Differences between AA and WN

[jimntx]

Go read this thread on the Southwest forum.

http://www.airlineforums.com/topic/54460-trouble-brewing-at-sw/#entry945778

Some quotes from the Dallas Morning News article...

"As part of its cost-cutting plans, Kelly said the company hopes to reduce the employee headcount next year through reduced hiring and attrition. He didn’t have a specific target figure to share.

There are no plans for layoffs at the company, Kelly said." Not even a veiled threat to get the employees to accept pay/benefit cuts?

"Overall, he said Southwest plans to shave $100 million from corporate overhead in an effort to reduce its unit costs. 'There’s no real fat at Southwest, but clearly there are opportunities to streamline and focus,” Kelly said in a conference call with analysts and investors'." Cut corporate overhead? Not possible. Every job and every expense at headquarters is essential to the operation of the airline.

"The airline will consider reducing supplier costs and possibly halting projects that don’t add enough value among other options." Please. If we thought of the project, it must be critical and important. We must be paying the front line too much. (See above.)

Kelly wasn’t ready to detail the Dallas-based company’s plans to increase revenue save for the continuation of ongoing efforts such as upgrading the interior of Boeing 737-700 jets. Improving the customer's flying experience? How could that possibly increase revenue? Everyone knows that customers are almost as big a brick in the backpack as employees.

I'm not judging. I'm must saying.

 

[FWAAA]

Kelly wasn’t ready to detail the Dallas-based company’s plans to increase revenue save for the continuation of ongoing efforts such as upgrading the interior of Boeing 737-700 jets. Improving the customer's flying experience? How could that possibly increase revenue? Everyone knows that customers are almost as big a brick in the backpack as employees.

I'm not judging. I'm must saying.

The interior "upgrades" to the WN 737-700s aren't about "improving the customer's flying experience" as you mistakenly assume. But that upgrade certainly is all about more revenue.

The project includes, among other things, all new, thinner seats with one inch less seat pitch (from 32" now down to 31") so that WN can cram yet another row of seats on each plane, increasing the seat count from 137 to 143. The article linked below features some discussion on just how much that's going to "improve the customer's flying experience:"

http://www.nytimes.com/2012/06/19/business/flier-satisfaction-suffers-as-more-seats-squeeze-in.html?_r=0

Similarly, Southwest Airlines recently received effusive publicity as it began rolling out its new cabin designs, which it called Evolve: The New Southwest Interior. These cabins are definitely nicer, with redesigned lightweight seats that provide a better sense of “personal living space,” as Southwest puts it.

On the other hand, the new seats for the Southwest 737s have 31 inches of pitch, instead of the previous 32 inches. This allows Southwest to squeeze one extra row of seats onto the planes, increasing passenger capacity to 143 from 137 while adding “greater revenue potential,” as Southwest said.

I would suggest that simple physics is at work in coach cabins, however smart the interior design. Joe Brancatelli, the publisher of the subscription Web site Joesentme.com, agreed.

“I don’t want a sense of space. I want the space,” he said. With all the cutbacks, “there’s nothing left in coach except space, so it really comes down to how much you can get.”

 

[jimntx]

The interior "upgrades" to the WN 737-700s aren't about "improving the customer's flying experience" as you mistakenly assume. But that upgrade certainly is all about more revenue.

The project includes, among other things, all new, thinner seats with one inch less seat pitch (from 32" now down to 31") so that WN can cram yet another row of seats on each plane, increasing the seat count from 137 to 143. The article linked below features some discussion on just how much that's going to "improve the customer's flying experience:"

http://www.nytimes.c...ze-in.html?_r=0

Yeah, but I bet they won't have whole "you are free to move about the cabin" rows of seats. We are probably going to add that to the IFE package. Beats spending money to fix the problem.

Oh, and their seat pitch will now be equal to AA's IIRC. Up until now, WN has had the greatest domestic seat pitch in coach for years. I don't remember you sarcastically talking about AA when they "crammed" two additional rows into the S80. Why is that?

 

[FWAAA]

Yeah, but I bet they won't have whole "you are free to move about the cabin" rows of seats. We are probably going to add that to the IFE package. Beats spending money to fix the problem.

You got me there.

Oh, and their seat pitch will now be equal to AA's IIRC. Up until now, WN has had the greatest domestic seat pitch in coach for years.

While that's true, don't forget that AA is removing a row of seats from its planes (Main Cabin Extra) to mimic UA's successful Economy Plus (free for elites and for sale to the unwashed masses). For some passengers, AA is trying to make them slightly more comfortable. Not so on WN. On WN, even the Business Select (expensive fare) purchaser may not get an exit row (the only expanded legroom on WN).

I don't remember you sarcastically talking about AA when they "crammed" two additional rows into the S80. Why is that?

I pissed and moaned endlessly when Short-Man Arpey began to undo Tall-Guy Carty's baby - MRTC. By time he removed the rear galleys on the MD-80s to squeeze in even more seats than existed prior to MRTC, I was beaten down and didn't bother complaining. But my failure to speak up wasn't because I was happy about it.

I also complained loudly around here when Arpey gave in to the analysis of the APFA that concluded that the 737s had too many F seats (20) and that 16 was the better number. Just a few years earlier, in 1998 or 1999, Carty announced that over 100 MD-80s would be reconfigured from 14F to 20F and deployed in business-centric markets to make it easier for frequent flyers to upgrade (that's what the announcements said). When the 738s had their F cabins trimmed, the rest of the MD-80s got two extra F (from 14 to 16), and the 20F were reduced to 16F, but that didn't make up for the reduction of the 738 F cabin.

 

[WorldTraveler]

yet one of AA's network competitors has aggressively replaced seats throughout its fleet with slimline seats, added a premium economy cabin that, like AA's is a few front rows of seats, and also increased first class seats for a total increase in seats on most aircraft types. And that carrier has comparable seat pitch to its network competitors. It is the lighter seats that makes it possible to achieve multiple goals.

But replacing seats is hardly the primary points of what Jim noted above since personal space is largely unchanged.

The primary point is that WN is restructuring w/o layoffs and by focusing their cost cutting at their headquarters... granted they don't have to extricate themselves from the baggage the network carriers have picked up over 70 years but it says there is a different set of values that guides restructuring than what is being used at AA.

Seats are seats... there are only a few manufacturers of a/c seats in the world but there are a number of different ways those seats can be used within a larger airline business model.

 

[eolesen]

I just love reading from people who've never spent any appreciable time in either AA's or WN's HDQ sit and judge how they approach management restructurings.

There's no question AA did its fair share of cost cutting outside of organized labor between 2001 and 2012. It's well documented in the SEC filings. In every budget year, we had no choice but to find new ways to do more without backfilling vacancies. I know the unionista talking points disagree, but I saw firsthand (even after leaving in 2006) that there really are fewer people each year in HDQ when compared to front-line employment, with one notable exception -- IT work that was in-sourced from HP and Sabre. Still, AA is using about 40% less real estate in Centerport than they were ten years ago. There are probably still entire vacant wings at HDQ, even after closing down CPOC, CP2, and the other satellite buildings outside of HDQ1 and HDQ2.

The problem with the "reduce management overhead" approach is that you eventually run out of low hanging fruit. Management overhead typically accounts for well under 10% of an airline's labor expenses.

It's kind of like the "make sure your tires are properly inflated" approach to dealing with high gas prices. It will work for a quarter or two, but long term? Don't think so...

 

[WorldTraveler]

EVERY airline restructuring has played out quite publicly so it really isn't too surprising what is really going on at any airline.

The primary difference between WN and most other legacy airlines is that they have continued to grow revenue. Even though WN's revenue growth has slowed, it is precisely resolving some of their automation issues which will allow them to move from integration of the two airlines and restructucturing to growing revenue again.... few network airlines have moved that quickly to restore revenue growth.

ALL American businesses that are positioned for the long term are becoming more and more efficient... there are abundant statistics to show that American business has used the crises of the past decade to increase efficiency far more than to grow their businesses. The difference between the "norm" for American businesses and those that stand out is the ability to grow revenue...

And while AA's RASM took a nice tick up in the last quarter, total revenue was virtually flat since capacity fell just as fast as RASM grew. Thus, AA is still a ways from growing system revenues which is what is necessary in order to position the company for long-term success.

WN and a few network carriers have demonstrated that continued revenue growth is precisely what allows them to build long-term stability post restructuring.

 

[signals]

I don't think Kelly wants to tarnish WN's 'no layoffs in 40 years' record.

 

[WNMECH]

For the record, I have more personal space when flying in the new seats.

At 5'11" I have the same legroom.
In the old seats I am looking at the back of the head of someone I don't know.
In the new seats they seem to have taller headrests and with thinner cushions I sit lower a little.
It is not uncomfortable and I can not see the back of anyones head. Dirty hair and all.
I feel like my space is mine.

 

[Birdman]

I don't think Kelly wants to tarnish WN's 'no layoffs in 40 years' record.

Truly that would be a shame. There's a notice in an office in hangar 1 in Tulsa that states:
Company: Southwest Airlines
Sales:$15.6 billion
Market Value:$6.4 billion
Employees: 45:392
Advice: Make your employees No. 1

I witnessed on a full flight from Dallas to Tulsa last month a couple of WN attendants deadheading who, after seeing the other attendants working hard to fill drinks, got up from their seats and passed out nuts and pretzels to everyone on board. I was impressed and realized that any company with employees like those attendants are much less likely to sit around and watch their company fail. Although I'm leaving the industry I sympathize with those at AA who are left to compete with such high standards.

 

[jimntx]

What you witnessed I have seen many times on WN flights. Heck, I've seen WN employees who are NOT flight attendants get up and help serve.

 

[Ifly2]

To the original question


Think a bit on the difference between management, and leadership

 

[nbmcg01]

From a union and staffing position I have a problem with others doing my job. If you can't get the job done with the current staffing numbers then you need to adjust the staffing levels.

 

[QA4Jet-A]

From a union and staffing position I have a problem with others doing my job. If you can't get the job done with the current staffing numbers then you need to adjust the staffing levels.

I find it sad that you look at it that way... as an employee, if I can help out I will. It's all about Customer Service... That's what brings customers back but perhaps you are too concerned about what your contract says! So be it... Cheers QA

 

[swamt]

From a union and staffing position I have a problem with others doing my job. If you can't get the job done with the current staffing numbers then you need to adjust the staffing levels.

Really?? As a union mech with SWA, I too have not only offered but helped my fellow employees with passing out anything to the passengers when flying. Matter fact I have helped with unloading passengers using wheel chairs as well as going down to baggage claim and helping passengers with collecting their belongings. Do you really see that there needs to be more staff? Negative!! Just a nice gesture to help out our fellow employees as well as our customers... Get a clue man.