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.
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.
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?