A word on capacity from AMR (Mr. Parker concurs)

[Traderd]

http://www.thestreet.com/_mktw/newsanalysis/transportation/10317191_2.html

Arpey has an ally in Doug Parker, CEO of US Airways (LCC - news - Cramer's Take - Rating), who has said repeatedly that reduced capacity is the primary source of the current industry recovery. "It's not great management," Parker said at a July earnings conference. "It's because a bunch of seats went away. [And] as seats have gone away, you have seen the ability to raise fares."

 

[AA717driver]

Yeah, most of those seats used to be on AA airplanes... TC

 

[linecheck]

Close to 70 aircraft have been parked at AAA/HP since last year..

 

[Flyer1015]

Yeah, most of those seats used to be on AA airplanes... TC

Is that in reference to the MRTC program ?

 

[AA717driver]

No, it's a reference to the AA and TWA planes in the desert or in a liquor store cooler. TC

P.S.--70 planes is nothing. AA parked 70 F100's and around 100 727's, not to mention the 26 717's, 35 DC9's, 17 or so 767-300's. Did I miss any? Oh, yeah, nearly 50 MD80's (some ex-TWA, some natives) and the dozen or so PW-powered TWA 757's heading out the door over the next few years. Even adjusting for USAir being half the size of AA/TWA, AMR still got you by more than a nose...

 

[FlyBoeingJets]

So with SWA adding 37, JetBlue and Airtran adding double digits....who is in the driver's seat next year? Wallstreet says the legacies and is running away from the LCCs. Yet the growth continues anywhere but at the Legacies. They must be focused only on international exposure.

As soon as AA and UAL start bringing back furloughes faster than retirements I'll be convinced the economy has not shifted away from healthy growth.

 

[IAHERJ]

Not all legacies. CAL has taken on new 737-800's this year and gets 2more 777's very early next year. DAL is expanding and will probably place an order for new planes as it continues to expand internationally. BTW, CAL is expanding domestically before someone states that all the legacies are shrinking domestically and expanding internationally only. Don't know about NWA except that they will be getting new planes to replace some -9's while continuing to add widebodies to replace the DC-10. Sure the LCC's are continuing to expand domestically. The business model of almost each LCC depends on adding new capacity and employees on junior pay. Heck, CAL admits that adding so many employees over the last 2 years on 1st year pay has been a real shot in the arm.