The American-US Airways Merger is Creating the Opposite of Synergies

One complaint of American Airlines flight attendants is that the introduction of Premium Economy means they have to do more work. American isn’t dedicating more staffing to the new premium cabin.
And as a result anecdotally I’ve heard from quite a few passengers that service suffers.

American’s rebuttal to flight attendants who feel they have to do more work is that staffing ratios remain the same. They’ve added seats to economy on their Boeing 777-200s. And they’ve added a premium economy section. But by adding a flight attendant in back the ratio of flight attendants to passengers is the same as it used to be.

The trick here is American folding Premium Economy into Economy, treating them the same even though Premium Economy entails more work and is supposed to mean better service.

Another challenge American faces with its flight attendants is which group of flight attendants get to fly which routes? Over the summer I shared a leaked memo about aircraft changes that was making legacy US Airways flight attendants unhappy.

The merger of American and US Airways isn’t as done as it appears to many customers. The airline still isn’t set up to have legacy American Airlines flights attendants fly legacy US Airways aircraft and vice versa, or to mix legacy American and legacy US Airways flight attendant crews on the same flights.

So when they take a European route historically flown by US Airways and assign a legacy America Airlines plane to fly it, that means US Airways flight attendants lose the opportunity and American Airlines flight attendants pick it up.

And they’re assigning some legacy American Airlines 757s and 767s to fly Philadelphia – Europe. And that means US Airways flight attendants are losing cool Europe flying opportunities.

You’d think that American’s declaration that Philadelphia is its transatlantic gateway and that they fly boutique business markets from New York JFK — combined with pulling back from JFK flying and adding transatlantic routes from Philadelphia — would be enough to mollify legacy US Airways crew. But it’s not.


American Airlines New York JFK

So American is adding flight attendant staffing to existing legacy US Airways Airbus A330 flying next summer. So more US Airways flight attendants can work European routes.

From a passenger perspective, more crew – and so a better passenger:crew ratio – should be a good thing.

But for the airline, adding flight attendants to planes to make flight attendants happy temporarily as a ‘make good’ so they can fly cool places is the very definition of crazy.

When mergers are consummated they promise ‘synergies’ which mean cost reductions as a result of reduced staffing. Adding a flight attendant to A330 routes to make flight attendants happy because they haven’t yet finished the merger four years in is an example of how this merger is creating whatever the opposite of synergies are.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. Flew AA PE LAX-AKL-LAX a few weeks ago. While the seating was nice, the service was lacking. It was fascinating watching PE service in a twin aisle airplane. I quickly learned that service isn’t equal and sometimes you get “the good aisle” and sometimes you don’t. I had the “good aisle” on LAX-AKL and “the bar aisle” on the return.

    Items included with “bad aisle” service are lack of eye contact, FAs having conversations over your head (as though you weren’t there), shove-in-your-face service, annoyance when you call button for something.

  2. @NYBanker no, I don’t think you understand what is going on. Gary’s article is about the division in the company at the moment. LUS and LAA flight attendants are not allowed to fly together. When a LUS route gets flown by a LAA Crew it reduces the available flying for LUS flight attendants, which translates into a pay cut. Another thing you aren’t considering is the premium pay associated with those routes. Depending on how much a flight attendant works, this could be a difference of around $12,000/year. If the company you worked for decided that another office was better equipped to handle the job you do, and they told you that you couldn’t transfer, you had to work a less desirable job AND you had to take a $12k pay cut I am sure you would be upset as well.

  3. The opposite of synergies are “dis-synergies”. Not an uncommon word or idea among m&a and management consultant thought leaders….

  4. Look at UA/CO. Still two airlines under one name. No mixing of flight crews or aircraft. Even the announcements on board are different. Purser = United, Flight Coordinator = Continental.

  5. “How will you be compensating us”. I find this to be either crazy or valid depending on if there is a financial impact to the FA’s salary or take home pay.

    AA needs to figure out how to get a Pre Flight Beverage in 100% of the flights, that’ll make the customers happy.

  6. once Again Leff, You don’t have a Clue about What u are talking about and yet You think You do. Don’t worry about things that REALLY don’t concern you ( Staff Pay/benefits/ routes or integration)…. stick to being a Pissy Critic

  7. @Russ. I think what Gary is trying to say is that AA has given pay rises to the FA’s and they still are not happy. As they have not completed the complete integration they are now doing the polar opposite of creating efficiencies.

    Rather than just saying Gary doesn’t know what he is talking about, if you post some reasons, actual prosaic reasons, why he is wrong, I am very confident he will respond to your comments. He is pretty good about dialogue when it warrants

  8. The pay raise was not given to encourage employees to provide better service. It was given because AA employees cannot he asked to work as hard or harder than their peers at Delta and United if they weren’t making at least the same wages.

    The reason, again, that LUS Flight Attendants are asking for compensation is because the company has taken away premium flying from LUS and given it to LAA. This means there is less money in the pockets of ALL LUS flight attendants because there isn’t as much flying available for that work group. It also affects the quality of living for some flight attendants who are put back on call (reserve) because the staffing levels are not adjusted due to lack of integration.

    You cannot take money and time away from part of your employees and give it to the others without some sort of pushback.

    I think this is why Russ was saying Gary doesn’t know what he is talking about because it is an internal issue at AA that unless you are part of you have no true knowledge of nor right to discuss. If investors are concerned about AA having to pay money, maybe istead if laying blame on the Flight Attendants they should encourage AA to finalize the merger. None of this would be a concern if the negotiated contract for both sides from 3 years ago was implemented already.

  9. @Nick This is just silly: “I think this is why Russ was saying Gary doesn’t know what he is talking about because it is an internal issue at AA that unless you are part of you have no true knowledge of nor right to discuss. ”

    I understand the issue. Four years into the merger AA still is flying separate crews, LAA and LUS, and they’re flying an extra crew member on A330s to Europe as a make-good. My post has nothing whatsoever to do with how much flight attendants ought to make. It’s that management isn’t driving synergies from a merger, they’re incurring extra crew costs because they haven’t made the merger work.

    And I have no right to discuss this?

    You’re dead wrong to say “The pay raise was not given to encourage employees to provide better service.” Doug Parker was explicit that the model is pay people more, better service, earn a revenue premium. That’s what he promised investors.

    The idea that AA crew are ask to work *harder* than peers at Delta is just silly, AA is far less crew-efficient than Delta (ie it takes more people to do the same work at American than it does at Delta).

  10. If you read my initial response it was in agreement with you. Somehow the pay raise was brought into this and it has nothing to do with the issue of integration.

    Since it was brought up, though, I am curious why you think there are inefficiencies that relate to the ability of AA flight attendants to do their job vs Delta. In my experience all flight attendants do the same job. If there are inefficiencies it is not a problem with a work group but rather the product.

  11. When I work, I work as hard as I can. With that, I cannot be asked to work ‘harder’. I’m already working as hard as I can. Now, honestly speaking, I can be asked to work differently. If I were to be asked to work differently, I would because I do what my employer asks me to do if not illegal or unethical or inappropriate. They pay, I work. They pay, I work hard. I don’t work hard, I don’t get paid or I get fired or I keep my fat trap shut. As someone who runs a company (albeit small), I’m deeply offended by employees (including myself0 being asked to work ‘harder.’ That is very different than working more hours. If I’m paying someone to work blah to blah, I expect and deserve 100% effort during the blah to blah hours. If someone bitches to me about having to work harder during blah to blah hours, they can and should quit their job which demands focus and effort while being paid to seek one which does not expect production, effort, focus while being paid. I have become accustomed to FA’s spending half of a three hour flight sitting on their butts reading books; I’ll never become accustomed to someone working half a flight saying they are ‘working hard.’ I don’t consider it work when I sit there and watch Netflix for half the flight. I see no difference.

    Let the irrational flaming being.

  12. @mdtravel what does this have to do with the lack of synergy at AA?

    If you insist on discussing the work ethic of FA’s though, let me remind you that we are not there to wait on you hand and foot. We go to training not to learn how to pour a Coke, but so that in the off chance something goes terribly wrong on your flight we can save your life. Did you know that paramedics and firefighters also sit around a lot reading books and watching Netflix? Do you think they have a poor work ethic for sitting around in between calls? Same with pilots. Do you think they do not work hard because most of the flight they sit behind the controls while autopilot flies the plane?

    I was a flight attendant for a long time and let me make something very clear to you: we have a lot of downtime, but that does not mean we are not working. There are many things we do that you never notice. I worked very hard to ensure the safety and comfort of my passengers, and was recognized by my passengers regularly with letters to the company. Until you have worked in the shoes of a flight attendant maybe you should relax on judging their work ethic. Maybe if you actually knew what a flight attendant does and what they are on the plane to do you would feel a little more “accustomed” to what you think you’re seeing. Granted there are some lazy FA’s but they are not the norm.

    If you’re looking for constant attention from your flight attendant may I suggest Netjets, Flexjet or purchasing your own company jet and staffing it with one of your “hard-working” crew members?

  13. “One complaint of American Airlines flight attendants is that the introduction of Premium Economy means they have to do more work. “

  14. As a long time Flight Attendant, I retired at 42 10 years ago. The company will not add an additional Attendant, and the flyer suffers. There is barely enough time to finish a regular service, and now everyone suffers. But, somehow there are flyers brainwashed into believing that they will receive the same service, now that AS has implemented PE. Good luck, service will be sacrificed.

  15. I’ve never understood why people think Parker is a good airline CEO.

    Not only is the US/AA merger not complete, he still hasn’t finished the US/AW merger.

    At least his airline is only $20 BILLION in debt….

  16. My observation, admittedly not based on a high volume of travel but maybe 20+ flights since the merger, is that US took over AA, after AA’s employees did everything possible to get rid of their management. I flew US a lot in the year prior to the merger. The current AA service is the old US service, all the way. One pass of the drink cart, 20 passes for picking up trash, and the incredibly annoying in-flight pitch for the credit card. At least they haven’t cut the gate agents to one per flight, the way US did it.

  17. You are all wrong and unless you actually work AA your opinions are just that, opinions. About the flights being taken away from JFK and sent to PHL, the flights are going from Legacy American crews to other Legacy American crews. Legacy Us Air crews in PHL won’t be flying those PHL- Europe routes, so they are losing premium pay and flight time. Compensation by adding the extra position on the 330 helps a few f/A’s who can get that position,but not all. As for the raises, they are to be on parity with the other big airlines. And as long as the airlines are posting big profits, then raises should be given. As for the service, planes are not a restaurant, or a fast food place. They are meant to get you from point a to point b . And flight attendants are on there to get you to and from those points safely. And there is a lot of down time on longer flights. They don’t serve hot meals anymore in most coach cabins, so the service does not take as long.
    But my problem with this article is that it is opinion. And everyone has a right to theirs. But basing them on leaked memo’s, a statement at a shareholder’s meeting, does not give a full and complete picture of what’s happening there. There are many other factors that are in play and a culture that , unless one is part of it, one will never understand how and why things work.

  18. AMERICAN AIRLINES NEEDS TO START HIRING QUALITY QUALIFIED PEOPLE TO RUN THIS AIRLINE AND WE NEED TO START THAT FROM THE TOP. IMPROVE CUSTOMER SERVICE AND MOST IMPORTANT HIGHER MANAGEMENT NEEDS TO UNDERSTAND THEY DON’T RUN THIS AIRLINES BUT EMPLOYEES DOES AND WITHOUT EMPLOYEES IT WILL SHUT DOWN IN ONE DAY BUT WITHOUT THEM IT WONT IT WILL CONTINUE TO FLY SO TAKE GOOD CARE OF EMPLOYEES AND TREAT THEM RIGHT LIKE VIRGIN ATLANTIC CEO DOES WE NEED TO FOLLOW VIRGIN ATLANTIC CEO THEORY. AMERICAN AND US AIRWAYS MERGER IS NOTHING BUT A DISASTER. A DINKY AIRLINE WITH BAD REPUTATION DOES NOT BUY A MAJOR AIRLINES WITH GOOD REPUTATION.

  19. The US Air and AA is a mess….and NOT BECAUSE OF FLIGHT ATTENDANTS! I am a business traveler flying round-trip both domestic and international flights at least 2X each month. As with the United and Continental merger, the MANAGEMENT of the airlines have made flying on these airlines nothing but unacceptable. Continental was an EXCEPTIONAL airline, US Air was a GOOD airline….AA and United were the ABSOLUTE WORST in the USA airspace…..they took the poor business models of AA and UA and forced them upon the 2 other airlines-what else can expect? I continue to hope for the day that Continental will break away from the United disaster and become what they once (and still are-you can definitely notice the difference between a Continental plane/crew vs. legacy UA plane/crew) with respect to customer service, cleanliness of the plane and how crammed the flights are….I have been a Delta fan since the unfortunate Continental merger. When Delta merged with NorthWest, they took the best of both airlines and have made it my choice for airlines….not only that, but their partnership (not just Skymiles) with KLM is uniquely streamlined and makes any trans-Atlantic flight almost seamless!

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