Robert Isom’s plan as he takes over as CEO of American Airlines is simple: “Run a reliable operation” and “get back to profitability.”
It’s the strategy he released on a slide while addressing American Airlines employees at the company’s annual leadership conference in Dallas in February. The hope is that the first goal, getting planes to land on time and canceling fewer flights, will see the airline earn more profit through efficiency and customers willing to pay a premium for tickets.
isom takes over as CEO on Thursday and said he hoped to reverse the problems that plagued the carrier even before it merged with US Airways in 2013, which brought Doug Parker to the top executive position and other top executives, such as Isom as Chief Operating Officer.
Who is Robert Isom, the next CEO of American Airlines?
The carrier has battled labor battles, high rates of flight cancellations and delays, slow integration with US Airways – even before major external challenges such as the Boeing 737 Max crisis and the COVID-19 pandemic. In 2020, The Wall Street Journal dubbed American Airlines the worst airline in the country, despite improved to sixth out of nine for 2021.
Americans’ strengths and struggles will be tested again this summer, with airlines projecting their biggest crowds since pre-pandemic 2019.
Although Parker has guided the airline through a pandemic, industry analysts and labor officials say Isom has a difficult task ahead of him if American is to catch up with competitors at Southwest, United and Delta.
“What’s the point of being the biggest airline in the country if no one wants to fly with your company?” asked Henry Harteveldt, travel industry analyst and president of Atmosphere Research Group.
Making customers want to fly with your airline means making sure passengers can rely on you to get to their destination reliably, Harteveldt said.
While American improved its on-time ranking among major airlines in 2021 ahead of Dallas-based Southwest Airlines and Chicago-based United Airlines, it was still hit by multiple weekends throughout the year. last when thousands of planes were canceled as its network unraveled under heavy loads and small patches of bad weather.
But since December, when he was named Parker’s successor, Isom has focused on “operational reliability”, meaning making sure planes land on time and cancellations are reduced to a minimum.
“What falls to us right now is to make sure that as demand returns, we run an incredibly reliable airline, welcoming customers back, getting American back to profitability as soon as possible and, in the long term, making sure American is the best airline in the business,” Isom said with a interview with The Dallas Morning News in December.
Because Isom has spent the past eight years as the airline’s president and chief operating officer, he’s likely sincere about his goal of improving reliability, said Oliver Lamb, managing director of Ailevon Pacific Aviation Consulting. .
“It goes without saying that there has been a lot of media coverage of US operational shortcomings, some of which are beyond US control,” Lamb said. “I think right now American isn’t an airline that needs someone who’s going to do some big-picture strategic thinking about their next destination, but they need to execute the plans that have already been announced. “
In some ways, Isom arrives in the United States with set plans for the years to come laid out by Parker. The airline company signed massive alliances with JetBlue and Alaska Airlines strengthens its positions on the East and West Coasts and has one of the youngest fleets in the industry, with orders for more than 200 Boeing and Airbus jets over the next five years.
Isom will also have to improve the company’s relations with the unions. American is currently in negotiations with flight attendants and pilots, who have all complained that the way the airline schedules crews is causing more delays and cancellations.
“I can’t imagine more that is going to be required of a new CEO than what is going to be required of Robert Isom,” said Dennis Tajer, spokesman for the Allied Pilots Association representing 13,000 pilots at American. “This summer is going to be more crowded and stressed.”
American issued an apology to pilots and flight attendants last summer after periods when crew members frequently showed up for hotels on trips without reservations having been booked.
Tajer said the airline often struggles to connecting pilots to planes during periods of heavy cancellations. The union also complained that too many pilots are stuck on call and unable to take extra shifts even when available.
“It runs through the whole brand,” he said. “Management is struggling to attract pilots because they are an outlier in total compensation.”
On average, American Airlines pilots were paid $249,841 in 2020, the Massachusetts Institute of Technology’s most recent year. airline data project. Southwest led the way with an average pilot salary of $330,089, followed by United at $255,695. Delta trails the industry’s top four carriers with average pilot compensation of $235,285.
American at last settled a five-year contract fight with mechanicswho are represented by the TWU-IAM association, just as the pandemic was beginning in 2020. But Gary Peterson, director of the Transport Workers Association’s airline division, said the relationship with management had not improved. , despite an agreement.
“American could do a lot better if it listened to employee groups,” Peterson said.
A group of American Airlines passenger service agents representing 14,000 other employees are expected to begin negotiations this summer after talks were postponed during the pandemic.
Peterson said there was hope Isom would strike a new tone with the unions.
“That’s really the question mark,” Peterson said. “You always have a management team that has a lot of identical faces.”
Making employees happy after two tenuous years of pandemic-era flying will be key to overturning passenger perceptions of Americans, Harteveldt said.
“When people are unhappy, half or more say the cause is usually rude service or lack of attention, environmental things on the plane or at the airport,” he said. declared. “The flight attendant task force, more than anyone else, has endured a great deal of stress and coercion from unruly passengers. It certainly contributes to how they feel about their work.