All Things Travel: American Airlines Merger Takes Off
BOSTON (CBS) – The American Airlines merger with US Airways is on schedule to be completed in about 18 months.
That was the message brought to Boston on Thursday by Jim Carter, Managing Director and Eastern Sales Division for AA, to about 40 corporate travel managers at a Boston luncheon.
These corporate travel managers account for more than $100 million in airline revenue for passenger flying in and out of Logan Airport.
The combined airline will challenge JetBlue as the number one airline in passengers arriving and departing at Logan Airport. Emerging from bankruptcy, the combined airline now operating under the AA brand showed a $402 million profit in the first quarter of the year.
American is now the largest airline in the Northeast with major hubs in New York City, Philadelphia, Washington, Charlotte and Miami.
The merged airline gives American corporate customers use of the US Air Shuttle routes to LaGuardia Airport in New York and Reagan Airport in Washington. Having the shuttle will assist the new airline in a strong selling point as corporate air contracts go out to bid.
The first step in merging the two carriers was moving US Airways from the Star Alliance to the Oneworld alliance that also includes British Airways and their flights from Boston to London. The two airlines' frequent flyer programs are also being merged.
The majority of U.S. airlines are showing strong profits and cash flow that is allowing them to buy new fuel-saving jets which in turn is helping companies like Boeing show record profits.
AA has 500 new planes on order and will take delivery of its first Boeing 787 Dreamliner later this year. 83 new aircraft will join its fleet this year. It has 50 Dreamliners on order. The carrier will also need to hire 1,500 new pilots in the next five years.
One of the interesting factors in the Dreamliner is that the number of First Class seats is being reduced to make room for Business Class seats, where corporate travel managers put their customers on long haul flights.
Logan Airport now has 105 AA departures a day and according to Carter could add more service as the merger is completed. The first step could be a resumption of service between Boston and San Francisco.
"I would not be surprised to see a few more dots on the map," said Carter.
One of the problems facing American is at Logan Airport's Terminal B where currently AA operates on one side of the terminal and US Airways on the other with the new United Terminal in between. One suggestion made by this reporter to eliminate confusion for departing passengers, is to rename the two parts of that terminal north and south.
All Things Travel Reports can be heard on WBZ NewsRadio 1030.