Throughout the Covid pandemic American Airlines has focused on connecting flights through its Charlotte and Dallas hubs. It’s pulled back in other markets, like Los Angeles which will no longer be its primary transpacific gateway and New York which was hit by the virus early and now faces travel restrictions (quarantines) for people coming from much of the country.
The airline’s Miami hub, though, represents opportunity going forward because of where they see their best opportunities internationally unfolding. Senior Vice President Vasu Raja told employees on Wednesday that “Miami is probably the most unique part of the American Airlines network, and it’s always going to be, and we’re always gonna be big there and we’ll always play to win there. Full stop.”
He explained that Miami is central to two of the three best opportunities in international flying that American Airlines has in the coming months – Caribbean and South American (with the third market being Mexico):
It’s our primary jumping off point to long haul South America. There’s two important things to know out there, that one the lifeblood of Miami is really connecting into Caribbean for us. And we’re huge, we’re gonna be huge, that’s probably going to be the first thing that recovers out of it.
Indeed right now the part of our system that sees the most bookings is Caribbean and Mexico. So Miami will play there.
And then two, probably the first thing that goes and drives the recovery international is probably less changing customer tastes and more how our competition changes..we’re flying most of the Miami – South America network starting in August and going into September. We’re doing that for two reasons.
One we’re effectively the last good long haul option going in most of South America. That’s an important thing that we provide our customers, we’re going to keep doing that.
And two that’s probably the best cargo opportunity we have in the system, because that’s a thing that we can do that no one else can do.
Avianca and LATAM are in bankruptcy, and aren’t competing with American. That won’t last forever. Ultimately more competition will exist on South America routes, so the relative strength of these markets (such as they are) may not last. Mexico and Caribbean leisure destinations aren’t only strong for American, and face significant competition. They also won’t drive the sort of yields or year-round travel to sustain the airline either.