American Airlines CEO Robert Isom lamented this morning how difficult it is to run an airline like AA. But to blame AA’s problems on the FAA, supply chains, and Boeing fails to fully account for why American continues to underperform its peers.
American Airlines CEO Blames Supply Chain, Air Traffic Control For AA’s Woes
Speaking at a Skift Forum in Dallas, Isom complained, “‘It has never been harder to operate an airline.” He cited air traffic control issues and supply challenges as the main culprit for making it difficult.
“And so, whether it’s air traffic control … that’s very different. That to fly from Chicago to New York, it’s 30 minutes longer than it was 20 years ago.”
And he’s right that not only has progress in modernizing US air traffic control systems stalled, but that the mismanagement of the current system has led to operational inefficiencies like being forced to add buffer time to flights, known as schedule padding, due to the uncertainty of air traffic congestion, particularly on the East Coast.
Isom also blames the supply chain, saying both aircraft and engine manufacturers are failing to deliver.
“The supply chain…the airframers or the engine manufacturers, but the whole supply chain really hasn’t come back to where it was in 2019.”
And he’s right about this too. Work came to a standstill at Boeing for seven weeks as 33,000 workers went on strike. Engine manufacturers have had great challenges in delivering. And that has frustrated AA’s growth plans.
A Lack Of Clear Vision At American Airlines
But here’s the thing. Notice how Delta and United have performed so well while American has struggled. All three carriers operate weather-prone hubs and deal with the same Air Traffic Control system. United has also run into delivery issues with Boeing and while Delta is buying Airbus jets right now, you cannot reduce AA’s problems to factors beyond its control (same issue with Delta’s CrowdStrike meltdown).
While it has become almost cliche among airline analysts, Isom’s problem is that AA still does not have a vision. The Vasu Raja approach failed and even as AA continues to bulk up its domestic routes and add international flights to “safe” destinations in Italy and Spain, there is no discernible strategy that is driving operations: it seems AA just throws things out to see what sticks and tries far too hard to be many things to many people.
Tomorrow, I’ll discuss how AA forfeits loyalty by missing out on low-hanging fruit like its phone systems, website, and onboard wi-fi. That’s part of the problem too, but more indicative of the lack of clarity in pushing toward excellence.
CONCLUSION
More introspection is needed at American Airlines. Yes, there are factors beyond its control that have impacted operations and made it “hard” to run the airline. But those issues are not unique to AA and it is time that AA determines once and for all what it wants. Does it want to be a premium competition to Delta and United or does it want to provide something else, like an alternative for budget travelers who want just a little more than Spirit Airlines? Because trying to please all people ends up pleasing no one.
image: AA
