American Airlines and JetBlue announced a Northeastern Alliance in July of 2020. Targeting routes mainly to and from New York, the alliance, since then, has led American to focus on building up both domestic and international operations out of John F. Kennedy International Airport (JFK). Simple Flying spoke with American’s Managing Director of Global Network Planning, Jason Reisinger, about the airline’s positions in New York and Philadelphia. He stated that both cities fulfill slightly different positions, but ultimately they will complement each other.
American Airlines will maintain New York and Philadelphia positions
American Airlines maintains a sizable hub out of Philadelphia International Airport (PHL). Located in Pennsylvania, the hub has served mostly as a transatlantic base of operations for American. In the absence of a strong New York transatlantic hub, Philadelphia helped fill in a crucial gap in the airline’s network. However, with the new JetBlue alliance and the importance of New York as a global market, it seemed that Philadelphia might lose out on some love from American Airlines.
However, Mr. Reisinger stated to Simple Flying that this would not be the case, explaining that the two would complement each other:
“I don’t think that the New York partnership does anything to hurt Philadelphia. In the long run, it may actually help, if you look at some of the spokes that will connect to New York, those people could also go through Philadelphia on different types of trips. I think they actually work together and may in the spokes of parts of the country actually complement each other.”
What it boils down to is a fundamental difference in mission. Philadelphia’s mission is the following:
“Philadelphia has a different purpose and that purpose doesn’t go away. It flows people from most of the United States to Europe. It also is a good northeast flow point to the rest of the United States, and, in fairness, it’s a top 10 city in the United States; it has a lot of local demand for itself.”
Whereas New York serves the following purpose:
“New York, in and of itself, is the largest air market in the world. I think what [the Northeastern Alliance] allows us to do is just be competitive there with United and Delta, who have larger operations, to get those customers. Obviously we’ll flow some people through there as well.”
The different missions of each hub
Essentially, Philadelphia is a transatlantic connecting hub. American flies to a sizable number of European destinations out of Philadelphia, including to cities like Amsterdam and Dublin, where American does not operate nonstop from New York.
New York City is one of the fiercest battlegrounds for both domestic and international air competition. With United’s large hub in Newark and Delta’s expansive presence out of New York-JFK, American Airlines was stuck in New York without a strong position.
After tweaking the airline’s model to and from the city, the new JetBlue partnership will enable the airline to unlock a greater position in New York City. However, this new position will not be as threatening to Philadelphia as previously hypothesized.
A difference of routes
Philadelphia and New York do have some overlap on international routes, but it is not a perfect overlap. One of the starkest differences is that New York is getting much more service to South America than Philadelphia. For example, since launching the partnership, American has announced service to Colombia, Brazil, and Chile. The airline serves none of these destinations from its hub in Philadelphia.
However, given American’s focus on flying more people to and from the New York area than necessarily connecting passengers there, the airline expects to continue to route connecting passengers to and from Philadelphia, in addition to the slice of origin and destination passengers it gets in Philadelphia.
Ultimately, the goal is to enable both the New York and Philadelphia hubs to thrive in their own respective realms. American continues to focus on that and expects its current trajectory in both cities will hold. Time will tell how much both of them will grow, but for now, American remains firmly committed to its Philadelphia hub.
What do you think about American’s positions in New York and Philadelphia? Let us know in the comments!