1. The half (or more) empty airplanes on the DFW-ATL route for AA has been going on for several years now. I brought the point up at a public meeting over 3 years ago that we seemed to be kidding ourselves that we were competing with DL on that route.
2. Up until about 6 months ago or so, most of the DL a/c at Terminal E were RJs; so, since about the only place you could go on DL from DFW was to ATL, I assumed those rjs were going there. I don't ever remember AA flying rjs on that route.
3. The service standard at AA for several years has been to give the whole can.
4. I have taken another pay cut to subsidize those empty flights (and others that AA flies "to compete"), and you want me to enjoy them? I think not.
Jim,
while most of us have been conditioned to believe that it takes full flights in order to be profitable, there is a very good chance that AA is quite profitable on DFW-ATL even with a 65% load factor in the summer.
FL forced fares down and LFs increased as AA and DL matched fares. DL made sure it had enough capacity in the market in order to limit FL's ability to take DL passengers.... now with FL out of the picture, AA and DL have almost identical shares of the local market but, as I noted, DL's higher LF comes from its larger hub and its ability to connect more passengers at ATL than AA does at DFW. The LF on DFW-ATL for both AA and DL is below their system averages so you can bet that if DL - who has the largest amount of capacity - wasn't making money, they would reduce capacity. ATL-DFW like alot of DFW routes is a business travel heavy route which means there is alot of "dead" capacity in the middle of the day and middle of the week. As long as DL keeps capacity in the market, AA has no choice but to do the same...
DL obviously does fly from DFW to its other hubs and most recently added LGA service and most of DL's service EXCEPT for ATL is on RJs. DL upgraded some SLC, MSP, and DTW flights to mainline over the past several months - coincidentally when "operational issues" surfaced at AA but AA still has the larger share of traffic from DFW to all of DL's other hubs, because of the "largest hub" principle I noted above.
DFW, like MIA, is a solidly profitable hub for AA and they really don't have a lot to worry about from DL, other than the return of LGA service. DL is picking up some traffic bound for DFW but AA continues to control the local Texas market quite well.
The real threat to AA comes from NK's one or two flights a day into dozens of markets; some want to write them off but NK is a very low price carrier and will pull just enough passengers off to make a difference on their few flights - and then will add another frequency.... and then another. And there are passengers - business and leisure alike - who will always be driven by low fares.
And then there is the whole Wright Amendment that has the potentially reshape the N. Texas aviation market and allow WN the opportunity to pick up alot of AA business traffic; unlike MDW and HOU, DAL is between the largest business market (the city of Dallas) and the major airport in the region (DFW). Even w/ the limitations on growth at DAL, geography has the potential to significant alter the results seen in other two airport cities.
AA's future is dependent on keeping WN in a pretty small box at DAL when the Wright Amendment falls (in addition to the mechanic issues which Bob cites).
Merry Christmas to you!
