21 May 2008

AA Downsizes domestic operation drastically

The world's number two airline - AMR's American today announced a dramatic cut back in their domestic operations. They will be axing across the board. Here are the brief details:

Aircraft Culled: A300s, MD80s, over 75. This includes some RJs and Turboprops.

Routes - cutback and schedule frequency reduction.

Total reduction in flown miles represents a cut back of 12% according to the Wall Street Journal.

American will also charge $15 for the first bag and additional charges will be added. American hopes to raise several ".. hundred million dollars.." of additional revenue in this fashion. Given the $100 million UAL said it would raise from $25 for second bag costs - this will be an interesting challenge.

As I have noted before the airlines are going to park some planes. This will be the winter of discontent for travelers but it looks like summer isn't going to be so hot. As Willie Walsh of BA stated earlier - "Kiss low fares goodbye"



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