Posts from the ‘American Airlines’ Category

Lori Ranson, writing for the APEX Editor’s Blog, talks about some of the intricacies relating to the American Airlines and US Airways merger:

“Now management teams at the two carriers face the formidable challenges navigating a seamless combination of their respective operations while minimising the effects of inevitable integration challenges on the combined carrier’s expanded customer base.”

On one side of the fence, we have two management teams which are now trying to combine as one. Needless to say, this won’t be a pretty sight, nor would the process of it be anything but a dread for the many. Clashing corporate cultures and the amalgamation of personnel, on almost every level of the pecking order, will most certainly reverberate throughout the organisations (that’s with an “s”, for now).

Oh, and how can I forget about the unions supporting their members…

“But cracks appear to be spreading in the joint vision for the overall passenger experience for the American Airlines that will emerge after the two airlines complete their targeted 18-month integration effort.

Roughly a month after American choreographed an elaborate unveiling of an update of its 45-year old aircraft livery, uncertainty is arising over the new branding’s longevity now that American and US Airways are merging to become the “new” American. The new livery that features [an] American flag on the tail and a flight symbol replacing the iconic eagle next to the American name at the front of the aircraft has drawn more criticism than praise amongst the active aviation community.”

Wasn’t that the plan from the very beginning — that is, American Airlines and US Airways becoming as one, and taking the former’s branding?

All the rumour and speculation relating to the new American Airlines livery were around weeks before its official announcement, including pictures of their new Boeing 777-300ER aircraft leaving Paine Field with no tail markings. During this same time, the merger talks have been well under way.

More interestingly, though, is how American have made such significant investments in their rebranding and restructuring efforts, but yet they selectively chose to turn a blind eye on the very-clear possibilities of a merger with US Airways. How can this possibly be?

“Queried directly about the new American branding–including the new livery–remaining in place now that two carriers begin work to build a joint management team for the new carrier, US Airways president Scotty Kirby told investors that the American Airlines name is the greatest in the history of aviation, and with “100,000 employees who are excited about this..that’s going to help us have the best product in the industry, and really your brand is as much about your employees and how they treat customers”.

Prodded that he avoided directly answering the question about retaining the new livery, Kirby quipped: “I was well coached.””

What a load of crap.

“US Airways has also concluded that based on lessons learned from its integration with America West, and observing the mergers of Delta and Northwest and United and Continental, that it is more prudent to “take the larger airline’s [technological] systems and put those in place”, said Parker.

Asked if that same philosophy would apply to the passenger service approach of the combined carriers, and queried specifically about the fate of American’s “Main Cabin Extra” extended legroom offering, US Airways’ president Kirby remarked that “there is going to be a whole host of integration harmonisation that needs to go on.” Soon a transition committee will start work on a whole host of areas where the two carriers have differences, and Kirby stated there are “no answers [on those differences] yet”.”

Yes, let’s do talk about sitting around and watching other airlines wrestle away…

I’ll use the Continental and United Airlines example. On the surface, their integration is pretty simple: retain the United brand name, but use the Continental tail. Why? Those of us in the commercial aviation are aware that the latter scores far greater points when it comes to passenger experience, by far. Brand association, via visual stimuli, is a very strong one, and I believe this is one of the baseline reasons why the new branding set-up is so.

But beneath the surface, although United-Continental attempts to integrate the better passenger experience factors into their current product, those very same issues relating to the management teams and their workers still plague the development of those possibly-positive aspects from their joining.

In my personal opinion, for both Delta-Northwest and United-Continental mergers, one major flaw comes to mind: branding. In reality, the Delta and United brand names are indeed more far-reaching than the respective alternative. However, if I were to use passenger experience as a means for the branding decision, I would’ve most certainly chosen the alternate brand for both. It is also my belief that those in management who makes such decisions have, pretty much, no regard for the qualitative aspects and long-term implications of their decisions.

Getting back to the American Airlines and US Airways merger, both airlines have somewhat-tarnished reputations when it comes to their branding, hence it probably wouldn’t matter as much in that regard. The integration of the two airlines into the same “American Air” branding makes the most sense, given how the former is the one actively acquiring the new aircraft and upgrading their in-flight (hard) products — albeit the airline having filed for Chapter 11 bankruptcy protection back in November 2011.

As with virtually all airline mergers we’ve seen in more-recent time, there will be winning and losing elements for customers, more so for the frequent flyers of either airline. Again, the acquisition of newer products by American Airlines will mean an improved on-board passenger experience for various flights/routes. But for people who have Star Alliance Gold status with US Airways’ frequent flyer programme will most likely lose access (to those partner airlines) once the merger is completed, as the decision to go oneworld has already been made.

“Shortly before Kirby made those comments, American’s CEO and the combined carrier’s future Chairman Horton stressed that American has had a strong focus on “our highest value customers–global travellers that provide a disproportionate share of our revenue, and our strategy over the last couple of years has been all about building a great experience for those customers”.

“Doug and I have talked a lot about that,” Horton remarked. “The mission going forward is to make sure we’re pushing forward with all of those things and ensuring that we only make it better for our best customers.””

By “our highest value customers” being those “global travellers that provide a disproportionate share of our revenue” , I’m assuming Horton was referring to the subset of passengers who either: don’t have much choice when it comes to picking a carrier based on their required itinerary; or are clueless to the fact there are better alternatives made available by numerous non-American-based carriers.

All I’m going to say here is this: If you’re going to attempt a mass exercise on improving the passenger experience, then should this not be across-the-board rather than just concentric on keeping your premium-paying customers happy?

Of course, this wouldn’t be the American way of doing it (pun very much intended).