Milwaukee to be 2nd. HUB

 
Old Dec 29, 09, 12:28 am
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Milwaukee to be 2nd. HUB

Airtran will announce shortly that they are going to make Milwaukee their second operations base in the USA, initially basing at least 50 flight attendants and 50 pilots in the new operation hub. Milwaukee will join Atlanta as an operations hub in April.

Milwaukee flights already represent 11% of Airtran's total traffic. This can only be expected to increase as crews are based in the city.
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Old Dec 29, 09, 6:47 am
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FL press release:

http://pressroom.airtran.com/phoenix...577&highlight=
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Old Dec 29, 09, 7:42 am
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All they need now is about 5-7 more gates.

US may be leaving, relocate United, and American and AirTran can have the entire C concourse.
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Old Dec 29, 09, 8:17 am
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Originally Posted by RSVP View Post
All they need now is about 5-7 more gates.

US may be leaving, relocate United, and American and AirTran can have the entire C concourse.
That would be a good shot at our "Hometown" airline now that they have to share space with WN. Can you see the irony in that one. Good thought.
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Old Dec 29, 09, 9:42 am
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This is great news for MKE and the entire region. Every time people say AirTran isn't serious, they keep upping the ante. I suspect that they have been running a lot more connections through MKE than we realize. I believe that their strategy is to capture as much of the local market share as possible by lowering fares and stimulating demand from a larger catchment area, and also filling as many leftover seats as possible with connecting traffic. Although this traffic sometimes has junk yields, AirTran's costs are very low, so the losses are also lower. They must believe that the MKE airport is the best place to try to build this much-needed east-west hub. I give them credit for continuing to try to make this work.

AirTran currently has nine gates on the C concourse if you include the ground-level operations at C17. I wonder if United might be able to move down to Concourse E to be with its new partner Continental? I don't know if two gates would be enough for that combined operation. E60 and 61 appear to be vacant, however. Perhaps if US Airways eliminates its mainline MKE-PHX service, as some are speculating, it's possible that both US and UA could move down to E, which would free up 4 additional gates on C and give FL 13 gates.

Last edited by newsmanhoss; Dec 29, 09 at 10:48 am
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Old Dec 29, 09, 10:41 am
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It is good to see AirTran organically growing in MKE as I had hoped they would. This route to growth in MKE was a much better path than a hostile takeover of Midwest. So congrats to AirTran and their crew members!
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Old Dec 29, 09, 1:52 pm
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Article from the Business Journal:

http://milwaukee.bizjournals.com/mil...8/daily10.html
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Old Dec 29, 09, 3:22 pm
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Originally Posted by newsmanhoss View Post
AirTran currently has nine gates on the C concourse if you include the ground-level operations at C17. I wonder if United might be able to move down to Concourse E to be with its new partner Continental? I don't know if two gates would be enough for that combined operation. E60 and 61 appear to be vacant, however. Perhaps if US Airways eliminates its mainline MKE-PHX service, as some are speculating, it's possible that both US and UA could move down to E, which would free up 4 additional gates on C and give FL 13 gates.
I am sure United and American could find a new home at Mitchell.

AirTran has made a serious commitment to Milwaukee and Milwaukee County will be happy to give them the additional space they need. I was on the E concourse last spring and it looked pretty underutilized to me.

Delta would probably be willing to shed some of those gates as its Milwaukee presence shrinks.
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Old Dec 29, 09, 3:48 pm
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Originally Posted by RSVP View Post
I am sure United and American could find a new home at Mitchell.

AirTran has made a serious commitment to Milwaukee and Milwaukee County will be happy to give them the additional space they need. I was on the E concourse last spring and it looked pretty underutilized to me.

Delta would probably be willing to shed some of those gates as its Milwaukee presence shrinks.
Dead on, RSVP. Does DL/NW really need six gates? They only serve ATL, MSP, DTW, MEM, and CVG. I'm sure they could lose one or two at the very least.

I was just on E earlier this month and agree that it is highly underutilized.
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Old Dec 29, 09, 9:35 pm
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I think UA really only uses Gate 9, AC is next to them at 10. They could easily move over to the old AirTran gates in E.
Either way, it should be interesting in MKE the next year or two. Will Southwest stay? Is US Airways going to rollover? Will Delta put up a fuss? What will Republic do?
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Old Dec 30, 09, 3:53 am
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I think people are reading far too much into that. This still makes MKE smaller than ATL, MCO and BWI. While 22 destinations and 50ish flights a day is nice it can also be gone in 1 summer. FL doesn't have physical assets in the Milwaukee area like reservation centers, corporate offices, etc. What they have is an operation basically the size of what NW ran out of IND. And if you paid attention to the aviation news you'd know how fast that went away. NW had a huge operation in IND (FL at MKE size) and it was gone in no time flat. That is what happens when you don't have a real vested interest in a smaller market like you do in MCO and ATL. It is far too easy to pull the plug and pack up when times get tough.

Until the battle with YX/F9 and WN is resolved you are just one bad quarter or two from having 50 flights to 22 destinations slashed to 12 flights and 3 or 4 destinations. I know the growth is exciting but 50 flights a day really isn't that big especially when a number of them are rj. Just think NW @ IND and what could happen and how fast it could happen. That is unfortunately the reality of smaller markets.
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Old Dec 30, 09, 9:34 am
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Originally Posted by Indy View Post
I think people are reading far too much into that. This still makes MKE smaller than ATL, MCO and BWI. While 22 destinations and 50ish flights a day is nice it can also be gone in 1 summer. FL doesn't have physical assets in the Milwaukee area like reservation centers, corporate offices, etc. What they have is an operation basically the size of what NW ran out of IND. And if you paid attention to the aviation news you'd know how fast that went away. NW had a huge operation in IND (FL at MKE size) and it was gone in no time flat. That is what happens when you don't have a real vested interest in a smaller market like you do in MCO and ATL. It is far too easy to pull the plug and pack up when times get tough.

Until the battle with YX/F9 and WN is resolved you are just one bad quarter or two from having 50 flights to 22 destinations slashed to 12 flights and 3 or 4 destinations. I know the growth is exciting but 50 flights a day really isn't that big especially when a number of them are rj. Just think NW @ IND and what could happen and how fast it could happen. That is unfortunately the reality of smaller markets.
BWI doesn't have any reservation center or corporate offices. Do you discount what AirTran is doing there? The fact is, thanks to technology, the reservation centers and corporate offices don't have even be located in a city where the airline does business.

The fact is, AirTran publicly stated that Milwaukee is going to be its second hub, and will be the only crew base outside of Georgia or Florida. There is some significance to that. Yes, it's still smaller than ATL, MCO, and BWI, but it's also larger than the other 63 cities in the FL network.

At the current MKE growth rate, it's closing in on BWI. According to the information AirTran presented at the Next Generation Equity Research Airlines Conference earlier this month, in 2010 MKE will account for 13% of their operations. BWI is estimated at 14%. Their operations are about the same size, and FL chose to designate Milwaukee the second hub. Orlando is not actually considered a hub because they don't route connecting passengers through that station. Look at the route map and you'll see what I mean.

The Milwaukee metro area has two million folks, plus an additional 2 million+ in the northern tier of Chicago. If cities like Charlotte, Cincinnati, Memphis, Cleveland and Salt Lake City can support hubs without a huge city like Chicago next door, then Milwaukee can certainly support what it is doing. And the recent passenger numbers prove it.

How many flights per day would AirTran have to add in Milwaukee for you to recognize what is happening here?
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Old Dec 30, 09, 10:03 am
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"This still makes MKE smaller than ATL, MCO and BWI"

I can remember you said that about BWI/MCO a few years ago. I think you said SWA would eventually run Airtran out of BWI. They have steadily increased flights out of there for almost a decade. They are not the number one carrier as far as market share in either of those markets but yet profitable.

"FL doesn't have physical assets in the Milwaukee area like reservation centers, corporate offices, etc"

MCO is there corporate head quarters and has a large mx base there but yet they don't have a pilot domicile there. One of the reasons they have never opened a pilot domicile either in MCO or BWI is because of the seasonal flying. 737's are used heavily in the winter months with the north/south flying and in the summer they are used to increase frequency on the east/west flying. Also Airtran has a pretty large mx store for parts in MKE. Millions of dollars worth. So to say that will pull out in no time, I think you miss the point.

"What they have is an operation basically the size of what NW ran out of IND."

Unlike MKE, IND never had mx base there. Unlike MKE, IND never had a mx store. Unlike MKE, IND never had crew domicile there(both F/A and pilot). As a matter of fact this is the first time Airtran has opened a pilot domicile in over a decade. Unlike MKE, IND didn't have a feeder(Skywest in MKE). IND was never set up like a hub. It was/is mostly P2P flying. IND never got up to 50 flights a day. MKE will be close to sixty a day. With more to come. On top of that Airtran is flying charters to over six international destinations out of MKE to mexico and the carribean. IND never had that either. It just makes sense for them operationally. ATL now represents less than half of there total asm's in flying. So over half there flying is out of ATL now. It just make sense.

There having there best financial year in its company history. 9 out of the last ten years they have been profitable. They are willing to take some risk to make this work. Good for them. Over half a billion in the bank. If you adjust the stage lengths(appples to apples comparison) airtan has lower costs than SWA and Frontier. Alot of pressure from SWA in DEN, adding lots of capacity there plus Airtran/SWA in MKE put alot of pressure on Republic. I guess we will see.
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Old Dec 30, 09, 3:59 pm
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"I can remember you said that about BWI/MCO a few years ago. I think you said SWA would eventually run Airtran out of BWI. "

Actually that probably wasn't me.

"Unlike MKE, IND never had mx base there. Unlike MKE, IND never had a mx store. Unlike MKE, IND never had crew domicile there(both F/A and pilot). As a matter of fact this is the first time Airtran has opened a pilot domicile in over a decade. Unlike MKE, IND didn't have a feeder(Skywest in MKE). IND was never set up like a hub. It was/is mostly P2P flying. IND never got up to 50 flights a day."

The MX base and what not doesn't matter. All it takes is for FL to let a lease expire and pack up what limited equipment they have up on a few trucks and move out. Same goes where a few pilots reside. Just involves a simple relocation. It is just as easy to move them out as it is to move them in. And BTW IND was at 50 flights a day with NW at one point. The operation was so large that they were serving approximately 2 million passengers a year.

The bottom line is that until the situation with YX/F9 is resolved MKE isn't safe for FL. The fact is the market will not support two hubs. One will go. Question is which airline and when. Right now FL has the easiest way out. All they need to do is allow a few leases to expire and relocate some employees. Not a major thing to do. It is going to take a few years before the operation there is safe.

If you had to guess right now which airline do you think blinks first? YX/F9 or FL?
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Old Dec 30, 09, 5:44 pm
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BTW if you want to know how committed AirTran is to MKE just look at the length of the leases they sign. Are they two year leases? If so then they haven't really committed yet.
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