Back in May, Suzanne Boda was named American’s Senior Vice President of Los Angeles. The creation of this role was a visible symbol that the airline wasn’t about to back down from its dogged pursuit of Southern California glory. On the eve of the launch of American’s newest Asia route this Sunday, Los Angeles to Beijing, I sat down with Suzanne at LAX to get a better sense of her, and the airline’s, plans for Los Angeles.
When Suzanne was working to turn around Philadelphia with US Airways, she focused on two things. The first was to “take care of your employees which is the same philosophy we have today at American Airlines. We went through the entire airport where our employees were and the breakrooms probably hadn’t been renovated in 25 or 30 years and essentially gutted that and renovated it. And we gave them the tools they needed to do their jobs.” The second involved building community. “… a lot of us being out there for events, being part of the chamber, various nonprofits, getting our employees involved in Do Crew [US Airways community service group] events. That changed the perception in the community.”
This is a blueprint for how Suzanne wants to run LAX, but LA isn’t Philly, of course. Suzanne was quick to point out that “what’s different about LA is this is probably one of the most competitive airports in the country. We happen to be the largest airline flying here both domestically and internationally, but it’s still very competitive. There’s not one hub carrier. Effectively we all operate here fairly close to each other. How do you differentiate yourself here because we want to be the hometown airline? When [people] think of going somewhere, [how do we make sure] they think of American Airlines first?”
Some of it involves stepping up community efforts even further. “It’s not just putting your name on a wall somewhere saying ‘I support this organization’…. We want to make sure our employees are engaged in the community as well as having our name out there…. Doing things for our communities like last month we built [a playground]. It’s roll up your sleeves…. You know, we employ 6,000 people in LA, and that’s a lot of great, great jobs. Career jobs, high-paying, great benefits. We want those kids to be our employees in the future.”
That kind of outreach helps, but first, you have to get the basics right.
Oh, And the Operation Matters
The baseline for being able to compete requires an airline to run a good operation. The situation in Philly was far more dire when Suzanne arrived there, but American has had its struggles at LAX. She didn’t mince words when I asked what was on her list of priorities. “First of all, improving the operation. That was number one because you can’t run a bad airline and continue to have your customers be loyal supporters.”
Last summer the airline hit a nadir, especially in June when the operation went off the rails. Suzanne wasn’t in LA then, but she was overseeing hubs and gateways at the time.
“We did a really deep dive to figure out what went wrong and what went right and how we could capitalize on what went right. It was sort of a perfect storm last summer where we knew we were going to have construction. What I believe we did was underestimate how difficult it would be to operate under that construction…. We did survive, and we did provide a decent product last summer. It wasn’t great, but I’ll say it was decent.”
This summer, things have been running much better. June 2016 was miserable for the airline, especially its mainline performance. Look at what a year can do.
Remember, this is departures exactly on time (D0), so the standard Department of Transportation (DOT) metric of arrivals within 14 minutes of schedule lies well above 80 percent. And it has only continued to improve since then. Since July 1, 69 percent of mainline departures from LAX have gone exactly on time or earlier.
How did this come together?
Our friends in network planning… spent a lot of time with us out here. We did a deep dive into ‘how can we move the schedule?’ We even moved some [flights] by 2 to 3 minutes to reduce gate congestion, and it really worked.
American also focused its fleet. “We moved all the 767s out. Just having a couple of widebody aircraft types to focus on is a much better maintenance plan.”
Improvements In the Short Term
The operation is working well for now, but the passenger experience needs to be better. Further, this is still an airport that’s becoming more and more constrained every day. With every airline eyeing growth opportunities, I wanted to know what American would do to stay ahead of the curve.
The time seems right for American to work on this. After years of uncertainty, the airline’s footprint at the airport is fairly stable. Now that American has swapped its four gates in Terminal 6 for four in Terminal 5, it has established its domain in the southwest corner of the terminal area.
There will be minor growth. Next year, for example, Terminal 5 will be refitted to have 2 additional gates. One of those will be American’s to have (the other is common use).
But the real focus is more on making minor shifts to improve the operation. For example, once the midfield concourse opens and relieves pressure on the Bradley Terminal’s existing gates, airlines can shuffle and American will get more room in Terminal 5. It will give up some of the gates it uses in Bradley when it can, mostly in the morning when things aren’t as busy. (Though it will keep gate 151, a narrowbody-only gate is shares with Copa.)
The biggest improvement, of course, would involve ditching the Eagle’s Nest with its 8 remote gates for regional flying, but that’s not happening soon. “I think that’s TBD. But we are thinking about that, and working with [Los Angeles World Airports] on that. It’s tough because it’s 8 gates over there and that is a lot of flying. There’s really no way to just put those on Terminal 5, for instance.” For now, American has had to settle for minor fixes, e.g. replacing those ancient 1970s school buses with modern buses.
Beyond that, the airline refreshed the old Delta SkyClub in Terminal 5 and took it over once Delta moved out. With that open, it shut the Admiral’s Club in Terminal 4 to completely redo it. That will reopen before the end of the year with a completely new design, including a Flagship Dining area.
American is also pouring effort into something you may not think much about, the customs and immigration facility in Terminal 4. “If you come in now it’s narrowbody-capable… you go right downstairs, there’s the APC kiosks, Global Entry. If you don’t have any bags, you can leave. If you have bags, today you have to go over to [Bradley]. We’re renovating the baggage claim carousels today since they were essentially inoperative.” This should be done by early next year. Remarkably, clearing customs in Terminal 4 vs Bradley improves connection time by 50 minutes. This could result in a dramatic reduction in minimum connect times after American gets this up and running.
There are other small touches as well. In Terminal 4, American has gone so far as to think about its lighting.
In the foreground above is the new lighting with a higher ceiling. Beyond is the old, darker arrangement.
Improvement In the Longer Term
LAX is perennially under construction, and that won’t change anytime soon. It’s going to take several years, but by the middle of the next decade, it’s going to be a very different experience flying American there.
LAX is working on the LAMP, its giant project to build a people mover to connect the terminals to long term parking, a new rental car center, and more. The train will go down the spine of the central terminal area, and there will be a stop for Terminals 4 and 5. But here’s the plan: The distinction between Terminals 4 and 5 will virtually disappear.
American CEO Doug Parker was in town earlier this year to show off the airline’s plans for these terminals. Suzanne explained, “There will be a bridge [from the people mover] that will flow into our headhouse. You’ll go right across the bridge into our big open check-in area. That will flow into security and from there you can choose whether to go into Terminal 4 or 5.”
In other words, Terminals 4 and 5 will essentially become concourses of one big terminal all connected behind one security checkpoint. With the connection to Bradley that already exists, there will be easy, free-flowing movement between Terminals 4, 5, and Bradley. (Only the Eagle’s Nest will remain on its own.)
Improvement In the Longer, Longer Term
In the even longer run, American hopes to add 10 gates at LAX, but that’s just a hope and a dream. “There are no details right now.” Still, with American and every other airline wanting to grow, how on Earth is the airport going to avoid pure gridlock?
There’s a lot of work being done with “surface management” to try to improve arrival and departure rates. That and nextgen air traffic control are going to have to find a way. But without new runways or the invention of beaming technology to make runways obsolete, I remain concerned about LAX’s ability to handle future growth.
Maybe all this expensive construction will raise costs so much that the airlines don’t want to grow as much. Or not. American sees LA as incredibly important to the airline, and it’s not going anywhere. I’ll let Suzanne finish this post herself.
I will tell you the opposite of it being expensive to operate. It’s expensive not to operate here. It’s the third largest corporate market in the United States. It is probably one of the two, if anybody outside the US comes to the US for the first time, they either come to LA or New York. We capture that business market, but we also capture leisure here. This is our one and only large gateway to Asia. Is it expensive? Yes. But it’s more expensive not to be here.
