MAH4546 said:
Oh wow, you still don't understand AA is the only domestic airline with TBIT gates.
That's really pathetic.
It's been explained to you how DL and UA are allowed to use TBIT gates last-in-priority, but are not allowed to rely on them being available. So sad you can't accept the truth.
No, there is nothing pathetic about airlines being able to house their own operation in their own terminals.
Good for AA for having access to TBIT gates. You are the only one that seems to think it is a badge of honor and a huge advantage.
The difference in the gates that AA has vs. DL and UA comes from its domestic size, not its
Let me remind you again that DL and UA for 2014 were considerably larger than AA in int’l passengers at LAX which explains a lot about why they have higher average fares. Instead of using their gates for 50 passenger jets, DL is quickly moving its operation to mainline. And all RJs that are left are large RJs. UA is removing connecting capacity but its local market share has remained basically unchanged. It is the same thing that DL has done at CVG on a different scale.
And, once again, DL is the largest int’l carrier at LAX and is adding capacity faster than AA or UA.
You continue to hold onto the notion that more gates is going to translate into the ability to operate more int’l flights - and that has yet to be proven. Given that AA does not come close to obtaining industry average fares on the flights it does operate across the Pacific or to GRU, there is little reason to believe that AA will continue to keep building LAX int’l unless it intends to subsidize it.
Given that DL gets almost as much revenue on its LAX-NRT flight by itself as AA gets on both of its LAX flights to Asia, the economics for DL adding flights is far better than it is for AA.
jcw said:
All you have to do is look at DOT reports - DL is #3 in international revenue - unless you are saying DL is not reporting accurately to the DOT
You would also see DL losses in LATAM are double the losses of AA's in Asia
Tough one
I am familiar with the int’l revenues for the big 3 and also know that your statement about DL’s losses to Latin America is itself at best a partial representation of the truth that in no way compares to AA’s losses across the Pacific.
First, revenues to Latin America peak in the 1st quarter – for both DL and AA. Revenues across the Pacific peak in the 3rd quarter. You took a quarter where revenue was peak for AA to Asia and compared to a quarter where revenue was weak for DL to Latin America.
Second, you fail to note that DL had a very strong profit in Latin America at the end of 2013 which was large enough to offset DL’s losses in Latin America this year so far that has been posted and go back to 2011. In contrast, AA has posted losses across the Pacific for years with the last quarterly profit in 2010 and AA’s total losses far larger than its profits.
Third, you fail to note that AA’s own profitability to Latin America has dropped considerably in 2014 as well with AA posting a small loss in Q2 and its Q3 loss well below its 2013Q3 profit. When 4th quarter financials for 2014 and for the 1st quarter of 2015 and beyond, you might find that AA’s losses to Latin America far exceed DL’s based on sheer size. AA is cutting routes to S. America; DL is not.
Finally no US legacy carrier has been profitable across their entire system (in every region on a consistent basis) including UA to Asia.
My issue with AA’s losses to Asia is NOT that they have periodic losses or that they are developing their network in a region where they are small or weak.
My criticism of AA is that they have had the mindset for years that they have to fly from the top US markets to Asia against competitors who are undoubtedly very profitable on their routes to those regions and where DL and UA gained their position in those markets through mergers while AA in contrast is trying to fly to Asia from NYC and LAX on markets that it has launched on its own with the weakest partners in the region.
In contrast, DL did not buy its way into Latin America and has built its presence there on its own. DL has so far only tried to fly to Latin America from NYC and LAX to markets where DL has a partner on the other end (MEX and GRU) or in markets where AA has stopped flying or reduced its presence considerably (mostly Caribbean). DL has not started MIA to Latin America and UA pulled back from there.
It’s also worth remembering that DL did start JFK-EZE and AA immediately doubled capacity, fares fell for both carriers, and DL withdrew its service within a few months. No one here talked about why DL needed to stick it out or that it was a developmental route that would eventually make money.
And yet people can’t accept that DL and UA are willing to do the same thing to protect their west coast to Asia markets – which AA did not buy its way into or that it doesn’t make sense for AA to try to compete in markets where it is highly doubtful they will ever generate results comparable to DL or UA.
And finally on the subject of overall revenues, you would do well to remember that AA’s int’l revenue is heavily driven by Latin America – almost half.
AA has also enjoyed huge fare premiums to Latin America which have been the bread and butter of its profitability including to provide subsidies for its Pacific operation.
AA’s Pacific operation is just over 10% of its int’l revenues, the smallest int’l region for the big 3 both on a percentage basis and actual total revenue basis.
It has been easy for AA to use the profitability of its largest region to subsidize its weakest.
But AA’s Latin operation has suffered the largest RASM decline of any US carriers’ region and the outlook for Latin America is not good. Not only is AA fighting weak local currencies but competition is heating up dramatically from both Latin and US airlines. AA is in the very difficult position of having to defend market share while other carriers are encroaching and average fares are already in decline.
By the time 2015 revenues are finalized and maybe before, AA might have slipped to the 3rd largest US carrier in terms of total int’l revenue.
and UA has been a strong int'l airline for years but since CO was right at 50% int'l at its peak, it was THE MOST int'l US airline since Pan Am.
