When a CEO tells the media, “We are not asking our customers to be happy with anything,” you know there’s an issue.
American’s 4th quarter earnings call brought about the comment by Doug Parker, CEO of American Airlines, the now combined merged company of American and US Airways.
After making the remarks, Parker tried to cover his tracks by reporting positive changes to their hard product, including additional wifi installation, flat-bed seats, and AAmiral’s Club renovations. According to Parker, American’s intentions are to “leap frog” their competitors, but it’s hard to leap frog when American itself is still catching up. For example, Delta no longer flies any angled-flat bed routes, while American still has plenty. American is still installing wifi aboard their regional aircraft, while Delta has already completed that task. While I’m hopeful for the changes American will bring, I’m not necessarily anticipating anything better than what the other airlines are offering, simply because it’s hard to pass another airline in terms of onboard experience, when your airline itself doesn’t have that experience to begin with. Further, American downgraded their meal service – while their competitors, including both United and Delta have upped the offering. Looks like American is “leap frogging” in the wrong direction. 🙂
A spokesman from American explained Parker’s remarks as, “It’s unfortunate if someone takes it out of context and doesn’t use it as it was intended — in support of our need to invest in the customer experience. We’re investing $2 billion dollars in new seats, improved lounges and airport enhancements.” Here’s where I’m confused. I’m not sure how the original statement could be interpreted as supporting the customer experience. Parker, in my interpretation, is stating his opinion, and as a whole, it’s on the negative. So, to try to cover the tracks and say it was in support of a better customer experience is simply baffling to me.
What do you think about the comment? Was it in support of customer experience as AA claims?
Hat Tip: Skift
Image Credit: Associated Press
Jamie Larounis is an avid traveler, blogger and miles/points educator. Traveling well over 100,000 miles a year and staying in hotels for over 100 nights, he leverages miles, points and other deals to fly in first class cabins, and stay in 5-star hotels. The Forward Cabin shares his experiences, musings, reviews, tips, tricks, resources and industry news with you, the fellow traveler.
I believe his comments have been taken out of context. My understanding is that he was responding to the fact that customers will not necessarily be seeing lower fares in the near future, in spite of the huge drop in oil prices. And that is the thing that they won’t be “happy” about. And yes, I can see how the current high fares, along with the drop in fuel prices, will help pay for AA’s capital expenditures in its aircraft and airport lounges.
This reminds me of Peter Greenberg’s comment at the New York Times Travel Show last week. Airline’s motto: “We are not happy until you are not happy.”
Indeed, the cost of airline tickets in relation to fuel costs may have precipitated this comment, but I think that is exactly the way Doug Parker thinks. His whole desire to merge with American was driven by his ego and his desire to out-do Jeff Smisek while leading one of the world’s largest airlines. He had pretty much the same (I don’t give a s***) attitude when he met with a group of frequent flyers during Star Mega Do 2 in 2010. It took him (and US Airways) quite some time to bounce back from his draconian measures after the America West merger caused a sharp drop in US Airways revenue. He has no idea that keeping your customer base happy has anything to do with the success of an airline. The hardcore American elites (who will defend the airline to the teeth) have been pretty much left alone so far with this merger, while the US Airways elites were given a big boot up the kaboodle. It doesn’t matter whose back he steps on to get to the top…
And, Thomas, your Peter Greenberg quote is right on target.