New American Airlines Video Claims Cramming More Seats Into Planes Is ‘Amazing’ For Passengers

American Airlines has a new internal video for employees explaining that cramming more seats onto planes is good for business and good for customers too. It begins arguing they’re upgrading the quality of the airline’s interiors and asks, “if the goal is to make the aircraft better why are we also adding more seats?”

Vasu Raja, the airline’s Senior Vice President of Network Strategy, says that densifying “both for our customers, for our team, and for the future of American Airlines that’s an amazing thing.” The funny thing though is that while there’s an attempt to suggest adding seats isn’t all bad for customers, and complains that customers don’t pay more for a better product, American never actually offers a reason why squeezing more seats onto planes is ‘an amazing thing’ for customers.

Here’s the video:

There are four basic arguments American makes. I don’t think they hold up well to scrutiny.

Stack ‘Em, Pack ‘Em and Rack ‘Em Makes Money For American Airlines

Raja says densification is how they make money, that “the average fare has never been lower yet at the same time we make money, how can that be?” He suggests is two things:

  • their bigger route network, that helps them collect more revenue, and
  • “bigger than that, the number of seats we have on the airplane.”

Now unless he’s thinking that more passengers on planes means more people to pitch credit cards to, he’s completely off base.

American’s cost per available seat miles consistently outpaces the revenue they earn per seat mile. In some quarters their costs are higher than passenger revenue and cargo meaning they’re losing money flying airplanes. They go back and forth between earning all of their profit and merely most of their profit from selling AAdvantage miles to banks. The idea that densification drives their profit simply isn’t borne out by the financials.

Vasu says low fares mean they need to cram in more seats, but that means chasing the marginal $49 passenger rather than going after a revenue premium. Remember they are reducing the number of Main Cabin Extra seats and reducing the space both Main Cabin Extra and first class get.

Airline President Robert Isom complains about the carrier’s inability to attract a revenue premium yet has a strategy of competing largely with Spirit and Frontier,

[T]oday there is a real drive within the industry and with the traveling public to want to have really at the end of the day low cost seats. And we’ve got to be cognizant of what’s out there in the marketplace and what people want to pay.

The fastest growing airlines in the United States Spirit and Frontier. Most profitable airlines in the United States Spirit. We have to be cognizant of the marketplace and that real estate that’s how we make our money.

We don’t want to make decisions that ultimately put us at a disadvantage, we’d never do that.

They are adding marginal seats to chase $29 fares and giving up premium business, which is uniquely odd now that they’re actually selling more domestic first class seats than ever before.

But Delta Does It, Too!

The video doesn’t mention the stats on their Boeing 737s, going from 150 seats before the merger to 160 right after and now to 172 as they remove seat back entertainment even from planes. Instead they mention the plan to add 9 seats to legacy American Airlines Airbus A321s and 3 to legacy US Airways A321s. And they make the case that ‘Delta does it too.’

Delta, of course adds seat back entertainment and has generally happier crew taking care of customers. They’re also a more reliable airline, so the overall Delta experience is better even where there’s a similar number of seats on planes. In any case this management has offered the excuse that Delta makes money because of their fortress Atlanta hub and lack of competition. That would suggest a need for a better product than Delta.

More Room Throughout Coach Didn’t Work 15 Years Ago

Jill Surdek, Senior Vice President of Flight Service, appears in the video talking about American’s “More Room Throughout Coach” which ended 15 years ago. She says customers “make their decision on the overall ticket value” (price) so offering a better product doesn’t win business.

This says nothing to support American’s strategy of less room in first class. It also fails to describe the current marketplace. IATA’s new rich content distribution will finally show customers more than just schedule and price, so customers will for the first time be buying on more than schedule and price. American is preparing to fight with a strategy that’s quickly becoming outdated.

Moreover American’s inability to earn a revenue premium by giving more room to all seats is a straw man when it comes to justifying giving less room to all seats. It says nothing about the advisability of going from 150 seats on Boeing 737-800s (pre-merger, but long after the More Room Throughout Coach experiment ended) to 160 seats when the Tempe team took charge to 172 seats in their latest iteration.

Customers Don’t Notice The Difference

Vasu Raja says that adding more seats doesn’t mean less room for passengers, because the room is actually taken away from the physical seats themselves. He says “the seats are contoured, they’re slimline, so people have more actual legroom, they have more comfort in the seat.”

In other words, customers keep their legroom by using a harder seat with less padding. To him, a harder seat that gets really tough to sit in after a few hours is “more comfort in the seat.”

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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Comments

  1. DUI Dougie has always had an affinity for the low-paying passenger. He ran American West for goodness sake, and used that ridiculous LCC ticker symbol after the US Airways bankruptcy #2

  2. The slimline/firmer seats are far more comfortable for me. Heck, I’ll take a Frontier seat over the “padded” seats on other airlines. I think this comes from larger/overweight passengers overtime creating butt grooves that I slide into, causing lower back pain and further reducing leg room. With limited/no padding, this doesn’t happen. At 6’3″, though, there’s clearly less room and knees pressed into the back of the seats is no bueno.

  3. If it weren’t so pathetic, this video could easily be mistaken for a parody. It’s dripping with contempt for the flying public and wreaks of corporate “new speak.” I’m guessing their new target customer is an individual with a double-digit IQ who flies once or twice a year– and one who compares AA to Frontier and Spirit.

  4. Ironic that at the very moment in the video where they are bragging about such a wide and growing network of cities, they show images of Hong Kong, where they have been cutting back with gusto in recent months.

  5. I agree 100% with AA. I cant stand them but they are correct. No one wants to pay for more legroom so why should they provide it? These online forums are filled with people who do not understand the business. Would you provide a service no one will pay for?

  6. I wouldn’t think to fly Spirit, Allegiant, Sun Country, and Frontier but if the gap between legacy carries are this small and getting even smaller, the day that I fly said carriers might be fast approaching.

  7. A well stated argument. What I have extreme difficulty understanding is why the suits in their ivory tower don’t just fly these new amazing economy seats regularly to discover just how bad the seats are.

  8. Robert Crandall said I best, over 20 years ago: People want whatever it takes to get the lowest fare even if it means cramming seats on the wing.

  9. As usual, AA is completely out of touch with their customers.. SMDH

    Slim line seats are more confortable? Who the Hell are they kidding?

  10. If I was going to invest a billion dollars in an airline, I’d trust Vasu’s judgment and reasoning over Gary’s any day. Vasu is focused on what’s economically possible. Gary is focused on what he wants as a passenger.

  11. I put my money where my mouth is and pay for more leg room. Yes, *on average* you cannot fill an entire cabin full of people willing to pay extra for more space. But some of us, for whatever reason, are willing to pay up with our own money. See Spirit’s “Big Front Seat.”

    One thing that the ULCCs do right is give me that choice, and make it easy for me to do so. I fly EasyJet, Ryanair and Air Asia quite a bit, because I don’t have to jump through hoops to get the exit row seats.

    The industry has evolved a lot over the years, where the legacy US carriers used to only allow exit row seats to be pre-assigned to elites or those on full fare Y. The carriers that let me buy extra leg room for a nominal fee got my first look.

  12. @ Dan — When you fly a USA legacy carrier, anyone — even those who fly Basic Economy on AA — can buy any coach seat they want, including exit rows. Of course, it will cost you. The price is variable, but it seems to be about $60 extra on a domestic flight. From my experience, almost no one pays: the seats eventually get filled by elites who get these premium seat assignments for free. If any of the better coach seats are then left, and the plane is full, they’re then randomly assigned to basic economy customers who decide not to pay for a seat assignment. This is why “more room in coach” didn’t work, and why AA is putting more seats on their planes. The vast majority of people don’t want to pay for more room: they are, of course, happy when they get more room for free.

  13. @chopsticks – utter non-sequitur, Vasu made a claim that does not stand up to scrutiny. I wouldn’t take a billion dollars to invest in an airline. Not in the top 5 places I would put the money.

  14. DL has conclusively proven that people DO pay for better product. Just look at all their financials, and how “premium” revenue has increased for them.

    To say that people don’t pay for a better product is to say that people only buy Chevrolet Sparks.

    I cannot understand the board of AA for keeping these idiots around. How many more billions of shareholder’s money are they going to waste before they’re finally fired?

  15. Yeah, right!

    So say the biggest liars & freeloaders who NEVER, EVER pay a penny for their comfy seats in the pointy end of the plane. (Cue massive eye rolls & itsy bitsy violins for these greedy jerks who say its cheapskates who “won’t pay for anything & therefore deserve to be treated like dirt.”

    What a load of crap.

    How hilarious it is that the biggest freeloaders on any flight who NEVER, EVER pay extra for their 1st/Biz class premium seats when they fly in their positive space seats up front, and whom also NEVER, EVER have to endure the long lines & other odious abuses & insults that are the many product degradations in recent years as the industry killed off any semblance of meaningful competition & instead “restructured” itself into an abusive Cartel/Oligopoly that are the only reason it continues to get away with myths & outright lies like this bs video does justifying teeny-tiny seats, crammed into no legroom 30”-31” pitch rows; super narrow, 17” wide, butt numbing, hard as cement seats; and loos so small the sinks are useless & people have even gotten stuck inside trying to cram into a space that’s too small & narrow for them to fit into among other passenger hostile – er “passenger pleasing” insults & degradations – implemented by these shameless hypocrites who themselves NEVER, EVER pay for the “luxuries“ and “amenities” they claim everyone else (but themselves, of course) don’t deserve because they’re freeloading cheapskates undeserving of a modicum of dignity, comfort & respect when they fly despite the fact that unlike these hypocritical, not to mention pampered divas & whiny liars, the people these whiny liars are referring to as cheapskates are actually FARE PAYING passengers who **PAID for their (crappy, uncomfortable & unworthy for the airline manager freeloaders) seats** (plus, of course, the greedy, freeloading, hypocrites’ salaries) that these hypocritical jerks installed and claim are perfectly fine (for everyone but themselves, of course).

    And enough idiots & gullible fools believe them, too.

    Go figure!

    Ah, yes, that old LIE about More Legroom Throughout Coach failing.

    If that’s so, then why did OG JetBlue succeed as a start-up offering more legroom than any other airline in coach; free seatback IFE featuring 36 channels of LiveTV; lower fees & fewer restrictions; a checked bag & more when nearly every other “no frills”/low frills, no legroom, no service (etc.) airline of the deregulation era such as People Express, America West, or Tower Air (just to name but a few examples of FAILED airlines that offered inferior products aboard mostly dilapidated planes when compared to OG JetBlue)?

    One can drink airline managers’ Kool-Aid all one wants spouting self-serving propaganda, myths & lies as preposterous as this video is.

    But that won’t change the FACTS that the people making these claims are FULL-ON CHEAPSKATES themselves who NEVER, EVER pay for the things they’ve taken away from others using faulty logic that it was done because NOBODY, including the jerks who spout these lies, wants to pay for it.

    Especially when this is being said by the same jerks who have the chutzpah to call an attempt to reduce row pitch to 29” while installing child sized loos and ripping out seatback IFE an “Oasis”.

    If that alone does not lay bare just how sleazy, dishonest, despicable & contemptible these whiny hypocrites are, then nothing will.

    It’s the LACK of meaningful competition, and the emergence of a greedy Cartel/Oligopoly that’s to blame for flying becoming as bad as it has in recent years all while countless billions of dollars have been sucked out of passengers’ pockets and express tracked into a handful of Oligarchs’ pockets.

    “Oligopolies are GREAT!” – said by NO ONE EVER except the Oligarchs and the shills that work & sell their souls to them (that just so happen to also be the BIGGEST FREELOADERS on every flight they’re on, too!).

  16. All said and done about what customers will pay for misses the big point; AA customers HATE the airline and especially the CEO Parker. At some point how a customer feels about your business will have a major impact. Southwest for example. In all AA propaganda they never mention how their actions impact customer loyalty and affinity. They think profits will come from stuffing more seats but at what price to the customer experience.
    Parker has to go so AA adds the customer experience back in their business model. Their inner focused business model is going to be their demise.

  17. Yea ok. the people who are making decisions solely based on ticket price and nothing else are the people who have little money or are soo inexperienced in air travel they don’t know any better. Often times these are the same types of people who misbehave on aircraft, which we have seen on other budget carriers. I think if there was more meaningful competition in the US people would pay a bit more for a comfortable flight, but competition feels very restricted in the US, so some people are forced to sit in these damn seats out of necessity.

  18. Another reason not to fly American.

    They have always had issues, especially with customer service.

    How condescending can you be AA?

  19. It is the reality. People want more legroom, but they are not willing to pay a dime for it. If united is five dollars cheaper, then they will pick united. Don’t you think they would purchase more extra legroom. Seats. For 60$ if they wanted it that bad?

  20. @Rudi —> It is all about diminishing returns…if I need to pay $60 for extra legroom from (e.g.) SFO-JFK, I’ll do it. But if it’s $60 between SFO-LAX…I am *not* paying $60 for a 60 minute flight — I’ll just put up with it.

  21. Bottom line – American Airlines just SUCKS!!! They hate their customers. Why would anyone fly them and have to deal with a bunch of angry, pissed off employees. Raju, and all American executives should have 2 rows of these wonderful coach seats moved into their offices, and they should have to sit in the 2nd row for a week, and see how comfortable they are……
    I would not fly American if they gave me a free first class ticket anywhere!

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