American sees itself as having “the best hubs in the business for domestic and international short haul network” in Charlotte, DFW, and Phoenix. They’re working to build New York JFK working with Alaska to build Seattle on the West Coast, according to executives in a recording of comments to employees last week that’s been shared with View From The Wing. However their approach to long haul is different.
International From Charlotte Will Mostly Stay Boeing 777s
Long haul international from Charlotte is likely to remain operated predominantly by Boeing 777-200s, rather than moving to Boeing 787s as the airline takes more aircraft from Boeing.
They’ve added a third London Heathrow departure from Charlotte and it departs the U.S. at 11:25 p.m. during the summer flying season. (They’ve also added a late night third Los Angeles flight.) Vice President of Network Planning Brian Znotins acknowledges the slots they were able to secure from another airline “aren’t at the perfect time” but sees them as good enough to make sense and there are competitive reasons as well,
We don’t want anyone else getting those slots. We want to be the leader at Heathrow and we don’t want to let people catch us in Heathrow. We want to keep that lead and the only way to do it is to take those slots when they become available.
However Chief Commercial Officer Vasu Raja jumped in to correct the anti-competitive narrative, “the increasingly less critical one we need to get ’em so others don’t” and then emphasized the value to the airline of the slots.
Raja suggests that the Charlotte metro area is “smaller than San Antonio” yet the city works so well for the airline that they can fill a third Heathrow trip with customers in “New Bern, North Carolina, Knoxville, Tennessee.”
Philadelphia Is Still Their Transatlantic Hub, It Just May Not Seem That Way
The airline still sees Philadelphia as their primary connecting hub to Europe, with New York JFK as predominantly for local traffic. But without as much local demand in Philadelphia, they haven’t brought back as much domestic capacity. And that means fewer connecting passengers to support transatlantic flying.
This should grow back as the airline receives Airbus A321XLRs, smaller planes that can profitably fly with fewer passengers. (I’d note that they have retired the planes that could have made transatlantic work under this scenario, the Boeing 757s and 767s.)
New Airbus A321XLR Business Class, Credit: American Airlines
Los Angeles Is More For Domestic And Short Haul International Now
Transpacific demand hasn’t recovered even though Covid restrictions have largely been lifted. Fares are back “because there’s a handful of people looking to go back home” but we’re far off the depth of demand that supports more Asia flying by American, according to Raja.
“LA is a really tough market for us” in Brian Znotin’s words. With all of the Asian carriers serving LA, there’s too much capacity for his airline to make money, and they need to generate yield premiums by havin “the only non-stop or the most non-stops.” So Shanghai, Beijing and Hong Kong service lost money prior to the pandemic. Hong Kong “seems to be on the decline” and this is when he noted “what are the ways we can serve Singapore, what’s our opportunity there?”
Znotins says they’re “doing very well in the short haul domestic and regional network there.” If international grows back in the future “it might mean a Singapore, it might mean South Pacific.”
American Has Been Temporarily Using Widebodies Domestically
While they’re adding widebodies and plan expansion, they haven’t been fully utilizing the planes they’ve got on international routes. They’ve temporarily found themselves flying widebodies to Havana and Las Vegas.
Some of that is using aircraft time when it would otherwise just sit on the ground, and moving around aircraft for maintenance, but it isn’t only that – Znotins explained that they hadn’t wanted to do Haneda flying yet but got slot exemptions late for this past winter so they had put 3-4 787s into that airport (to squat on slots), which they the repurposed for short haul (“You can sell some Vegas, you’re going to sell zero Rome”).
Focus On Adding Frequency, Not Destinations For Now
New international flying has been focused on adding second trips to primary European cities, rather than new markets. However they do not currently see the 33 Boeing 787s and 50 Airbus A321 XLRs they have still coming as replacing existing aircraft (e.g. using 787s to retire Boeing 777s) and so should be adding new destinations in the future – however “Boeing hasn’t been great about delivering those airplanes on time” according to Znotins.