American Airlines Puts Legroom-Crunching Project Oasis On Hold

American Airlines is in the midst of a retrofit project that it's calling "Project Oasis." The goal is to retrofit its domestic Boeing 737-800 and Airbus A321 so they have the same seating configuration. But it hasn't been a, well, oasis so far for the airline, between negative customer feedback and safety issues found in the retrofit work.

American Airlines' President Robert Isom said Tuesday morning at Wolfe Research Global Transportation Conference, AA has now put the Project Oasis retrofit project on hold on its Boeing 737s. But, this move isn't being made because of customer feedback.

With its fleet of 24 Boeing 737 MAX grounded during the busy travel season, American Airlines has had to cancel around 115 flights per day through August 19. So, AA is pausing the Project Oasis 737 retrofit to reduce cancellations as much as possible. Fewer planes down for weeks to get the interior redone means more planes in the air flying passengers.

Here's why this pause is good news for American Airlines flyers. While Project Oasis has some benefits (e.g. power outlets larger overhead bins), AA is taking this opportunity to cram more seats into each aircraft, reducing pitch throughout the plane. None of the retrofit planes will have inflight entertainment screens when they're done, even if they had perfectly-good IFE screens before.

While AA's retrofit of its A321s has its advantages, there aren't many fans of the Boeing 737-800 retrofit. Just like on AA's Boeing 737 MAX, the bathrooms are downright tiny at just 24 inches from wall to wall. The slimline seats aren't comfortable to sit in for the some of the long flights on which AA is scheduling these planes. And the 30-inch pitch in standard economy just feels really tight.

The first-class cabin is also getting the squeeze as part of Project Oasis. AA is pulling out its aging but generally comfortable 737 first class seats and installing the same type of seat that it uses in premium economy on international flights. And it's also cutting the pitch between 1-3 inches per first-class row.

Passengers have voiced their displeasure with the comfort of these seats, the lack of under-seat storage and the lack of inflight entertainment screens. On the retrofit 737-800, the seats don't even have a seatback tablet holder for those that BYOD (Bring Your Own Device).

On top of these issues, there are safety concerns regarding theit work done by one of American Airlines' retrofit contractors. AA had to ground 14 of its Project Oasis Boeing 737-800s for inspections and repairs when the issues were found. Those aircraft have now returned to service, but not before AA had to cancel hundreds of flights.

Many American Airlines frequent flyers would be very happy if the airline were to rethink its Project Oasis retrofit plans. However, an about-face would surely be costly for AA, since it already has retrofit 71 Boeing 737-800 and likely has contracts in place for suppliers to continue Project Oasis.

And although Project Oasis is on hold for the Boeing 737-800, an American Airlines spokesperson confirmed that the A321 retrofits are still scheduled to start this fall. AA is likely to wait until the 737 MAX returns to service before starting this retrofit.