American Airlines hosts a ‘state of the airline’ event for employees after its earnings calls. There senior management shares their vision for the company and employees can ask questions. In addition to those questions that are asked live, there are followup questions that get asked – and answered – in writing.
The airline has shared written responses to several employee questions, and some of those were interesting (to me).
- No to India and Africa. American Airlines told Skift they’re considering flying to India and Africa. I said I do not believe that. They told employees specifically that they have no plans to fly to either. They also said no to Los Angeles – Seoul (which JonNYC seems to disagree on). For a return to Tel Aviv at least employees got a ‘we’re always looking..’
- American Airlines is “planning to make some changes” to basic economy. They already eliminated the restriction that basic economy passengers cannot bring full sized carry on bags onto the plane, because they were losing business to Delta which did not have that restriction. I don’t expect future changes will make basic economy better.
- Why there’s never enough food for sale in coach. American Airlines accounts for only about half of the food on board in economy. They determine provisioning based on what flight attendants report as sold, but “today we can only account for an average of 50% of the product we board on flights.” They give the example that if they board 10 sandwiches, only 5 show as sold, they assume the lower number is what’s needed — even though that does not appear to be the case.
- Flight attendants are allowed to give you the full can of soda if you ask. They pour you a cup but they aren’t forbidden from giving you the can. I’m surprised that’s still allowed with higher prices stemming from aluminum tariffs.
- New beverages coming. The spring annual review of liquor offerings will “include tequila.” Gin is also “a potential area of opportunity” and they’ll “look into” offering herbal tea.
I hope the annual review will drop one or two of those beers that uses rice or corn syrup and expand the craft beer offering.
So the FAs are eating the sandwiches?
“…additional costs are…seat spoilage when passengers don’t cancel”
So if I book a Basic Economy seat then just no show for the flight, you’re mad that you could have sold this seat to someone else for a higher cost? Is this how airlines think or am I interpreting that wrong?
Their NOT there …. come on !
what do they think the incentive is for someone to go through the trouble of calling in to cancel an non-refundable ticket?
Maybe they think we should be more considerate of AA feelings or their profit so we should feel obligated to make the extra effort. Sounds reasonable
I think AA just wants to put down a cost number for everything (in order to come up with fare numbers they show you). Apparently whether BE passengers show up or not, there is additional work that incurs cost (eg. BE customers make more calls to resolution centers). AA just needs to account for those.
Seems to me that AA’s algorithms for determining how many seats they can oversell a flight needs to be adjusted for Basic Economy. The communication seems to imply that it is statistically more likely that a BE passenger no-shows than a normal passenger, though it would need to be backed up with data. So, if true, AA should in theory feel safer about selling extra tickets on flights where there is a large BE cohort. That would at least solve the seat spoilage problem though it would not address the rest of the concerns posed in that question.
Along those same lines, perhaps selling extra tickets for a flight is where the airline sees extra profit from BE. It’s not just the upcharge to go from BE to economy but the extra oversold tickets that are now realized (less any change fees that the company might have received on these tickets if sold as regular economy).
Kind of surprised they’ll actually give you the whole can if you ask given how incredibly cheap they’ve become. Reminds of that scene in National Lampoon’s European Vacation when Clark gets a soda on a flight:
-FA: Do you want something to drink?
-Clark: Sure, I’ll have a Coke.
-FA: Do you want that in the can?
-Clark: No, I’ll have it right here.
Hahaha so AA isn’t accounting for the EXPs that get free food in Y? Because those sandwiches aren’t technically sold, they’re given away, right? My goodness, how stupid can the idiots running AA be! Unbelievable.
I guess seat spoilage does not necessarily mean they must oversell the flight or feel bad that a customer did not cancel. It’s just the expected additional sales of a seat if a customer has cancelled instead of holding onto it not showing up at the end (you can estimate it from historical sales data). It is in the accounting system so they can monitor it for possible monetization. Perhaps that’s all to it.
The crux of the employee’s question was that after accounting for all the charges/fees paid to airports/countries, support cost (resolution call centers, etc), and everything, is there still any profits from BE fares? The (indirect) answer was that BE fares are needed because AA wants to compete with budget airlines also.
The comment about seat spoilage was not from the company; it was in the question asked by the employee. Just because a random employee considers it a problem didn’t mean the company does.
@Stu: They do account for comps given out, whether to EXPs or for customer service, but they can only account for those if the FA properly logs the comp on their tablet. Not sure how that makes the people running the airline idiots…
Herbal tea is a no brainer. Long shelf life and you probably only need to cater 5-10 tea bags.