AE Pilots say NO.

[commavia]

No, the point of all the large RJs was primarily to replace the uneconomic 44-/50-seat RJs, just as Delta is doing.  Three CRJ700s is a perfect replacement for four EMB145s.  And yes, there will be plenty of them to do just that when combined with the growth at mainline, and the elimination of marginal 50-seat markets - again, just like Delta is doing.
 
AA clearly has essentially the exact same strategy as Delta for drawing down small jet flying and upgauging to larger RJs or smaller mainline - so there should be no need to write endless diatribes tearing this strategy down.

 

[WorldTraveler]

sorry but AA specifically said they needed large RJs to grow back into key markets that could not support mainline service and where small RJs is not viable from a customer service standpoint.

The first round of large RJs was into ORD markets, which ironically has a very high percentage of RJs compared with other hubs.

AA is in the SAME DIRECTION as DL in their RJ strategy but AA did not succeed at reducing its fleet to the same degree in BK as DL had already announced and AA is later in the process of diversifying its RJ contractor fleet than DL, UA, or US who have all used multiple operators for years.

And the biggest difference is that DL is dramatically reducing its total RJ footprint more than any other carrier.

AA and DL may have similar goals but no they do not have the same means to get to that goal.

This year will be absolutely pivotal in the restructuring of the US airline industry around the regional carriers.

If AA and DL end up in the same position by this time this year - or even the next - I want you to make sure you let me know and I will absolutely acknowledge that you were indeed right.

 

[mwa]

With regionals losing about 100/month now (xjt and egl) wouldn't it be prudent to act soon before the capital I the form of pilots vanishes from under their noses ?

 

[WorldTraveler]

I believe you are exactly right, mwa.

Can you share what you think the action plan should be and how it plays out particularly for AA, AE, and its contract regional carriers?

 

[mwa]

Do a Compass type maneuver ie create a large RJ partition at mainline then after the training demands normalize merge the 2 ops

 

[commavia]

That's the funny thing - unlike some, I don't need the satisfaction of hearing others validate my opinions, right or wrong, and somehow concluding that my acting arrogant and uninformed constitues some sick form of "winning" something.  Different strokes.
 
As to this issue, AA thankfully today provided us all with the specifics that validate that yes, indeed, the new regional capacity is, in fact, largely replacing small jet flying.  AA's monthly investor update included the fleet plan going forward which showed, clearly, that Eagle's fleet count net-net YOY is essentially flat, with 44-seat EMB140s being replaced pretty much 1-for-1 with large RJs - at an increasingly rapid pace.  Delta may be reducing its overall RJ footprint more right now, but as I already said, I doubt AA is too far behind, since AA has a very healthy order book of both large RJs and new mainline aircraft on the horizon.
 
As for the rest of your B.S., no, actually AA is plenty diversified with regional feed - with a total today of 10 operators from 6 parent companies (Delta: 7, from 4 parent companies), so that argument's out the door.  And that assumes, of course, that one considers regional feed diversification to necessarily be a good thing, which I personally don't.  Long-term, strategically, I think it's a bad thing and I suspect all three carriers - AA, Delta and United - are very shortly going to be utilizing a much shorter list of operators, and for good reason.  But that's a different discussion.  As to the fleet count, I also find it funny that now somehow AA not reducing their fleet as much in bankruptcy as Delta is a bad thing, when relatively recently we were hearing how AA was in such dire straights that it was going to have to shrink so dramatically.  Yet more revisionist history.  In reality, the fact that AA didn't shrink as much in bankruptcy as Delta was a reflection of the fact that it didn't need to - it entered bankruptcy in a dramatically better position than Delta did and thus didn't need to undergo nearly as much capacity reduction as Delta.  As we now see, AA, just one year out of bankruptcy, is by some estimates now projected to be pacing roughly the margins it took Delta several years to build to.
 
Fear, fear, fear.

 

[eolesen]

No, the point of all the large RJs was primarily to replace the uneconomic 44-/50-seat RJs, just as Delta is doing.

Spot on. "Growing the network" doesn't have to equate to dumping new capacity into the market while retaining the old capacity.

In pm-AA's case, there were second tier markets they couldn't properly serve with the huge gap they had between 50 and 110 seaters. The new LRJ's filled that gap. Capacity growth with a zero-sum game as far as growing the fleet.

 

[WorldTraveler]

that's all nice, Comm, but AA's largest regional partner by a wide margin is the one whose pilots just rejected mgmt.'s labor offer.

And AE is wholly owned which increases the risk and decreases the ability to find other options.

And many of those large RJs at other carriers are owned by the major carrier themselves who can redeploy them if necessary.

It is not fear. It is reality.

The AE labor meltdown does leave AA exposed to the RJ pilot shortage moreso than other airlines.

if it's no big deal then you will have proof in time to show that I was wrong.

I still contend that for a whole lot of reasons, AA is going to be closing some hubs and the RJ pilot shortage will just be cover for what was going to have to happen anyway.

 

[commavia]

Again - it's all about long game vs here and now.  Today, the "conventional" view - advanced by Delta and professed by its acolites - is that wholly owned regionals are a liability.  Long-term, I think that will prove to be wrong.  Creating a meaningful career progression for pilots, which are quickly becoming among the most scarce resource "inputs" into the airline value chain, is going to have really power to attract and maintain a viable workforce, and in that regard mainlines have an opportunity with wholly-owned regionals that they don't have otherwise.
 
As for closing hubs, I don't see any risk of any of AA's true domestic megahubs - DFW, ORD, CLT, PHL, MIA, PHX - closing other than perhaps a major realignment of PHX which I think is inevitable in the next few years because of the higher cost levels.  I intentionally excluded JFK and LAX from that list because I view both of those as more gateways than hubs - a distinction lost in AA marketing, but important.  And, in any event, JFK and LAX are both relatively inconsequential when it comes to regional feed.  Thankfully, AA today does not have any of its major hubs exceedingly heavily dependant on 50-seat RJs to anywhere near the extent that Delta did with CVG/MEM, and United with CLE, which is of course precisely why those hubs were closed.

 

[eolesen]

Agree on most of what you've written, comm, aside from CLT. I think both CLT and PHX are going to see some downsizing, particularly with CLT's international service. It's catchment area is pretty well bracketed by PHL, DFW, and MIA. It's the same reason that nonstops from PHX to Asia would make little sense when LAX is an hour's flying time away.

 

[WorldTraveler]

given that there was a 10% drop in AA's TATL traffic, the question has to be asked what part of AA's TATL system failed to deliver the traffic that was expected. If the winddown of the Star relationship really drove a falloff in bookings to Star hubs, then it says that there are questions of how secure a lot of US' network is since it is heavily dependent on Star hubs.

But since the falloff was also seen to Latin America, the chances are high that the issue is not US hubs at all.

As for wholly owneds, DL has them as well and yes there are flow thrus as well.

As for dependence on small RJs, it doesn't change that AA's RJ fleet has a far higher percentage of 50 (and smaller) seaters than DL or US (since the networks have not been harmonized yet). UA is ahead of AA in the 50 seat replacement but it remains to be seen by how much. The 50 seaters have to come out of the networks of network carriers.

As I have noted, UA is in worse shape than AA just because it still has more hubs many of which do rely on a high percentage of regional carrier traffic.

But UA is already taking the steps to rationalize its network and to reduce its headcount. AA will be doing the same.

 

[commavia]

I completely agree that CLT is going to see a reduction - in both frequency, and capacity.  But I think that will be driven far more by the progressive upgauging away from 50-seat RJs, and the fact that CLT previously had way more volume relative to its market size because of USAirways' lower unit costs and focus to drive traffic through there.  In the future, I think CLT will lose much if not all of this seasonal Europe flying (BRU, LIS, etc.) and basically get down to just the larger European capitals/hubs (LHR, CDG, FRA, MAD).
 
Unlike former hubs that were way too small and poorly-situated relative to other, stronger hubs (a la MEM, CVG), though, the economic, geographic, and demographic fundamentals of the CLT hub are, in my view, excellent.  PHL, DFW and MIA cannot be effective hubs for the southeastern U.S. in anywhere near the same way CLT can.  That region is large and growing, but only big enough for two megahubs and CLT is a great #2 hub in the region behind ATL.

 

[RJcasualty]

As a sidelight, yesterday's performance survey  http://www.cnn.com/2014/04/07/travel/airline-quality-ratings/  placed AE at the bottom. While weather might have played a part, the incessant threats from and neglect by management is taking its toll. The redeployment of the CR7's to Envoy-DFW is a clear indication that outsourcing has reached its limits. In the end, I wouldn't be surprised if the jerked away 170's do the same. Instead of withering on the vine, Envoy stands to become for better or worse, dumping ground rather than burial ground.  

 

[mwa]

look at what mgmt. did for culpability here.
25 Min turns, wasteful pilot assignments in a difficult staffing environment. EGL has been set up to fail because no one knows how to do anything but bow and scrape to mainline.

 

[luvthe9]

I think the American Pilots had better take a good look at their President. It seems to me that rather than be a UNION President, he has become a spokesman for management and a hatchet man for them too.

If they think they are going to have an easier time with Parker and Company by being their water boys, they had better understand who they work for before they take everyone over the cliff. It is a damn shame and a travesty when one union is working hand in glove with their management to hurt another union on the same property. We saw it with us and now we see it with Republic Airline Pilots.

In this letter he apologizes for criticizing the Republic pilots for turning down their sub-standard contract and then following his apology he does precisely that again.

Wilson needs a muzzle and restraints or replacement before he does anymore damage to the reputation, such as it is, of the APA. They had better start doing damage control.