robbedagain
Veteran
- Oct 13, 2003
- 11,125
- 2,676
wt if you were the new ceo of the new aa what would you do to correct the whole issue of what goes on btwn aa vs us vs dl vs wn etc
CF: AA Isn't as Weak in Asia As You Might Think
- Thread starter eolesen
- Start date
WorldTraveler
Corn Field
- Dec 5, 2003
- 21,709
- 10,662
- Banned
- #47
Actually, Fluf, you are right. You did not put your faith in the contents of the article you posted.
This is what you wrote:
"My wager - no less than a 3 page rant from WT."
So, since we're playing psychologists together online, what was your intention for posting the article?
Did you think that if you posted your expectations for a lengthy response, I would do just the opposite?
If you really didn't want to hear the evidence which I provided, then why did you provide a platform on which I could build my arguments?
As I have noted, I do not work for any airline and do not receive any pension from one either. I do not have any website because I do not attempt to sell my analysis.
I participate in this forum because, free from any monetary incentives which provide loyalty to any airline, I provide insights which others cannot or do not wish to provide.
You may choose to call what I write as opinions, and that is your choice. I back up what I write by the track record I have established in nearly ten years on this forum.
I have nailed a frighteningly large number of key strategic issues that have faced the issue on the head - with a far better "kill" ratio that some of the "professional" analysts and popular press writers which get cited here.
You and anyone else clearly want to the argument personal. It is not personal to me. It is about the successes and failures of companies in the US airline industry.
DL has managed to completely rebuild its franchise and turn into one of the most successful airlines in the world. And it has done it at the expense of other airlines, which over the past five years has most notably been AA.
All of the labor discussions and every other topic discussed on here rests on the single ability of AA to financially succeed as a company.
Despite being first in a rush to exit BK as a standalone and now in a merger with US, AA hasn't fixed the basic structural issues that put AA into BK and allowed competitors such as DL to take billions of dollars of revenue that could have paid your salary and profit sharing and kept jobs for AA employees.
Feel free to classify what I write as opinion. But I am as certain as the day is long that AA will continue to suffer at the hands of competitors including DL and that will continue to negatively affect your career and your paycheck.
robbed,
great question but the creditors made their decision.
Horton as hard as he may have been to labor in cutting salaries and benefits, chose the path of doing the thing that provided the greatest opportunity for AA to succeed in the marketplace.
AMR's creditors did not believe Horton made the right choice, in large part, I believe (that is an opinion Fluf since I can't back it up by data) that continued labor unrest was too risky for their ability to recover what they have lost.
I am honestly not sure how the new AA can figure out how to compete; competitors such as DL have been preparing for either an AA standalone or merger scenario- that is why DL is focusing so many strategic efforts on AA's top markets - LHR, Mexico, and Brazil.
The discussion is not just about DL either, but as has been the case for at least five years, DL has been the most aggressive carrier in directly attacking AA.
AA has a year (+/-) to prepare for WN's ability to fly from Dallas Love Field to markets throughout the US; unlike any other multi-city airport in the US, the dynamics involving DAL and DFW will ensure that WN succeeds very well with their new domestic flying.
We can continue to debate what will happen for the next two years but there isn't a whole lot that will be apparent as a result of the merger although competitors will continue to add new flights into AA's key markets and AA (including US) will continue to do their best to do the same in competitors' key markets.
If what I have written is just opinion, there is a good chance it will be shown to be wrong. If I really have spoken the truth based on real data, then those who have a stake in the success of the new AA will be heavily impacted.
Each can choose what they wish about what they want to believe and the consequences of who might be right and who might be wrong.
This is what you wrote:
"My wager - no less than a 3 page rant from WT."
So, since we're playing psychologists together online, what was your intention for posting the article?
Did you think that if you posted your expectations for a lengthy response, I would do just the opposite?
If you really didn't want to hear the evidence which I provided, then why did you provide a platform on which I could build my arguments?
As I have noted, I do not work for any airline and do not receive any pension from one either. I do not have any website because I do not attempt to sell my analysis.
I participate in this forum because, free from any monetary incentives which provide loyalty to any airline, I provide insights which others cannot or do not wish to provide.
You may choose to call what I write as opinions, and that is your choice. I back up what I write by the track record I have established in nearly ten years on this forum.
I have nailed a frighteningly large number of key strategic issues that have faced the issue on the head - with a far better "kill" ratio that some of the "professional" analysts and popular press writers which get cited here.
You and anyone else clearly want to the argument personal. It is not personal to me. It is about the successes and failures of companies in the US airline industry.
DL has managed to completely rebuild its franchise and turn into one of the most successful airlines in the world. And it has done it at the expense of other airlines, which over the past five years has most notably been AA.
All of the labor discussions and every other topic discussed on here rests on the single ability of AA to financially succeed as a company.
Despite being first in a rush to exit BK as a standalone and now in a merger with US, AA hasn't fixed the basic structural issues that put AA into BK and allowed competitors such as DL to take billions of dollars of revenue that could have paid your salary and profit sharing and kept jobs for AA employees.
Feel free to classify what I write as opinion. But I am as certain as the day is long that AA will continue to suffer at the hands of competitors including DL and that will continue to negatively affect your career and your paycheck.
robbed,
great question but the creditors made their decision.
Horton as hard as he may have been to labor in cutting salaries and benefits, chose the path of doing the thing that provided the greatest opportunity for AA to succeed in the marketplace.
AMR's creditors did not believe Horton made the right choice, in large part, I believe (that is an opinion Fluf since I can't back it up by data) that continued labor unrest was too risky for their ability to recover what they have lost.
I am honestly not sure how the new AA can figure out how to compete; competitors such as DL have been preparing for either an AA standalone or merger scenario- that is why DL is focusing so many strategic efforts on AA's top markets - LHR, Mexico, and Brazil.
The discussion is not just about DL either, but as has been the case for at least five years, DL has been the most aggressive carrier in directly attacking AA.
AA has a year (+/-) to prepare for WN's ability to fly from Dallas Love Field to markets throughout the US; unlike any other multi-city airport in the US, the dynamics involving DAL and DFW will ensure that WN succeeds very well with their new domestic flying.
We can continue to debate what will happen for the next two years but there isn't a whole lot that will be apparent as a result of the merger although competitors will continue to add new flights into AA's key markets and AA (including US) will continue to do their best to do the same in competitors' key markets.
If what I have written is just opinion, there is a good chance it will be shown to be wrong. If I really have spoken the truth based on real data, then those who have a stake in the success of the new AA will be heavily impacted.
Each can choose what they wish about what they want to believe and the consequences of who might be right and who might be wrong.
JFK Fleet Service
Veteran
.
OP
eolesen
Veteran
- Jul 23, 2003
- 15,940
- 9,371
- Thread Starter
- Thread starter
- #49
WT, nobody is trying to shut you down. But it's pretty apparent that you like the pulpit position. You chose wisely in your next career, because people don't like to question faith or be questioned on faith.
But this isn't faith, and it isn't a hobby.
It's peoples' careers. It's people's second family.
You'll pander to make people think that you have vested interests in AA's success, but your own words and behavior betray you. And that's reflected in the voting system, in people's responses, and yes, the number of people who put you on ignore.
No, he used to work for another airline. He's been pursuing another career for the past six years or so, yet seems pretty attached to airlines.
He won't post his CV. And he doesn't have to. It would lead to far more questions than it would confirming his credentials.
But this isn't faith, and it isn't a hobby.
It's peoples' careers. It's people's second family.
You'll pander to make people think that you have vested interests in AA's success, but your own words and behavior betray you. And that's reflected in the voting system, in people's responses, and yes, the number of people who put you on ignore.
No, he used to work for another airline. He's been pursuing another career for the past six years or so, yet seems pretty attached to airlines.
He won't post his CV. And he doesn't have to. It would lead to far more questions than it would confirming his credentials.
WorldTraveler
Corn Field
- Dec 5, 2003
- 21,709
- 10,662
- Banned
- #50
Actually, Fluf, you are right. You did not put your faith in the contents of the article you posted.
This is what you wrote:
"My wager - no less than a 3 page rant from WT."
So, since we're playing psychologists together online, what was your intention for posting the article?
Did you think that if you posted your expectations for a lengthy response, I would do just the opposite?
If you really didn't want to hear the evidence which I provided, then why did you provide a platform on which I could build my arguments?
As I have noted, I do not work for any airline and do not receive any pension from one either. I do not have any website because I do not attempt to sell my analysis.
I participate in this forum because, free from any monetary incentives which provide loyalty to any airline, I provide insights which others cannot or do not wish to provide.
You may choose to call what I write as opinions, and that is your choice. I back up what I write by the track record I have established in nearly ten years on this forum.
I have nailed a frighteningly large number of key strategic issues that have faced the industry on the head - with a far better "kill" ratio that some of the "professional" analysts and popular press writers which get cited here.
You and anyone else clearly want to the argument personal. It is not personal to me. It is about the successes and failures of companies in the US airline industry.
DL has managed to completely rebuild its franchise and turn into one of the most successful airlines in the world. And it has done it at the expense of other airlines, which over the past five years has most notably been AA.
All of the labor discussions and every other topic discussed on here rests on the single ability of AA to financially succeed as a company.
Despite being first in a rush to exit BK as a standalone and now in a merger with US, AA hasn't fixed the basic structural issues that put AA into BK and allowed competitors such as DL to take billions of dollars of revenue that could have paid your salary and profit sharing and kept jobs for AA employees.
Feel free to classify what I write as opinion. But I am as certain as the day is long that AA will continue to suffer at the hands of competitors including DL and that will continue to negatively affect your career and your paycheck.
robbed,
great question but the creditors made their decision.
Horton as hard as he may have been to labor in cutting salaries and benefits, chose the path of doing the thing that provided the greatest opportunity for AA to succeed in the marketplace.
AMR's creditors did not believe Horton made the right choice, in large part, I believe (that is an opinion Fluf since I can't back it up by data) that continued labor unrest was too risky for their ability to recover what they have lost.
I am honestly not sure how the new AA can figure out how to compete; competitors such as DL have been preparing for either an AA standalone or merger scenario- that is why DL is focusing so many strategic efforts on AA's top markets - LHR, Mexico, and Brazil.
The discussion is not just about DL either, but as has been the case for at least five years, DL has been the most aggressive carrier in directly attacking AA.
AA has a year (+/-) to prepare for WN's ability to fly from Dallas Love Field to markets throughout the US; unlike any other multi-city airport in the US, the dynamics involving DAL and DFW will ensure that WN succeeds very well with their new domestic flying.
We can continue to debate what will happen for the next two years but there isn't a whole lot that will be apparent as a result of the merger although competitors will continue to add new flights into AA's key markets and AA (including US) will continue to do their best to do the same in competitors' key markets.
If what I have written is just opinion, there is a good chance it will be shown to be wrong. If I really have spoken the truth based on real data, then those who have a stake in the success of the new AA will be heavily impacted.
Each can choose what they wish about what they want to believe and the consequences of who might be right and who might be wrong.
E,
I will accept your statements above... but if you and others are so certain that my opinions are nothing more than the ramblings of someone who can't let go of the airline industry, then why do they evoke such strong responses?
I have never underestimated the impact of what happens in the industry on people's lives and careers but far too many people fail to grasp what really drives success or failure in the industry.
All the discussions about which union can do a better job make no difference if the company cannot succeed.
I think you and others react as strongly as you do because I HAVE BEEN right and it is precisely because of that track record that you are afraid of what might happen in the future.
Discussion should be based on listening to what is easy to hear and what is not. If it is rubbish, it will be shone to be just that.
People who are not threatened by what I say or see it as mere opinion wouldn't go to the trouble of voting down my posts thousands of times..... despite the JV I have with Spectator, WT is still in the hole by hundreds of votes - and it largely has come in response to posts on the AA forum.
There are a whole lot of people who don't want to hear what I have to say.
You and they can tell me why they find what I write so objectionable.
Since you're still editing your response, and I am editing mine in response to you, I'll wait until both have "dried" and we can go from a fresh slate.
BTW, my primary function in my new area of work is to develop strategy. Strength builds on strength.
This is what you wrote:
"My wager - no less than a 3 page rant from WT."
So, since we're playing psychologists together online, what was your intention for posting the article?
Did you think that if you posted your expectations for a lengthy response, I would do just the opposite?
If you really didn't want to hear the evidence which I provided, then why did you provide a platform on which I could build my arguments?
As I have noted, I do not work for any airline and do not receive any pension from one either. I do not have any website because I do not attempt to sell my analysis.
I participate in this forum because, free from any monetary incentives which provide loyalty to any airline, I provide insights which others cannot or do not wish to provide.
You may choose to call what I write as opinions, and that is your choice. I back up what I write by the track record I have established in nearly ten years on this forum.
I have nailed a frighteningly large number of key strategic issues that have faced the industry on the head - with a far better "kill" ratio that some of the "professional" analysts and popular press writers which get cited here.
You and anyone else clearly want to the argument personal. It is not personal to me. It is about the successes and failures of companies in the US airline industry.
DL has managed to completely rebuild its franchise and turn into one of the most successful airlines in the world. And it has done it at the expense of other airlines, which over the past five years has most notably been AA.
All of the labor discussions and every other topic discussed on here rests on the single ability of AA to financially succeed as a company.
Despite being first in a rush to exit BK as a standalone and now in a merger with US, AA hasn't fixed the basic structural issues that put AA into BK and allowed competitors such as DL to take billions of dollars of revenue that could have paid your salary and profit sharing and kept jobs for AA employees.
Feel free to classify what I write as opinion. But I am as certain as the day is long that AA will continue to suffer at the hands of competitors including DL and that will continue to negatively affect your career and your paycheck.
robbed,
great question but the creditors made their decision.
Horton as hard as he may have been to labor in cutting salaries and benefits, chose the path of doing the thing that provided the greatest opportunity for AA to succeed in the marketplace.
AMR's creditors did not believe Horton made the right choice, in large part, I believe (that is an opinion Fluf since I can't back it up by data) that continued labor unrest was too risky for their ability to recover what they have lost.
I am honestly not sure how the new AA can figure out how to compete; competitors such as DL have been preparing for either an AA standalone or merger scenario- that is why DL is focusing so many strategic efforts on AA's top markets - LHR, Mexico, and Brazil.
The discussion is not just about DL either, but as has been the case for at least five years, DL has been the most aggressive carrier in directly attacking AA.
AA has a year (+/-) to prepare for WN's ability to fly from Dallas Love Field to markets throughout the US; unlike any other multi-city airport in the US, the dynamics involving DAL and DFW will ensure that WN succeeds very well with their new domestic flying.
We can continue to debate what will happen for the next two years but there isn't a whole lot that will be apparent as a result of the merger although competitors will continue to add new flights into AA's key markets and AA (including US) will continue to do their best to do the same in competitors' key markets.
If what I have written is just opinion, there is a good chance it will be shown to be wrong. If I really have spoken the truth based on real data, then those who have a stake in the success of the new AA will be heavily impacted.
Each can choose what they wish about what they want to believe and the consequences of who might be right and who might be wrong.
E,
I will accept your statements above... but if you and others are so certain that my opinions are nothing more than the ramblings of someone who can't let go of the airline industry, then why do they evoke such strong responses?
I have never underestimated the impact of what happens in the industry on people's lives and careers but far too many people fail to grasp what really drives success or failure in the industry.
All the discussions about which union can do a better job make no difference if the company cannot succeed.
I think you and others react as strongly as you do because I HAVE BEEN right and it is precisely because of that track record that you are afraid of what might happen in the future.
Discussion should be based on listening to what is easy to hear and what is not. If it is rubbish, it will be shone to be just that.
People who are not threatened by what I say or see it as mere opinion wouldn't go to the trouble of voting down my posts thousands of times..... despite the JV I have with Spectator, WT is still in the hole by hundreds of votes - and it largely has come in response to posts on the AA forum.
There are a whole lot of people who don't want to hear what I have to say.
You and they can tell me why they find what I write so objectionable.
Since you're still editing your response, and I am editing mine in response to you, I'll wait until both have "dried" and we can go from a fresh slate.
BTW, my primary function in my new area of work is to develop strategy. Strength builds on strength.
robbedagain
Veteran
- Oct 13, 2003
- 11,125
- 2,676
WT lets go from this point.... lets say you are parker and you take control of aa right now as a merged carrier with all that you have right now lets hypothetically say us/aa are combined and posted a profit for the 1st after the merger etc what would you do to regain lost area
WorldTraveler
Corn Field
- Dec 5, 2003
- 21,709
- 10,662
- Banned
- #52
robbed,
I'm not honestly sure how to answer your question... it is simply too early to know what will work and what won't... but all the signs are there to say that AA/US are going to face the very same issues after the merger as they have faced before AA's BK and merger, without success.
I'm not honestly sure how to answer your question... it is simply too early to know what will work and what won't... but all the signs are there to say that AA/US are going to face the very same issues after the merger as they have faced before AA's BK and merger, without success.
robbedagain
Veteran
- Oct 13, 2003
- 11,125
- 2,676
ok wt i can accept that... let me ask this how would you go about fixin the issue using the planes you have and the mgmt team you have would you use the new arrivin planes to open new cities in part in asia and use the older planes similar to dl
WorldTraveler
Corn Field
- Dec 5, 2003
- 21,709
- 10,662
- Banned
- #54
that falls under a hypothetical question which can't be ever measured since the decisions have already been made with input from someone (me) who has absolutely no input or control over the outcome.
My recommendation to you and everyone else is to make the best of the chance you have been given to make this merger work, recognize the enormous challenges you face, and then work like the dickens to prove me wrong.
I would be tickled pink for the collective voice here to "win" while I "lose."
My recommendation to you and everyone else is to make the best of the chance you have been given to make this merger work, recognize the enormous challenges you face, and then work like the dickens to prove me wrong.
I would be tickled pink for the collective voice here to "win" while I "lose."
I can't find any DOT fare data for international flights. Domestic flights? Yes. When Cosmo posted here a few years ago, he said that there were sources of international fare data but they were not public and by the terms of his access to the data, he could not disclose specifics about the fare data.
As I said above, I don't have access to this sort of fare data, but these numbers of yours are not accurate. In fact, they're mathematically impossible. Here's why:
For all of 2012, in its 10-K, AA reported $1.344 billion of DOT Pacific revenues. You have previously posted that AA's China flights are struggling against UA and DL, so taking you at your word, I have to assume that AA's revenue from its five Japan flights is at least equal to 5/8s of its total Pacific revenue, as AA had five flights to Japan in 2012. That means AA had at least $840 million in revenue from its five flights to Japan.
In 2012, Delta reported $3.645 billion in total DOT Pacific revenues. You posted that DL carried 11X (eleven times, right?) the revenue to Japan as AA carried. That would mean that DL carried $9.240 billion of revenue to Japan, and that's 2.5 times its total Pacific revenues. See the mathematical impossibility there? The assertion of "11x" doesn't pass the LMAO test. Delta certainly carries more revnue to Japan than does AA, as DL has far more flights to Japan. But it doesn't carry anywhere near 11X AA's revenue. That would require the $9.240 billion of revenue to Japan, or more than a quarter of all of Delta's 2012 revenues. That's not the case.
The other assertion above that DL's average fares to Japan are 75% higher than AA's average fares are likewise fantasy, probably the result of unreliable data. Here's why:
Delta does not report its yield by DOT geographic region in its 10-K but AA does report those numbers in its year-end 4th quarter earnings (loss) release in early January. In 2012, AA's yield for the DOT Pacific operations was 12.4 cents. Not terribly impressive, to be sure. Again, taking you at your word that AA's China routes are struggling, I have to assume that AA's Japan yields are at least this 12.4 cents (as AA's yields to China are likely less).
No doubt UA and DL garnered higher yields to Japan. But your claim that DL attracted an average fare to Japan that was 75% higher than AA's average fare would require that DL obtain a yield to Japan of 21.7 cents. That's not even remotely possible, and again it does not pass the LMAO test.
I didn't read Brent's blog piece as caring about the revenue share. Sure, it's very important to the airlines, but frequent flyers don't give a damn about how much of the total revenue is carried by DL, UA or AA. Cranky was simply responding to the oft-repeated nonsense spouted by some frequent flyers that you can't get to Asia on AA, when in fact you can. Not from as many places, and maybe at lower average fares (which generally appeals to Cranky's audience) but you can get there.
WorldTraveler
Corn Field
- Dec 5, 2003
- 21,709
- 10,662
- Banned
- #56
Cosmo is right that FOREIGN CARRIER DOT data is masked to US users and vice versa but Cosmo and I are US citizens as are AA, DL, and UA. We can indeed see what US carriers see w/ a great deal of clarity.
You are making a lot of assumptions on your own, including that AA and DL carry comparable percentages of revenue on their flights between the US and Japan - and they do not. DL's NRT hub is heavily skewed towards carrying high value revenue between the US and Japan and a lower percentage of lower yielding traffic on its intra-Asian routes, supplemented by local Japan revenue to the rest of Asia. DL has far more capacity between the US and Japan, and as I noted, a large part of it is between the US and Hawaii which is almost entirely local Japanese revenue. Further, there is ample data to show that DL's average fares between the US and Japan are above either AA and UA regardless of how accurate the data is for NH and JL. There is more than enough evidence to see that is true - AA's request to move its JFK-HND flight to LAX, its abandonment of JFK-NRT, UA's attempts to put the 787 on LAX and SEA to NRT... the average fare benefit DL has multiplied by its higher capacity and higher percentage of the local Japan market is precisely why the data is accurate.
If the mere point of the article was to say that you can get to Asia on AA and its partner JL, then I don't think anyone really doubted that. "Weak" could mean a whole lot of things and even in the response that E posted, the author didn't choose to respond that way.
perhaps I was not reading the intent of the article but my point still remains that number of flights is a very poor measure of competitiveness in any region. You can compare the number of seats two airlines offer in a city but it tells you nothing about the strength or weakness of a carrier in that market.
700 posted DOT international profit data by region and it clearly shows that not only is AA a lot smaller than DL and UA over the Pacific, but their yields are lower and their profit margin is far lower.
Airlines cannot continue to offer services that do not meet sufficient levels of profitability and DOT data which is public clearly shows that AA's Pacific operation is far less profitable than its peers.
If weak doesn't have anything to do with financial health, then you can look at schedules if you want; but I can assure you that unless AA figures out how to serve Asia and obtain fares comparable to other carriers, they will have no choice but to reduce their services.
Remember that both AA and DL built up west coast-Asia gateways on their own via SJC and PDX/LAX only to dismantle them; DL's solution was to merge with NW.
I'm not sure why it is so surprising that AA is in the same position DL was in before the NW merger - or that it will take an equally significant strategic action to push AA into the same league over the Pacific as its competitors.
It is well accepted that market size translates into pricing power and the ability to charge premium fares; it is precisely because of this principle that the DOJ cares about market concentration in mergers.
It also isn't any surprise that AA has pricing power at LHR and in Latin America as well as DFW and MIA where it commands so much more of the market than any other carrier.
The same principle applies over the Pacific except that in that area, AA is at a disadvantage.
You are making a lot of assumptions on your own, including that AA and DL carry comparable percentages of revenue on their flights between the US and Japan - and they do not. DL's NRT hub is heavily skewed towards carrying high value revenue between the US and Japan and a lower percentage of lower yielding traffic on its intra-Asian routes, supplemented by local Japan revenue to the rest of Asia. DL has far more capacity between the US and Japan, and as I noted, a large part of it is between the US and Hawaii which is almost entirely local Japanese revenue. Further, there is ample data to show that DL's average fares between the US and Japan are above either AA and UA regardless of how accurate the data is for NH and JL. There is more than enough evidence to see that is true - AA's request to move its JFK-HND flight to LAX, its abandonment of JFK-NRT, UA's attempts to put the 787 on LAX and SEA to NRT... the average fare benefit DL has multiplied by its higher capacity and higher percentage of the local Japan market is precisely why the data is accurate.
If the mere point of the article was to say that you can get to Asia on AA and its partner JL, then I don't think anyone really doubted that. "Weak" could mean a whole lot of things and even in the response that E posted, the author didn't choose to respond that way.
perhaps I was not reading the intent of the article but my point still remains that number of flights is a very poor measure of competitiveness in any region. You can compare the number of seats two airlines offer in a city but it tells you nothing about the strength or weakness of a carrier in that market.
700 posted DOT international profit data by region and it clearly shows that not only is AA a lot smaller than DL and UA over the Pacific, but their yields are lower and their profit margin is far lower.
Airlines cannot continue to offer services that do not meet sufficient levels of profitability and DOT data which is public clearly shows that AA's Pacific operation is far less profitable than its peers.
If weak doesn't have anything to do with financial health, then you can look at schedules if you want; but I can assure you that unless AA figures out how to serve Asia and obtain fares comparable to other carriers, they will have no choice but to reduce their services.
Remember that both AA and DL built up west coast-Asia gateways on their own via SJC and PDX/LAX only to dismantle them; DL's solution was to merge with NW.
I'm not sure why it is so surprising that AA is in the same position DL was in before the NW merger - or that it will take an equally significant strategic action to push AA into the same league over the Pacific as its competitors.
It is well accepted that market size translates into pricing power and the ability to charge premium fares; it is precisely because of this principle that the DOJ cares about market concentration in mergers.
It also isn't any surprise that AA has pricing power at LHR and in Latin America as well as DFW and MIA where it commands so much more of the market than any other carrier.
The same principle applies over the Pacific except that in that area, AA is at a disadvantage.
Yeah, um, let's try that again.
FY2011 O&D Traffic
JFKGRU: 582 PDEW
MIAGRU: 625 PDEW
JFKGIG: 230 PDEW
MIAGIG: 180 PDEW
JFKBSB: 43 PDEW
MIABSB: 142 PDEW
JFKCNF: 67 PDEW
MIACNF: 110 PDEW
JFKREC: 20 PDEW
MIAREC: 43 PDEW
JFKSSA: 16 PDEW
MIASSA: 44 PDEW
JFKMAO: 13 PDEW
MIAMAO: 82 PDEW
JFKPOA: 28 PDEW
MIAPOA: 38 PDEW
JFKCWB: 26 PDEW
MIACWB: 38 PDEW
JFK-Nine Largest Brazil Markets: 1,025 PDEW
MIA-Nine Largest Brazil Markets: 1,302 PDEW
WorldTraveler
Corn Field
- Dec 5, 2003
- 21,709
- 10,662
- Banned
- #58
first of all, JFK is not the sum total of the NYC market. There is a lot of traffic that uses LGA and connects at other hubs and NYC also includes EWR.
Second, Brazil consists of more than just the 9 cities that you mentioned here esp. since they are the cities that AA serves or will serve. The world is bigger than just the markets AA chooses to serve.
Third, you may be using CRS data which reflects all carriers but DOT data for US carriers is what I am looking at. Neither source is completely accurate since DOT data does not accurately reflect foreign carriers while CRS data does not reflect carrier direct bookings.
I'm not sure the point really matters since there are 3 US carriers and 1 Brazilian carrier serving the NYC-Brazil NONSTOP market plus US via connections while AA is the SOLE US carrier that serves MIA-S. America (any market will do).
It is precisely the fact that there are over 1000 passengers per day (a couple hundred doesn't matter) served by one US carrier that will make it a slam dunk when the first other US carrier decides it is time for AA to have competition in the MIA-Latin America market.
With the World Cup and Olympics coming up, it is a matter of if, not when, AA will face competition in the MIA-Brazil market.
AA has done well for decades in limited access markets like Latin America and LHR. The challenge is to do well in markets like continental Europe and much of Asia which is Open Skies - and AA's track record is not near as strong there.
Specific to the current discussion, AA has its hands completely full opening up DFW-ICN in a market up against KE as an established carrier who also has a hub on the other end.
and since you reopened the topic, I'll make note of Brett Snyder of CF's work bio which comes from his website.
USAir Sales Intern (1996-1997)
America West Sales Intern (1997-1999)
United Dulles Operations Intern (1999)
America West Pricing Analyst/Sr Analyst/Manager (1999-2002)
Eos Intern (2003)
United Marketing Planning Product Manager (2004-2005)
PriceGrabber.com Business Director of Travel (2005-2007
In less than 12 years, he held jobs w/ 6 different companies but half of the time was still at US or HP. His bias becomes rather apparent.
Too bad I didn't read his bio before I replied to E's first post...
Second, Brazil consists of more than just the 9 cities that you mentioned here esp. since they are the cities that AA serves or will serve. The world is bigger than just the markets AA chooses to serve.
Third, you may be using CRS data which reflects all carriers but DOT data for US carriers is what I am looking at. Neither source is completely accurate since DOT data does not accurately reflect foreign carriers while CRS data does not reflect carrier direct bookings.
I'm not sure the point really matters since there are 3 US carriers and 1 Brazilian carrier serving the NYC-Brazil NONSTOP market plus US via connections while AA is the SOLE US carrier that serves MIA-S. America (any market will do).
It is precisely the fact that there are over 1000 passengers per day (a couple hundred doesn't matter) served by one US carrier that will make it a slam dunk when the first other US carrier decides it is time for AA to have competition in the MIA-Latin America market.
With the World Cup and Olympics coming up, it is a matter of if, not when, AA will face competition in the MIA-Brazil market.
AA has done well for decades in limited access markets like Latin America and LHR. The challenge is to do well in markets like continental Europe and much of Asia which is Open Skies - and AA's track record is not near as strong there.
Specific to the current discussion, AA has its hands completely full opening up DFW-ICN in a market up against KE as an established carrier who also has a hub on the other end.
and since you reopened the topic, I'll make note of Brett Snyder of CF's work bio which comes from his website.
USAir Sales Intern (1996-1997)
America West Sales Intern (1997-1999)
United Dulles Operations Intern (1999)
America West Pricing Analyst/Sr Analyst/Manager (1999-2002)
Eos Intern (2003)
United Marketing Planning Product Manager (2004-2005)
PriceGrabber.com Business Director of Travel (2005-2007
In less than 12 years, he held jobs w/ 6 different companies but half of the time was still at US or HP. His bias becomes rather apparent.
Too bad I didn't read his bio before I replied to E's first post...
OP
eolesen
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- Jul 23, 2003
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How ironic... At one point, you used to conveniently ignore EWR data, and only refer to the "largest airline east of the Hudson" when comparing things...
There certainly are more than nine airports in Brasil, but Infraero isn't in a position to expand beyond the ones already listed above. They have a hard enough time dealing with the airports they manage, let alone adding to that number.
Sorry, I typed JFK, but those numbers are for JFK+EWR+LGA+whatever little traffic flies from HPN, ISP and SWF to Brazil. MIA figures include FLL and PBI, but FLLGRU, for example, is 4 PDEW, so you can imagine how small everything else.
Those are the O&D numbers, plain and simple. To argue that New York is the number one U.S.-Brazil market is absolutely laughable.
I'm using MIDT data. If you want to argue that U.S. carriers carry more NYC-Brazil traffic in total than they carry Miami-Brazil traffic, fine. I bet that's true, because Brazilian (and LatAm like AV, CM) carriers probably do have a greater porportion of Miami-Brazil traffic than they do JFK-Brazil.
Also, those are the nine largest U.S.-Brazil markets. They account for >85% of the market. From Miami, Fortaleza, Florianapolis, Belem, Goiania, Grande Vitoria, Natal and Foz de Iguacu all generate at least 13 PDEW. None of those generate >5 PDEW from NYC; and of course from every else, even Orlando, they don't even generate 1 or 2 PDEW.
And if Delta wants to apply for MIAGRU on Friday, awesome. That's what I'm hoping for, along with AA on LAXGRU. It wouldn't shock me and it's good for competition. I welcome Delta's entry into the market. It needs Miami to make LatAm work.
Those are the O&D numbers, plain and simple. To argue that New York is the number one U.S.-Brazil market is absolutely laughable.
I'm using MIDT data. If you want to argue that U.S. carriers carry more NYC-Brazil traffic in total than they carry Miami-Brazil traffic, fine. I bet that's true, because Brazilian (and LatAm like AV, CM) carriers probably do have a greater porportion of Miami-Brazil traffic than they do JFK-Brazil.
Also, those are the nine largest U.S.-Brazil markets. They account for >85% of the market. From Miami, Fortaleza, Florianapolis, Belem, Goiania, Grande Vitoria, Natal and Foz de Iguacu all generate at least 13 PDEW. None of those generate >5 PDEW from NYC; and of course from every else, even Orlando, they don't even generate 1 or 2 PDEW.
And if Delta wants to apply for MIAGRU on Friday, awesome. That's what I'm hoping for, along with AA on LAXGRU. It wouldn't shock me and it's good for competition. I welcome Delta's entry into the market. It needs Miami to make LatAm work.
