What American Airlines is Telling Employees About Their Dispute With Chicago O’Hare

American Airlines is pissed that Chicago O’Hare expansion plans preserve United’s 14 gate advantage rather than the 9 gate advantage they say they expected after shelling out for 5 new gates themselves.

At issue is O’Hare’s $8.5 billion expansion plan, and what they dub a ‘secret provision’ added in ‘at the last minute’ that gives United more gates than they thought the plan entailed.

American Airlines at Chicago O’Hare

Both United and American have resisted adding gates at Chicago O’Hare for years, since they have most of the gates themselves and don’t want competition. They are happy to see gates added as long as they are the ones who get the gates, and if they’re both getting gates they want to ensure neither gets an advantage over the other.

United Airlines at O’Hare

Things are getting nasty and American Airlines emailed their Chicago-based employees about the dispute:

I’d quibble with a couple of things in this email.

  • Chicago isn’t “the nation’s only dual carrier hub” since Alaska and Delta both hub in Seattle and Virgin America and United both hub in San Francisco. Of course there are three-carrier hubs as American well knows from its experience at New York JFK and LAX.

  • American says they were assured the gate gap between American and United won’t widen, and that’s true relative to the status quo — so the issue here is the baseline (widen compared to today, or widen compared to the agreement for American to build more gates?).

Tortas Frontera, the One Thing We Should All Agree on at O’Hare

This week the airline told the federal government that if they don’t get their joint venture with Qantas approved they’d drop Sydney service. Now they say they won’t sign a new lease at O’Hare as-written. I don’t expect them to drop Chicago service, too…

Instead this will ultimately be settled by the lobbyists (and possibly courts), because gates are allocated by politicians and their designees. And once allocated, airlines are generally permitted to lock in their use of the gates into the future keeping out potential competitors. Alaska Airlines bought Virgin America largely for access to the gates that Virgin had accumulated at congested airports that they couldn’t replicate themselves.

As American notes, competition is good. In the past in Chicago they’ve been against adding competition, so I’m happy to welcome them to the cause.

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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  1. @Gene
    Based on Gary’s post it is 14 right now. American was negotiating to reduce it to 9; United apparently negotiated as well and it stayed at 14.

    American is saying it is “increasing” from “9” to 14 = 50% increase!!!

  2. “Frankly, we are baffled that this is how the city has chosen to reward our loyalty and investment”. American is finally getting a taste of their own medicine. Their own statement encapsulates exactly how many of their “most loyal customers” feel about American itself. Less space between seats. Smaller bathrooms. Removing seatback video. Making upgrades near impossible for non-corporate EXP customers. This is how they choose to reward our loyalty and investment (in their brand)?

  3. So United makes better deals. As a response, American management writes to its staff: “It is because of you that we are so successful in Chicago.” …hmm, duly noted. I bet employees are now feeling encouraged not to let the management ruin what’s left.

    Competition is good, so compete, stop whining!

  4. Mr President we must not alowwwwwwwwwww a United Gate Gap!

    Mr President I have a plan…

    Mein Fuhrer…I CAN WALK!

  5. American’s whining is a pile of bull. And I think Mr. Swalen captures its essence perfectly.

  6. AA loses its leverage in May when the 30 plus year lease expires. That same lease handcuffed O’hare from growing and UA/AA took full advantage of great terms it previously had.

    It’s not business as usual come May and AA will have to re-adjust. They are welcome to try to make MKE/STL a hub, good luck with that.

  7. Gary, Maybe one of your readers would know what is the current number of gates and flights American and United has today. A fair solution maybe keep the ratio but increase number of flights/gates with the expansion.

  8. @Thomas B,

    I just counted from an airport map. United has about 82 (I didn’t count the two Air Canada Gates, IDK if united ever uses them). AA has about 68, I’m not 100% sure what gates they are allocated in the L wing, I think it’s only the south gates (2a,2c,4,6a,6b,8,10abc).

  9. American must be getting the basic economy gate allocation. With no lease, united was able to bid and gain more gates than american did. I guess American wasn’t aware of all the new complications that came with the basic economy gate allocations and United was, and upgrade their number of gates before american found out about this. Like the poor passenger arriving at the airport for their basic economy fare and finding they no longer get a free checked bag, tough luck or just pay up.

    this is an error by american management, they blew it and now they are trying to blame someone else. United just showed better planning and implementation of their plan to acquire gates. Because you know gates are commodities.

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