DALLAS — American Airlines continues to cut routes out of Austin-Bergstrom International Airport (AUS), with Boston, Las Vegas, Nashville, and Orange County flights slated for cancellation into late 2024 and early 2025. After these changes, AA will only serve eight U.S. hubs and two leisure routes to Mexico from Austin.

In 2021 and 2022, AA aimed to establish Austin as a focus city, significantly expanding its flight network from primarily servicing its hubs to over three dozen destinations, including popular leisure spots like Cancun, Tampa, and Orange County. 

However, by early 2024, this strategy had been reversed, with the airline scaling back its Austin operations. American has now confirmed additional cuts, leaving only flights to its domestic hubs.

American  has systematically reduced its Austin routes. By January 2024, the airline ceased flights to several cities, including Bozeman, Cincinnati, Cozumel, and Jacksonville. By February and March, further cuts included destinations such as Sacramento, Washington Dulles, Nassau, and Punta Cana. 

Austin No Longer a Focus City

American Airlines’ decision to retreat from Austin appears tied to changing economic conditions. While Austin once saw rapid growth and was considered a prime market, that expansion has slowed.

Austin was previously one of the fastest-growing cities in the United States, but that growth has slowed considerably. For example, between July 2022 and July 2023, house prices in Austin dropped more than in any other major city, indicating a slowdown in the city's economic expansion.

Ben Schlappig from onemileatatime.com points out that real estate prices, a key indicator of the city's growth, saw the largest drop among major U.S. cities between mid-2022 and 2023, reflecting the broader economic downturn in the region. With demand stagnating, AA has chosen to realign its resources, focusing on more profitable routes.

Schlappig also notes that AA has been losing money on its Austin expansion since the beginning. While the airline loses money on many routes, it's only sustainable to continue unprofitable operations for so long.

Finally, AA faced too much competition on domestic routes out of Austin and had been forced to slash ticket prices more than expected. did the airline expand too quickly, creating overcapacity in the market?

Strategic Shifts

Several factors have led American to reconsider its Austin strategy:

• The discontinuation of the Northeast Alliance between AA and JetBlue (B6) has freed up regional jets that may be needed more in the Northeast.
• Austin's proximity to AA's Dallas-Fort Worth (DFW) hub makes many point-to-point routes from Austin less necessary.
• The airline appears to be refocusing on hub-to-hub connections rather than point-to-point flights from secondary cities like Austin.

To be sure, with these cuts, Austin is no longer a focus city for AA, as the pullback from AUS is significant:

• American is canceling 21 out of 42 destinations it previously served from Austin.
• This includes both year-round and seasonal routes to domestic and international destinations.
• The airline will maintain service to its major hubs and a few point-to-point destinations, but is significantly reducing its overall presence.

These cuts reflect a broader reassessment of the airline's network strategy and the changing economic landscape in Austin. AA is likely aiming to optimize its operations and profitability by concentrating on its core hubs and most profitable routes.

Despite this, Austin remains connected to key domestic hubs and leisure destinations in Mexico, though the city's prominence in AA’s network has significantly diminished.

The AUS route cuts come as AA is set to expand its network in Latin America by adding a new destination in Mexico. Starting March 6, 2025, the airline will begin daily flights to Tampico International Airport (TAM) from its DFW hub using its Embraer E170 aircraft. The TAM route is served by several Mexican carriers and United Airlines (UA), which offers flights to Houston.