone from adding more posts.
I started what was my final response several hours before reading your last response and finished it up as I completed other tasks of the morning.
You and I both posted what could have been FINAL STATEMENTS - but you can't stand that you can't get in the last word even though I had no intention to usurp yours as such.
I was gracious enough to acknowledge that what you wrote was accurate and relevant - and that you played a key role in this discussion. Yet you repeated the same behavior that you have shown elsewhere in shunning even the most gracious offers of peace and reconciliation.
I am not going to cow down to your childish behavior that - just like Commavia - is all about "marking territory" whether it is on the DL or AA forum or anywhere else where we happen to mutually have something to say. If a conversation naturally ends, I have no problem with letting it end at that point. But I am not going to count how many responses I have made or whether I have finished the last half dozen threads to decide whether I am through with a subject or not.
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Specific to this thread, I added a number of additional details about air service between the US and Brazil and the markets specifically that I would imagine the vast majority of people on this forum did not know and wasn't discussed before - so it wasn't simply a rehash of previous posts.
It was a logical conclusion and summary to this post which many find helpful after all the back and forth.
If you want to debate the conclusion or add anything else to the topic, feel free to do so - and I may respond. If you want to take potshots or mark territory or have a childish fit because you can't get in the last word, then I'll probably keep posting as well - until the conversation comes to a natural end.
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I will speak where and when I want to speak and within the stated rules of the forum, I will speak about what I want to speak about. I am not beholden to you or your desires to get in the last word.
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Damajagua,
thank you for your classy response.
I know I am abrasive at times online... that is part of my online personality... thank you for recognizing that I do have a great deal of insight about the industry and AA that I know many do find interesting and valuable. I am happy to share what I know. It is my desire that SOMEDAY we can have a forum where people's personal egos are not so large that they can't accept that others might be able to contribute something and even moreso that the things in life which we all cherish - including our "preferred airline" might have some faults that others might be in a position to point out.
The point of life for me is learning, growth, and broadening my horizons. For people who think similarly, there are many opportunities to learn through our online actions.

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I hope that whatever I might post here might open the eyes of some people to the significant threat that exists to AA. It saddens me greatly to hear your assessment that most people at AA are in complete denial to what is at stake.
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Unfortunately, I don't have enough of a picture of how you are attached to AA (employee, dept etc?) since I focus on the topic more than the people involved in discussions. In time, I might have the opportunity to meet you in person. I have met some wonderful people through aviation chat forums.
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I wish you and yours well, no, the very best, and will continue to believe that AA can turn things around and, relevant to this thread, that AA and DL - who seem to be the only two carriers interested in growing their Brazil networks - will both continue to succeed in that country.

 

[tech2101]

Oh yeah!

Take that!

 

[eolesen]

It is perfectly obvious that the real issue is that you can't stand it that someone else is in the kitchen and isn't willing to sit quietly on the sidelines and let you say what you want on this forum without being challenged.

No, it has nothing to do with that, and it's nothing personal, but the fact is this is a discussion forum, and not your personal lecture series.

 

[WorldTraveler]

When people quit telling me that they find the information I provide useful, I will quit posting.
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People do tell me that what I post is valuable and I will continue.
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Again, you came to a good summary conclusion of the situation at AA.
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As I obviously correctly noted, the issue is whether you will accept that this is a public forum. I have no problem with anyone else participating. You apparently do. No one is saying they have been shut out. The board is still processing all of the posts that are being made.
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When you can learn to live with the fact that someone else is sharing this forum with you, we can probably get along just fine.
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thanks 2101... it helps to laugh at life.

 

[commavia]

First, it has been asserted that flights from Atlanta to secondary markets in South (and in general Latin) America can't work because, in general, they haven't. That's a fact. If history is a guide, Delta has struggled to maintain even daily and/or mainline service to some smaller markets in South (and/or Latin) America, and several notable examples - yes, including Manaus (along with Fortaleza and Recife) - have failed in the past. Again - there is no disputing that Atlanta is a great hub, but there is also no disputing that Miami is a better (geographically, culturally, and economically) hub when it comes to South and Latin America.

This is not a debate about AA in general, its overall network performance, nor the total lack of aggressiveness or creativity on the part of AA network planning. (Although, while we're on the subject, I'm sure AA probably would be a bit more aggressive if it had altered union contracts, outsourced overhauls, frozen/dumped pensions, and shifted even more flying to regional operators, like all of its legacy peers - including Delta - had done.) This is about the AA application for more flights to Brazil from Miami.

And, to that point, and without even getting into the comical debates (lectures) about profitability figures, unit revenue figures (highly susceptible to manipulation and alteration by both the reporting airlines themselves and outsiders), or O&D figures (which are also highly debatable depending on the source cited), the bottom line is irrefutable, and it's this: there is no city - not a single one - in South America, and to my knowledge, not one anywhere in Latin America, where Atlanta generates more traffic, or supports more capacity, than Miami. Not one. That was the entire point I and many others were and are making, regardless of what's thrown up in response. Miami is the definitive hub to Latin America. It just is. Period. And no, Atlanta is no substitute. As I said, I'll revise my statement when Atlanta is supporting nonstop flights to Montevideo, La Paz and/or Cali.

Secondly, on a related and newsworthy note, AA and Delta jointly filed on Friday to modify their applications so as to reduce the amount of GIG-eligible frequencies each requested, and increase the amount they use from the more restrictive non-GRU/GIG pool, for their new flights.

 

[commavia]

the bottom line is irrefutable, and it's this: there is no city - not a single one - in South America, and to my knowledge, not one anywhere in Latin America, where Atlanta generates more traffic, or supports more capacity, than Miami. Not one.

Lest I be attacked, I'll go ahead and pre-correct myself: upon looking, I did see two small cities in Latin America that support more capacity to Atlanta than Miami: Liberia (which sees a 757 to ATL from Delta but only a 737 to MIA from AA in off-season), and Roatan, which currently gets one flight a week to ATL. So there it is - still, to the best of what I can find, not one city in South America where ATL capacity even comes close to MIA, and none in the rest of Latin America I can find either.

 

[eolesen]

Last I checked, Honduras and Costa Rica are both still safely located on the North American continent...

As I said about 10,000 words ago... "Latin America" is a pretty broad definition from Bermuda to Tierra Del Fuego.

 

[kirkpatrick]

"Latin America" is a pretty broad definition from Bermuda to Tierra Del Fuego.

Why Bermuda? Although discovered by a Spanish explorer, Juan de Bermudez, he didn't land there and the islands have never been inhabited by Spanish speaking people or governed by a Spanish speaking country.

MK

 

[eolesen]

No idea why DOT classifies it that way -- Mexico, Bermuda, and the entire Caribbean are classified as Latin America, as is the entire South American continent.

My guess that Pan Am and TWA defined their traffic regions along those lines prior to de-regulation, and their de facto standard became the government's standard for the T-100 data. My opinion is that T-100 data should have died along with regulation.

There's no need I can think of at the moment for the government to be collecting traffic and fare data anymore since they play no role in setting fares or limiting/adding competition. Prior to deregulation, definitely. Post-deregulation? Inappropriate when Open Skies dominates the international arena. Maybe in quasi-regulated markets like Brasil where there are only limited frequencies, but certainly not necessary for other markets where there are no longer barriers for entry or need to decide who is the Chosen Instrument.

It certainly helps investors and other airlines know where they stand, but what other industry has to file their sales data to this degree?...

 

[WorldTraveler]

Last I checked, Honduras and Costa Rica are both still safely located on the North American continent...

As I said about 10,000 words ago... "Latin America" is a pretty broad definition from Bermuda to Tierra Del Fuego.

Honduras and Costa Rica are both part of DOT Latin America in part because labor does not want to say that aircraft are being sent for maintenance in a part of the world where they don't speak English but which is in the same category as the US.


Commavia,
The longer you post the more your nature becomes evident just as it did with EOlesen.
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It is apparent that the image Tech posted above is completely representative of you.
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I am sorry you grew up with the notion that the only way for “you” to win is for someone else to lose but the world is full of people who recognize that “they” and what they care about are not the only things on the planet, still figure out how to succeed in the presence of others who sometimes can do things better than they, and who manage to be able live in their strength of who they are rather than having to tear someone else down in order for “you” to look good.
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The airline industry is highly competitive; every publicly traded US airline lists that as a risk in their public disclosures which they file with the DOT, including AA and DL.
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AA and DL and others do not believe like you that someone else to lose in order for them to succeed. Both carriers were strong proponents of deregulation and have prospered because of it. While each carrier has its faults, they recognize they have to fight for every passenger they carry.
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Regardless of what you want to believe, AA has no illusions about having Latin America all to itself. Where you and other a.net style fan boys lose your credibility (and you clearly do have positive things to contribute) is when you argue that so-and-so won’t win but my team will.
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First, it has been asserted that flights from Atlanta to secondary markets in South (and in general Latin) America can't work because, in general, they haven't. That's a fact.

We can stop right there because that is categorically false.
I’m not sure how you justify “general” but you either serve a market or you don’t. AA and DL both started service to non GIG-GRU cities about the same time; IIRC AA might have been a month or two ahead of DL – but both carriers have started and maintained service outside of GIG/GRU and both have maintained it.
If you want to reduce the argument to whether carriers have served cities outside of GIG or GRU or not, then the only correct answer is that AA and DL have both served cities outside of GIG and GRU; CO, UA , and US have not.
If the definition of secondary cities in the context of Brazil are cities outside of GIG and GRU, then not only does DL serve secondary cities in Brazil but they also serve secondary cities in Latin America because Brazil is part of Latin America.
While you rushed to try and defend AA’s size in Latin America and Brazil, you apparently overlooked the fact that no one ever debated the fact that AA was the largest airline in Latin America (in fact I acknowledged multiple times) and that MIA was the largest gateway to Latin America.
But since your apparent worldview cannot accept that someone else can have ANY part of something which “you” have, you careened into a tirade – which you persist at that ATL is “nothing” compared to MIA with respect to Latin America. Again, no one said ATL is on the verge of overtaking MIA. But ATL IS the 2nd largest gateway to Latin America – and your continual insistence that everything else outside of MIA is nothingness demonstrates either your lack of understanding about the industry or you immaturity in being able to accept that the world contains more than you.
DOT data shows that DL’s ATL-BSB flight in the most recent month of DOT data boarded more passengers than AA’s flight to SSA-REC even though DL’s flight operated fewer frequencies. The LF on AA’s MIA-SSA/REC flight has been running ten points lower than what DL has been running on ATL-BSB according to the DOT.So, making statements that DL has failed while AA has succeeded belies the fact that, among ex-GRU/GIG destinations, only AA’s MIA-CNF flight has grown to the point that it has surpassed everything DL is doing. Even if you don’t want to hear about the financials regarding the industry, no one is going to accept an assertion that operating more flights to carry fewer passengers is a win, esp. if the “fewer operations” generate more revenue.
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Since FOR and REC which DL served are generating comparable boardings for AA in REC and SSA, perhaps the evidence points to the fact that the markets of NE Brazil are not as large and as able to generate traffic as you and others want to believe.


You see, the secondary cities in Brazil that are doing well for either airline are those that have a very larger population (which CNF does) or cities where there are lots of connections to other flights inside of Brazil.
What has made a difference in the ability of secondary cities to succeed is the partnership with Gol, which AA and DL both share. Even AA’s new MIA-BSB flight shows a large double digit percentage of AA’s traffic is connecting beyond BSB to other destinations in Brazil just as is occurring on DL’s ATL-BSB flight. AA and DL also connect a significant amount of traffic to/from their US and global networks.


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You do realize that it was DL that added BSB service first, don’t you? AA is adding the market after seeing DL’s success – which is exactly what is expected when DOT data is make available.
Even AA’s backbone MIA-GRU route connects double digit percentages of passengers at GRU to other destinations in Brazil.

This is not a debate about AA in general, its overall network performance, nor the total lack of aggressiveness or creativity on the part of AA network planning.

Of course you don’t want to deal with anything other than your count of cities on a route map but the fact is that adding cities without being able to generate some level of acceptable returns for stockholders reduces AA to throwing dAArts at a dAArtboAArd, something I know full well doesn’t do – nor does any other airline that has profit as even part of its motive for existence.
AA, like DL, has developed its Latin America network, including Brazil, with profit motives in mind. AA might be taking a longer term view of when they expect those profits to come but they do expect profitability at some point. IN the meantime, any of us who understand the business understand that you sometimes have to make short term financially negative decision in order to reach a long term goal. The fact that DL cancelled some of its routes and operated others on a seasonal basis while AA obtained average fares that were well below levels in markets like ORD-FRA that AA they subsequently cancelled makes it all the more clear that AA has pursued market growth and share shift strategies at the expense of profit maximization.

Secondly, on a related and newsworthy note, AA and Delta jointly filed on Friday to modify their applications so as to reduce the amount of GIG-eligible frequencies each requested, and increase the amount they use from the more restrictive non-GRU/GIG pool, for their new flights.

Yes, I said that would be the case here.

There are enough frequencies available for AA and DL to get all they requested w/ this route case and there are still almost half of the available frequencies left over. The fact that DL previously served MAO should be of no consequence.

AA and DL are not afraid of competing against each other. If you have followed US-Brazil route cases for very long, you know that AA and DL have both quickly dismissed with the formalities as they have each amended their applications, just as they did here, in order to accommodate each others desires within the legal framework of the US-Brazil treaty.
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You surely also noted that AA is not proposing to start its MIA-MAO service for six months or more after DL restarts ATL-MAO AND AA is only proposing 4X/week IIRC while DL is proposing 7X/week. IF AA was really interested in knocking DL out of the market, they would have advanced the startup of their flights and increased their flights to the same number of frequencies as DL.
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Apparently, AA and DL have figured out that there CAN be two players in the market and BOTH can grow together.
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I see that you are not a “regular” to this forum. May I extend the invitation for you to participate on this forum. Your insights will be quite useful as long as you can understand that two or more entities can exist and thrive side by side, just as AA and DL have learned in Brazil.

 

[commavia]

Last I checked, Honduras and Costa Rica are both still safely located on the North American continent...

As I said about 10,000 words ago... "Latin America" is a pretty broad definition from Bermuda to Tierra Del Fuego.

As you alluded to, I was using "Latin America" in the sense that the U.S. government defines it - for better or worse - which does include not only South America, but also Central America, the Caribbean, and Mexico. And, while I see your point, I actually think that is fair (at least the Mexico and Central America piece). Those are regions/countries that definitely have more in common - culturally - with Latin (Spanish/Portuguese) heritage and history than, say, the Anglo-Saxon-rooted U.S. and Canada.

Again, the point I was making was that history has shown - in numerous cases over the last few years - that Atlanta works as a great hub for big Latin American (again, broad definition there) markets because of the connections it offers and the volume of demand those big cities generate, but from Managua to Recife and far in between, Delta has struggled time and again in markets outside of this big national capitols/commercial centers.

AA, on the other hand, has done far better in those markets (many of which, in fact, AA need not "add" like Delta since AA has been flying to many for two decades) because - I submit - the intrinsic strategic advantage that the Miami hub provides, both geographically and economically.

 

[WorldTraveler]

I’m glad you took the time to respond because I think we are coming to some sense of understanding of each other’s positions…. Dialogue always works that way. 
First, you need to remember that the size of DL’s total operation in Latin America is much smaller than AA’s. Any rational comparison of AA and DL in Latin America would account for the difference in the size of the two carriers.
You say that DL struggled in REC but you still don’t want to acknowledge that DL has replaced it with BSB which is doing better than FOR and REC and DL will operate as many frequencies from BSB as it did from FOR and REC. You want to say that FOR and REC are secondary but by your definition so is BSB. So, if DL is doing as well in BSB as they did in FOR and REC combined, then it is not accurate to say that DL is not doing well in secondary cities of Brazil.
By the same token, DL does serve MGA and has for several years.
Again, I’m not sure how you define secondary cities of Latin America other than the ones that AA serves but no one else does, but DL serves GYE and SCL yet no other US carriers do, IIRC.
Second, you appear to give AA some sort of credit for starting service to a market and keeping it in there regardless of how it does. I have never seen an analyst or anyone else say that is the prerequisite for success in a market. IN fact, if anything, that kind of strategy is exactly why AA has a much smaller int’l network than DL and UA had – even before those carriers found their own merger partners. There is a far greater chance of success in a market if you are willing to try it out, pull out when things don’t look good, and operate on a seasonal basis until the market develops. In contrast to AA, DL has added dozens of new cities to its network, ditched a few, but still has added more cities net/net because of being willing to be more aggressive and then pull back when market conditions don’t develop as planned.
When you look at financial results, it is clear that AA’s approach doesn’t deliver any better results in the short term because they are burdened with holding onto a lot of underperforming routes for a period of time and then longer term, someone is going to come in and compete with them on the “winning” routes because thanks to DOT data, everyone is going to find out what is successful before long.
I think the whole notion of sticking with the market is related in a lot of AA fan’s minds is related to the moral superiority of not filing for bankruptcy. It ‘s a great concept to stick it out but it doesn’t translate into anything superior financially and it weighs the company down. Again, companies don’t have “souls” and only do what is legal or not – and then they can throw in some “nice things” if they want.
Third, I am a lot less reluctant to use the word “failed” to describe any airline’s strategies. The airline industry has always been very volatile and the past 10 years have only accelerated the instability. Carriers move in and out of markets in response to changes in the overall economy. I wouldn’t call DL’s presence in the NE of Brazil any more of a failure than AA’s presence is in Germany – and I wouldn’t call AA’s presence in Germany a failure. Every carrier has strengths. Every carrier has core assets which help them succeed more in some regions than other carriers.
I am a proponent of aviation overall… and I want to see everyone win. I have repeatedly said in this and other threads that I want to see AA return to its former strength and NOT fail. I may be like the high school coach who yells in your face and gives you two positive words but who you later look back at and realize he taught you things you never would have learned, including to keep fighting and prove them all wrong – you can do it!
I’m glad you dropped into forums, Commavia. And I hope you return. OFTEN. And I hope we can converse about lots of things on this and other forums of this board…
Just as there is room for everyone to say their piece, there is room for multiple airlines to succeed.
I am convinced that history will look back kindly on both AA and DL’s efforts to develop the Brazil market outside of GRU and GIG.