AA

[goingboeing]

AMR Love Field expansion is a bad move, rival says

It is a very good move to take on SWA at Love Field.If SWA charges $99 round trip to STL then AA will charge $79 to grab market share.AA management is not afraid to fly certain routes at a loss to have some control over market share.
And besides,AA's employees have deep pockets for management to dip into.[Management's view,not mine]

This is an example of being careful of what you wish for because you might just get it.SWA wants total repeal of the Wright Admendment and now the Missouri exception will bring them some competition that they previously not dealt with.

 

[CruelSummer]

It is a very good move to take on SWA at Love Field.If SWA charges $99 round trip to STL then AA will charge $79 to grab market share.AA management is not afraid to fly certain routes at a loss to have some control over market share.
And besides,AA's employees have deep pockets for management to dip into.[Management's view,not mine]

This is an example of being careful of what you wish for because you might just get it.SWA wants total repeal of the Wright Admendment and now the Missouri exception will bring them some competition that they previously not dealt with.

I think most of all it was the move AA had to make...not surprised at all that they are taking on SWA at Love. Curious to see how it goes...maybe you are right to say to be careful what you wish for!

 

[ELP_WN_Psgr]

The only problem is everyone knows how this is going to end up, to include (much to their chagrin) American's management.

American will go in and throw some flights out of Love Field to KC and St Louis. They will carry some passengers. Not as many as WN but some.

The market will get bigger between Dallas and those two cities because prices will be lower.

Southwest will make money carrying passengers at those fares but American won't.

To add insult to injury in this go-round, Southwest can feed connecting traffic from SAT, AUS, LBB, MAF, and ELP thru Love Field on to the two Missouri cities.

Over at Love Field AA won't have that luxury.....and unless they are flying RJs, they won't be able to sell DAL passengers on a connection to LGA, ORD, DCA or some place like that.

If they do go ahead and throw RJs on the route, they can do the connection bit, but they will be throwing most of the O&D traffic away. AAdvantage miles or not, a 737 is a much easier plane ride to sell than the Barbie dream jet.

Having American at Love Field is not going to sway many of Southwest's loyal following....and they (AA) will be pulling some of their DFW traffic over to "the other airport". Once there, some of the AA folks might <<<horrors>>> give WN a try.

For American this is a lose-lose proposition, and had I been the guy in charge, I think I would have pursued the less risky path. Specifically, I would have stayed at DFW, allowed Southwest's fares to generate a larger market for both of us, and grabbed the passengers for whom DFW is more convenient. I would have sweetened the pot with some extra miles and promotions. I would have had all my connecting traffic feed and probably would not significantly miss whatever traffic WN siphoned off. The only thing I would have missed is the revenue lost by the lower fares, but that happens whether I am at DFW or at both Love & DFW. The advantage to staying at DFW is I do not incur the costs of opening up and staffing a new station.

Since they have announced their intent to move some flights to Love Field, I reckon they stay there awhile, get their butts kicked, declare victory, and move everything back to DFW.

 

[corl737]

[...]I reckon they stay there awhile, get their butts kicked, declare victory, and move everything back to DFW.

That's a great line (regardless of who it applies to). Thanks for the chuckle!

 

[CruelSummer]

Having American at Love Field is not going to sway many of Southwest's loyal following....and they (AA) will be pulling some of their DFW traffic over to "the other airport". Once there, some of the AA folks might <<<horrors>>> give WN a try.

I don't think AA taking flights to Love is an attempt at stealing SWA's loyal following... I think it is more an attempt to reduce the numbers of passengers they'll lose because people are more loyal to themselves and convenience than an airline most of the time. And if more people will pick Love because of that, since the MO options are now available, then it is in AA's best interest to make sure that WN isn't the only MO option at Love, given that they seem to care about keeping those passengers...

 

[NewHampshire Black Bears]

ELP WN Psgr,

Curious to see how WN make "react" to AA flying WN pax N/S to MDW(or DFW) on 56 mainline A/C ??

I read somewhere recently that AA said the DAL flying WON'T be limited to STL/MCI

ALL of us regulars here, and Arpey and Kelly realize the
1. Wright(as we know it) WON'T be overturned.

BUT(as Corl737 pointed out clearly to me)

2. The Feds will start "exempting" 1 city at a time.

Net result, AA is going to have to "play a few AWAY games" with WN. In football, It's not a gaurantee that the home team wins all the time !!

Like it or not, (for better or worse), there has only been 1 airline, in the history of USA commercial aviation, that can be compared to a "CAT with 9 Lives")

I'll give you "9" guess's WHO !!!


NH/BB's

 

[corl737]

Curious to see how WN make "react" to AA flying WN pax N/S to MDW(or DFW) on 56 mainline A/C ??

I read somewhere recently that AA said the DAL flying WON'T be limited to STL/MCI

SWA is marketing MCI/STL to all its other Wright-restricted cities as simple connections through DAL. I think AA realizes that to limit DAL flying solely to MCI/STL restricts their potential market. Will they be forced to shift some current DFW flights from ELP/MAF/AMA/LBB/AUS/SAT/HOU/MSY to provide additional connection possibilities at Love? If they put Eagle flying as feeding DAL, how many passengers will accept the first leg on an RJ then transfer to mainline at DAL for the last when SWA already gives "big jet" service the whole way?

Alternatively, will Eagle become a full-fledged airline and establish its own hub at DAL? With <56 seats, their RJs could build a substantial nationwide route structure without the restrictions of the Wright Amendment and would blow the doors off SWA. Oh yeah, Independence Air tried the 100% 50-seat RJ thingy already. :blink:

What a dilemma for AA's management. Keep the camera's rolling!

 

[NewHampshire Black Bears]

Correcting a "boo-boo"

My above post #36, obviously should read,......... "Flying WN pax N/S to MDW...... OR "ORD"

on 56 "SEAT" mainline A/C " ???


NH/BB's

 

[Ch. 12]

This is an example of being careful of what you wish for because you might just get it.SWA wants total repeal of the Wright Admendment and now the Missouri exception will bring them some competition that they previously not dealt with.

I sure hope you're not talking about the imaginary monopoly that WN has at DAL according to AMR/DFW. Where has WN not faced competition? DAL-ELP (sorry ELP!)? That markets that WN serves out of DAL are relics of its early days and are in no way why WN is doing well today. I'm sure the RDU-PHX flights fare much better than DAL-AnySmallTexasTown.

WN has faced much competition. If you think they cannot handle competition, you are wrong. If anyone has not faced much competition, it would be the AA ops at DFW. I think you have your thoughts reversed.

 

[sfb]

I don't think AA taking flights to Love is an attempt at stealing SWA's loyal following... I think it is more an attempt to reduce the numbers of passengers they'll lose because people are more loyal to themselves and convenience than an airline most of the time. And if more people will pick Love because of that, since the MO options are now available, then it is in AA's best interest to make sure that WN isn't the only MO option at Love, given that they seem to care about keeping those passengers...

Forgive me if I don't understand why it is important to retain passengers in a market where it is unlikely that you will ever make a profit. Worse than that, you also divert passengers from an existing market which decreases your profit potential there, too. While service to STL and MCI from DFW could be reduced, that makes your product to & from DFW less attractive to passengers.

I just feel that the assumption that AA "must" go into DAL in order to be competitive or put weight behind its threats is flawed. The best strategy is for AA to give passengers a reason to choose their service based on product, convenience, competitive price, etc. Going into DAL concedes home field advantage to WN -- they aren't dumb enough to do the same for AA at DFW.

Continental competes very effectively with Southwest from Houston to LAX, LAS, PHX, etc. They do so by providing a product with more amenities for which passengers are willing to pay a bit extra.

 

[eolesen]

Continental competes very effectively with Southwest from Houston to LAX, LAS, PHX, etc. They do so by providing a product with more amenities for which passengers are willing to pay a bit extra.

Then why does CO feel compelled to offer service on IAH-DAL, despite having much more frequency from IAH to DFW and no competition from WN to IAH?

 

[corl737]

Then why does CO feel compelled to offer service on IAH-DAL, despite having much more frequency from IAH to DFW and no competition from WN to IAH?

Only RJs fly from DAL to IAH. Being within the restrictions of the Wright Amendment (<56 seats) Continental can market worldwide service out of Love Field, something they could not do using larger aircraft. DAL-IAH-"the world" is obviously a reasonable market ... provided the passengers don't mind starting and ending their trip on an RJ!

For those North Texas fans of Continetal who want to fly on something larger the whole way it's DFW or nothing.
(Check the Continental website and put in DAL-LGW and you'll find schedules and fares from Dallas Love to London Gatwick!)


(edited for spelling ... whoops!)

 

[eolesen]

Continental can market worldwide service out of Love Field

As will AA, once the amendment is repealed, and I've already said that this move signals to me at least that AA recognizes that the amendment's days are numbered.

I personally don't care if it stays or goes, but I will give AA credit for trying to position itself to be in place for when it is repealed. It can take 60 days to open up a station, so if AA's in place already when it is repealed, they'll be able to do what WN just did with MCI and STL -- offer flights for sale immediately.

 

[sfb]

Then why does CO feel compelled to offer service on IAH-DAL, despite having much more frequency from IAH to DFW and no competition from WN to IAH?

Actually, believe it or not, CO's IAH-DAL service is as frequent or more so than their IAH-DFW flights. Taking 1/23/06 as an example, CO has 13 IAH-DAL flights and 12 IAH-DFW flights. Granted, CO uses mainline on some IAH-DFW frequencies so there are many more seats available, but the actual choice of flights is comparable.

From looking at the schedule, it's pretty obvious to me that CO's IAH-DAL service is aimed at O&D traffic, given that almost all DAL-IAH flights are timed like a shuttle service, departing on the hour, every hour (except for the early afternoon). I suppose it also appeals to folks who are willing to put up with a connection at IAH in order to take advantage of the convenience of DAL -- sort of like the old EFD service.

You could ask the same question as to why AA flies HOU-DFW, not to mention HOU-LGA.