More AA gates coming in LAX

[WorldTraveler]

Gate efficiency is an UNCOMFORTABLE fact that you don't want to admit.

If the point for AA is solely to lock up real estate at LAX, then your point might be valid.

if the point is to show that AA at LAX or DL at JFK or WN at DAL is to make money, then the idea is to push the most passeengers thru the jetways that can be done.


right now other carriers are more efficient at using their LAX assets and they are indeed growing and will continue to do so in the next year despite the posts here for quite some time that DL is out of space at LAX while AA has space to grow.

Either that gate advantage should translate into a proportional growth advantage or the real estate advantage isn't translating into a revenue and share advantage.

 

[commavia]

Bwahahaha how comical.  The bitterness and detachment from reality is so transparent.
 
Back here in reality, the scheduling and operational flexibility afforded AA by its exclusive or preferential use of more gates than either of its competitors is an advantage, not a disadvantage.  Thus why AA has more flights at peak hours than either Delta or United (see recent CAPA analysis) and - lest we lose sight of the fact in the malaise of spinning and obfuscation - why AA is LAX's #1 airline.

 

[WorldTraveler]

and yet apparently those other airlines can operate flights at supposedly NON-PEAK flights and get just as good of an average fare.

Do me a little favor, commavia.

How about you go back about 5 years and list the number of gates that AA held over each of those 5 years.

and then it might be apparent why I am saying what I am saying.

when DID I gain the title of LAX' largest gate holder?

 

[LDVAviation]

[...]  So, that's an increase of 2 gates plus the elimination of those busses out to the Nest.  And, in exchange for these two gates and no more busses, AA is giving up their hangar and the adjoining property, their exclusive rights to T4, and their rights to the Nest.
 
But it's really not that good a deal, because a) to make the deal work for DL (they aren't going to take less gates than they have now), some airlines that are in T3 (and maybe even T2) now will have to move.  There's no where for them to go but T6.  (That pretty much guarantees that those 4 T6 gates that AA has now are goners, doesn't it?)  There's also been talk here that Alaska is going to move to T5 to be closer to AA (and to free up gates in T6, I'd wager).  Well there goes 4-5 of those T5 gates that AA just picked up.  So, now the gate count for AA is lower than before this started.  How is that a win for them?  Why do this deal?
 
But it gets worse.  Right now DL is landlocked at T5/T6.  They have no where else to grow.  (Sorry, WT.  They don't.)  By doing this deal, DL is freed from their trap.  (I don't know why WT isn't claiming this plan as a masterstroke by DL.  It's a full-fledged get-out-of-jail-free card for them.)  By swapping the Nest for T5, AA is giving their most potent competitor an out.  Right now, there's a ceiling on how much threat DL really is long-term.  Moving them to the north side takes that ceiling away.  Again, why would they do this deal?

[...] So what am I missing here? 

 
Some more details:  
 
The 2 new gates at T4 and the preferential use of gate 151 are the result of a deal for AA's Master Lease to T4.  As part of this deal, LAWA will fully cover the costs of the reconfiguration, about $200 million.
 
There is no deal yet for AA's hangar.  
 
The rights to first refusal on T5 gates would be part of this deal.  With respect to the use of those gates, the only thing that is certain at the moment is that AA wants to trade T6 gates for T5 gates.  Beyond that, there are a number of possibilities, some do not include AS.  For instance, there is room in T5 for organic growth and/or the entire Eagle operation.  AA has discussed both possibilities, alone or in combination, with LAWA.  Depending on what happens in 4 to 5 years and provided that AA fully exercises its rights, there could be a net gain of more than 2 gates, significantly more.  
 
Plus, I think your math is not accurate for this reason.  Even though Eagle gates are no different than mainline gates from an administrative standpoint (i.e., the gate cap in the Stipulated Settlement), it is still the case that Eagle gates are not as useful as mainline gates at T4.
 
... As for T2, it will continue to be used by other airlines (e.g., WestJet and Air Canada).    Delta will gain only 1 or 2 preferential gates at T2 (over its position at T6).  All depends on the final configuration of T3.  It can be configured for 13 gates (same as T5), but there are contingencies which may reduce its gate count by 2 gates.  
 
Delta will not get preferential rights to any TBIT gates.  The T3 connector will allow them however to use the northside gates.  While Delta will certainly have more gate flexibility than they do now on the south side, in 5 years they will not end up with as many preferential/priority gates as AA.  
 
Still, I see your point.  Why would AA do anything to help its most potent competitor?  Here's the thing, at LAX, Delta is not really AA's most potent competitor.  If I remember correctly, AA (without US) runs something like 30% of the peak time flights to Delta's 4%.  This difference almost fully explains the gate requirements of each airline at LAX.  Remember at LAX gates are like slots, especially at peak times.  Moreover, as commavia indicated, in 5 years AA can do a lot with its 3 new gates to consolidate and increase this critical difference.  In which case, after 5 years, it may be AA's thinking that it may not matter how much gate flexibility Delta gets as a result of the move.

 

[WorldTraveler]

DL is not trying to get as many gates as AA has.

AA has 2.5 times more gates than DL has right now but yet DL is growing at a faster rate and has been able to displace UA as the 2nd largest airline and has 80% of the local market share that AA has.

AA and LAX can talk about all of the T5 gates that they want but they aren't getting any until DL moves. and DL is not moving until they get MORE gates than they have now and if rebuilding T3 is what it will take for DL to move, it will take years to accomplish. DL also is not moving unless it gets access to a connected set of international gates - whether that be T2 or TBIT.

all AA can do right now until DL moves and DL itself starts to gain an even larger advantage over UA and narrow the advantage that AA would have is for AA to move flights off of the Eagle pad into terminal gates which increases convenience but also allows upgrading to mainline flights. Meanwhile, for 2016, DL will have the highest average aircraft size of all of the big 4 at LAX and also will be down to a couple dozen RJ flights and they will all be 76 seaters - no 70 seaters after years of having no 50 seaters.

and in the largest markets at LAX, DL serves SEA and PDX and is growing its share in the NYC market plus serves BOTH Tokyo airports. AA at best has an advantage with GRU that DL and UA do not. If the AKL rumor comes true that will be another unique market for AA if they want to go to battle with NZ and UA.

 

[commavia]

The 2 new gates at T4 and the preferential use of gate 151 are the result of a deal for AA's Master Lease to T4.  As part of this deal, LAWA will fully cover the costs of the reconfiguration, about $200 million.

 
LAWA will fully cover the $200M T4 reconfiguration cost - very interesting.
 
So would you characterize the T4 reconfiguration as essentially, or close to, a "done deal," and if so, any sense on timeline?  I'd imagine they'll have to take other T4 gates out of commission, at least temporarily, as they build up the additional gates' infrastructure, repaint lines, etc.?  Additionally, given how packed T4 already is at peak times, I do wonder how T4 security will handle it, and I also will be curious to see where these additional gates are going to be - I would guess down by 48/49, as to those are widebody-capable now and probably the largest gate/seating areas on the concourse?
 

The rights to first refusal on T5 gates would be part of this deal.  With respect to the use of those gates, the only thing that is certain at the moment is that AA wants to trade T6 gates for T5 gates.  Beyond that, there are a number of possibilities, some do not include AS.  For instance, there is room in T5 for organic growth and/or the entire Eagle operation.  AA has discussed both possibilities, alone or in combination, with LAWA.  Depending on what happens in 4 to 5 years and provided that AA fully exercises its rights, there could be a net gain of more than 2 gates, significantly more.  

 
AA wanting more access to T5 as opposed to T6 is logical just based on the shorter distance to T4 and TBIT.  Will be very interesting to see if, and how, this progress - particularly the prospect of T5 being used for "organic growth" above and beyond partially or fully replacing the T6 and/or Eagle gates.
 

... As for T2, it will continue to be used by other airlines (e.g., WestJet and Air Canada).    Delta will gain only 1 or 2 preferential gates at T2 (over its position at T6).  All depends on the final configuration of T3.  It can be configured for 13 gates (same as T5), but there are contingencies which may reduce its gate count by 2 gates.  

 
Not surprising - as has been discussed repeatedly, there are plenty of current and prospective future T2 users who want access there just as much as , if not more than, Delta.

 

[dfw gen]

What cities are included in this analysis?

We moved Atlanta to the west coast.helps with dot numbers we will put it back on the east coast tomorrow

 

[WorldTraveler]

The west coast includes cities in the states of California, Oregon, and Washington.

As much as you two and others want to think otherwise, DL is not moving from one side of LAX to another for an equal number of gates or even a few more and it is not going to accept any solution that doesn't include as good as or better gate connectivity and increased international operations than what it has today.

All of the talk about what AA can do in LAX with T5 is meaningless until LAWA does a deal with DL that is acceptable to DL.

Meanwhile based on current schedules, DL continues to be the fastest growing airline at LAX and is doing it even though many people here have said that DL is out of gate space while AA based on the gate counts here, has 2 1/2 times the number of gates that DL has.

UA is the carrier that is pulling back at LAX and DL is picking up most of UA's share based no the most current DOT data. AA and DL clearly will both continue to grow but the plans of both are tied together. To try to believe otherwise is a disconnection from reality.

 

[commavia]

No, no, no.  "All of the talk" is about what AA could do at LAX with T5 in addition to what AA already can do, and is doing, with its gate real estate there today.

 

[WorldTraveler]

of course they COULD grow... if DL moves and DL COULD move if they get more real estate in the process. whatever DL gets on the east side will be a major determinant of whether AA can consolidate its operations in T4 and 5.

It makes all the sense for AA to have T4 and 5.

DL will make very certain that it gets a sufficiently larger number of gates that are connected and include significant international capacity.

If DL gets what it wants - and there is no contract that has determined what DL will do - THEN AA can begin the process of consolidating its operation.

 

[MAH4546]

Delta has already made an agreement in principal to move to T2/T3, and it does not include additional gates. It is happy to keep its gate count.
 
AA will be gaining seven gates over what it has now even without the proposed move, and in addition the T5 move would allow it to no longer have RJ-only gates. 

 

[WorldTraveler]

DL has signed no contract.

When DL moves and has no more gates while AA does, let us know.

T5 is DL's terminal for at least the next few years.

It is childish and foolish at best to act as if it is AA's before DL has announced any firm plans to vacate it or to move elsewhere.

 

[Platinum Steve]

 
Some more details:  
 
The 2 new gates at T4 and the preferential use of gate 151 are the result of a deal for AA's Master Lease to T4.  As part of this deal, LAWA will fully cover the costs of the reconfiguration, about $200 million.
 
There is no deal yet for AA's hangar.  
 
The rights to first refusal on T5 gates would be part of this deal.  With respect to the use of those gates, the only thing that is certain at the moment is that AA wants to trade T6 gates for T5 gates.  Beyond that, there are a number of possibilities, some do not include AS.  For instance, there is room in T5 for organic growth and/or the entire Eagle operation.  AA has discussed both possibilities, alone or in combination, with LAWA.  Depending on what happens in 4 to 5 years and provided that AA fully exercises its rights, there could be a net gain of more than 2 gates, significantly more.  
 
Plus, I think your math is not accurate for this reason.  Even though Eagle gates are no different than mainline gates from an administrative standpoint (i.e., the gate cap in the Stipulated Settlement), it is still the case that Eagle gates are not as useful as mainline gates at T4.
 
... As for T2, it will continue to be used by other airlines (e.g., WestJet and Air Canada).    Delta will gain only 1 or 2 preferential gates at T2 (over its position at T6).  All depends on the final configuration of T3.  It can be configured for 13 gates (same as T5), but there are contingencies which may reduce its gate count by 2 gates.  
 
Delta will not get preferential rights to any TBIT gates.  The T3 connector will allow them however to use the northside gates.  While Delta will certainly have more gate flexibility than they do now on the south side, in 5 years they will not end up with as many preferential/priority gates as AA.  
 
Still, I see your point.  Why would AA do anything to help its most potent competitor?  Here's the thing, at LAX, Delta is not really AA's most potent competitor.  If I remember correctly, AA (without US) runs something like 30% of the peak time flights to Delta's 4%.  This difference almost fully explains the gate requirements of each airline at LAX.  Remember at LAX gates are like slots, especially at peak times.  Moreover, as commavia indicated, in 5 years AA can do a lot with its 3 new gates to consolidate and increase this critical difference.  In which case, after 5 years, it may be AA's thinking that it may not matter how much gate flexibility Delta gets as a result of the move.

Thanks, LDV.  Some of this makes sense.  New questions arise, though:
 
1) You tied the T4 gates and TBIT 151 to the T4 Master Lease and specifically separated the hangar discussion from it. Then you said "The right of first refusal to T5 gates would be part of this deal."  Is "this deal" the T4 deal?  Or the hangar deal?
 
2) T5 would certainly offer great opportunities for organic growth - if they don't have to put the entire Eagle operation in there.  Is the Nest going away and (potentially) moving to T5?  Or will Eagle stay out in the hinterlands and T5 become a place for organic mainline growth?
 
3) If Eagle is going to move to T5, is the expectation that there will be some regating (is that the right term?) to add new gates to allow more, smaller jets than it is currently designed?  Is that why you think my gate-count math is off?
 
4) If the hangar discussions are separate from all of this T4-T5-T6-Nest-TBIT maneuvering, then what is LAWA offering to get that deal done?
 
5) If DL is going to take over T3 and get space on T2, where do the airlines in T3 go?  T5 would be the obvious answer, unless AA is taking over T5.  Then that would mean T6, but can B6 and Virgin fit into the AA and DL gates in T6?  Or will that require moving Alaska out of T6 to have the needed space?  And (I know, a lot of questions), if Alaska moves, don't they have to go into T5 to make any of this make sense?  Then aren't we right back to AA's gate count only being about par to where they are currently?
 
 
This is all interesting stuff going on.  Thanks in advance for your input.

 

[WorldTraveler]

time out.

There is NO DEAL for DL to move and thus any plans for what AA will do is at best childishly immature.

The 3 stooges of this thread continually act like 2 year olds that sweep all of the cookies into their own laps.

rational adults recognize that AA can't do anything if DL doesn't move and that LAWA is not in the least beholden to come up with a plan that benefits only AA or that they would even want to do that.
DL has absolutely no incentive to move unless it gets more space so it can add more flights. let me be even more clear. DL IS NOT MOVING UNLESS IT GETS MORE SPACE, A CONNECTED FACILITY IF IT SPANS MULTIPLE TERMINALS, AND MORE INTERNATIONAL CAPABILITIES THAN THEY HAVE TODAY.

DL specifically noted that LAX is one of its key markets that are contributing to growing margins and revenue advantage. DL is growing faster than any other carrier at LAX. It is pure silliness to believe they would accept no growth at LAX for decades.

There is absolutely no evidence that any of what has been written here is anything more than the fantasy of a few people.

Every one recognizes that AA is going to grow.

Only a few people on the internet could honestly believe that LAWA or DL is going to agree to any deal that gives AA all of the cookies while everyone else is supposed to roll over and play dead at AA's feet

but when you have tried to argue for years that AA would launch MIA-NRT and that hasn't happened, why wouldn't you move on to something that is just as much as a fantasy as to believe that AA will dominate the growth at LAX to the exclusion of any other viable competitor.

 

[700UW]

So when did you become VP of Properties for DL?