US/AA merger settlement imminent!

[IORFA]

This post is hidden because you have chosen to ignore posts by WorldTraveler. View it anyway?

Everyone adding this royal pain to their ignore list removes many possible negative posts.

 

[WorldTraveler]

AA already has several flights from JFK to South America.    PHL?   Not a lot of O&D there.    ORD to South America?   UA and AA have tried some, but Chicago is not the center of the universe when it comes to South American O&D.   Miami is.    
 
Charlotte?   Some US employees have reported that quite a few of the passengers from GIG and GRU disembark at CLT and then connect to MCO.  If that's true, then new AA should probably just fly them to MIA and then connect them to MCO.    That would shave several hundred miles and a few hours off their journey.   
 
The largest O&D markets to/from Brazil are, in order, Miami, NYC and then MCO.    LAX and LAS are also pretty big.   

AA is pretty big in Brazil, Argentina and Chile, along with a presence in just about every other country in South America and most countries (if not all of them) in Central America.   
 
I realize that the CLT hub is big and amazing, but amazing hubs don't always support long-haul international flights to all .    DL's hub at ATL is substantially larger than CLT yet DL has tried and cancelled nonstop China flights from ATL.   

precisely... Latin América lives and dies on connections to/from Florida.  At some point, new AA will decide whether it makes sense to continue to operate flights to S. América which are dependente on low fare connections to Florida which could be served via AA's existing MIA flights.
 
AA's MIA hub will face increasing competitive challenges in the near future as true Open Skies fall across the Latin América region.   AA needs to funnel every bit of traffic it can thru MIA, not circuitous routings thru more northern hubs.

 

[MAH4546]

 
AA's MIA hub will face increasing competitive challenges in the near future as true Open Skies fall across the Latin América region.  

 
Again? In the same thread of all places? 
 
Why do you refuse to realize that, outside of Venezuela and Sao Paulo, U.S.-Latin America operates in an open skies-like environment today. Not sure what the "true" qualifier ads. There is nothing stopping AA's competitors from expanding in the market today. Yet they don't. And, again, AA competes with another airline, and often two, sometimes three, and, in the case of Bogota, four, on every single major Miami-LatAm market sans Maracaibo.  

 

[eolesen]

Even Venezuela is a bit ridiculous.... Given the ongoing issues with currency expatriation, the risk averse airlines are going to continue to pass on serving the country.

 

[WorldTraveler]

Again? In the same thread of all places? 
 
Why do you refuse to realize that, outside of Venezuela and Sao Paulo, U.S.-Latin America operates in an open skies-like environment today. Not sure what the "true" qualifier ads. There is nothing stopping AA's competitors from expanding in the market today. Yet they don't. And, again, AA competes with another airline, and often two, sometimes three, and, in the case of Bogota, four, on every single major Miami-LatAm market sans Maracaibo.

you do realize that GRU is the largest market in Latin America?

Most of the rest of Europe was Open Skies long before the UK had Open Skies and then when LHR did open to competitors, the slots that were available on the open market cost tens of millions of dollars.

Latin America is no more Open Skies than Europe was or even is today.

Competitors are not going to challenge AA in the single region of the world where AA is strongest until they are able to compete openly and equally in all of the markets in the region.

The DL-VS joint venture and the $360M investment DL made is a way to ensure that the tables are as balanced as they possibly can be.

AA continues to hide behind very protectionist policies of Latin American governments and the only way that competitors will enter the market in mass in AA's largest markets is when they can completely and fairly compete with AA in all of the top markets.

 

[eolesen]

You say AA is hiding behind the protectionist policies of Latin America.

Exactly where are they hiding, WT?

If you're trying to make the case that GRU isn't facility constrained, or that it's done out of protectionism, please explain yourself. I can hardly wait. Until T-3 is complete early next year, there really is no room at the inn.

 

[MetalMover]

The DL-VS joint venture and the $360M investment DL made is a way to ensure that the tables are as balanced as they possibly can be.
 

QUESTION: WHAT DO THE FOLLOWING NAMES HAVE IN COMMON?
 
OTTOMAN
UMAYYAD CALIPHATE
PERSIAN
BYZANTINE 
HAN
BRITISH
HOLY ROMAN
RUSSIAN
MONGOL
ROMAN
DELTA
 
ANSWER: THE 11 GREATEST EMPIRES IN HISTORY. THE FIRST 10 HAVE RISEN AND FALLEN.....THE LAST ONE  STILL RULES.

 

[WorldTraveler]

You say AA is hiding behind the protectionist policies of Latin America.

Exactly where are they hiding, WT?

If you're trying to make the case that GRU isn't facility constrained, or that it's done out of protectionism, please explain yourself. I can hardly wait. Until T-3 is complete early next year, there really is no room at the inn.

where did I say that GRU wasn't facility constrained? You and I both know it very much is.

And AA has benefitted from its dominant position in key markets around the world that haven't had the same levels of competition as other carriers, including at DFW, LHR, and GRU as primary markets.

The WN spokespeople here have stated - and I believe them - that WN didn't ask to be put into a little box but that is where they have lived and will until that countdown clock strikes 0.

GRU is opening a new terminal as we both know and with it comes Open Skies at GRU, the only market (joined with nearby Campinas) that any use airline can't serve.

BTW, isn't today the addition of two new cities to AA's network in Brazil? CWB and POA?

AA's strength in GRU and the above average fares there compared with other markets have fueled their ability to grow in other secondary cities throughout Brazil.

 

[MetalMover]

So when DL dominates a market, it's because of perfect and superior  management and strategy. But when others dominate a market, it's because of luck and local politics.

 

[WorldTraveler]

absolutely not. Just tell me what major markets that AA dominates and which are very competitive.

 

[eolesen]

Again, how about some specifics on where AA is hiding behind protectionism in Latin America?

There's no asterisks for you to hide behind on your statement.

Waiting.

 

[Mach85ER]

E,
Put down the mouse and step slowly back from the keyboard. You're getting sucked into a debate with a guy who lives in an old Goldstar fridge box behind an airline memorbilia shop on 36 st.
 
He can probably score you a couple of BN B727 plastic models in Calder colors if you ask nicely

 

[MAH4546]

you do realize that GRU is the largest market in Latin America?

Most of the rest of Europe was Open Skies long before the UK had Open Skies and then when LHR did open to competitors, the slots that were available on the open market cost tens of millions of dollars.

Latin America is no more Open Skies than Europe was or even is today.

Competitors are not going to challenge AA in the single region of the world where AA is strongest until they are able to compete openly and equally in all of the markets in the region.

The DL-VS joint venture and the $360M investment DL made is a way to ensure that the tables are as balanced as they possibly can be.

AA continues to hide behind very protectionist policies of Latin American governments and the only way that competitors will enter the market in mass in AA's largest markets is when they can completely and fairly compete with AA in all of the top markets.

 
So, in other words, Delta isn't currently challenging American Airlines in Manaus, Cali or Montevideo because it can't get access to Sao Paulo? But once it can gain access to Sao Paulo, it will enter those markets? 
 
But wait, there's more...Delta was granted additional access to Sao Paulo that became effective earlier this month, yet, surprise surprise, it applied with DOT to delay the start to March 2014. And it'll probably try to delay that start again to the World Cup, then apply for "seasonal" use after the soccer traffic dries up.
 
Yup, Sao Paulo is just such a closed market , so hard to gain access too, that Delta isn't even using all the frequencies it has. 
 
Bogota is Open Skies. Rio de Janeiro is Open Skies. Santiago is Open Skies. Buenos Aires is open access. Lima is Open Skies. 
 
There is nothing stopping Delta and United from competing. Absolutely nothing. 

 

[WorldTraveler]

Again, how about some specifics on where AA is hiding behind protectionism in Latin America?

There's no asterisks for you to hide behind on your statement.

Waiting.

If you and MAH can't grasp the concept that GRU is the single largest and richest market in Latin America and has enormous effect on a carrier's ability to compete in all of the region.

Neither DL or UA is going to enter MIA-Latin America which is the single largest market in Latin America until it is close enough to being able to compete in MIA-GRU which is the largest market within the region.

Every carrier is well aware of AA's size in Latin America and its dominance of MIA. You don't pick a fight with a carrier when you enter that fight with one arm tied behind your back.

For now, DL and UA will focus on building Latin America from its own hubs and to cities where it can generate the highest amount of revenue.

GRU, just like every other market, is not a horserace for market share even though that is how AA has treated Latin America for years now - throwing in capacity as fast as it can. Have you noticed that AA's RASM growth in Latin America has not been keeping up with its capacity growth? AA is adding capacity so fast that it is willing to limit its average fare growth in order to stake out new markets. IOW, AA's costs for the new capacity is growing faster than their ability to generate revenues to cover those costs. If they were as certain that they are and will remain #1, they wouldn't be throwing capacity in so fast that they are pushing down their yields.

DOT statistics will clearly show in time whether AA's new LAX-GRU service generated acceptable yields but the chances are real high that the route will not generate sufficient revenues to cover costs on a flight that is as long as to Asia. Further, AA is adding more capacity to a market that has never had that much capacity and AA chose to continue with the flight even though slot times at GRU are different from what they wanted by several hours.

DL is not starting a new flight to ATL on a sustained basis with a departure at 2 a.m. from GRU which is what they would have had to do. The new GRU-ATL flight will depart in the same prime bank of evening US departures. Even though US is improving its GRU-CLT departure, it will be leaving after 2 a.m. which will make it the last departure to the Americas. Not exactly a great schedule to attract business passengers which make or break int'l flights.

AA is in a market share race in Latin America because they realize that Latin America is the only global region where they or AA/US will be dominant on a sustained basis.

 

[eolesen]

So... the ever powerful DL can't compete in GRU until it can match AA?

Seems to me AA isn't the one hiding behind protectionism.

AA's simply taking the slots they're given and making it work.

Meanwhile, DL delays starting service and hoards a scarce and limited resource (route authority to GRU)...

Protectionism takes many forms. Hoarding unused route authorities and wasting slots on regional service which could also be used to support more competition are just two of them.