AA applies for new Cuba frequencies

[FWAAA]

Today, March 2, was the deadline to file requests for USA-Cuba scheduled frequencies, and AA asked for a lot:

Americans proposed Cuba service:

To Havana:

Miami 10 daily frequencies
Charlotte one daily frequency
Dallas/Fort Worth one daily frequency
Los Angeles one weekly frequency
Chicago one weekly frequency


Also from Miami:

Two daily frequencies to Santa Clara
Two daily frequencies to Holguin
Two daily frequencies to Varadero
One daily frequency to Camaguey
One daily frequency to Cienfuegos

Press Release: http://hub.aa.com/en/nr/american-airlines-submits-application-to-us-department-of-transportation-to-operate-scheduled-service-to-cuba

Application with DOT: http://c.hub.aa.com/newsroom/American+Airlines+Cuba+Application+%2528DOT-OST-2016-0021%2529+FINAL.pdf

Other airline route requests: http://www.usatoday.com/story/travel/flights/todayinthesky/2016/03/02/list-here-cuba-route-us-airlines-want/81231586/

 

[AirwAr]

Why not put in for NYC to Havana as well?  Got to be better than CLT.

 

[Kev3188]

Interesting how (relatively) few spots UA put in for...

For some reason, all I can think of is when everyone was filing for routes immediately after deregulation, and they brought a huge box which everyone else thought was full, but only had a single sheet inside...

 

[autofixer]

Why not put in for NYC to Havana as well?  Got to be better than CLT.

You can funnel NYC and other destinations through CLT?  

 

[commavia]

For some reason, all I can think of is when everyone was filing for routes immediately after deregulation, and they brought a huge box which everyone else thought was full, but only had a single sheet inside...

 
Absolutely.  Some of these applications are ridiculous - the height of irrational exuberance.  At least to start - especially unless or until tourism restrictions are lifted - the vast majority of demand is going to come from South Florida and NYC, and to a lesser extent the rest of Florida and LAX.  Bottom line - I suspect that probably 85-90% of Cuba O&D will come from a 5-6 metro areas (MIA/FLL, NYC, MCO, TPA and LAX).

 

[FWAAA]

Why not put in for NYC to Havana as well?  Got to be better than CLT.

In 2015, there were about 70 charter flights to Cuba from JFK (looks like none from EWR), compared to more than 2,000 from MIA, so there can't be much Cuban-American family travel from NYC. Once the travel restrictions are lifted, and casual tourism is allowed, then the big cities that have a lot of Caribbean travel (BOS, NYC, PHL, etc) will probably warrant flights.

The airlines prioritized their choices, and CLT was ranked 8th by AA, with #1-7 being MIA, so it appears that AA doesn't want CLT until it gets seven daily MIA flights. CLT provides some small town connectivity that MIA lacks, and as pointed out, both MIA and CLT connect well to NYC.

 

[autofixer]

In 2015, there were about 70 charter flights to Cuba from JFK (looks like none from EWR), compared to more than 2,000 from MIA, so there can't be much Cuban-American family travel from NYC. Once the travel restrictions are lifted, and casual tourism is allowed, then the big cities that have a lot of Caribbean travel (BOS, NYC, PHL, etc) will probably warrant flights.

The airlines prioritized their choices, and CLT was ranked 8th by AA, with #1-7 being MIA, so it appears that AA doesn't want CLT until it gets seven daily MIA flights. CLT provides some small town connectivity that MIA lacks, and as pointed out, both MIA and CLT connect well to NYC.

Don't leave out of the equation European and Canadian connections to Cuba.  They go there on vacation.    

 

[jimntx]

Canadians and Europeans already have non-stop service to Havana.  Unless we offer really cheap fares, why should Canadians and Europeans make a stop in the U.S. on the way to their vacation?

 

[AirwAr]

At this point, Is it more important to have direct competition in a few markets...or, do you go for more direct markets?  If you were the government, picking winners & losers for Havana, how would you dole the frequencies?  

 

[FWAAA]

At this point, Is it more important to have direct competition in a few markets...or, do you go for more direct markets?  If you were the government, picking winners & losers for Havana, how would you dole the frequencies?

That's a good question. AA stressed in its application that since casual tourism is still not allowed, the vast majority of the passengers will, for the foreseeable future, be the same Cuban-Americans visiting family in Cuba who are already flying via the charters, and the vast majority of those charters depart MIA.

AA's application argues that there is already a need for 7-8 daily MIA-HAV flights, and it argues that 10 is the right number to accommodate some growth this year.

With limited frequencies to HAV, I don't think Silver will win any with its 34-seat SAAB 340s. AS won't win two daily LAX flights, as AA argues that there is almost enough traffic for one weekly flight (which AA began in December).

If the DOT agrees with AA's view that the current family members will be the majority of the passengers (until the tourism rules are relaxed), then many of the HAV flights should be from MIA/FLL. I don't think AA wins all of its wish list, but I think AA has a good shot at winning most of its requested HAV frequencies.

I think almost every airline will win their requested frequencies to the secondary airports, but HAV will be hotly contested.

 

[AirwAr]

Here is my completely unbiased guess:
 
AA MIA-HAV–6
AA DFW-HAV-1
AA LAX-HAV-1
B6 FLL-HAV–3
B6 JFK-HAV-1
B6 TPA-HAV-1
WN FLL-HAV-3
WN TPA-HAV-1
DL ATL-HAV-1
DL JFK-HAV-1
UA EWR-HAV-1
 
I think that, unless the "Saturday only" service is in addition to the allotted 20 daily flights...they shouldn't even come into play at this time.  Wait till tourism opens up.

 

[FWAAA]

Did you mean to type "AS" instead of "AA" for LAX-HAV? Alaska has requested two daily LAX frequencies but AA requested just one weekly frequency.

Other than that nit-picking, I agree that your predictions are very reasonable-looking.

I think AA has a good shot at getting several of the frequencies for MIA.

Once casual tourism is allowed, I would think that NYC, BOS, PHL, ATL and the other huge metro areas would provide some well-heeled "let's escape winter" tourists, at least in the winter.

 

[AirwAr]

Did you mean to type "AS" instead of "AA" for LAX-HAV? Alaska has requested two daily LAX frequencies but AA requested just one weekly frequency.

Other than that nit-picking, I agree that your predictions are very reasonable-looking.

I think AA has a good shot at getting several of the frequencies for MIA.

Once casual tourism is allowed, I would think that NYC, BOS, PHL, ATL and the other huge metro areas would provide some well-heeled "let's escape winter" tourists, at least in the winter.

 
You're right...the USA Today site showed LAX-HAV as a daily request for AA.  So, sure...let's give it to AS.

 

[FWAAA]

This week, the applicants filed their responses to the other airlines' requests; here is AA's 243 page response:

http://www.regulations.gov/contentStreamer?documentId=DOT-OST-2016-0021-0115&attachmentNumber=1&disposition=attachment&contentType=pdf

AA's application stressed that the rules on tourism weren't changing, and thus it made sense to give AA the majority of HAV frequencies because that's where the family members have been boarding charter flights.

But this week, the White House changed the rules on tourism, essentially changing them so that Americans are on the "honor system" with respect to whether their trip is permitted:

http://www.nytimes.com/2016/03/16/us/politics/white-house-cuba-restrictions.html

http://www.latimes.com/world/mexico-americas/la-fg-cuba-travel-20160315-story.html

AA's application was predicated on the rules remaining the same for the time being, and now the rules are changing; this may not bode well for AA's requests.

 

[UPNAWAY]

Probabably not, not really any policy change except the "honor" system part. So from a governmental standpoint I thnk they will assume similar traffic. The real advantage is most of the Cuba market is going to be from MIA, not FLL, not TPA or MCO etc....