Amr first quarter reusults
- Thread starter damajagua
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15 738s remain to be delivered from 4/1/11 thru the end of the year. In 2012, AA will take delivery of at least 28 new 738s.
No 777s in 2011 but the new 777-300ERs begin delivery late in 2012 (2 in late 2012) and the other three sometime in 2013.
In addition, there are the old deferred orders for 11 738s and seven 777-223ERs scheduled for delivery starting in 2013 thru 2016.
WT said AA was set to park "dozens" of aircraft this year. So far, AA has announced intentions to park 25 MD-80s. Two dozen. The 2011 738 deliveries offset those retirements.
I correctly predicted last July's orders of about 35 additional 738s and I predict that this July (or sooner), AA will order another two or three dozen 738s for delivery in 2012-14.
On the other hand, I may be completely off if AA has determined that it has enough 738s and really needs 70 seaters or 100 seaters instead. And, of course, orders for those will follow settlement of the pilot's contract.
Thanks for the best and accurate info, as always. WT's parking dozens of A/C and leaving out the new deliverys is the equivalent of the statement of UA and Dl gaining a huge market share increase without noting the mergers. To be expected.
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if 15 738s remain to be delivered during the rest of the year and 2 DOZEN plus 1 aircraft will be set down, AA will not be maintaining its current level of fleet activity... given that they have agreed to pull down 1% of their capacity - the smallest reduction among the network carriers - they don't need the same number of airplanes they have now.
I have noted MULTIPLE times above that DL and UA have been involved in merger activity.... you, Mikey, and others can't wrap your minds around the reality that perhaps AA made some faulty strategic decisions by deciding they would not merge and they will now have to live with the consequences of those decisions....
maturity involves hearing what needs to be heard - not what you want to hear. For sever years, AA and its employees have been unwilling to hear that things are broken at AA or that others might have figured out how to do things better than AA. The reality is that the world has moved on... AA and its employees either need to recognize that the world has moved on and AA needs to move with it or it will be relegated to the pages of history along with Pan Am, Eastern, and TWA, all of whom never believed they would cease flying.
I have noted MULTIPLE times above that DL and UA have been involved in merger activity.... you, Mikey, and others can't wrap your minds around the reality that perhaps AA made some faulty strategic decisions by deciding they would not merge and they will now have to live with the consequences of those decisions....
maturity involves hearing what needs to be heard - not what you want to hear. For sever years, AA and its employees have been unwilling to hear that things are broken at AA or that others might have figured out how to do things better than AA. The reality is that the world has moved on... AA and its employees either need to recognize that the world has moved on and AA needs to move with it or it will be relegated to the pages of history along with Pan Am, Eastern, and TWA, all of whom never believed they would cease flying.
Yep, and they got how much? $5 billion?
Not counting Taesel I beleieve its currently 5%, but its only that low because we have more of own stuff than we can handle at the moment.
Really based upon what, comparing different business models? The fact is that AA has seen huge improvements in both revenue generation and productivity, and AA's productivity gains are real, they arent driven by transferring costs somewhere else on the balance sheet.
You seem to be unaware that most of the growth in this industry is in those markets, they will need their mechanics to work on their own stuff and the fact is that more maintenance work is still sent into this country than sent out. Lufthansa still operates a huge MRO operation and they have superior wages and benifits than we do and one last thing, tell me how that guy in China or Latin America is going to answer that gate call in JFK, LGA, LAX, DFW MIA or ORD?
AA disagrees with you. They claim they need 7 day coverage at the bases to increase production and they are running out of time. When I put out the statement that if all mechanics stopped working OT or second jobs in the industry that hundreds of aircraft would end up grounded the company complained that I was advocating a job action. I also have read reports that the shortage of mechanics is a worldwide problem since most of todays youth have no interest in getting dirty, working odd shifts and sacrificing their social life for what they pay mechanics.
If you believe that I would suggest that you urge your Congressmen and Senators to push for a release and teach us a lesson. Spirit didnt do such a good job busting their pilots and the FAA certifies around 100,000 pilots a year. Around 15,800 Commercial and Air Transport pilots in 2008. AA alone has still 1200 pilots on furlough but Spirit gave up the fight. Pilots are very critical and that gives them a lot of leverage but in reality their skill is not very portable so the stakes are higher for them. For us, not so much anymore, a schematic for an autopilot is very similar to a schematic on a washing machine, a wind generator, solar panel or a Nuclear Power plant cooling system. Righty tighty applies 99% of the time . Turbines are in aircraft and powerplants. The skills we have, where we are trained in Pneumatics, Hydraulics, electrical and electronics are very portable and that means we can easily find work elsewhere, if you ever noticed we keep our tools on wheels, they are called "rollaways". The fact that they have cut our pay in real terms by 40% means we really, really dont have much to lose anymore. As I've said before my wife re-enterred the workforce a short time ago and she earns over $5/hr more than I do.
AA did merge, they merged with TWA. That move made them the largest carrier for over 5 years.
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Bob,
If AA is only doing about 5% insourcing then the actual impact to CASM is not more than 1%.. since maintenance is only one of several departments at AA.
If AA is doing that little insourcing, then they aren't distorting anything by not breaking out the maintenance labor expense for insourced work. Remember that even for DL, insourcing amounts to .3 cents of CASM and that probably includes work other than just maintenance.
..
AA's revenue generation has trailed not only its network carrier peers as well as that of low cost carriers for a number of quarters and its costs have been above the industry for years.... that has been acknowledged by other people here.
AA may have another business model than the rest of the industry but it hasn't shown that it can be profitable... no one is opposed to AA operating differently than the rest of the industry - WN certainly came out w/ a different model and has continued to refine it. But WN has consistently made money. AA's network carrier peers made money last year and lost a whole lot less this most recent quarter.
If AA wants to say it has a different business model than the rest of the industry, it needs to show it can do so profitably.
....
Obviously, Bob, not all MRO work is sent overseas from the US.. and yes there are large US based MROs... not only those which are operated by airlines but also thse that are independent.
There is obviously contract line maintenance as well as base/overhaul maintenance. Other carriers and have successfully used both inhouse and contracted maintenance for both areas.
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Yes, you are right that there aren't enough mechanics right now... but there is a huge pool of labor overseas that are willing to work for the wages that they can receive from foreign MROs... there are training programs going on overseas as well as in the US.... what doesn't look as attractive for a career in the US still looks pretty attractive overseas.
I'm not surprised that AA viewed your statements as a call for a job action - although I also believe that you are correct that if your people quit working OT, AA would be in a world of hurt... still the majority of people will do what is best for their own pocketbooks - and will keep working OT until the ability to do so runs out. The uncertainty at AA only makes it all the more likely that AA mechanics will take advantage of opportunities to work now rather than wait for a tomorrow that may or may not come.
...
I have never doubted the value of mechanics.. I simply am saying that high unemployment, the ability to outsource including overseas where it is contractually permitted, and the threat that AA has of BK to alter contracts makes it more likely than not that the company will prevail than labor...
that's a pragmatic approach to the situation - not one I hope happens but which I believe is more likely than not.
...
yes, we know AA bought TW ... and then they proceeded to unwind most of what they acquired.. that is part of why AA's costs went to the industry's highest... growth helps to keep costs from growing and may even bring unit costs (CASM) down. Shrinking capacity is a guaranteed way to send CASM and perhaps total costs up. AA is now trying to unwind many of the costs associated with the capacity from TW it no longer wants/needs but that is incredibly hard to do and makes it that much harder for AA to compete in core competitive markets like NYC, LAX, and CHI where AA cannot afford to be at a cost disadvantage.
If AA is only doing about 5% insourcing then the actual impact to CASM is not more than 1%.. since maintenance is only one of several departments at AA.
If AA is doing that little insourcing, then they aren't distorting anything by not breaking out the maintenance labor expense for insourced work. Remember that even for DL, insourcing amounts to .3 cents of CASM and that probably includes work other than just maintenance.
..
AA's revenue generation has trailed not only its network carrier peers as well as that of low cost carriers for a number of quarters and its costs have been above the industry for years.... that has been acknowledged by other people here.
AA may have another business model than the rest of the industry but it hasn't shown that it can be profitable... no one is opposed to AA operating differently than the rest of the industry - WN certainly came out w/ a different model and has continued to refine it. But WN has consistently made money. AA's network carrier peers made money last year and lost a whole lot less this most recent quarter.
If AA wants to say it has a different business model than the rest of the industry, it needs to show it can do so profitably.
....
Obviously, Bob, not all MRO work is sent overseas from the US.. and yes there are large US based MROs... not only those which are operated by airlines but also thse that are independent.
There is obviously contract line maintenance as well as base/overhaul maintenance. Other carriers and have successfully used both inhouse and contracted maintenance for both areas.
-------------
Yes, you are right that there aren't enough mechanics right now... but there is a huge pool of labor overseas that are willing to work for the wages that they can receive from foreign MROs... there are training programs going on overseas as well as in the US.... what doesn't look as attractive for a career in the US still looks pretty attractive overseas.
I'm not surprised that AA viewed your statements as a call for a job action - although I also believe that you are correct that if your people quit working OT, AA would be in a world of hurt... still the majority of people will do what is best for their own pocketbooks - and will keep working OT until the ability to do so runs out. The uncertainty at AA only makes it all the more likely that AA mechanics will take advantage of opportunities to work now rather than wait for a tomorrow that may or may not come.
...
I have never doubted the value of mechanics.. I simply am saying that high unemployment, the ability to outsource including overseas where it is contractually permitted, and the threat that AA has of BK to alter contracts makes it more likely than not that the company will prevail than labor...
that's a pragmatic approach to the situation - not one I hope happens but which I believe is more likely than not.
...
yes, we know AA bought TW ... and then they proceeded to unwind most of what they acquired.. that is part of why AA's costs went to the industry's highest... growth helps to keep costs from growing and may even bring unit costs (CASM) down. Shrinking capacity is a guaranteed way to send CASM and perhaps total costs up. AA is now trying to unwind many of the costs associated with the capacity from TW it no longer wants/needs but that is incredibly hard to do and makes it that much harder for AA to compete in core competitive markets like NYC, LAX, and CHI where AA cannot afford to be at a cost disadvantage.
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