Originally Posted by
spin88
That is an assertion, not fact, and accepts a particular c2012 PMCO view of the aviation world in which focusing on fortress hubs and non-competitive routes and cutting capacity are the way to profitability as gospel. IMHO that was a mistake in 2012 and its a mistake today. I think UA bleeding traffic and dramatically under-performing from 2012-2017 show the plan has not worked, YMMV.
Where did I say United should focus on fortress hubs and non-competitive routes? United hasn't cut capacity and has no plans to cut capacity. Yet, capacity is finite (both from an airplane perspective, but also from at airports) and airlines need to make choices about where they allocate it. Unlike AA or Delta, United doesn't have a large portfolio of fortress hubs where it can pull capacity from (without loosing market share) to grow elsewhere.
Specifically to the west coast, you need to recognize that pre-merger, there were an awful lot of RJs flying up and down the coast, including the supposedly-critical markets of PDX/SEA-LAX. This is not a post-merger phenomenon.
Originally Posted by
spin88
First, an example, company I work with has offices in LA and SF, does business up and down the coast and then periodic trips to NYC. They have 20 sales people who regularly travel mostly up and down the West Coast. At my suggestion they got a corporate deal, and it was DL that got the business. Why? Well DL covered the places they needed ex-SFO and ex-LAX, and UA lacked adequate connectivity to PDX and SEA where they do a lot of business. That combined with DL's better service and reliability tipped the deal to DL. Its not huge (likely $250K in sales) but a good example of the benefits of having a more integrated network.
Second, building out the network in a region has knock on impacts. For example, as DL has built out LAX and SEA it has made it possible for me to fly places via DL ex-SFO that would have been difficult in past. E.g. I have taken 8 trips to TUS in the last two years, easy to do via LAX connection, UA offers me no really good options. The result is that DL is now getting 70% of my $60k+ in spending, not the 25% they were getting when I started to fly them post 3/2/12.
Every company and individual's travel patterns are different. Statistically, United will offer the best network for most SFO-based travelers and should be competitive at LAX in key markets. Delta is not competitive in SFO for people in SFO going to PDX or TUS, just like United is not competitive travel frequently from LAX to ATL or DTW.
Increasing network utility would benefit any carrier. Hence the decisions taken by AA, Alaska, Delta, Southwest and United over the past few years.
Originally Posted by
spin88
P.s. and I might add that my opinion appears to also be Kirby's opinion (which is why he is trying to claw back some share ex-LAX) and is certainly the view behind the VX/AS merger, which attempts to build up regional strength on the West Coast.
United is gaining gate capacity that was out of service for terminal/UC construction. It is tough to grow when you don't have space to park airplanes.