Fleet Post Merger (if it happens)
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robbedagain
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I could see benefits of using both aircraft types for international and adding more cities too.
Jester
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AA has on order narrow body aircraft from both Boeing and Airbus for the simple reason that neither one could handle the large number aircraft to replace their sizable fleet of MD-80s which are increasingly too expense to fly. Consider a typical 1,200 miles flght where an MD-80 would burn around 15,000 pounds of fuel vs. a new generation B737 would burn around 10,000 pounds of fuel. That's about 750 gallons of Jet-A at $3.20/gallon for around $2,400 per segment and figure about 6 segments a day? Over $14,000 in extra fuel per day or $430,000/month, and that's more than a lease payment on new piece of equipment, and they have a few hundred of MD-80s to retire? Simply put, AA cannot afford to wait for either Boeing or Airbus to provide for all of their narrow body needs.
How would a possible merger of US impact the mix of Airbus and Boeing orders in the future? Difficult to say, but it wouldn't be the first time that an airline merger happened for no other reason than to buy needed aircraft, and eliminate competition in the process.
Zero chance that a combined US-AA does what you asked.
AA already has almost 200 738s on the property and has more on the way this year and next (several dozen more). AA still has almost 200 MD-80s that need to be replaced.
In addition, as Jester mentioned, AA has 130 Airbus A319s and A321s on the way beginning late 2013 thru 2017. The A319s will replace, in part, some MD-80s and the rest will be growth aircraft (AA hasn't had a small mainline plane like the A319 for a decade). The A321s will replace the 762s (three class transcons) and will also replace older 757s.
On top of that, AA has another 100 738s on order beginning late 2013 thru 2017. By 2017, most of the MD-80s will be gone, replaced by A319s and 738s.
Then, in 2018, AA has another 130 Airbus A320neo family planes on order (dunno which models yet) plus another 100 737max family planes on order. Those 230 will begin replacing some of the older 738s (oldest were delivered beginning 1999), will replace more 757s and the remainder will be growth aircraft. That 230 planes will be delivered 2018-2022.
The A330s will be good for shorter-range two class flights but I doubt the fantasy plane (A350) will ever show up at a combined US-AA. AA has 14 77Ws on the way beginning next month plus 42 787-9s beginning in 2014 or 2015. And options on 58 more 787-9s. Plus 47 existing 777s.
Keroseneuser
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I would expect to see lots of changes to the orders if Parker is running it. I don't see him dumping late model 73-800's for new 737's. Most of the current east and west bus fleet is in the 99 to 2001 model range or older. Remember parker is a pure numbers guy, Nothing else seems to come into play in his decisions. Depending on the run the 321 has limitations especially when it has to replace 757's or 767's. Currently the 321 has a crappy climb and there are many transcon flights that it is limited to fl 290 till it can burn enough fuel to get higher. It can be a serious runway hog as well when heavy. There are lots of departure climb restrictions that the 21 cannot meet in the summer and you have to get ATC to modify them for you. The newer version they are talking about addresses some of these issues but I don't know if it gets near the performance of a 757, would have to look that up.
My guess would be a full on effort to replace all md-80s asap will be parkers first objective as you mentioned.
Good points.
I don't think that very many of the of the 738s will be replaced, but the second big wave of 737s (100 737max) won't be delivered until 2018-2022, and the first 74 AA 738s were delivered 1999-2002, so they'll be pushing 20+ years old by then and that second wave should be more fuel efficient. I agree that there will likely be no hurry to replace those 74.
Very true. AA's current plan is to outfit the JFK-LAX/SFO transcon A321s with just 102 seats, so the plane should be slightly lighter than a typical A321 when empty and perhaps an additional 16,000 pounds lighter when full (at 200 pounds per pax incl bags). Dunno if that will help it climb to efficient cruise altitude faster. The good news is that there's no shortage of runway at JFK, LAX or SFO, the three airports where the 102-passenger 3-class transcons will takeoff.
Why AA chose the A321 over the 739ER is a mystery to me, but I previously speculated that one possible reason was floor area. The A321 features more square footage with a slightly longer cabin than the 739ER, so the A321 comes closer to the 757 in usuable square footage. That's particularly important when you want enough space for 10 lie-flat first suites (1 x 1) plus 20 flat business seats (2 x 2) and 72 economy seats. AA hasn't said how many A321s it plans to buy, but if it buys a bunch of them to replace 757s, there could be more winter westbound fuel stops in AA's future, as a lot of transcons are currently flown with 757s that usually can make any transcon nonstop.
Based on the numbers of anticipated deliveries at this point, there shouldn't be any MD-80s remaining by late 2017 if the fleet stays the same size or grows. Of course, they could be gone sooner if the mainline fleet shrinks.
To the OP's point, as mentioned by Jester, AA's demand for 460 single-aisle planes in 10 years, a very aggressive schedule, probably would have taxed either Boeing or Airbus if AA had gone with one manufacturer. Given that so many Boeing single-aisle planes are in the AA fleet now (more than 300 plus 2012-13 prior orders) plus 200 additional 737s on order, the simplistic "Airbus for domestic and Boeing for international" is not a possibility.
Keroseneuser
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102 seats in a 321? Wow, US 321's are configured for 183 and parker is in the process of adding 4 or 5 more per plane now.
Having worked under parker now for 7+ years I would bet a nice lunch that if this AA merger goes through you will never see a 102 seat 321. That is 81 warm butts he cannot sell tickets to. If the AA deal goes I am betting the "New AA" will mirror US in its service and seating. This is a guy that removed all built in video screens and onboard Entertainment from the entire east fleet. We are installing wifi in everything now but that is it.
I would say 3 class service will be gone on all domestic fleets and the only thing left that resembles current AA service levels will be on the international, just like we are at US now. Parker is all about the numbers, service ranks way down the list for him. He is all about how many butts he can plop on the plane at once. My guess is the domestic fleet will all be fitted with what is now your business class (Ie US first) and coach. I cannot see parker taking up valuable seat space for anything that lays flat on a transcon. It's not how he operates.
We don't even carry snacks for first class on anything under about 2 hours, don't know the exact criteria for what gets what you would have to ask a flight attendant on that, but compared to the old legacy style that AA is Parker runs a bare bones operation. Only freebie in coach anymore is drinks, everything else is pay to play, or eat as the case may be.
Piedmont1984
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EMB 190 series - more than God can count. They will fit nicely into most MD-80 and retiring 737 routes. Customers like them, they are fast, fuel efficient, and so far extremely cheap to operate. Brazil is giddy with anticipation.
FYI..... I fly JFK-LAX trips and there is BIG money on those flights. We have 10 F/C , 30 B/C and 128 M/C on our 767-200s and many times we have 10 full fare pax in F/C. AA is going after the premium pax who pays top $$ for the seat. AA is focusing on the business pax, that's where the money is. Leave the cattle car to the others.
Keroseneuser
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Would be nice, but i do not see it happening if parker is running it. US made 321 million in the second quarter, third quarter is due out wed.
He is going to stick in his comfort zone. He is wooing the AA employees but I fully expect him to mirror the LCC operation that he is comfortable with. i am no fan of Parker and team's employee relations etc, but you have to give him credit on being able to fill airplanes and pull profits off it. It is a rare flight when we have more than 5 or 8 open seats on the airplane. The trip i just came off of was full all but one leg, and I think the count was 178 on the non full one. 5 open seats. It's driving our commuters nuts from places like DEN, MCO, TPA, LAX, SEA, etc. Poor guy last week said he had not ridden anything but the jumpseat in a month.
You have to remember US used to have all the goodies that AA currently does, that lasted about 3.2 seconds after parker got ahold of it. Expecting him to change how he operates just because the name painted on the side will say AA is a losing bet if I were to wager on it.
Parker will add the award processing fee to frequent flyers redeeming miles from their on line accounts.All the processing is done by the customer,not a res agent.This shows what Parker thinks of his best customers,not much.
I still think AA will emerge as a stand alone carrier and US will have to grow the old fashioned way,slow,well planned growth with many more widebodies. Still more destinations in europe to service, ARN,OSL,VIE,PRG,BUD,NAP,MXP,and some south america cities. I know some of the European cities I listed have been served in the past,but some could warrant another look.
I still think AA will emerge as a stand alone carrier and US will have to grow the old fashioned way,slow,well planned growth with many more widebodies. Still more destinations in europe to service, ARN,OSL,VIE,PRG,BUD,NAP,MXP,and some south america cities. I know some of the European cities I listed have been served in the past,but some could warrant another look.
You forget Parker did wade into the trascon market 12-13 years ago and got spanked with the mediocre product in the US top transcon market.
AA is the US anchor of the OneWorld alliance. To date, LCC has been a second string player without full ATI in Star..
Don't confuse DP's survival skills with prowess.
He's done a good job with a poor hand, but to think his methodology has long term durability in the Global alliance is foolish. The top fare business travelers dollars will depart faster than they've been returning to AA if he ends up at the helm of a combined airline, and he uses his current strategy.
Don't believe me? Ask Art from ISP..
Keroseneuser
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Did not say i thought it was a good idea. Just telling you how it is with him. Every single decision comes down to one question, how much does it cost?
Art from ISP can fill you in on how it went. He was very vocal and running his consumer group during that time. I bet he expects the same scenario if parker takes AA.
Like wal-mart execs, parker reviews every single thing about the operation to see where he can cut costs, boost revenue, and reduce employee expense.
We are hiring on the east, but at the same time he has been offering 1 month leaves (Unpaid)for all bases for the last 10 months. We charge for "preferred seats" meaning emergency aisle etc. Coffee and soft drinks are the only freebie, though he did charge for soft drinks for a few months but we had a near riot from the pax.
i am not saying that I feel its the best thing for getting the real high end passengers. But after 7+ years working for him I am confident that the high end passengers are not his target market. In his mind it causes too many planes to leave with empty seats.
You may be correct, but I have a feeling if this AA deal goes through you will be back on here 12 months or so after that and say "I see what you were talkng about now"
Although many AA employees publicly profess their adoration for Doug Parker and their hatred for the vile Tom Horton (he's the devil), my fear is that Doug Parker will make changes to the parts of AA where AA has had success, like the JFK-LAX market, where AA is the market leader and obtains average fares of more than $400 each way, almost double what B6 attracts and almost as high as UA's average fare.
Not being an AA employee, I'm not saddled/burdened with emotional hatred for Horton and I'd prefer that he take over US instead of Parker taking over AA. Horton's just the guy who was willing to do what Arpey should have done a decade ago: file for Ch 11 and inflict the punishing pain on the employees and get it over with, like US, UA, DL and NW did during the past decade.
In defense of Parker, all he's known since he joined HP in 1995 was its post-bankruptcy Desert Discount model. When he had the chance to take over US, he chose to expand on that Desert Discount model with some laughable failures. He could have chosen to go head to head with UA, AA, DL, NW and CO but cheapened the US side of the equation to make a much larger America West out of the combined airline.
And to his credit, he abandoned some of his more insane Lousy Cheap Carrier initiatives (among others, charging for water and sodas) and he has actually improved US with the lie-flat Envoy seating to Europe. It's possible that if he is handed the reigns at a combined AA-US, he won't immediately cheapen and/or abandon the products that work (like the 3-class transcons). Nearly every frequent flyer expected AA to announce some form of 2-class JFK-LAX/SFO configuration last July, like the UA ps transition to 2-class and the DL BE transcons. But instead, the guy with the most data on who is willing to pay F and J fares between NYC and LAX/SFO chose to keep 3-class transcons when the new A321s arrive next year, completely stunning all the know-it-alls who claimed there was no market for 3-class First. My guess is that Smisek either knows that customers prefer AA over UA or Smisek has made a mis-calculation. Horton also has announced that all 47 of AA's existing 777-200s will be converted to 2-class configuration beginning in 2014, so he's no stranger to product degradation. The 14-16 (14 firm orders now but more likely on the way) 777-300s will have eight F suites each, plus 52 J seats that are very similar to the new US Envoy (and CX J).
US has been profitable this year, but run the numbers with industry-average pilot pay and industry-average FA pay, and the profits get much smaller in a hurry. With US paying its 190 pilots just slightly more than American Eagle pays its CRJ700 pilots, no wonder US is currently profitable. B6 pays its A320 and E190 pilots substantially more than US East pays on the same equipment. All those East narrowbody captains at $125/hr, much less than nonunion jetBlue pays its pilots. Less than Spirit. Less than almost any other airline. And with the US FAs averaging about $40k annually (compared to about $50k annually at AA), little wonder Doug Parker has shown some impressive profits. Bring the pay of those two groups up to AA levels and the money begins to fly out the door. For the past several years, AA would have saved about $2 billion each year if it enjoyed the US payscales and work rules, and if that had been the case, AA would have been the most profitable carrier since 2005.
AA had a revenue growth deficit in 2010 and 2011, but AA's PRASM growth performance this year has erased much of that problem, exposing the much higher AA labor costs as the number that prevents large profits. Of course, just recently, AA fixed much of that labor cost differential.
My sincere hope is that if Parker gets to take command of AA, he brings nobody with him from Tempe and keeps everyone in AA management onboard, perhaps minimizing the temptation to "America West-ize" American Airlines. If he gets to takeover AA, he'll be handed an airline with vastly superior revenue generating ability to that of US (even Parker has admitted that) and fresh bankruptcy contracts, so costs shouldn't be an issue for a few years.
Not being an AA employee, I'm not saddled/burdened with emotional hatred for Horton and I'd prefer that he take over US instead of Parker taking over AA. Horton's just the guy who was willing to do what Arpey should have done a decade ago: file for Ch 11 and inflict the punishing pain on the employees and get it over with, like US, UA, DL and NW did during the past decade.
In defense of Parker, all he's known since he joined HP in 1995 was its post-bankruptcy Desert Discount model. When he had the chance to take over US, he chose to expand on that Desert Discount model with some laughable failures. He could have chosen to go head to head with UA, AA, DL, NW and CO but cheapened the US side of the equation to make a much larger America West out of the combined airline.
And to his credit, he abandoned some of his more insane Lousy Cheap Carrier initiatives (among others, charging for water and sodas) and he has actually improved US with the lie-flat Envoy seating to Europe. It's possible that if he is handed the reigns at a combined AA-US, he won't immediately cheapen and/or abandon the products that work (like the 3-class transcons). Nearly every frequent flyer expected AA to announce some form of 2-class JFK-LAX/SFO configuration last July, like the UA ps transition to 2-class and the DL BE transcons. But instead, the guy with the most data on who is willing to pay F and J fares between NYC and LAX/SFO chose to keep 3-class transcons when the new A321s arrive next year, completely stunning all the know-it-alls who claimed there was no market for 3-class First. My guess is that Smisek either knows that customers prefer AA over UA or Smisek has made a mis-calculation. Horton also has announced that all 47 of AA's existing 777-200s will be converted to 2-class configuration beginning in 2014, so he's no stranger to product degradation. The 14-16 (14 firm orders now but more likely on the way) 777-300s will have eight F suites each, plus 52 J seats that are very similar to the new US Envoy (and CX J).
US has been profitable this year, but run the numbers with industry-average pilot pay and industry-average FA pay, and the profits get much smaller in a hurry. With US paying its 190 pilots just slightly more than American Eagle pays its CRJ700 pilots, no wonder US is currently profitable. B6 pays its A320 and E190 pilots substantially more than US East pays on the same equipment. All those East narrowbody captains at $125/hr, much less than nonunion jetBlue pays its pilots. Less than Spirit. Less than almost any other airline. And with the US FAs averaging about $40k annually (compared to about $50k annually at AA), little wonder Doug Parker has shown some impressive profits. Bring the pay of those two groups up to AA levels and the money begins to fly out the door. For the past several years, AA would have saved about $2 billion each year if it enjoyed the US payscales and work rules, and if that had been the case, AA would have been the most profitable carrier since 2005.
AA had a revenue growth deficit in 2010 and 2011, but AA's PRASM growth performance this year has erased much of that problem, exposing the much higher AA labor costs as the number that prevents large profits. Of course, just recently, AA fixed much of that labor cost differential.
My sincere hope is that if Parker gets to take command of AA, he brings nobody with him from Tempe and keeps everyone in AA management onboard, perhaps minimizing the temptation to "America West-ize" American Airlines. If he gets to takeover AA, he'll be handed an airline with vastly superior revenue generating ability to that of US (even Parker has admitted that) and fresh bankruptcy contracts, so costs shouldn't be an issue for a few years.
nycbusdriver
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Can't forget taking out all the coat closets!
