American Airlines New York City (JFK, LGA) Strategy

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American Airlines recently announced they would be cutting their New York (JFK) to Orlando (MCO) route, which caused some questions on what American’s plan for New York is, and if they’re going in a “downward spiral”.

In New York, there’s two airports which American Airlines primarily operates out of which are New York’s John F. Kennedy and New York’s LaGuardia. What’s unique about LaGuardia is that you can only fly so far from due to a perimeter rule.

Even though American has cut New York (JFK) to Orlando (MCO), they’re growing in New York (JFK) to Austin, TX, and San Antonio, TX. Since Orlando is within the perimeter rule, American has made the decision to operate that route exclusively from LaGuardia, whereas both Austin, TX, and San Antonio, TX could not be served.

When it comes to their aircrafts, American plans to add more mainline service to New York as a whole as they continue to shift flying from regional jets to mainline. New York is a unique marketplace for aviation as there are three major airports in the market: New York’s John F. Kennedy, LaGuardia, and Newark.

New York has also many barriers that don’t exist in other markets including slots. These slots govern how many take offs and landings each airline can do at New York’s John F. Kennedy and LaGuardia. Next the airspace in New York is extremely limited and it’s getting to the point that there’s more departures than space available.

American’s New York strategy is pretty clear as they’re focused on business travelers. They argue that besides New York, their other hubs including Los Angeles, Dallas, Chicago, London are where business travelers need to go, so they’re able to offer more flights on these routes than their competition.

Internationally, American Airlines has pulled out all their 757’s and 767’s out of New York, and instead operate all their transatlantic flights on their 777’s, which is a competitive advantage compared to Delta who operates a vast majority of their transatlantic on 767’s and even 757’s.

As a result of these changes, American has started being profitable on their international routes out of New York, and they believe it’s related to the quality of their product. Sure, Delta may have more flights in the market due to added slots, but American doesn’t see that as a negative for them.

What are your thoughts of American Airlines in New York City? Feel free to share your thoughts in the comments below. 

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Comments

  1. Do you have any data backing up this statement – “As a result of these changes, American has started being profitable on their international routes out of New York, and they believe it’s related to the quality of their product.” ?

  2. I think that you’re giving AA an awful lot of credit by saying that they have a strategy. If they were looking to go big on business travel, they certainly wouldn’t have killed off JFK-ZRH for example, and they would increase feeder flights to JFK using mainline aircraft that people might want to fly (except Oasis 737’s, which no one wants to fly). Ultimately, they’re without any kind of clear vision in New York, which is the real problem. Saying that they want to make money is a nice enough goal, but doesn’t do a thing to make the changes required to make it happen.

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