American Airlines CEO says he doesn’t know if partner JetBlue has lie-flat seats
It can be hard to keep track of all the different airline products and services out there — even if you’re the CEO of the world’s largest airline.
It’s a bit awkward, though, when it’s a major competitor. Or a partner. Or both.
American Airlines CEO Robert Isom said on Monday that he was not familiar with the details of JetBlue’s Mint product, to the point that he was unsure whether the product features lie-flat seats.
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Isom’s statements came during the antitrust trial over the Northeast Alliance between American and JetBlue in US District Court in Boston on Monday. The Department of Justice alleged that the alliance amounts to anti-competitive action that will lead to higher fares. However, the two airlines have argued that the alliance is the only way they can effectively compete against Delta Air Lines and United Airlines in the Northeast.
“I’ve never flown the Mint product, I don’t know if Mint is lie-flat,” Isom said. Then he clarified that while he was aware that JetBlue “has a domestic first-class product, I can’t speak to all the amenities they include.”
Isom added that he was drawing a distinction between domestic first class — which American offers on most domestic routes — and “international business class” and flagship products.
The discussion of lie-flat products took place during a broader questioning by DOJ lawyers surrounding competition and cooperation between American and JetBlue on premium transcontinental routes —specifically, those from Boston and New York to Los Angeles and San Francisco.
Based on questioning, the DOJ appeared to argue that since American and JetBlue both offer a lie-flat premium product on those transcontinental routes, the NEA eliminates competition.
“With the NEA in place you don’t have to worry about JetBlue coming after American for your premium customers, right?” DOJ lawyer Bill Jones asked Isom.
American operates a subfleet of Airbus A321s on that route, dubbed the A321T. It features 20 business-class seats and 10 Flagship First seats — all of which are lie-flat, in configuration otherwise used on long-haul flights.
While it is not uncommon for CEOs in any industry to leave the finer details of things to their teams to fully understand and manage, the transcontinental market is of considerable importance to US airlines with fare premiums often paid by high-volume and high-value business travelers.
While there are several domestic routes from the New York-area airports and Boston that are excluded from the alliance, those premium transcontinental routes are not among them.
It also was not the first time that an American Airlines chief has admitted to being unaware of an important and relevant onboard product.
Former CEO Doug Parker faced criticism in 2018 when he admitted he had not flown the airline’s new “Project Oasis” cabins; These cabins were the subject of fierce criticism from passengers over cramped, tiny lavatories and a lack of in-seat power. The airline ultimately altered the final design of the cabin, although the coach seats remained cramped.
From the trial: American Airlines forgot it had landing slots at JFK. Then it lost some of them
Monday saw testimony from Isom and current American Airlines senior vice president Scott Laurence, who, in a previous role at JetBlue, was widely considered the driving force behind the alliance.
Much of the focused on intentions and mechanisms behind the alliance, with little in the way of surprise.
Boston, which is not slot-constrained in the same way as the New York airports, was the subject of questioning earlier on Monday.
“The Northeast Alliance created an opportunity for us to be as viable a competitor in Boston as we could be,” Isom said in court.
The trial, which began on Tuesday, Sept. 27, is set to continue for up to three weeks. JetBlue CEO Robin Hayes and American Airlines chief commercial officer Vasu Raja are among those who have testedified, with former American Airlines CEO Doug Parker expected to testify this week.
TPG is reporting from the trial in Boston, so stay tuned for the latest.