DL CEO hints at PVG hub

[eolesen]

Nice try, but no.  AA ceased flying to Australia in 1992.  The joint business with QANTAS was approved in 2011, nearly two decades later.  During that time, when AA had no joint business with QANTAS, it still continually elected not to fly to Australia with its own metal.

Point of order, Comm... AA and QF had a codewhoring agreement that predated the JV by at least 20 years. When I worked at JFK back in the 1990's, QF had full-time staff to work with the codeshare passengers continuing on at LAX. This was while the HNL-SYD/AKL flights were still being operated.

 

[WorldTraveler]

deleted

 

[commavia]

Point of order, Comm... AA and QF had a codewhoring agreement that predated the JV by at least 20 years. When I worked at JFK back in the 1990's, QF had full-time staff to work with the codeshare passengers continuing on at LAX. This was while the HNL-SYD/AKL flights were still being operated.

 
Absolutely correct - as I acknowledged in previous posts.  AA and QANTAS have had a progressive deepening marketing relationship going back decades - as you say, well before the JBA was instituted.  No question about that.  Nonetheless, it is true that specifically the joint business (or JBA) did not come into effect until 2011, nearly two decades after the last time AA flew its own aircraft to Australia/New Zealand.  Thus my earlier point that AA concluded, multiple times - first before any relationship with QANTAS, then before the QANTAS JBA, and now after the QANTAS JBA - that Australia operations were not worthwhile.

 

[WorldTraveler]

I believe the US and Australia did not sign Open Skies until 2008 or so.... so no JBA could have happened based on DOT and DOJ's standard practices.

and based on the discussion here about China, any comments about DL and a hub in China either requires China and the US to have Open Skies, which they did commit to as part of the last Air Services Agreement - although that hasn't happened - or China would have to allow DL to operate some of its own services beyond China - or DL would not operate a true hub with flights beyond the Chinese gateway.

I still believe Open Skies and JVs between both DL and UA with their Chinese partners is more likely than not within the next five years.

 

[topDawg]

 
 
 
Frankly, I don’t understand what the sensitivity is here.  Nobody is attacking precious Delta’s honor.  A definitive, categorical statement was made, and I’m simply calling it what it is – baseless.  We’ve been told – repeatedly – that the AA-QANTAS joint business “cannot” possibly be positive for AA employees, and apparently, in lieu of providing an example of an actual AA employee who was harmed, we’re to conclude that in reality rather than actual AA employees being directly, immediately harmed, in reality this is a hypothetical about whether current and/or future AA employees could get “harmed” by a missed opportunity to operate flights to Australia.
 
 

I don't believe I said anything about Delta. 
 
I have explained to you how it hurts AA employees (current and future). 
 
LAX-Oz market is more than large enough for AA to compete. They don't because they have a JV. IF they are truly going to build this gateway/hub whatever you and other claim they are going to build, flying LAX-SYD (at least) is a huge part of it. 
 
IMO it like Delta dropping JFK-CDG a few years ago. Simply shows they are not nearly as big in the market place as some make them out to be. 

 

[FrugalFlyerv2.0]

IMO it like Delta dropping JFK-CDG a few years ago. Simply shows they are not nearly as big in the market place as some make them out to be. 

 

 

[jimntx]

Why ever should AA fly LAX-SYD?  Just for the glory of it?  WT has noted AA's failings in that department time and time again.  AA has a very profitable JV with Qantas.  Why mess with that?  Besides Qantas is not the only airline flying LAX-SYD.  Why should AA start up a flight there?  To flood the market so that no one makes any money on the route?
 
Make up your minds over at DL.  Either the evil AA is hurting its employees by flying unprofitable routes at the expense of the employees,  or it's hurting its employees by not flying routes that others do better (and for which AA gets paid a portion of those profits)?  Get back to us when you decide.

 

[WorldTraveler]

AA needs to figure out how to compete in AND making money flying the most important routes in the world if it wants to be a truly global carrier.

It is worth noting that not only did DL put its own metal back into JFK-CDG but it is doing it with a 333 on a year round basis (I just took the flight not that long ago) which is the largest aircraft it regularly uses across the Atlantic other than the 744s that are there for the summer.

And DL is also operating EWR-CDG.

DL added LAX-SYD on its own metal because corporate clients said it was a strategically important market that DL had to serve; Skyteam has a limited presence in the S. Pacific so DL had to take the lead. The US is the largest market from Australia to a Skyteam airline's home country.

and the JV might be profitable with QF but AA still puts a fraction of the passengers on QF metal that DL or UA put on their own planes. AA has a token presence in the market and nothing more.

I don't really care if AA flies LAX-SYD if they have decided they don't want to do it. But specific to LAX, AA CANNOT say that it intends to be the top US airline in LAX if it doesn't serve Australia which is one of the top markets.

and the problem with saying that a JV is enough is that in one market after another across the Atlantic and the Pacific, AA has been unable to develop its own presence on a profitable, sustained basis. AA tried to fly to a dozen cities in continental Europe early after deregulation but pulled out of many of those markets. US now has the potential to help AA regain a meaningful presence in continental Europe. In Asia, we have yet to see that AA can be long-term viable outside of DFW - and from DFW, AA is not competitive for most O&Ds because DFW is so far south.

and specific to PVG, AA has added a bunch of capacity which is now being replaced with 787s which will help provide a cost advantage but other carriers will have new generation aircraft so that benefit is transitory.

and as much as it probably hurts for some people to admit that FWAAA nailed it with his answer, UA has a similar route structure to AA's and they have managed to successfully fly alongside their alliance partners. I'm not sure I totally buy why AA can't make it if UA can.

If you want to argue that AA doesn't need to be in one market after another and can't be profitable doing so, then don't tell us that they will be the number one US int'l airline because they are not and certainly not from the US' largest int'l markets.

 

[topDawg]

Why ever should AA fly LAX-SYD?  Just for the glory of it?  WT has noted AA's failings in that department time and time again.  AA has a very profitable JV with Qantas.  Why mess with that?  Besides Qantas is not the only airline flying LAX-SYD.  Why should AA start up a flight there?  To flood the market so that no one makes any money on the route?
 

Why should AA fly any international route at all? 
Just dump everything off on JJ, BA, QF and JL and call it a day. 
 
Then dump the domestic network to MQ and OO. Become a virtual airline and be done with it. 
 
 
 
 
AA seems to be the only airline that can't fly along side its partners and the fan boys be okay with it. The s**t storm that would happen if DL dropped a route like LAX-SYD to Virgin here would be epic from people like yourself. All i hear about is how AA has this awesome product. Its so so much better than DL. They can take over the world.....
 
but can't fly routes in their own JVs? 

 

[topDawg]

But specific to LAX, AA CANNOT say that it intends to be the top US airline in LAX if it doesn't serve Australia which is one of the top markets.

exactly.
This is a huge reason why Delta has added routes like LAX-LHR. 
 
They could just let Virgin do it....but don't. Why? not flying to London for LA is a great way to not gain any ground with HVCs and corporate markets. 

 

[WorldTraveler]

and as much as JVs and alliances are touted, they do not come close to replacing one's own service.

AA has a flavor that is not anywhere close to being the same as BA or QF or CX. HVCs know it.

and LAX is such a spread out mess that just like JFK, the reason you must have your own flight is because there are too many carriers in too many places for you to have a viable presence spread out all over the airport.

and before someone touts to AA and QF's close proximity at LAX, it still hasn't translated into AA coming anywhere close to DL and UA in terms of what they carry on their own metal.

and when DL and UA both fly to Tokyo and PVG as well as Australia and all 3 fly to LHR, it is hard to argue that AA has an advantage when DL and UA both have more service to Asia/Pacific.

 

[FrugalFlyerv2.0]

and as much as JVs and alliances are touted, they do not come close to replacing one's own service.
 

Does this premise apply to DL-AM or do you have another standard that you apply in this case?
 

 

[topDawg]

Does this premise apply to DL-AM or do you have another standard that you apply in this case?
 

Does this premise apply to DL-AM or do you have another standard that you apply in this case?
 

FWIW in a DL/AM JV (or without one) Delta was going to jump into more marketplaces not less.
And it looked like grow a good bit between the two countries.

however if you want to talk about the double standard you can talk about Delta not following contracts like WT loves..... (Delta not flying its contracted amount of AF/KL/AZ flying.)

 

[jimntx]

 
 
 
The s**t storm that would happen if DL dropped a route like LAX-SYD to Virgin here would be epic from people like yourself.
 

You could not be more wrong.  I would have to take lessons in order to even care what the hell DL does.  I'm certainly not the WT of AA trying to tell everyone else what they should or should not do.  I noticed on another post that himself has just decreed a new minimum standard for a world-class airline.  One must fly LAX-SYD.  There are any number of airlines that don't fly that route that are highly preferable to DL.  I've flown most of them and DL.  Your not nearly as special as you think.  What next? One must fly ATL-CSG in order to be even considered for world-class designation?
 
Oh, and you'll be happy to know that you have earned a place next to WT on the ignore list.  The day is coming when the two of you will just be posting back and forth to each other  because the rest of us are all sick of the Dullta Uber Alles all day every day. You make a lovely couple.

 

[eolesen]

LAX-Oz market is more than large enough for AA to compete. They don't because they have a JV. IF they are truly going to build this gateway/hub whatever you and other claim they are going to build, flying LAX-SYD (at least) is a huge part of it. 
 
IMO it like Delta dropping JFK-CDG a few years ago. Simply shows they are not nearly as big in the market place as some make them out to be.

Yeah, not so sure I agree with you.

Traffic to/from Oz is skewed heavily towards an AU point of origin. Aussies love to come to the US in greater numbers than Americans go there. If AA were in LAX-SYD with their own metal, they'd be challenged to hold their own up against QF's almost all-A380 schedule.

DL manages to do OK in US-OZ mainly because because VA is still a relatively small airline outside of Australia -- they only have 5 B773's capable of flying to the US, so DL picks up the slack quite nicely.

US-CN is going to eventually be the same way that US-AU is -- more Chinese will be looking to travel from China than there will be Americans looking to travel to experience second world living. To the extent that the Chinese airlines don't have the lift, their US counterparts may do well. CX certainly isn't in that position -- they've got plenty of lift.

-----

As a traveler, I was more than content to fly on BA, CX or QF for the reasons that others have already intimated -- their service is far better. Star and Skyteam are content to have overlapping services in markets, and oneworld seems to take a different approach by dividing and conquering.

Then again, it may come down to the union contracts -- we already know that DALPA has their grievances with management over the split of flying in the JV's, and UAL MEC's seems to have taken the approach that worrying about who flies what outside of UA is less important right now than who flies what *inside* of UA.