The American Airlines pilots’ union said it has noticed a “significant spike” in safety and maintenance-related incidents.
27.03.2024 - 15:38 / travelweekly.com / Vasu Raja / Gary Leff / Airlines
American Airlines currently lags Delta and United financially. But American believes it can close that gap -- with a strategy that diverges from its legacy rivals.
At its Investor Day earlier this month, its first in seven years, American executives laid out a vision for increasing profitability that leans heavily on growing the rank-and-file membership of the AAdvantage loyalty program combined with leveraging the breadth of its regional network.
American also plans to add first-class seats on retrofitted planes and on regional aircraft, which sounds like a bid to increase its position within the premium airspace.
But some analysts made note of the fact that the airline did not spend time at the Investor Day event discussing details of its premium offering, including seats, lounges and service.
That's an approach that differs sharply from Delta and United, which, in corporate messaging and product investment, often home in on premium engagement, with a significant emphasis on transoceanic flying.
"They are not growing their long-haul international as a focus," Gary Leff, who authors the View From the Wing blog, said of American. "They believe their advantage is a network … creating connections and operating more regional jets. It's not a product strategy."
Viewed within the immediate context of Wall Street, the March 4 Investor Day event fell flat. American's stock dropped 5.4% that day, Bloomberg Intelligence aviation industry analyst George Ferguson pointed out.
"I think it kind of hit the market with a bit of a thud," he said.
But for American, the story that ultimately matters is whether its strategy succeeds in driving higher revenue and higher margins. The carrier recorded an operating profit of 5% last year, compared to United's 7.8% and Delta's 9.5%.
Coinciding with its Investor Day, American announced an order of 260 aircraft, all geared toward upsizing the average seat count in its planes. For its mainline fleet, the order includes 85 Airbus A321neos and 85 of the yet-to-be-certified Boeing 737 Max 10. Only 20 of those jets, however, are scheduled for delivery before 2029.
American also said it would retrofit the interiors of its Airbus A319s and A320s beginning next year, with all of the planes receiving an extra row of first-class seats.
In addition, the carrier's new order includes 90 Embraer E175 regional jets with the first deliveries scheduled for next year. They'll replace American's existing fleet of 50-seat Embraer and Bombardier aircraft by 2030, clearing the way for the airline to offer a first-class cabin on all planes.
During the Investor Day presentation, American chief commercial officer Vasu Raja detailed how American intends to make use of its regional fleet to
The American Airlines pilots’ union said it has noticed a “significant spike” in safety and maintenance-related incidents.
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