American Airlines Rebuilt Its Dallas Hub — Missed Connections Are Down 50%

American Airlines completely restructured its largest hub in Dallas, moving from 9 heavy peaks of flights arriving at the same time and then departing at the sme time to 13 smaller peaks throughout the day.

They’re also spending millions padding flight times but by reducing misconnections and missed bags they should actually save money overall and give customers more flight options with less stress – even if it makes total travel time a little bit longer.

• A bank is basically a coordinated hub “wave” with lots of arrivals coming in, customers and bags connecting, then lots of departures go out.

• But everything has to go perfectly. If a flight doesn’t get off its gate, a new one can’t come in. Passengers and crew can’t get off and move to the next flight. Delays cascade. Plus there’s little time between flights, so small delays means a lot of missed connections.

• De-peaking or spreading out the operation reduces stress on gates, crews on the ramp, baggage systems, customer service agents, taxiways, crew connections, and ability to recover during irregular operations.

At the quarterly internal ‘State of the Airline’ employee meeting held right after their earnings call on Thursday (a recording of which was reviewed by View From The Wing), Jim Roses who runs the DFW hub addressed employees.

Despite only a few weeks of data, Moses reported that American is performing better on missed bags than ever before, and has improved on-time departure and arrival performance. Net-promoter socres are up 22%, missed connections down 50%, and customers are reacting positively to reduced rush.

It is not often that we set records. I know. We will start with that.

I am going to talk a little bit about 13 banks, but first, to Robert’s point about the record, we wanted to mention that yesterday the DFW hub set an MBR [missed bag report] record, our best in the history of the DFW hub. That number actually started with a three, so the team is incredibly proud. It gets even better, because yesterday American Airlines also set our best MBR record. That speaks to the outsized impact DFW has on our network. A big thanks to the entire team for delivering that.

As Anne mentioned, we transitioned into this reimagined flight schedule at DFW 17 days ago. The early results have been really promising. We know they are early results, but we are incredibly encouraged by what we are seeing. I want to thank many of you in this room and throughout our company who have been working cross-departmentally for quite some time to bring this reimagined DFW schedule to life. It did not happen overnight.

What is this new bank structure? We have transitioned into a 13-bank structure. For the past decade at DFW, we have run a nine-bank structure. For those not familiar with what a bank is, think of a bank as a rush hour. At DFW, we had nine really big rush hours throughout the day. Now we have 13 rush hours. You may be thinking: Jim, you went from nine to 13. Why is that better?

…How is nine to 13 good? We have flattened out those rush hours. I mentioned nine really peaked rush hours. Now we have 13 rush hours that are flattened out. Early results show that this flatter schedule is better for our customers, team members, bags, and connections.

As I mentioned, DFW has an outsized impact on our network. The team works really hard to support that. Every day, more customers, more bags, and more crew members go through DFW than any other location or hub we have. It is important that we get DFW right.

While I will talk about some of the early stats we are seeing, what is really important is what we are hearing from team members and customers. Early comments and feedback have been really positive, whether from our hub-control center about how we gate aircraft; from team members working in our terminals; from customer-service agents, CSMs, or fleet-service agents. The feedback has said: now we are able to deliver like we have wanted to deliver. We do not see the same rushing in the terminals that we saw in the past.

Last week, one of our 737 captains stopped me in the terminal and said, “Jim, we are getting into the gate quicker at DFW. What happened? We are not taxiing as much as we have in the past. We are saving taxi time. We are noticing a difference at DFW.”

A customer also stopped me around day four. I thought he was going to ask where his connecting gate was. Instead, he said, “You work here, don’t you?” I said, “I do,” and that can always lead somewhere. He said, “I am an Executive Platinum. You and your team are getting it right here. We notice a difference.”

We still have a lot of work ahead of us and a lot more to do. But we are seeing better on-time departures and better arrival performance. We have seen a 22% increase in NPS over this period compared with where we were. That is the work of our team and the result of setting the team up for success.
Misconnecting customers over DFW have decreased by 50% compared with the same period last year. We are on track to have our lowest misconnect rate in years at DFW this April. We have to keep that going.
We have also had six of our best-ever mishandled bag rate days at DFW since April 7, when the new schedule went into place. The team has done a fantastic job.

If you fly in and out of DFW, you have probably noticed construction. There is a lot of construction, but we are also investing in DFW. The roadways as you enter and exit International Parkway are under construction, and that will wrap up for World Cup very soon.

We are excited about Terminal C and reimagining Terminal C. We opened the first two gates in the Terminal C pier a few weeks ago, and the rest of the Terminal C pier will open in early June. Later this year, in the fall, we will open the Terminal A pier. That A pier will allow us to start growing DFW. Not far behind that, late next spring, we will open phase one of Terminal F at DFW, which is going
to be an incredible facility.

CEO Robert Isom added, “A lot of people are going to ask why we did not do this earlier. As you grow a hub, you think of different ways to produce revenue and improve the customer experience. We are going to grow DFW to be the largest single-carrier hub in the world. When Terminal F opens, we will have the capacity to run 1,100 flights. It is really important that we get this right.”

So why not earlier? They were focused more on cost than revenue. And while they emphasized running a strong operation, they didn’t invest properly in delivering it. That strategy changed – they’ve been more willing to invest, as seen in the much-improved vision for new terminal F in Dallas, the investments they’re making in Miami, and a new slate of clubs. They still need a widebody aircraft order, so they haven’t quite gone all-in on capital spending, but they’ve turned around their approach.

Some of this improvement at DFW may not be sustainable through summer thunderstorms, summer schedule growth, and construction across terminal C and F. But it should set them up for better performance through these challenges than they’d otherwise experience.