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American Airlines vows to fix slumping on-time performance

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American Airlines vows to fix slumping on-time performance

Unread post by bimjim » Fri Oct 26, 2018

https://www.travelweekly.com/Travel-New ... erformance

American Airlines vows to fix slumping on-time performance
Robert Silk
Oct 25, 2018

After a summer in which American Airlines' on-time performance took a precipitous dip, the carrier said it will improve operations.

"We know that we must be better, and we will," American president Robert Isom said during the company's third-quarter earnings call Thursday.

American's on-time performance, including American Eagle-branded flights that are flown by regional carriers, was 72.4% in July (the last month for which the DOT has released statistics) and 72.4% in June. Those numbers placed the airline seventh and eighth, respectively, in on-time performance among the 10 carriers the DOT tracks in its monthly Air Travel Consumer Report. They were also markedly behind American's year-to-date on-time performance through July of 77.2%.

Meanwhile, the cancellation rate for American and American Eagle flights was 3% in July, ninth place in the ranking.

During Thursday's call, Isom said the drop was partially a result of inclement weather in Dallas. But he said it was also caused by a variety of other factors, including engine changes that American had to take with new aircraft deliveries and FAA-mandated engine fan blade inspections (the FAA's response to the failure in April of a fan blade on a Southwest plane).

Still, Isom said American needs to improve its operational planning in order to be ready for the peak season and have aircraft property staged at the start of the day.

He offered one way in which the carrier's operations have already grown simpler. This month, American completed the integration of its 27,000 flight attendants into one system. That means flight attendants who became part of the company as a result of American's acquisition of U.S. Airways in 2013 can now work in all aircraft that American flies. Previously, each attendant could only work on their legacy carrier's aircraft.

With the integration, American has more scheduling flexibility, which will decrease recovery time in the case of irregular operations, Isom said.

He added that the change is already paying dividends. American's cancellation rate is less than 1% thus far in October.

American reported net income during the third quarter of $341 million, down 48.4% year over year. The decline was driven by a 12.4% increase in costs, due largely to a nearly $700 million increase in fuel expenses.

But American also underperformed on revenue growth relative to competitors Delta and United. The carrier recorded total operating revenue of $11.56 billion in the third quarter, up 5.4% from last year and in line with analyst expectations, according to the website Seeking Alpha. By comparison, United's revenue was up 11.2% this quarter and Delta's jumped 8%.

American CEO Doug Parker said the carrier expects to increase revenue by $1 billion next year via initiatives that include include changes to American's international network, the introduction of more widebody aircraft equipped with premium economy cabins, and the introduction of additional narrowbody aircraft configured with more seats.

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