AA in dilemma on when to replace aging fleet

[FA Mikey]

story here

American Airlines Inc. has a fleet of aging airplanes and a hard decision to make.

Every day it flies an aging McDonnell Douglas MD-80 is another day that it burns 20 percent to 30 percent more fuel than it would use with today's replacement airplane, the Boeing 737-800.

"There's no question, from a purely operational point of view, American should be replacing those airplanes – fuel emissions, noise, maintenance," said aviation consultant Scott Hamilton, who focuses on aircraft manufacturers Boeing Co. and Airbus.

But if American starts replacing its fleet of MD-80s now, it may miss out on a new generation of fuel-efficient airplanes in six or seven years that would burn even less fuel than the 737-800, with fewer emissions and less noise.

To complicate matters, no one knows when the new generation of fuel-sipping airplanes will be ready to enter the fleets of the world's airlines.


continued here

 

[Gautier84]

story here

American Airlines Inc. has a fleet of aging airplanes and a hard decision to make.

Every day it flies an aging McDonnell Douglas MD-80 is another day that it burns 20 percent to 30 percent more fuel than it would use with today's replacement airplane, the Boeing 737-800.

"There's no question, from a purely operational point of view, American should be replacing those airplanes – fuel emissions, noise, maintenance," said aviation consultant Scott Hamilton, who focuses on aircraft manufacturers Boeing Co. and Airbus.

But if American starts replacing its fleet of MD-80s now, it may miss out on a new generation of fuel-efficient airplanes in six or seven years that would burn even less fuel than the 737-800, with fewer emissions and less noise.

To complicate matters, no one knows when the new generation of fuel-sipping airplanes will be ready to enter the fleets of the world's airlines.


continued here

from an environmental point of view, AA should clearly replace its old fleet.
from a financial perspective, that is another story.

And I think the second choice will be the one they'll make. The right for them, the wrong for the environment

 

[Nor'Easta]

AA will soon make a huge aircraft order announcement. Once all unions are in negotiations, they will announce it. Then they will claim "we need to reduce labor costs." :down:

 

[Gautier84]

[quote name='Nor'Easta' post='580494' date='Mar 9 2008, 12:55 PM']AA will soon make a huge aircraft order announcement. Once all unions are in negotiations, they will announce it. Then they will claim "we need to reduce labor costs." :down:[/quote]

If what you say'll happen, that'll be bad news.
Though I've heard AA is one of the most profitable airliners, in Europe at least they are hiring.

I'm new out here,
what's your opinion about AA?

 

[Nor'Easta]

If what you say'll happen, that'll be bad news.
Though I've heard AA is one of the most profitable airliners, in Europe at least they are hiring.

I'm new out here,
what's your opinion about AA?

AA has never got a long with labor. Labor and Management have been at odds for a looooong time and it will never improve. Our management is set to take another huge multi-million dollar bonus, while the employees struggle to survive.

 

[Gautier84]

[quote name='Nor'Easta' post='580499' date='Mar 9 2008, 12:06 PM']AA has never got a long with labor. Labor and Management have been at odds for a looooong time and it will never improve. Our management is set to take another huge multi-million dollar bonus, while the employees struggle to survive.[/quote]

that is not right, indeed. Management AND employees should make one :down:
Do you also for AA?

 

[FWAAA]

If what you say'll happen, that'll be bad news.
Though I've heard AA is one of the most profitable airliners, in Europe at least they are hiring.

Actually, AA was one of the least profitable airlines last year, compared to the other USA legacy airlines. And this year is shaping up to be another loser, given that jetA is now over $3/gal.

What do they all have in common? With the exception of Continental, recent bankruptcies by which they slashed pay rates, walked away from unsecured debt, in many cases froze and in some cases terminated already earned pension plans. And CO had two bankruptcies earlier in which it slashed pay and benefits, so their recent concessions were not as large as many of the others. Since they were starting out at lower pay rates, CO employees' recent concessions didn't have to be as large.

While AA employees took it on the chin in the 2003 concessions, the pay cuts are in most cases less severe than they were at the bankrupt airlines.

 

[TIME FOR CHANGE]

If what you say'll happen, that'll be bad news.
Though I've heard AA is one of the most profitable airliners, in Europe at least they are hiring.

I'm new out here,
what's your opinion about AA?

You are just a number. They want you to do it all with nothing. They reap the benefits off of your hard work and then tell you to eat cake.
You will continue to subsidize the cost of fuel by taking pay and benefit concessions. You will have no voice in the worthless union you must pay dues to.
Save yourself from the airline industry get out now especially if you are new to it.
The benefits sux and so do the people running the place. They dont care about you or your inability to make ends meet on the paultry salary they pay.
I have been in this industry since 1986 and it has been a continual death spiral. The only thing that ever changes is the color on that tail.

 

[comatose]

Actually, AA was one of the least profitable airlines last year, compared to the other USA legacy airlines. And this year is shaping up to be another loser, given that jetA is now over $3/gal.

What do they all have in common? With the exception of Continental, recent bankruptcies by which they slashed pay rates, walked away from unsecured debt, in many cases froze and in some cases terminated already earned pension plans. And CO had two bankruptcies earlier in which it slashed pay and benefits, so their recent concessions were not as large as many of the others. Since they were starting out at lower pay rates, CO employees' recent concessions didn't have to be as large.

While AA employees took it on the chin in the 2003 concessions, the pay cuts are in most cases less severe than they were at the bankrupt airlines.

I don't believe you can accurately state what is less severe if you are not employed and taking pay cuts from this company.
Taking it on the chin-right. Attitudes like yours is why I could really care less if any flight leaves.

 

[FrequentFlierCA]

[quote name='Nor'Easta' post='580494' date='Mar 9 2008, 12:55 PM']AA will soon make a huge aircraft order announcement. Once all unions are in negotiations, they will announce it. Then they will claim "we need to reduce labor costs." :down:[/quote]

You're missing the point: reducing costs is the name of the game here, and while the capital expenditure for the new planes will be large, the long-term savings will be greater. What does this mean practically? More profits for AMR, which means a larger pie to be shared with the labor force.

As a customer and fan off AA, I'm truly sorry that you won't get a big payday in this round of negotiations. You happen to work in a very competitive industry with low profit margins (if any) and extremely high costs.

Initiatives like fleet replacement (again, while costly up front) will lead to sustained profitability for the company and secure pay and benefits for the labor force.

 

[Nor'Easta]

You're missing the point: reducing costs is the name of the game here, and while the capital expenditure for the new planes will be large, the long-term savings will be greater. What does this mean practically? More profits for AMR, which means a larger pie to be shared with the labor force.

As a customer and fan off AA, I'm truly sorry that you won't get a big payday in this round of negotiations. You happen to work in a very competitive industry with low profit margins (if any) and extremely high costs.

Initiatives like fleet replacement (again, while costly up front) will lead to sustained profitability for the company and secure pay and benefits for the labor force.

If we don't get a HUGE increase in pay during negotiations...

You will see 18,000 plus AA Flight Attendants marching in unity with picket signs in hand, out in front of your airport!

So you think its fair that AA management gets multi-million dollar bonuses? You sound like a person in AA management. :down:

 

[ual777fan]

As a customer, I sincerely hope there isn't a strike since I have between 4-5 trips booked with AA right now. But you guys don't get paid what your worth so I would understand the rational for going out on the picket lines.

As for the fleet planning... A big order for the Bombardier CJets, you heard it hear first. They would offer between a 40-50% fuel savings over the current MD80 fleet and a substantial savings over the 737-700 that Southwest uses. Instant competitive advantage.

 

[FA Mikey]

Not to worry, not even opened negotiations yet for the FA's.

 

[mga707]

As for the fleet planning... A big order for the Bombardier CJets, you heard it hear first. They would offer between a 40-50% fuel savings over the current MD80 fleet and a substantial savings over the 737-700 that Southwest uses. Instant competitive advantage.

Since the 'CJet' is still just a 'paper airplane', can you really say for sure that it's seat/mile cost will be less than the 737-700/-800?

 

[AMFAMAN]

More profits for AMR, which means a larger pie to be shared with the labor force.

Where have you been hiding? Just doesn't work that way here, try a larger pie to be shared by a few at the top.