American Airlines continues to show promising growth in passenger and cargo factors. In June, the airline flew 4.2 million passengers compared to less than one million passengers in April. Load factors were running at just 15% in April, but have since recovered to 63% in June.
In a message to American Airlines employees yesterday, CEO Doug Parker painted a mixed image. While he said passenger numbers are tending in the right direction, the overall situation on American Airlines remains bleak.
“But to be clear, even with the traffic trending upward, the absolute numbers behind these improvements are pretty grim,” he said.
Play a busy week on American Airlines. The airline has ‘restarted’ its international flight for the next 12 months and has generated some controversy by booking flights at 100% capacity since Wednesday. Parker is designing these changes as part of a “new way of traveling.”
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Airport traffic suggests the worst is over for American Airlines
Despite Doug Parker’s mixed messages, U.S. airport numbers suggest the worst is over for American Airlines.
At American’s busy downtown Dallas Fort Worth, the airline is expecting about 44,000 passengers today. From a minimum of just 200 daily flights in and out of DFW, American Airlines will operate 667 flights on its busiest days beginning July 9.
At Miami International, the number of passengers has increased tenfold since its March lows. In Las Vegas, there were approximately 200 flights per day in June. In May, there was an average of 145 flights per day.
In Denver, 600,000 passengers passed through the airport’s security checkpoints on June 29, their busiest day since mid-March.
Competing airlines also strengthen services
That trend is supported by American’s competitors who are beefing up services during July and August.
Key competitor United Airlines will add nearly 25,000 domestic and international flights in August. Delta Air Lines expects to fly some 600,000 passengers over the weekend of July 4. It’s a significant drop in the 3.2 million passengers that Delta flew on July 4, but also a huge improvement compared to recent lows.
Back on American Airlines, his ongoing traffic numbers will be bolstered by the decision to fill the planes to 100% capacity starting this week. It is a brave step forward and runs counter to what some airlines are doing.
While Delta Air Lines, Frontier, JetBlue, Hawaiian Airlines, Alaskan Airlines and Southwest Airlines continue to block their intermediate seats or fly around two-thirds of their capacity, United Airlines and American Airlines will now run their flights at 100% capacity.
It is a cunning way to increase both passenger traffic and revenue, while reducing the cost of additional flights that run on lean cargo. But many public health and passenger officials have criticized the measure. It is not so much a new way of traveling as it is a return to the old way.
More than 20,000 American Airlines employees could lose their jobs this fall
Meanwhile, in the same message to the AA team, Doug Parker warned of impending cuts.
“We currently anticipate having 20-30%, or over 20,000, more payroll team members than we need to operate our schedule this fall.” Parker said.
However, while he vowed to correct American Airlines’ rights, Parker did not say those 20,000 employees would be automatically laid off this fall. He is looking for a “creative solution” to the problem that union incorporation will entail.
