AA announces $1.5B in renovations to LAX terminals

FWAAA

Veteran
Jan 5, 2003
10,251
3,900
As part of AA's negotiations for a new 15 year lease at LAX, AA has announced plans to spend $1.5 billion to renovate terminals 4 and 5:

American Airlines Chief Executive Doug Parker said Friday that his airline plans to spend more than $1.5 billion to upgrade the airline’s terminals at LAX airport over the next 10 years.

“This investment will not only improve the customer experience, but it will also give our team members a better place to work every day,” Parker said.

The announcement comes only a month after Delta Air Lines announced that it is spending $1.9 billion over the next four years to upgrade its two terminals at LAX.

http://www.latimes.com/business/la-fi-travel-briefcase-lax-investments-20170602-story.html

http://www.dailybreeze.com/business...nes-announces-16-billion-lax-terminal-upgrade

http://mynewsla.com/business/2017/0...-american-airlines-spreads-projects-15-years/

Very good news. Mentioned in some of the news sources is the hint of additional gates for AA, probably including all of terminal 5 at some point, when the other assorted airlines can be moved to the new mid-field terminal.
 
More details from a press release issued by LAWA:


LAWA, AMERICAN AIRLINES ANNOUNCE NEW LETTER OF INTENT

American Commits $1.6 Billion Investment, Will Continue to Grow Presence at LAX

(Los Angeles, California – June 2, 2017) Los Angeles World Airports (LAWA) and American Airlines announced today that American would continue its investment in LAX with more than $1.6 billion committed over the next 15 years to dramatically improve Terminals 4 and 5.

American’s letter of intent that sets the framework for negotiation of a new 15-year lease agreement features airport improvement projects that would be made possible by this investment and would happen over the next 7-10 years, including:

· A new vertical circulation core with connection to the landside Automated People Movers (APM) train system

· Unifying the passenger check-in and baggage claim areas

· Improving check-in facilities in T5

· Centralizing the T4 and T5 security screening checkpoint at the APM level

· Connecting T4 and T5 on both the landside and airside of the building, including an above-ground connection extending from the T4/TBIT Connector to T5 on the airside

These improvements would essentially be made by tearing down the lobby areas of T4 and T5 one small section at a time and building a new, state-of-the-art facility, all while keeping the airport up and running.

The agreement also paves the way for American to receive additional gates as they continue to grow their operation and add destinations.

“This is a substantial commitment on the part of American, and our Board of Airport Commissioners will soon be reviewing the details of the new lease,” said Deborah Flint, Chief Executive Officer of LAWA. “Today we want to make sure American knows we are so appreciative of their support and willingness to support our efforts to make LAX and Los Angeles a preeminent destination in the world. I’m so pleased that American shares our excitement for the future of this great airport, and wants to partner with us to achieve our vision to create a world-class airport.”

“This investment will not only improve the customer experience, but it will also give our employees a better place to work every day while allowing us to continue to grow in the marketplace,” said Doug Parker, Chairman and CEO of American Airlines. “We are committed to being the preferred airline at LAX, and we couldn’t do that without the more than 6,500 American Airlines team members making sure our 225 flights a day get out safely and on time. Our customers are counting on these team members to validate the trust they place in us each time they step onboard one of our aircraft.”

“This deal with American to dramatically improve terminals 4 and 5 along with projects like the new Midfield Satellite Concourse, the Automated People Mover, the consolidated rental car facility, and the renovation of terminals 2 and 3 are to deliver on our top priority - giving our passengers the world class experience they expect and deserve,” said Sean Burton, President of LAWA Board of Commissioners.

http://www.lawa.org/newsContentbs.aspx?ID=2355

*I would have used the quote function but the new software hides long quotes and makes them difficult to read.
 
Yahoo! More construction at LAX!!!

For us passengers there's a bunch of stuff to like here (after it's all done, of course). Combining T4 and T5 ticketing and security areas would certainly presage that AA is going to take over all of T5. No way you spend that kind of money for just four gates. So, that would certainly also mean that the days of the Nest are numbered. A genuine Yipee! from this flyer. Won't miss those bus rides and missed flights. Not even a little.

There are a couple of items that aren't mentioned that beg questions:

1) Why are there no renderings or drawings to go with this press release? LAX and DL made their big announcement with a full media kit. All LAX and AA can muster are a few bullet points. Seems odd, doesn't it? Was this rushed through in a "Me, too" effort to keep DL from stealing too much attention in LA? That's what it feels like.
2) If AA is taking over all of T5 (which is admittedly a leap - just not a big one), when will that happen?
3) Where will the other airlines in T5 go? MSC? That's a big expensive building for the likes of JetBlue and Spirit. That can't work long term, can it?
4) No mention of the AA hangar and the southern build out of the MSC. When does that get resolved?

and, the big one:

5) Why is this just a 15 year deal? It's going to take upwards of 10 years to fully build all of this stuff (which is bordering on hilarious when it comes to the APM). That gives AA only 5 years before their lease is up. That's a huge expense for just 5 years of unencumbered operations.

While the items listed sound great and logical, this whole announcement feels incomplete. There's got to be more coming, right?
 
1) Why are there no renderings or drawings to go with this press release? LAX and DL made their big announcement with a full media kit. All LAX and AA can muster are a few bullet points. Seems odd, doesn't it? Was this rushed through in a "Me, too" effort to keep DL from stealing too much attention in LA? That's what it feels like.

Not exactly. From the press release quoted above, AA has merely signed a letter of intent that sets the framework for negotiations of a new 15 year lease. Delta signed its LOA in early January, 2016, and the detailed plan with drawings wasn't released until July, 2016, when the LAX BOAC approved the new DL lease. If this follows the Delta timetable, then detailed plans should be released before Christmas. When DL signed its LOA in Jan 2016, Richard Anderson told analysts about it but there was no splashy announcement by LAWA nor detailed plans or media kits. That didn't happen for six more months.

2) If AA is taking over all of T5 (which is admittedly a leap - just not a big one), when will that happen?

I expect that to happen when the MSC North project opens, which is scheduled for late 2019 but will probably be sometime in 2020 (nothing at LAX finishes on time). Ground was broken early this year:

http://www.latimes.com/local/lanow/la-me-ln-new-airport-terminal-20170227-story.html

3) Where will the other airlines in T5 go? MSC? That's a big expensive building for the likes of JetBlue and Spirit. That can't work long term, can it?

They will probably go to MSC North when it opens or to other TBIT gates if that makes more sense. If that doesn't work out for them - who cares? The airline world (and its employees) would be far better off if Spirit and Frontier stopped flying.

4) No mention of the AA hangar and the southern build out of the MSC. When does that get resolved?

Don't know when that happens. The 12 new gates in the MSC North complex add more than enough space for the other Terminal 5 occupants. Looks to me like the MSC South gates will be expansion gates.

5) Why is this just a 15 year deal? It's going to take upwards of 10 years to fully build all of this stuff (which is bordering on hilarious when it comes to the APM). That gives AA only 5 years before their lease is up. That's a huge expense for just 5 years of unencumbered operations.

Delta's new lease was about 22 years in duration; don't know why AA and LAWA are talking about a 15 year lease. Nevertheless, it's not as though AA will move out at the conclusion of that term. About the huge expense: AA will likely pay about $30-$50 million for proprietary improvements, and LAWA will fund the remaining portion thru cash reimbursements and rent credits over the lease term (exactly what DL is doing with its $1.9 billion Terminals 2 and 3 renovations). The $1.6 billion figure looks huge but it's not as though AA is actually investing that amount.

While the items listed sound great and logical, this whole announcement feels incomplete. There's got to be more coming, right?

A lot more details are on the way. MAH4546 posted on Flyertalk that more details may be released on June 15.
 
when the new terminal opens is it possible that all of the One World carriers that serve LAX will be parked in that general area for a much smoother transfer between the One World Airlines
 
when the new terminal opens is it possible that all of the One World carriers that serve LAX will be parked in that general area for a much smoother transfer between the One World Airlines
Probably not, because AA will use T4 and T5 for narrowbody flights, while widebodies will use TBIT, which is connected on the sterile side to the south side terminals, including 4 and 5. It's an easy short walk from 4 or 5 to TBIT right now, so we don't face the same inconvenience here as at JFK, where not all Oneworld airlines are at T8.

Speaking of JFK, it's time for AA to finish the remaining portion of the JFK terminal. It will take years, and by time it's done, AA may be a bigger deal at JFK than it is now.
 
The remodeled JFK Flagship Lounge just opened - and it's very nice. Access is by status/class of service compared to the Admirals Club where one can pay to get in. The JFK FL was about 10 years old and due for a refresh.

LAX has had a Flagship Lounge since about 2003 and it's currently being expanded/remodeled, due to reopen in October (but probably sometime next year, as delays are the rule for LAX construction). There is a temporary FL in the Admirals Club.

PHL is getting a new Flagship Lounge and MIA is also getting a new FL (although MIA had one of the first ones 18 years ago). MIA hasn't had a FL for a few years. DFW is also getting a FL after a long absence. All the existing Flagship Lounges are being remodeled. No FL for CLT.
 
thanks bud Wonder if AA will put one in CLT and one in PHL in the future
PHL is getting a new Flagship Lounge and MIA is also getting a new FL (although MIA had one of the first ones 18 years ago). MIA hasn't had a FL for a few years. DFW is also getting a FL after a long absence. All the existing Flagship Lounges are being remodeled. No FL for CLT.

Seems that PHL is getting one in this new flurry of activity. Since CLT is not mentioned for now or the future, I would guess nothing is planned at this time.
 
I'm surprised that the second half of JFK hasn't happened yet. Isn't AA flush with cash?...

15 years is an eternity in airline time, and ever since the demise of Eastern (which left large portions of ATL un-rentable), airports have tended to negotiate shorter terms for flexibility.

Presumably, this term doesn't replace the current lease, and as mentioned, a LOA isn't a contract, so add 15 years to however long the current lease is. It won't be 22 years, but balancing out what the airport wanted to spend with the term length is all part of the negotiations.