Cargo leads AA integration

LOS ANGELES — American Airlines has designated its cargo unit to lead its brand and operational integration with US Airways.

“We expect to be on a single air waybill well before the FAA approves our Single Operating Certificate,” said Robert D. Isom Jr., COO of American Airlines, at the IATA World Cargo Symposium this week. Isom is leading the effort to integrate AA and US Air. Interestingly, there is precedent for this approach within the oneworld alliance; IAG also initiated its integration of British Airways and Iberia with their cargo departments.

Like seemingly every other combination, all-cargo, and express carrier in the world, Isom said that AA would put more emphasis on temperature-sensitive shipments, as well as leverage the bellies that each of the carrier’s new 787s [and A350s] would offer. AA recently invested in a new controlled-room-temperature (CRT) facility at JFK, and is finalizing one at London Heathrow. The carrier is also getting ready to break ground on a new 30,000 square foot (2,800 sq m) dedicated cold chain/pharma facility in Philadelphia.

AA’s “essential” cargo business is on pace to generate more than $800 million of revenue – “and a significant portion of that falls directly to the bottom line, a bottom line that hasn’t been in the black that often in the past,” Isom said. The carrier’s future cargo business will be reliant on AA’s fleet changes, most significantly the 42 787-800s and -900s, and the 22 A350-900s that AA has on order. The first of the 787s will be delivered before year’s end, and the A350s are scheduled to begin arriving in 2017.

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One thought on “Cargo leads AA integration

  1. When comparing CASK for AA’s different WB types (eg for their Retail Psychologists piloting the AA on-line CRS pricing unit to correctly determine the lowest possible real-time “bottomline”) the apport of underbelly air cargo to the ASK calculation may be phrased into following equation :

    (aggregated) ASK = [ (leveraged seat count) + (leveraged ULD count) x Vol/φ ] x L … where φ is the revenue conversion factor for freight vs YCff (Y-class full fare ticket price) and where ‘Vol’ is the volume in cuft of the applicable ULD – PMC or LD3 or LD6 etc …; besides, ‘L’ is the sector length in Km …

    The revised (freight-boosted) new bottomlines are more aggressive and may conveniently be applied cutting for higher market shares …