Airliner World 09.2021

RIGHT • A Boeing to build back better. AA has been
777 undergoes aggressive on this front, with fleet
electrostatic spraying right-sizing, creating two high-profile
at the carrier's DFW alliances with domestic ‘frienemies’,
hub, as a preventative unexpected network growth, and
COVID-19 measure a ‘no sacred cows’ approach to
ROSE BACA/ grounding unprofitable flying.
AMERICAN AIRLINES
Znotins compares the events of
BELOW • The airline has 2020 on the US airline industry to
come a long way since having a health scare: “It motivates
April 15, 1926 when you to start exercising and eating
Charles Lindbergh flew its better. Ten years from then, you're a
first flight – carrying mail healthier person because of it. Our
from St Louis to Chicago ‘health scare’ caused us to take a hard
AIRTEAMIMAGES.COM/ look at what we were invested in
JOHN KILMER – less profitable areas such as
the west coast and New York. We
can't afford to make those kinds of
investments in a world where
cash is tight.

“Strategic flying is a euphemism
for losing money in this business.
We had flights like Los Angeles to
Beijing, which were losing money for
us, but we would call it strategic and
that would allow it to stick around.
But in a crisis like this, you need to
take a hard look at it and say: ‘LA to
Beijing. That's not working for us.
It's never worked for us. So what do
we do differently in those markets
[that] aren't traditional strengths for
American and allow us to maintain a
presence there, and relevance, while
not having to invest [as much]?’”

This thinking helped facilitate the
creation of an international west coast
alliance in Seattle with Alaska Airlines
and much ballyhooed northeast
alliance with JetBlue in New York
and Boston. For Znotins, the benefits
of such partnerships were clear: “We
partnered with Alaska so we can
benefit them by having long-haul
flying off the west coast [Seattle to
Shanghai, London, and Bangalore].
They can go after corporate accounts
in their markets, and for us, we
don't have to invest [aircraft] in
loss-making flying on the west coast.
We can take those and invest them
elsewhere in the system, where
we can make a return, but still not
abandon the west coast because of
our partnership with Alaska.

“The same is true in New York
– American and JetBlue alone are
number three and number four
[respectively in NYC]. If we combine
our forces, we can be number one
and attract more corporates in the
market, which allows us to have a
stronger presence there,” said Znotins.

On the face of it, AA appears to
have given up more than it has
gained, regarding the number of
slots and city-pairs, particularly at
LaGuardia (LGA), and, to a lesser
extent, JFK. That said, American
does reap additional domestic feed
to its expanding international JFK
operation, which had previously
been shrinking over recent years.
“We can use the widebodies to fly the
long-haul stuff, which is what we're

www.key.aero 101

ABOVE • Recently, JetBlue good at. We've got the differentiated anti-competitive, and should be there are hubs that lose money. If we
and American have product and JetBlue doesn't have any scrutinised more like a merger or can eliminate the losing money part,
formed an alliance in the widebodies. They can't get to Tel Aviv joint-venture (JV). American boasts it then we'll be more profitable and we'll
New York and Boston area on a non-stop basis, but with their goes well beyond the typical alliance. be able to grow more.”
AIRTEAMIMAGES.COM/ code on our metal, they can. So, it is In fact, a domestic ‘super-alliance’ of
VINCENZO PACE taking our [long-haul] strengths and, this scale (much less two) hasn’t been American’s big build up in Austin,
just like on the west coast, providing seen in well over a decade before the Texas, is a good example of the
BELOW • American's access to those strengths for wave of consolidation of the 2000s. airline redeploying freed-up aircraft
Robert W Baker the market.” from formerly unprofitable ‘strategic’
Integrated Operations While Znotins stressed that the flying. Its now firmly on an offensive
Center opened in Fort At JFK, the partners codeshare arrangement is not a JV, when footing – locked in a three-way race
Worth on August 15, 2015 and compete on a number of asked why Raja said he doesn’t in establishing a focus city in the
AMERICAN AIRLINES overlapping routes, particularly on care which ‘metal’ passengers fly booming state capital against Delta
domestic transcontinental runs, on, he revealed: “We do have a Air Lines and Southwest Airlines.
but the strategy at LGA is a little financial settlement that allows us to
different. “In a market like LaGuardia, participate in JetBlue's success. They “In the first decade of the century,
we tied up [aircraft] flying routes can participate in our success in the we saw our competitors try to
that were losing money. JetBlue Boston and New York markets. By take those opportunities where
can fly more LaGuardia. We can working with JetBlue, and they had we were weak and we had played
code on their flight, still capture the aspirations to grow in LaGuardia, defensive. So we're trying to be more
business demand, but not have to we can scratch their back and offensive emerging from this crisis
invest in these loss-making routes they'll scratch ours. Our goal is to and not give up ground. Austin,
in the system and use those [aircraft] continue to grow. There for a whole host of reasons, was
somewhere else.” are hubs that make growing before the pandemic and
money and it's growing even more afterwards,
Carrier competition with people relocating there. It is a
market that is tougher to serve via
Some rival carriers, most notably our hubs, because we're facing more
ultra low-cost firm Spirit, competition. So, if you really want
have cried foul on the to be a player, you have to fly more
alliance, alleging non-stop from Austin.”
that it is
Fleet focus

The pandemic provided a further
opportunity to accelerate retirement
of older types and simplifying the
AA fleet, which resulted in 10% less
capacity. The remaining Airbus
A330s, Boeing 757s, and 767s, all due
for ‘the departure gate’ were sent to
the desert at the onset of the crisis.
With the loss of aforementioned
‘strategic’ flying, changing widebody
fleet capacity, and
comments

102 AIRLINER WORLD SEPTEMBER 2021

RIGHT • American Airlines
is the world's largest
airline across multiple
metrics, including
fleet size and scheduled
passengers carried
AVIATIONIMAGENETWORK/
SIMON GREGORY

BELOW • AA's portfolio
comprises Airbus, Boeing
and Embraer examples
AIRTEAMIMAGES.COM/
MARKUS MAINKA

www.key.aero 103

RIGHT Fleet team uncompetitive with narrowbodies
members unloading and that [aircraft] – over the course
baggage from a of 12 months – wouldn't make
handling vehicle money for us. That's the reason we
onto the aircraft belt decided to retire them. Instead, we're
AMERICAN AIRLINES going to have XLRs that can fly more
consistently year-round to Europe.”
RIGHT The Texas-based
carrier has rolled out new The 2021 summer season has
technology to reduce undoubtedly been a boom time for
the risk of COVID-19 domestic leisure travel in the US, but
transmission at its sites the picture typically changes in the
AMERICAN AIRLINES autumn, when leisure tends to fall
away in favour of business trips. The
BELOW The company from the company that the flying them, that means we get AA network planning chief said these
began trading on the New international network will be more [of them] and grow with all-important flyers are set to return:
York Stock Exchange on different, many industry analysts more non-stops to new places.” “We've been speaking with our
June 10, 1939 have speculated that this will result corporate customers and many are
AVIATIONIMAGENETWORK/ in a diminished long-haul network Znotins explained the rationale returning to travel this summer, with
on the other side of COVID-19. Asked behind this logic: “We had a habit 47 out of 50 saying that they'll be back
SIMON GREGORY by Airliner World if there is truth in of taking an A330 and flying three by the end of the year, [but] at what
this theory, the AA network planner months of the year to Europe, [which] volume is still yet to be determined.”
insists it isn’t the case: “If I've got was profitable for us, but then we had
smaller, more economically viable nine months where you couldn't fly it With relatively few long-haul
[aircraft], like the 787 and the [Airbus profitably, because the demand wasn't routes available for mass travel, and
A321] XLR, and we can make money there. So, we put a high seat-cost surging – if uncertain – demand
plane in the domestic system that is for domestic services, American,
Delta, and United have been adding
capacity with widebody aircraft that
would otherwise be parked. But as the
CARES payroll support ends and the
COVID recovery is patchy, what is the
future for widebody metal?

“[Border closings and openings]
are unpredictable, and that's why we
went with predictable strength this
summer. We chose not to leave any
of our widebodies parked in reserve,
speculating that there will be markets
in Europe that will open up and
there will be strong enough yield and
demand to warrant the flight. We said:
‘Hey, demand is strong to Vegas, so
let's put that widebody there instead.’

“So, when/if Europe does open [this
summer], all our widebodies are spent
– we are not going to add to Europe.
But we made not only the safe bet
but the right bet to go domestic and
short-haul Latin. We're already seeing

104 AIRLINER WORLD SEPTEMBER 2021

ABOVE An Airbus that routes such as Cancún are still through a once-in-a-generation crisis but when you get to do something
A321ceo, N145AN booking stronger than a normal wasn’t demanding enough, during you've never done before and learn
(c/n 6783), saddles [autumn]. If we have continued the height of the pandemic Znotins new things, you have to adapt in a
up alongside Boeing weakness in the long-haul market was commuting home to Calgary very rapid and meaningful way. Over
787-9, N821AN (c/n with these widebodies, we'll just keep nearly every weekend, until the the last 12 months, I have been more
40640), at Los Angeles flying them in places like [the ones] Canadian hotel quarantine policy interested in my job than I've ever
AIRTEAMIMAGES.COM/ we're flying them this summer. Did came into effect. Znotins is not alone been in 20 years, because everything
we buy that [aircraft] to fly to Cancún? in cramming ten years of change into I thought was true got pitched out
BASTIAN DING No. But we know that airplane will 18 months, but he seems to have the window and we had to
eventually go back to long-haul thrived with the challenge. “It was reinvent.”
flying,” the AA executive remarked. sobering but, in a way, exciting. I
would never choose this crisis again,
As if helping steer the airline

www.key.aero 105

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PROUD PERFORMERS FLY E2

CONGRATULATIONS HELVETIC AIRWAYS,
ON TAKING DELIVERY OF THE E195-E2.

As part of their strategy to optimize their fleet mix, Helvetic Airways
have recently taken delivery of the first of four E195-E2s. Striking a
great balance between range, fuel burn and environmentally friendly
operations, this new-generation jet also gives Helvetic the seating
capacity and flexibility to match capacity with demand. We wish this
innovative and proud European carrier every success for the future.

embraercommercialaviation.com
#E2Sustainability