Their current strategy of "Shrinking to profitability" is one that will not work and history is littered with examples of failed airlines that attempted to do just that.
Unfortunately, nobody is expanding right now (except marginal expansion by Jetblue) due to the lack of travel demand. When demand starts to turn the corner everyone will be adding flights, buying airplanes again.
Quote:
Originally Posted by bgmann
I kinda think AMR has something up their sleeve to be released in the next month or so to make Delta envy for. I hope at least...wishfull thinking. But if they dont do anything over a few years they might be checkmate.
The only thing AMR could have up their sleeves is a Chapter 11 filing.
They should have done it in 2003 and gotten it over with, but the stubborn insistence of their management to "Maintain control" has now painted them into a corner they can not easily get out of.
Their current strategy of "Shrinking to profitability" is one that will not work and history is littered with examples of failed airlines that attempted to do just that.
DL probably will end up with T-9 as Arpey and his team make a "Strategic Retreat" from the largest air transport market in the world.
In some ways, I miss the days of Crandall. You might not have liked him, but he was a dedicated manager, and utterly driven to see AMR succeed.
Under his reign you saw:
Introduction of computer reservations systems
Introduction of Frequent Flyer programs
Introduction of yield management
All of which were light years ahead of the competition. He was also steadfastly against deregulation and codesharing, especially international codesharing.
I'd be nice to see someone so driven to succeed these days, instead of the typical make bank and bolt milquetoasts we have today. RA is pretty much the only guy at the legacies that even remotely measures up as an "airline guy".
American and Kennedy are synonymous. They will not relinquish that terminal to a rival, especially Delta (If American wants to continue to exist). They'll watch JAL go away. New York is worth more. We all know New York sucks, but we put up with it because it is the difference between success and failure. Bye Bye JAL. There is always a new Chinese carrier to recruit anyway. Southern, Eastern, Air China, China Air, etc. Cathay (And Dragon Air) will get' er done for the Far Eastern side of the alliance.
American and Kennedy are synonymous. They will not relinquish that terminal to a rival, especially Delta (If American wants to continue to exist). They'll watch JAL go away. New York is worth more. We all know New York sucks, but we put up with it because it is the difference between success and failure. Bye Bye JAL. There is always a new Chinese carrier to recruit anyway. Southern, Eastern, Air China, China Air, etc. Cathay (And Dragon Air) will get' er done for the Far Eastern side of the alliance.
And that is now the choice that AMR is faced with.
New York travel, fraught with delays, changes, cancellations, etc., means the terminal really matters. With the exception of southern suburb traffic to Newark, because it sucks to cross the city to go to Garbage or JK, where you sit around makes a big difference. I'd say T-8 falls right behind DFW right now in importance for American. Maybe even more important than O'hare. Certainly more important than Garbage.
Delta and American route overlap from JFK means that the difference in sales could be where some first classer or coach poor slob has to sit around. Obviously, Delta knows this because they want 8. American must know it too. Europe-NYC travel will return and grow, But British Airways will likely reduce service, American will not give that diamond away even if it is a few months/maybe years down the road or the loss of JALways. Its musical chairs in New York and if you don't have a good one in the next year...well there are other lines of work...
Until I actually see the King down, I won't celebrate any victory. Nor will I understimate an opponent. AMR is a competitor, and a formidable competitor at that. I'm proud of my airline, but I think we're getting a little carried away here, measuring the curtains at JFK, and Haneda both.
Until I actually see the King down, I won't celebrate any victory. Nor will I understimate an opponent. AMR is a competitor, and a formidable competitor at that. I'm proud of my airline, but I think we're getting a little carried away here, measuring the curtains at JFK, and Haneda both.
Good article, but that is the point. If AMR needs to invest in JAL we are talking some serious money. Yes, JAL may side with its Oneworld partner, but if that money came from AMR alone, and not the whole alliance, it truly would weaken its balance sheet. That was the point. DAL is trying to make them decided. They may invest in JAL and tell DAL to kiss it in JFK, but they will be financially vulnerable.
Delta is playing for keeps, that was the point. It may appear on the surface they have lost this tat, but time will tell.
Position: "...that's right, ma'am: not a 'pilot', just a 'co-pilot'..."
Posts: 348
Quote:
Originally Posted by acl65pilot
Good article, but that is the point. If AMR needs to invest in JAL we are talking some serious money. Yes, JAL may side with its Oneworld partner, but if that money came from AMR alone, and not the whole alliance, it truly would weaken its balance sheet. That was the point. DAL is trying to make them decided. They may invest in JAL and tell DAL to kiss it in JFK, but they will be financially vulnerable.
Delta is playing for keeps, that was the point. It may appear on the surface they have lost this tat, but time will tell.
I get your point, but maybe you're not seeing mine. There is nothing in this Bloomberg article that tells us which way this will conclude, or even that we have lost this "tat". That wasn't my argument. The only value of the article is that it shows alternative outcomes. The point the article doesn't make, because it can't report the unknown, is what other events could occur. For example, could ANA offer a merger with STAR money?
For now, we seem to be looking at a series of difficult moves for AMR. I agree with you: they might have to make a difficult choice between sacrificing two valuable pieces. But you and I don't even see the entire chessboard, and we defintiely don't see the future. Therefore, it's pretty difficult for either one of us to call the result of this particular exchange, and it's definitely premature to call check mate.
And we should not presume they're not also playing for keeps.
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