Posted on Wed, Mar. 31, 2004
FORT WORTH STAR-TELEGRAM
Airline putting focus on Asia
By Trebor Banstetter
Star-Telegram Staff Writer
American Airlines' top executive pledged to expand the carrier's service in Asia, traditionally the weakest link in the airline's global network, by adding flights to Japan and developing partnerships with Asian carriers.
Speaking before the American Chamber of Commerce in Tokyo, Gerard Arpey, American's chief executive, said Tuesday that the world's largest airline plans to renew its focus on providing travel to Asia, which has long eluded the carrier because of international laws and restrictions.
"The one area today where our activities are less robust than we would prefer is across the Pacific," he said in his prepared remarks.
To prove his point, Arpey announced that next month, Fort Worth-based American will launch daily nonstop service between Los Angeles International Airport and Tokyo Narita International Airport.
American had planned to inaugurate the Los Angeles-to-Tokyo flight a year ago but canceled those plans after an outbreak of severe acute respiratory syndrome in Asia that caused traffic across the Pacific to plummet.
American serves Tokyo from Dallas/Fort Worth Airport, San Jose, Calif., and New York. But heavy demand for available slots for flights has thwarted efforts to expand service.
"If you're serious about serving Asia, you have to have Narita as a hub," said airline analyst Ray Neidl, of Blaylock and Partners in New York. "And that's where American has been at a disadvantage."
Rivals United Airlines and Northwest Airlines control most of the rights there.
Narita, however, has recently expanded, with a second runway and the privatization of the airport authority, which should allow for more competition, Arpey said.
"I expect the [airport's] privatization to enable it to enhance service, while reducing landing fees and other expenses as necessary to sustain its competitive position in the years to come," he said.
American will fly the new Japan-Los Angeles route with Boeing 777 aircraft that have first- and business-class cabins. The airline will offer up to 15,000 bonus frequent flier miles for travelers on the route through the end of June.
"We have long wanted to fly the Los Angeles-Tokyo route," said Dan Garton, American's executive vice president of marketing, in a prepared statement. "The substantial economic and cultural ties between the two cities make this a very important market."
American officials began negotiations this year with the Allied Pilots Association, which represents the airline's pilots, on training and work rules for so-called "super-long-haul" flights from the United States to Asian destinations.
The airline resumed the talks last year after they were delayed by the 9-11 terrorist attacks. That means additional flights to Asia destinations such as Hong Kong could be implemented over the next few years.
But analyst Henry Harteveldt of Forrester Research in San Francisco said American could find it tough to gain access to Asian markets.
"United and Northwest run really tough operations, and they rule that part of the world," he said. "They're not about to give it up easily."
Another strategy American plans to ramp up is its alliances with major Asian carriers, enabling U.S. travelers to connect through Narita to a variety of cities throughout the region.
The airline's partnership with Japan Air Lines, for example, "enables us to easily connect American passengers to key Asian markets like Bangkok, Singapore and Manila," Arpey said.
American also partners with Hong Kong carrier Cathay Pacific, China Eastern and Taiwan's EVA. This year, it began a partnership with Vietnam Airlines.
Neidl says Asia is an obvious growth market for American, which has been struggling with low-fare carriers like Southwest Airlines in the United States.
"Asia is the hottest-growing area, these countries are coming out of their recessions and really coming to life," he said. "It's where all the airlines want to be."
ONLINE: AMR Corp., www.amrcorp.com
Trebor Banstetter, (817) 390-706
[email protected]
© 2004 Star Telegram and wire service sources. All Rights Reserved.
FORT WORTH STAR-TELEGRAM
Airline putting focus on Asia
By Trebor Banstetter
Star-Telegram Staff Writer
American Airlines' top executive pledged to expand the carrier's service in Asia, traditionally the weakest link in the airline's global network, by adding flights to Japan and developing partnerships with Asian carriers.
Speaking before the American Chamber of Commerce in Tokyo, Gerard Arpey, American's chief executive, said Tuesday that the world's largest airline plans to renew its focus on providing travel to Asia, which has long eluded the carrier because of international laws and restrictions.
"The one area today where our activities are less robust than we would prefer is across the Pacific," he said in his prepared remarks.
To prove his point, Arpey announced that next month, Fort Worth-based American will launch daily nonstop service between Los Angeles International Airport and Tokyo Narita International Airport.
American had planned to inaugurate the Los Angeles-to-Tokyo flight a year ago but canceled those plans after an outbreak of severe acute respiratory syndrome in Asia that caused traffic across the Pacific to plummet.
American serves Tokyo from Dallas/Fort Worth Airport, San Jose, Calif., and New York. But heavy demand for available slots for flights has thwarted efforts to expand service.
"If you're serious about serving Asia, you have to have Narita as a hub," said airline analyst Ray Neidl, of Blaylock and Partners in New York. "And that's where American has been at a disadvantage."
Rivals United Airlines and Northwest Airlines control most of the rights there.
Narita, however, has recently expanded, with a second runway and the privatization of the airport authority, which should allow for more competition, Arpey said.
"I expect the [airport's] privatization to enable it to enhance service, while reducing landing fees and other expenses as necessary to sustain its competitive position in the years to come," he said.
American will fly the new Japan-Los Angeles route with Boeing 777 aircraft that have first- and business-class cabins. The airline will offer up to 15,000 bonus frequent flier miles for travelers on the route through the end of June.
"We have long wanted to fly the Los Angeles-Tokyo route," said Dan Garton, American's executive vice president of marketing, in a prepared statement. "The substantial economic and cultural ties between the two cities make this a very important market."
American officials began negotiations this year with the Allied Pilots Association, which represents the airline's pilots, on training and work rules for so-called "super-long-haul" flights from the United States to Asian destinations.
The airline resumed the talks last year after they were delayed by the 9-11 terrorist attacks. That means additional flights to Asia destinations such as Hong Kong could be implemented over the next few years.
But analyst Henry Harteveldt of Forrester Research in San Francisco said American could find it tough to gain access to Asian markets.
"United and Northwest run really tough operations, and they rule that part of the world," he said. "They're not about to give it up easily."
Another strategy American plans to ramp up is its alliances with major Asian carriers, enabling U.S. travelers to connect through Narita to a variety of cities throughout the region.
The airline's partnership with Japan Air Lines, for example, "enables us to easily connect American passengers to key Asian markets like Bangkok, Singapore and Manila," Arpey said.
American also partners with Hong Kong carrier Cathay Pacific, China Eastern and Taiwan's EVA. This year, it began a partnership with Vietnam Airlines.
Neidl says Asia is an obvious growth market for American, which has been struggling with low-fare carriers like Southwest Airlines in the United States.
"Asia is the hottest-growing area, these countries are coming out of their recessions and really coming to life," he said. "It's where all the airlines want to be."
ONLINE: AMR Corp., www.amrcorp.com
Trebor Banstetter, (817) 390-706
[email protected]
© 2004 Star Telegram and wire service sources. All Rights Reserved.
