Fitch cuts AMR's and AA's debt ratings

[Itestwell]

What experts are saying what about AA and China?

They are saying run. Run away.

I expect AMR to reduce much more capacity (as they've already alluded to...), and I hear that DL is set to announce a huge Pacific/ Atlantic pullback come Sept; anyone agree?

Who would've thought that International flying would become such a liability? Scary industry....

 

[FA Mikey]

Who says USAir could not afford to buy a plane?

You did in post number 5. Check it out in your own words.

And who cares if US has to look for a plane to buy, as opposed to already having it?

The point is there is more to it than just buying a plane. You have to negotiate pay rates and staffing, establish maintenance procedures, buy spare parts and train all the people ETC. Its not like buying a car and bringing it home.

If they decide to start PEK (which I believe they won't, since y'all are losing your shirts over the Pacific),

Us'all seem to be holding our own. We havent dropped and pacific flying YET. NWA, UAL and DAL have all announced plans for 15% cuts in their transpacific flying.

I am sure they would be able to secure said aircraft, in this environment, pretty easily.

In this environment, if the UAL and NWA's are not making the $$ there is no way the johnny come lately will be able to.

 

[Itestwell]

You did in post number 5. Check it out in your own words.

The post previous to mine inferred that US could not afford it. I didn't mean they actually couldn't "afford" it. Sorry I was not clear enough.

The point is there is more to it than just buying a plane. You have to negotiate pay rates and staffing, establish maintenance procedures, buy spare parts and train all the people ETC. Its not like buying a car and bringing it home.

Reeeally? Wow. You should contact USAir and tell them, since you're an expert. I am, like, so sure they don't know this stuff (you do know that US presented the pilots with A340 rates, right? :blink ...

Us'all seem to be holding our own. We havent dropped and pacific flying YET. NWA, UAL and DAL have all announced plans for 15% cuts in their transpacific flying.

Do you live in a bubble? Sadly, I don't think AMR has much Pacific traffic to cut, as opposed to NWA, UAL, and DAL. (you are much smaller in the region compared to the others...) I am sure however, that while all other airlines are losing their shirts to the Pacific, especially in the F cabins, that AA is doing wonderfully. In case you're bored (though not Pacific specific):

http://www.reuters.com/article/ousivMolt/i...E52B79N20090312

In this environment, if the UAL and NWA's are not making the $$ there is no way the johnny come lately will be able to.

Apparently you missed the part where I said USAir would be smart to once again postpone their first Asia service if the economy remains weak, and I certainly never said a "johnny come lately" would be any more successful than AA. Y'all have a great product. I just hope someone brainiac does not start another thread on here about how US should be immediately stripped of those China frequencies, only to have AA do the same thing a week later. Gawd, that was, like, such poor timing. But it was so funny!

 

[goodgirl37]

First things first, FA Mikey, you must admit that AA can't pull down on Pacific flying. AA really doesn't have any flying over the Pacific that amounts to anything, so if they did "scale back" it wouldn't exist at all. As for DAL and UAL, they have numerous routes from multiple cities that can be scaled back. AA can't really compare in this aspect, it would be like saying UAL will scale back South America. If they reduced flying there would be none left, and even moreso with AA and Asia. AA really doesn't even have a fight in the game.

 

[FA Mikey]

The post previous to mine inferred that US could not afford it. I didn't mean they actually couldn't "afford" it. Sorry I was not clear enough.

I guess when you said " poor "junk rated" USAir couldn't afford the plane," we actually thought you were saying usair couldnt afford the plane. I see how we got confused. We were pointing out that usair didnt have a plane and had little to no chance of acquiring one in time to start the route.

Reeeally? Wow. You should contact USAir and tell them, since you're an expert. I am, like, so sure they don't know this stuff (you do know that US presented the pilots with A340 rates, right? :blink ...

Saying "they didnt know all this stuff". Is that like where you aid usair couldnt afford the plane but didnt really mean it?

Do you live in a bubble? Sadly, I don't think AMR has much Pacific traffic to cut, as opposed to NWA, UAL, and DAL. (you are much smaller in the region compared to the others...) I am sure however, that while all other airlines are losing their shirts to the Pacific, especially in the F cabins, that AA is doing wonderfully. In case you're bored (though not Pacific specific):

http://www.reuters.com/article/ousivMolt/i...E52B79N20090312

By comparission AA is not losing it shirt, in the way that NWA and UAL might be. AA has only about 6.7 billion ASM's in the Pacific. BTW no one is cutting flights in the markets AA serves in ASIA.

Apparently you missed the part where I said USAir would be smart to once again postpone their first Asia service if the economy remains weak, and I certainly never said a "johnny come lately" would be any more successful than AA. Y'all have a great product. I just hope someone brainiac does not start another thread on here about how US should be immediately stripped of those China frequencies, only to have AA do the same thing a week later. Gawd, that was, like, such poor timing. But it was so funny!

Usair will have to postpone. They have made no attempt to acquire a plane to fly the route.

 

[FA Mikey]

First things first, FA Mikey, you must admit that AA can't pull down on Pacific flying. AA really doesn't have any flying over the Pacific that amounts to anything, so if they did "scale back" it wouldn't exist at all.

Really 6.7 billion seat miles. How much do you have to have for it to amount to "anything".

As for DAL and UAL, they have numerous routes from multiple cities that can be scaled back.

Good for them. Turns out the cities AA serves in ASIA are the ones no one is scaling back. In fact One airline is actually adding larger planes and seats to the route.

AA can't really compare in this aspect, it would be like saying UAL will scale back South America. If they reduced flying there would be none left, and even moreso with AA and Asia.

I am not sure you understand how much flying UAL still has in the Central and South America market. When you use the term scale back, its too broad a term. Is it one flight to EZE or one flight to SAL. That alone came be a big difference.

AA really doesn't even have a fight in the game.

They have a great fight, market share and following. In fact several carriers have left the market when AA announced or started up service.

 

[goodgirl37]

Ok, now which is it FA Mikey, 6.8 billion or 10.6 billion? A 4 billion jump is a big one, especially for flights only to destinations of Tokyo, Osaka, and Shanghai. :blink:

 

[FA Mikey]

My mistake I looked at the wrong line. It should be and was corrected to say 6.7 billion.

 

[Itestwell]

I guess when you said " poor "junk rated" USAir couldn't afford the plane," we actually thought you were saying usair couldnt afford the plane. I see how we got confused. We were pointing out that usair didnt have a plane and had little to no chance of acquiring one in time to start the route.

Right. Sorry to confuse you. I was simply repeating what has been said/is being said about US on here, in the news, etc.. It was a joke that flopped. I will try harder next time.

Saying "they didnt know all this stuff". Is that like where you aid usair couldnt afford the plane but didnt really mean it?

Again, I didn't realize you would be so confused. My bad.

By comparission AA is not losing it shirt, in the way that NWA and UAL might be. AA has only about 6.7 billion ASM's in the Pacific. BTW no one is cutting flights in the markets AA serves in ASIA.

Please post your proof, which will be contrary to what every airline is reporting. You may be right, I am just going by what I read. If revenues are down at every airline in Asia (and this includes the Asian carriers), I guess it's possible that AA is not affected. I am just not sure how, but I await your answer.

Usair will have to postpone. They have made no attempt to acquire a plane to fly the route.

Nah. If they had to , they could do it with a weight restricted 332, but again, they had the foresight to be the first to postpone last time (and became the laughing stock of AA on here.... until a week later); I sure hope they have the same foresight this time. Given the sharp falloff in cargo/ pax traffic to China (which is apparently affecting everyone but AA), I am sure the 332 would be more attractive. Again, just a guess.

EDIT: Here is some info for some Asia flying. Notice that AA's LF is already at 65% ORDPVG, from the July 2008 time period. Could the route be performing better now in Jan/ Feb '09? Just askin'...

Average fare data is for 3Q08, LF is for July 08 - both are the most recent data sets from the DOT.

AA ORDPVG $895 65% LF
CO EWRPEK 758 76
DL ATLPVG 905 59
UA IADPEK 933 66
ORDPEK 969 71
ORDPVG 895 65
SFOPEK 996 66
SFOPVG 1175 65

And...
http://www.airliners.net/aviation-forums/g...china#ID4298708

I am sure this was an aberration of some sort....

 

[FA Mikey]

Please post your proof, which will be contrary to what every airline is reporting. You may be right, I am just going by what I read. If revenues are down at every airline in Asia (and this includes the Asian carriers), I guess it's possible that AA is not affected. I am just not sure how, but I await your answer.

Before it was losing their shirt, no you say not affected which is it? AMR will feel a pinch like everyone else. But to a lesser extent due to our exposure to the market and minimal US carrier competition at JFK and DFW. AMR has not announced and cuts to its pacific flying.

Nah. If they had to , they could do it with a weight restricted 332, but again, they had the foresight to be the first to postpone last time

You say fore sight to postpone, I say no airplane and was making no plans to start the service. Think back to all the posts on the US board complaining about that. A weight restricted 332? Is that what was promised in the application for service? Does it measure up in seats and cargo space?

 

[Itestwell]

Before it was losing their shirt, no you say not affected which is it? AMR will feel a pinch like everyone else. But to a lesser extent due to our exposure to the market and minimal US carrier competition at JFK and DFW. AMR has not announced and cuts to its pacific flying.

Because, as compared to the larger players in the market, you simply don't have the frequencies to cut, or aircraft to downgrade them with. If you cut a market, you would likely exit it. I say AA is losing its shirt to China, yes. That's what I said. I may be wrong, but if I am, AA knows something that the other carriers do not.

You say fore sight to postpone, I say no airplane and was making no plans to start the service. Think back to all the posts on the US board complaining about that. A weight restricted 332? Is that what was promised in the application for service? Does it measure up in seats and cargo space?

Good stuff. So, if USAir postponed simply because they did not have the equipment available, what was AA's excuse? USAir said the A340 was to be used in its application. USAir had A340's ready to come on property. This info came out of DP's mouth on a Crew News Session, taped. Online. His words, not mine. Turns out the plane, and the route, are uneconomical in the current environment. This is pretty much happening to all carriers in China, of course, except AA.

 

[Itestwell]

Here's some good news... I guess when airlines (in this case DL) announce capacity reductions, and other airlines hint at it (AA), the market gets a bit happier!

http://www.bloomberg.com/apps/news?pid=206...&refer=home

 

[FA Mikey]

Because, as compared to the larger players in the market, you simply don't have the frequencies to cut, or aircraft to downgrade them with. If you cut a market, you would likely exit it. I say AA is losing its shirt to China, yes. That's what I said. I may be wrong, but if I am, AA knows something that the other carriers do not.

With 5 flights a day to NRT, there is room to cut and not exit the market. You say now its to China, AA is losing its shirt. I really dont know. You posted LF's but thats not all that telling. AA has three cabins and not one to bargain basement its premium seats. They are also very tight on the upgrades. AA's RASM is 11.04 cents, a 13.2% increase year over year.

Good stuff. So, if USAir postponed simply because they did not have the equipment available, what was AA's excuse? USAir said the A340 was to be used in its application. USAir had A340's ready to come on property. This info came out of DP's mouth on a Crew News Session, taped. Online. His words, not mine. Turns out the plane, and the route, are uneconomical in the current environment. This is pretty much happening to all carriers in China, of course, except AA.

Well if he said it, it must be true. We all know what a fine upstanding (away from the beer garden) guy he is.

 

[FA Mikey]

Here's some good news... I guess when airlines (in this case DL) announce capacity reductions, and other airlines hint at it (AA), the market gets a bit happier!

http://www.bloomberg.com/apps/news?pid=206...&refer=home

An not a single word about the new second daily ATL-NRT flight with a NWA 747. Amazing!

 

[BoeingBoy]

China traffic (PRC & Hong Kong) has been holding up pretty well compared to the rest of Asia - up 17.8% through November. South America has also been holding up pretty well - up 12.7% through November.

Jim