American Airlines hits the end of an era as it drops New York – San Juan link

US major American Airlines has confirmed its will end its non-stop flights between New York’s John F Kennedy International Airport and Luis Muñoz Marín International Airport in San Juan, from August 2017, continuing the carrier’s significant cutbacks in Puerto Rico, previously one of its major regional hubs.

The formal confirmation of the closure of the route, which it has flown since the early 1970s, followed an exclusive story on Routesonline on April 3, 2017 about the changes to the airline’s booking inventory. The report from our Airlineroute channel had revealed the cancellation of the twice daily link from August 22, 2017.

“We have made the difficult decision to cancel our service” between New York JFK and San Juan, an American Airlines spokeswoman said in a statement to USA Today. “We continually evaluate our network, looking at supply and demand for each route we serve. We want to ensure our fleet and crews are serving routes that are profitable, better positioning us for long term success against global competition.”

American started serving the New York JFK – San Juan market from March 1971 after it acquired Trans Caribbean Airlines. San Juan became a key regional hub for the US major providing key regional connections across the Caribbean. However, the airline’s presence has reduced in recent years and it officially closed its hub in San Juan in 2013.

Schedule data from intelligence provider OAG shows the scale of the airline’s cuts in San Juan over the past ten years with annual departures falling from over 35,000 movements offering over 4.5 million seats in 2007 to just over 4,000 departures providing just over 700,000 seats from San Juan in 2014.

Despite the significant cuts as part of the “de-hubbing” process, American has actually boosted its available seats from San Juan in the past two years, growing year-on-year capacity 7.7 per cent in 2015 and 40.2 per cent last year. The 2016 schedules helped surpassed the one million seat level for the first time since 2012, albeit where still significantly below the airline’s previous operational level.

It has been a long and successful story for American since it first entered this market back in the early 1970s. Its current twice daily Boeing 737-800 operation compares with a five times daily operation (4x daily from JFK and once daily from Newark) back in the first half of the 1970s and these flights were operated with larger equipment, including the 747 Jumbo Jet. In fact back in 1972, Airlineroute reports that Eastern Airlines and Pan American also served this market using such as aircraft as the 707, 747, Lockheed L1011 TriStar and Douglas DC-8.

However, the market has changed a lot across the last five decades and New York is no longer home to the largest expatriate Puerto Rican community in the United States mainland, a position now held by Fort Lauderdale. Puerto Rico has also been facing economic struggles which do not appear to be showing signs of significant improvement.

American is not completely exiting the San Juan market and will continue to link the destination to its hubs in Charlotte, Chicago, Dallas, Miami and Philadelphia. This summer it will hold an 18.1 per cent share of capacity out of Luis Muñoz Marín International Airport, ranking it as the second largest operator in San Juan. It was overtaken by JetBlue Airways in 2012 as the low-fare carrier has worked to fill the market void as part of its Caribbean expansion strategy.

It had put added pressure on American’s activities by providing its own services on the New York JFK – San Juan route since 2002, a route it now serves up to six times daily and one of 14 non-stop routes it offers linking San Juan to destinations in the mainland United States, the US Virgin Islands and the Dominican Republic. It also offers up to two flights per day to San Juan from Newark.

American will also be succeeded in the New York – San Juan market by its fellow US majors. Delta is offering up to four daily rotations out of JFK during the current summer 2017 schedule, while United Airlines has up to four flights a day out of its Newark Liberty International Airport hub. Low-cost pioneer Southwest Airlines also offers a weekly Newark – San Juan service.

New York JFK – San Juan has strong O&D flows with annual demand exceeding one million annual passengers on three occasions this past decade. Information from the AirVision Market Intelligence tool from Sabre Airline Solutions shows that demand on the New York JFK – San Juan has fallen for the past two consecutive years with an 11.4 per cent decline in 2015 and a 4.3 per cent slip in 2016.

Interestingly, average air fares have remained resilient over the past ten years and have actually increased 3.9 per cent between 2007 and 2016. The wider New York – San Juan market has fluctuated between 1.0 and 1.3 million annual O&D passengers over the past ten years, between 1,500 and 1,900 PPDEW (passengers per day each way).