5 Things American Airlines Told Their Employees After Yesterday’s Earnings Call

After each quarterly earnings call American Airlines senior management holds a ‘State of the Airline’ town hall with employees, where employees can ask questions and get answers.

Some of those questions were about American’s decision to become less restrictive (allow full-sized carry on bags) with their basic economy fares, and the mechanics contract (an issue that never seems to get resolved). However there were several items of broader interest to customers or that offered new insights as well,

  1. Expect more international flying from Dallas Fort-Worth and even Charlotte. American is getting more gates at both hubs, which they describe as their most profitable. In Wednesday’s earnings call they said that their growth has been focused in LA and in Philadelphia, the latter in response to a low cost carrier incursion. Now that’s shifting.

    As they get more gates they will add domestic feeder flights, and once that happens American’s Vice President – Planning Vasu Raja told employees “we anticipate more international flying from both of those hubs.”

    Raja added, “Dallas International is increasingly becoming the best international flying in the system.”

  2. They’ll bring back a widebody aircraft for Phoenix – Honolulu this winter. For operational reasons it may be a Boeing 787-8 instead of an Airbus A330. The A330 flew Charlotte – Phoenix, and according to Vasu Raja “if it encountered problems in Phoenix crew could go illegal” so they’re trying to “source it from a closer hub” to improve operating performance for the flight.


    American Airlines Boeing 787-8

  3. American expects to add a Dallas – Toledo flight. Employees always ask about routes they have a personal interest in, and Doug Parker was shocked to learn a question came up about a route that Vas Raja said was being seriously considered.

    Raja stammered a bit and then said, “I won’t say definitively, but it’s high on our forecast list.” Then Parker in disbelief declares, “Woah! That never happens!” Raja then says “In fairness it never happens because the questions are like Pakistan. Toledo is totally in the wheel house. We’ll nail Toledo.”

  4. A brief moment of truth? Speaking about the administration’s tariffs on imports, and foreign reaction to those tariffs, CEO Doug Parker explained his concern “most of what we worry about at least right now from a US Airways” and he catches himself, “from an American Airlines perspective..” American is often said to be US Airways with new branding, with legacy US Airways management running the airline.

  5. American’s IT focus remains on integrating two airlines, flight attendant integration and techops integration is still largely where they’re prioritizing. Beyond making American and US Airways a single airline, the priorities align with “business objectives” which means changes to basic economy and premium economy. I struggle to search for IT changes that would be needed for premium economy outside of how upgrades will work.

    CIO Maya Leibman almost never gets questions so that alone seemed notable. Maya ran the AAdvantage program circa 2011. In yesterday’s earnings call she also got a question, about the PSA debacle last month. Helane Becker from Cowen and Company wanted to know what American will do to avoid such issues in the future. Maya suggested the issue was unusual and unavoidable and didn’t details steps they’d be taking to mitigate similar risk elsewhere.

    Customer experience doesn’t get much attention in these calls so no one mentioned that American never issued a travel waiver to allow customers to reschedule plans around the thousands of flight cancellations in Charlotte. That represented, to me, self-destructive greed.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. At what point do they acknowledge that degrading the product reduced profitability?

    Also, it’s time for Doug to give the pilots another out of cycle raise

  2. Bring back a quality, world leading airline and get rid of this shame your running now. Try flying in one of the airplanes coach sections and while your at it attempt to use the rest room. You will never know how your custmers feel by sitting in First Class everytime you fly, but do you really care.

  3. I’m most interested in potential new INTL flying from DFW and CLT! I would’ve expected them to mention PHL, as many people seem to think AA is going to build up Eastern Europe from Philly.

    Any guesses on new INTL routes?

    DFW-MUC and DFW-DUB have been mentioned; BCN or VCE seem reasonable IMO. Asian flights seem pretty well covered but Taipei could be interesting. Why doesn’t AA fly DFW-GIG?

    As for CLT, the only two Euro destinations that seem plausible are MAN and VCE, with the latter being like the CLT-BCN/FCO flights (ie leisure); MUC could happen from CLT if Lufthansa drops Charlotte. Apart from that, we’re lucky to have as much INTL flying as we do. (Although, I would kill for flights to Brazil again but that won’t happen.)

  4. One would think a guy like Raja would know we do not fly out of DALLAS. He could have given the full correct name as Dallas/Ft worth and no one would complain about calling it DFW.

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