Following yet another co-operative op-ed, CEO Doug Parker of American Airlines had time to meet with President Trump this week to discuss Middle East airlines infringing on competition. He should fix his own airline first, not the competitive market.
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Yet Another Op-Ed
Ed Bastian, Doug Parker and Oscar Muñoz have become quite the scribes over the years, or their surrogates have. They have written several opinion editorials regarding competition specifically with foreign competitors despite reaching an agreement and operating open skies.
None of the carriers offer flights to Doha (Qatar), Abu Dhabi (Etihad) nor Dubai (Emirates) – this is about connecting traffic not direct flights. The carriers have no problems with joint ventures (JV) on other carriers that allow them to take advantage of connecting traffic in other countries like United’s JV with Lufthansa, American’s JV with British Airways, or Delta’s JV with Air France/KLM.
Their latest bombastic piece, which Gary Leff beautifully broke down line-by-line, demonstrates that they are catering to President Trump in the formulation of their prose and the concepts they wish to engender.
A Qatari Surprise at a Meeting with Trump
The lay-up meeting after fluffling Trump in the press was set to discuss how Qatar and other Middle East carriers are infringing upon the competitive nature of US carriers. Delta CEO Ed Bastion got the message that Qatar Airways CEO Akbar Al-Baker would be at the meeting and had transportation issues despite running the best-run airline in the country, one that also offers private jet services.
Trump stated that the CEOs of US carriers would need to go through the legal process to file complaints regarding their desire to correct the competitive issues. As an observer in the space who has found it confounding that Middle East carriers (who receive state funding to operate) are targeted as anti-competitive while other state carriers like China Eastern and China Southern are investment strategies from Delta and American. It’s also surprising that American continues this rhetoric despite being in an alliance and some (limited) cooperation with Qatar Airways.
Qatar’s presence at the meeting makes sense to me – just hash it out. Others bristled at the notion and I am sure that articles of cronyism are being typed as we speak. It seems fair to me that all the parties should be at the table… unless they can’t catch a flight from Atlanta, that is.
Doug Parker Should Focus on His Own Staff
Meanwhile, at his own airline, the suffering continues. The mechanics union has been forced by a judge order that American Airlines representation wrote to personally fine mechanics that refuse overtime. I have written before about how unhappy the flight attendants are with American Airlines management. I have covered the mechanics’ struggle to get a new contract despite working on the old contract that was due for re-negotiation several years ago.
Delays and a poor operational efficiency were dragging American Airlines profitability down before the mechanics’ struggle, and it has not since improved.
Doug Parker and American Airlines leadership are focused on the wrong things. They are busy formulating strategy on how to take away the unfair competitive edge of other carriers (with whom they partner) but fail to solve their problems which don’t require a meeting with the president. Fixing the mechanics’ contract is the lowest hanging fruit to improve operations.
United, in their defense, took the Dr. Dao incident as an opportunity to re-focus on customers. What will it take for Parker and co. to realize that it is not everyone else that causes American to languish behind their peers like their stock price? Look at the investment Delta has made in coach, their focus on their operations have led the charge. Perhaps Parker should address the plank in his own eye before pointing out the stye in that of the competition.
Conclusion
For some, Doug Parker’s joint op-ed and legal action against mechanics are just business-as-usual. For me, it seems to be a lot more like re-arranging the deck chairs on the Titanic. State-funded carriers may be a real problem that should be addressed and a CEO can of course (and must) focus on multiple issues at once, however, with the problems at home perhaps it is Mr. Parker that should have skipped the meeting rather than Mr. Bastian.
What do you think? Is Doug Parker focused on the right issues? Should he have written the op-ed anyway?
Clearly, the Qataris have payed to play and Trump now, miraculously, sees the light. Most corrupt administration of my lifetime.
That depends entirely on your perspective and age.
Wasn’t around for the Warren C. Harding administration so my perspective might be askew.
Haha .. nice little zing!
That’s what Americans get when the government is corrupt. Trump placing his personal interest over American workers
Excellent analysis, Kyle.
Gotta love the sore ass Democrat trolls…
AA is broken; has been for several years. Quit flying them 2+ years ago; as a businessman you can see it in the employees eyes and hear it in their voices. Doug Parker needs to go; along with many of AA’s Executive Team.
Parker has a truly impressive history of making bad decisions. I’d venture a guess that it’s the old HP mentality, which to be fair worked pretty well for a small regional airline. It’s just awful for the big leagues. Parker and the board that retains him despite impressive continued failures need to go.
I and my colleagues flew American Airlines for the 1st time two weeks ago… Needless to say we have requested our corporate travel department to never book is on that airline again.
My colleague’s luggage wasn’t loaded on her plane (she checked in 2.5 hours before her flight) and when they bag did arrive it took almost another 24 hours to get it to her hotel.
Due to bad weather my return flight was cancelled… My corporate travel office booked me on a Delta flight. American Airlines lost my bag: 1st I was told it would be at one baggage claim area then an hour later I was told it would be at another baggage claim area. After being told for another 2 hours my bag was coming I was then told that my bag was sent on another return flight to my destination city.
This was impossible because NO FLIGHTS left the Philly airport that day! No matter how many times I pointed this out to the baggage claim customer service representative she insisted that my bag had made it to Detroit.
Once I settled into a hotel room I called the baggage claim customer service number. The rep admitted that my bag hadn’t left the airport but simply couldn’t be located YET it was going to be placed on the next flight in the morning to Detroit! He couldn’t explained why it couldn’t be located yet it was booked for a flight! He also admitted once my flight was cancelled and I informed their personnel I was flying on another airline my bag shouldn’t have been placed on any AA flights- it should have been sent to a baggage claim area for me to pick up.
He offered to have the bag sent to my house after it arrived at DTW yet due to my colleague’s experience I declined and said I would get it from the airport. I found it in their baggage claim area 2 hours after I landed.
My other colleagues traveling to the West Coast encountered cancelled connecting flights and major delays…
Nope, no more American Airlines for us!
wow you had one bad experience partly due to weather and partly due to personal incompetence (checking a bag on biz travel) and you’ll never fly them again?!? tell me more!!
you sound like every whining spring break girl on facebook who paid $149 for a roundtrip flight to the other side of the country and was delayed 7 minutes and will NEVER FLY THE WORST AIRLINE IN THE WORLD AGAIN
cool small sample size… your opinion means nothing, thanks tho
World traveller, airline employee (not in USA) here. Flown AA on 2 occasions – international and domestic. Never, ever again. Worst service, grumpiest crew, just a bad experience. Not cheap either. At least if it was cheap could blame it on that.
I firmly believe that until Parker is shown the door AA will remain a train wreck. He’s in charge. What’s going on is directly reflective of his leadership. He owns it. And it’s a disaster that’s just getting worse.
Good article. The problem is I don’t think Parker can fix his airline and it’s time for a change. When will the BOD come to the same decision, and is it already too late?
United (my main airline) was in as bad a shape between 2012 and 2015 – possibly worse – and its BOD did nothing. Then they got lucky in that Smisek got embroiled in the “Chairman’s flight” scandal and the BOD had to act. But even then while Oscar Munoz fixed the labor disputes (within 15 months, 6 of which he was in hospital) they still struggled with a coherent strategy until AA cut Scott Kirby loose (stroke of luck #2). It took United 2.5-3 years after ditching Smisek for the airline to really turn around and turn in good financials.
Thing is, I’m not sure American will have that much luck. Even once the BOD acts, where are they going to find a new CEO and strategist to sort out both issues? I’m sure Kirby now has gold plated handcuffs at UA and why would he want to leave anyway as things are good there and he’s in line for Munoz’s job. It’s going to take a long time for AA to turn itself around, if it can. AA is loaded with a lot more debt than both UA and DL and if things don’t change soon that’s going to hurt them very badly.
At what point will Parker stop taking subsidized state money from Qatar Airways in the form of a monthly rent check by allowing them to rent AA’s facilities/lounges/gate for their daily JFK flight in to Terminal 8?
At what point will a reporter write about Qatar Airways being in the Oneworld Alliance with AA and how Parker talks out of both sides of his mouth?
Doug Parker is a hypocrite. Dirty money is still money.
Parker knows that.
Ralph get a life
As for Parker many of the posters above have voiced exactly what mine would be AA is bad and getting worse I can not understand why one would fly on them. I do have a number of friends that had high mileage accounts with USAir so they’re stuck really stuck. I am not sure Kirby would have been the answer other than anyone is better than Parker these days. At the end of the day flying for the most part on US metal sucks certainly internationally. I never fly US metal offshore two reasons, first security and second I like service and planes not in the boneyard’s ! Our carriers have forgotten what real service is ( of course the union factor comes in here ) and food is a second thought on AA and others. For me I’ll take AF and EK for all my international needs
As an employee for over 20 years, myself and my colleagues have seen the changes and it hurts us deeply. Problem is not only the CEO but the rest of US Airways management group and because of this they all must go. They carry parker’s mentality and his management. Nickel and dime. The company is tone deaf and refuses to take suggestions from their front line staff. Things will never change until the airlines entire culture changes and sadly I dont see this happening.
Yes! Exactly. What he said.
solve the controllable issues facing the company….leave the uncontrollable issues to the gods…
On the Qatar/Air Italy issue, it’s about time Parker and Munoz stop stringing along with Delta on this.
This issue has nothing to do with 5th freedoms. Air Italy is an Italian airline having to conform to Italian and EU labor laws and taxes. It just happens to be 49% owned by a foreign airline, just like (thinks for a nanosecond) Virgin Atlantic. It has everything to do with Delta trying to invest in the insolvent Alitalia who are currently only surviving on government subsidies (illegal under EU law).
And after getting their meeting with the President, Ed Bastian chickens out and finds the only Delta flight in the universe to have travel problems, leaving Parker and Munoz to face Trump.
If I were AA I’d (fix their airline first, then) start partnering with QR. It doesn’t have to be a JV, but restart mutual code sharing and take things from there.
And if I were UA I’d be seeking a partnership with Etihad (along with Lufthansa). Etihad has had its state subsidies withdrawn or savagely cut and is now a basket case of an airline and shrinking. I can see a deal where UA helps EY shrink further from the US but focuses on regional connections/feed to UA /LH at AUH to/from India and other parts of South Asia.
He has plenty to fix in AA but seems incapable. Whining about Qatar is just a distraction.
Doug’s comments were absolutely laughable. He actually whined about job losses because of Qatars unfettered access to secondary US markets. Really Doug “Outsource” Parker?
The frustrating part is the American Airlines, and, in fact, all airlines, could dramatically improve their “day of” operations starting within months.
Simply put, most airline delays, and their huge costs to passengers, airlines, taxpayers, governments, airports, employees, shareholders and the environment, are unnecessary and rapidly preventable “day of”, starting within months. The key to accomplishing this is a unique perspective of the problem.
For example, contrary to what we have heard, and continue to hear, and as proven, yes independently proven, by FAA, Embry-Riddle University, GE Aviation and others:
1. Most airline delays and ATC congestion can be prevented “day of” internally by an airline (defect prevention), starting within months, using the readily available Big Data, predictive analytics, computational power, optimization software, prescriptive actions, installed avionics and available flexibility, all in real time.
2. Preventing delays/congestion is a big win for passengers, highly profitable for airlines, reduces ATC costs/complexity and lowers greenhouse emissions.
3. ATC alone can never, and will never efficiently improve airline delays. Safety – yes, efficiency – no. Only the airline can define what is efficient for each of their aircraft.
Instead of following the competition by raising fees/fares, buffering schedules, cutting services and shrinking seats, an airline could look to “day of” operational efficiency using Big Data, predictive analytics and real time prescriptive actions as the much more profitable path to quickly and dramatically improve their competitive position, starting with putting the passenger where they were promised, when they were promised at a much higher level.
Toyota did it – airlines can as well.
AAs unions are 90% their own worst enemy and that’s something Parker cannot fix. The unions ensure their longevity by being disruptors of the peace and creating a wedge been the company and its employees. The only way to fix the discord between AA and its unionized staff is to eliminate the union.
Or eliminate Doug Parker!!! As well as his executive team and Board of Directors!!! They are the ones who are not doing their job, yet being so highly compensated above what they are worth, that they need to go… Not the unions, who, by the way, or not going anywhere! They are not driving down American Airlines, nor did they drag down US airways. By comparison, they are earning less than their peers in the industry, while Doug and his cronies are earning more than the industry calls for due to their incompetence…
Doug Parker is what he was always been: an absolutely terrible airline CEO. Anyone paying attention to the industry (but especially US Airways / America West) knew what was in store once he took over. How he managed to bamboozle the unions and the board of AA proves only his worth as a conman.
How the mighty has fallen. AA today is the worst in almost every respect of the three remaining majors and remarkably, still sinking… rapidly.
As a 30 year employee of American,I say it is time to clean house from the top down!Doug Parker and his sorry Team are right up there with Frank Lorenzo,and Carl Icon as the worst of the worst!
Great info on Parker!