Skift Take

The airline is going to have to figure out its labor issues soon, because it's starting to affect nearly every aspect of its operations.

American Airlines has delayed plans to redesign its cabins and add more capacity to the U.S. market, due to issues with unionized workers, the airline said.

The cabin upgrade, known internally as Project Oasis, will bring the number of seats on its narrow-body aircraft up to 172 from 160 in order to improve unit costs. But so far, American has finished 71 aircraft, putting it behind schedule, and has halted further upgrades until next year, the airline said at the 12th Annual Global Transportation Conference in New York Wednesday. The company blamed issues with the union, as well as the recent Boeing 737 Max grounding.

“We have 71 of those aircraft done,” said Robert Isom, president of American. “We hoped to have quite a bit more done than that. But with things like Max, and issues with our [union] slowing down, we’ve decided to put off further installation until the beginning of next year. We have 200 some aircraft left to go.”

Isom added that the new seats would be a “primary driver of growth” in the U.S. going forward.

In addition, on Wednesday, the airline filed a lawsuit against the Transport Workers Union of America and the Association of Mechanists, two unions representing mechanics and related workers. The lawsuit accuses unionized employees of intentionally slowing down aircraft repairs in order to gain leverage in ongoing contract negotiations. The airline and the unions have been unable to agree on a wide range of terms, including pay, health, and retirement benefits.

Along with the extra seats, the redesign project will include a renewal of the cabin, new overhead bins, and an updated wifi and entertainment system, the airline said. In March, the company had to ground 14 of its refurbished planes, due to issues with the overhead bins.

The changes have gotten negative media attention recently, with some saying that the new cabins provide less leg room, and a worse customer experience. While most other big airlines are adding seats as well, American has pushed it further: it will have 6 more seats than United has on the same plane.

The corporation responded by stating that, from what it could tell from its 71 updated planes flying, the customer experience was comparable between its traditional cabins and redesigned cabins. It added that the new seat configuration would likely become “the new standard” in the long run.

“There’s always things that come up when something is different,” said Isom. “And we’ll take a look at any feedback that we get. But when you boil it down and say: How are these aircrafts doing? You’ll find that there’s very little difference in terms of customer perception.”

CORRECTION: An earlier version of this story had inaccurate quotes from President Isom because of inaccuracies in a Reuters transcript that Skift used to report the story. 


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Tags: american airlines, legroom, unions

Photo credit: An American Airlines aircrafts at LAX in February of 2017. 316003 / 316003

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