Union leaders from acros American Airlines work groups have come together in an intervention to try to influence the direction of a flailing airline whose financial performance continues to lag the industry. They’re worried that an airline that underperforms will have less money to pay them – meaning long-term lower wages and less job security.
Pilots; flight attendants; aircraft dispatchers; passenger service agents; rampers and mechanics unions convened last week and issued a statement, and will come back together at the pilot union headquarters in October.
They’re right that there’s more surplus to extract from a profitable enterprise. That’s an important realization. And they’re right that this management has performed poorly over the past decade. However, letting the inmates run the asylum isn’t a recipe for financial success. Their incentives aren’t the same as shareholders or passengers (and management hasn’t done much to align them).
And calling for “service improvements that include greater employee empowerment and enhanced employee protections” underscores this reality.
Indeed, in some cases it’s these enhanced employee protections that are the problem, since American has a service problem relative to competitors like Delta and JetBlue and even United. Of course there are great crews, and it’s managemnet that’s to blame for not rewarding great service, not working to weed out unhappy employees, and not selecting for talent that’s going to overdeliver. But more employee protections just aren’t a way to fix that.
This comes as American is finally promising major changes to reverse a dozen years of neglect under former US Airways management.
Frequent flyers were leaving the airline even before the pandemic. American has a huge net promoter score deficit versus Delta and United. It’s progress that they’re now actually using NPS as a metric.
But their attempt to win back managed corporate travel seems to just be driving up cost, not increasing revenue since it’s the decline of the airline’s position in key business markets like New York, Chicago and Los Angeles that’s causing them to lose share.
I’ve said for many years that no airline has greater potential than American Airlines to be better than it is today. They’ve checked off a number of ‘quick wins’ over the past several months, like improving standby policies, letting premium passengers keep headphones until landing, and adding buy on board food for sale on more flights.
The real question is whether they’re willing to make long-term capital investments in passenger experience. Towards that end it’s great to see the commitment to a business class Flagship lounge for Charlotte and what I understand are plans to do the first renovation of an Admirals Club into the new style (Washington National D concourse).
American is quietly improving more than anyone realizes – but even their own employees don’t know it.
CEO Robert Isom needs to be out on the road, visiting stations, articulating a clear vision – one that customers can understand and also for employees can internalize so that they know service they’re meant to deliver. When Oscar Munoz did this, it’s what began to turn United around.
(HT: Paddle Your Own Kanoo)
Good. Organize. Workers (and consumers) don’t have to accept worse and worse. Demand better.
Well said, Gary, as I scan those 4 bullet points out the top, only a single term (“greater employee empowerment”) has the potential to improve customer outcomes. Every remaining term either has the potential to worsen AA’s financial performance or worsen customer outcomes.
the last paragraph is key.
Leaders can and should convey strategy and vision and AA hasn’t done it. Perhaps they are afraid of failing again but they need to be bold in figuring out where they are planning to go and get everyone onboard.
and some of the execs simply do not have a vision for what AA can be.
How about focus on yourself first. It’s rich when the surly FAs, who have no education, no clue how to do anything in life except serve drinks and browse on their phones, who hate their job and it shows, are lecturing others on how to do their job better. You’re the main reason AA lags financially. Same goes for the bag throwers, the power tripping gate agents, and basically all the miserable customer facing workers.
Mantis – Well said. The front facing gate agents and flight attendants are my two biggest complaints about AA.
First of all Isom needs to go. We was never the right pick when Parker stepped down. Unlike Parker who was doing monthly meetings with employees and visiting hubs, Isom is nowhere to be found. Counting his money I guess.
I agree that AA has made a number of positive yet small improvements this year. They seem to be going in the right direction but at a very slow pace. I think they need to identify the single most impactful improvement they can make and launch it in a big way. They should also relook their route structure. They ceded away so much business to the competition on coast to coast flights and northeast to Florida routes.
Heads up AA, and take a lesson from the competition WN. The GK years were filled with lies to the employees and to the Customers ending in unfulfilled promises as he toured the Stations throughout the system. When the promises come from Isom, hold his feet to the fire and hopefully keep the Predator at bay.
It would be a good start by having decent aircraft on transcon flights. On MIA LAX used to have a widebody with lie flat seats. Now these narrow body flights with no IFE leave a lot to be desired. I, along with many others are willing to pay thousands for decent seating. I travel often MIA LAX and pay F fare. If a better aircraft (I.e. 777, 787, etc)
more flyers would purchase, meaning more revenue for AA. That, coupled with other needed improvements would make AA the great airline
Isom seems to be at the root of the problem. These episodes with American Airlines kinda reminds me of the merger of Boeing and McDonnell-Douglas. Putting Harry Stonecypher in charge of the new combined companies was the downfall of Boeing!
@Helen
What do you mean no IFE. I much prefer the ability to use my personal IPAD to connect to the IFE rather than using the scratched up and faded screen on in seat displays. Just flew back from Europe yesterday and the screen was scratched hand on the 787 you can’t access the IFE through your personal device and can’t use your blue tooth headphones as well.
@Mantis — Keep ‘carrying water’ for those billionaires and their mercenaries (CEOs like Isom who made $31 million in compensation for 2024…) Real ‘the beatings will continue until morale improves’ vibes…
The only way that they will accomplish their goal will be to convince shareholders to completely shake up the Board of Directors from the ground up. All new board members and an entirely new C-suite with a totally different strategic vision. Until that happens, or until bankruptcy occurs, nothing meaningful will change.
Elliott Investment Management will be looking for a new company to invest in soon.
@Mike Hunt.
You are absolutely correct.
@jns — Let see… already charges for checked bags… already charges for assigned seats… welp, I guess our job is nearly done here… only thing left to do is to sell it and grab our golden parachutes — Elliott (mis)Management
I was on cancelled flight on Thursday back to Dallas. Plane came to in around 7pm. Ferried back empty to DFW around 4:30am. (Regulations allow more liberal pilot flying times for empty aircraft) and I was left to fend for myself – weather. Lowly Platinum couldn’t get a person on the AA phone. Cost me a hotel night and dinner and more importantly a whole day. Had to connect through hub, as no direct flights or at least that’s what online said. Look up “AA cancellation policy vs Delta” on AI – AA uses strategy to get planes back for no interruptions for next day start. Delta uses strategy that requires bit more investment in crews/planes but they fly late (even a lot later) but get you (and plane) home. Look it up – it’s fascinating. My issue is not with frontline – I’d be miserable too if mgt treated me like AA does theirs – I’m really tired with “don’t spend a dollar more than necessary” mentality of AA Execs. Where’s Mr Crandall when you need him. (Not PE – they will be even worse)
I went from flying AA 1-2 times a week to moving all that business to UA and DL. Over $30K a year in fares and tens of thousands in credit card spend…poof…gone. Not to return any time soon.
The culture at AA is, quite simply, busted. Corporate leadership has built an unsustainable cost structure. Customer-facing employee performance is inconsistent. Hard and soft products are failing to keep pace with traditional competitors. Route strategies are haphazard. Operational reliability is in the toilet. Messages put in the ether signaled that AA could care less about its customers.
If AA wants to fix this quick, it’s time to clean house in the C-suite and time to drop the hammer on customer-facing employee performance. It’s also time to get serious about offering a CONSISTENT, premium experience to their customers.
@ Gary — Correction: “CEO Robert Isom needs to be out” of a job. He needs to go. NOW.
@ Parker — +2 from my household. Haven’t missed AA at all. UA has been a breath of fresh air. DL still needs some work to improve phone service that they destroyed during COVID and F seating that has unacceptably low pitch on almost all aircraft. At least DL HAS phone service, unlike AA, where they’ll call you back when it is convenient for them. I very rarely book a cash ticket on AA, and when I do, I credit it to AS.
@Gene — Taking DeltaOne today on their upgraded 764 and the 359. Gonna be a long journey but so far the hard and soft products are treating us well. @Tim Dunn would be proud!
@Gene – Getting rid of Isom would be totally meaningless without a complete sweep of the Board. They are all incurably infected the ULCC strategic thinking a la US/HP, so whomever might replace Isom under their leadership would only be a carbon copy in terms of business mindset.
@ 1990 — Nice! It’s amazing what DL did with the same space on the 764s vs my favorite, the 763! And the 359s are super nice (all 3 of them 🙂 )!
@Gene — Not to wax poetic on hard product, but… I got the ‘crew rest seat’ (4D) on the 764, which has the extra curtains (even though there’s no door, like on the 359); yeah, the 763 is ancient, though, as I’ve said before, I’ve ‘learned to stop worrying and love’ the old girl, because it’s lie-flat has good length (for the taller folks), and the GUCs can be from Main to D1; those older 332s with the herringbone are maybe my least favorite (I know, Tim, they’re working on it!) This is where United has done better for consistency in upgrading all its 767 and most 777 to new Polaris, except those truly awful 772s with the reverse 2-4-2, which may be the absolute worst, but thankfully it’s usually just on a few domestic short-haul and transcons. AA just needs to upgrade its 777, 789, and a321T to the new Flagship Suites, then all will be right with the world.
1. The reference to “former USAir” management running AA into the ground creates a false impression that they no longer run the airline. Make no mistake about it, the entire Managment organization (line; staff and C-suite are the same inbred incompetents that were forced in with the merger.
2. It’s always interesting to note the unions referencing “weeding out poor performers. “Get real, THEY are the reason thousands of slackers and deadbeats continue to infest the airline.
Only one solution…….a complete housecleaning similar to their crosstown rivals….Southwest.
As a current employer of AA I love how the unions are handed everything under the sun while the rest of us, meaning lower level management employees are lucky to see a 2% raise on a yearly basis! These unions could care less about the company as all they care for are more overpriced labor contracts! This company is so flawed it’s not even funny and I could run it much better so these so called leaders of the company!
Upper management does not listen to the ideas of their workers and they don’t care as at the end of the day they only care about one thing and that’s themselves!
Looking back into time now I wish I would’ve gone to work at Delta or United as these companies are at least better st treating their customers and most employees!
Parker (Former CEO) left a mess. Parker and the rest of the US Air clowns ruined a once great airline. Isom made his millions for poor performance and I now is the time to fire Isom and bring in a new team..