According to the OAG updates on A.net GUM-KIJ is being axed from April...
With Okinawa gone too, what's the future of the GUM hub so to speak... also do UA plan to/ever can fly NRT-ROR/SPN (to compete with DL) or GUM-ICN/PVG/PEK or even PUS/CJU?
According to the OAG updates on A.net GUM-KIJ is being axed from April...
With Okinawa gone too, what's the future of the GUM hub so to speak... also do UA plan to/ever can fly NRT-ROR/SPN (to compete with DL) or GUM-ICN/PVG/PEK or even PUS/CJU?
Just some thoughts out there...
I have never been able to fathom GUM. It is as if there is a parallel airline out there utterly irrelevant to 99 percent of COdbaUA's customers.
A hub in GUM makes as much sense as a hub in Saskatoon.
A hub in HNL makes sense. Might have demand for daily service to CNS then.
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"A hub in GUM makes as much sense as a hub in Saskatoon.H"
Huh? The people in this area are a captive audience, CO (DBA UA) made big bucks for many years with the GUM hub, serving the islands in Micronesia, the Federation, and beyond, along with the Island Hopper that serves HNL, with the Johnston Island US military facility enroute.
I take it you have never been there. It is a nice (small) modern terminal with all gates within short walking distance and a better than average club
A hub in GUM makes as much sense as a hub in Saskatoon.
A hub in HNL makes sense. Might have demand for daily service to CNS then.
I take it you've never been to GUM. It is a major tourist destination for Japan and other part of Asia. UA can manage to fill a daily 777 and several daily 737s mostly with these tourists.
The ex-GUM service to the other islands is as much about cargo as it is about pax. I don't know much about the CNS service the times I've been on it the flight has been very light. I thought it was just COs way of saying they served Australia and being able to do it with a spare 737. I don't know why it's still around. From anywhere but GUM it's faster to connect via SYD to CNS.
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Quote:
Originally Posted by mre5765
I have never been able to fathom GUM. It is as if there is a parallel airline out there utterly irrelevant to 99 percent of COdbaUA's customers.
Pretty much.
It is there to serve the local/regional population and business/military, and no other carrier does. Kind of a niche thing.
But with the UA flights in the mix, some stuff that CO used to serve has less relevance, and thus less flow. For example, someone who used to travel IAH-HNL-GUM-HKG on CO now can travel on all CO/UA more efficiently IAH-NRT-HKG or IAH-SFO-HKG. So now there are even fewer GUM connections than before.
Then, with GUM's isolation, they are constrained in how small an aircraft they can put on routes, so if they can't get good return on a 737, it's a choice between running the route at a loss or not running it at all.
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Guam-Tokyo is a massive local market, and Japanese tourists flock to Micronesia. The hub is definitely a non-core, niche operation but the margins have historically been very good. Aside from the scheduled service, UA also operates regular charters all over Japan from Guam.
There have been talks of resumed service to ICN and TPE, as well as mainland China, but I don't know if we should read into this as anything more than a cut of an underperforming market.
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Um, Guam is the gateway to all of Micronesia, that's what makes it relevant. It is also a military base, so the flights frequently have members of the armed forces flying. Asian tourists visit the Miconesian region in large numbers, so the link there is also very important. Indeed, the fact that most of the food court options are Asian made it clear to me who their primary client base is.
Guam also makes it possible to get to Fiji and link up to Air Pacific's large network of pacific flights. So if you want to go from Palau to Samoa without having to go to Australia or HNL first, you use GUM.
Guam-Tokyo is a massive local market, and Japanese tourists flock to Micronesia. The hub is definitely a non-core, niche operation but the margins have historically been very good. Aside from the scheduled service, UA also operates regular charters all over Japan from Guam.
There have been talks of resumed service to ICN and TPE, as well as mainland China, but I don't know if we should read into this as anything more than a cut of an underperforming market.
Quote:
Originally Posted by pinks
Um, Guam is the gateway to all of Micronesia, that's what makes it relevant. It is also a military base, so the flights frequently have members of the armed forces flying. Asian tourists visit the Miconesian region in large numbers, so the link there is also very important. Indeed, the fact that most of the food court options are Asian made it clear to me who their primary client base is.
Guam also makes it possible to get to Fiji and link up to Air Pacific's large network of pacific flights. So if you want to go from Palau to Samoa without having to go to Australia or HNL first, you use GUM.
I understand all of the above, but the markets for CO@GUM have nothing to do with the core COdbaUA business. Indeed the markets have less to do with COdbaUA's business than Copa's markets, and Copa is now a separate airline.
If CO@GUM is a higher profit business than the rest of COdbaUA, then the right thing to do is spin it off as its own airline.
If GUM would actually allow us to fly to Fiji and Tahiti on UA metal that would be a different thing of course.
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Hmm... with the NRT "hub" and the GUM hub coming together during the merger, is there any reason other than lack of demand/underperformance for the non-service of NRT-ROR/SPN then...?
I understand all of the above, but the markets for CO@GUM have nothing to do with the core COdbaUA business. Indeed the markets have less to do with COdbaUA's business than Copa's markets, and Copa is now a separate airline.
If CO@GUM is a higher profit business than the rest of COdbaUA, then the right thing to do is spin it off as its own airline.
If GUM would actually allow us to fly to Fiji and Tahiti on UA metal that would be a different thing of course.
??????? Worst logic of the year.
Sell Guam ops because it's "higher profit business"? Really? UA should sell all their most profitable routes with that logic. What a lot of people haven't mentioned here is the value of the cargo component of the service provided. It's huge. I think the perception from some mainlanders is "where is Guam and why does US even fly there?". I could say the same thing about Akron (no offence intended). Just because you don't know it, doesn't mean it's not valuable. I think UA will tweak it, but it's too valuable to let go as long as UA has significant presence in Japan and Honolulu to support it. I would say the merger actually strengthens the Guam ops.
As for Copa, it's still important to UA, because it provides intra-SA routes that UA does not serve, and where it lags AA. I've flow Copa many times because of that.
Last edited by IAH-OIL-TRASH; Jan 28, 13 at 10:38 am..
Air Micronesia - known locally as Air Mike - morphed into Continental Air Micronesia - and then Continental morphed into UA, and now they are tweaking the service based on demand.
If CO@GUM is a higher profit business than the rest of COdbaUA, then the right thing to do is spin it off as its own airline.
If GUM would actually allow us to fly to Fiji and Tahiti on UA metal that would be a different thing of course.
I'd wager there is a lot of mainland traffic to/from Guam and also connecting from xxx small island-GUM-HNL-Mainland. Many places they serve are US territories and thus can only be served to other US destinations by a US flag carrier.
If they spin it off, then you have to have the overhead etc. of an entirely new airline for what is actually a relatively small operation.
Remember, Air Mike used to be a true subsidiary - it's own call sign, accounting, etc. and that proved to be less efficient than just folding it into mainline. Economies of scale and all of that.
Sell Guam ops because it's "higher profit business"? Really? UA should sell all their most profitable routes with that logic.
It is a common thing in the business world when a company has one business that is dramatically profitable than the other, that the more profitable business is sold off so that share holders can enjoy the profits.
Quote:
Originally Posted by adampenrith
Air Micronesia - known locally as Air Mike - morphed into Continental Air Micronesia - and then Continental morphed into UA, and now they are tweaking the service based on demand.
And the danger of the Air Mike operation being part of the monster known as COdbaUA is that the operation is harmed or treated as a cash cow. Hence be unsurprised if there are shareholder pressures to divest.
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It is a common thing in the business world when a company has one business that is dramatically profitable than the other, that the more profitable business is sold off so that share holders can enjoy the profits.
And the danger of the Air Mike operation being part of the monster known as COdbaUA is that the operation is harmed or treated as a cash cow. Hence be unsurprised if there are shareholder pressures to divest.
GUM does not exist in a vacuum, the hub contributes valuable passenger and cargo revenue to the rest of the system, especially to the mainland over HNL and NRT to a lesser extent. That advantage is lost with a divestiture of the former CO Micronesia operation. Similarly, without the United network to feed GUM at HNL or NRT, the operation has limited value to a potential buyer. Indeed, the only airline that would likely benefit from GUM to the same extent as United would be Delta, and it is unclear if such a course of action (i.e. conferring a significant benefit to one's chief competitor) would be prudent.
