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ARCHIVE: Routes (Flights) and Hubs (Speculation, News and Discussion)

ARCHIVE: Routes (Flights) and Hubs (Speculation, News and Discussion)

 
Old Jun 13, 2014, 2:19 pm
  #1546  
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Originally Posted by BoeingBoy
Given my friend FWAAA's comments re: CLT in the past, I think (and certainly hope) he's being sarcastic of those so in a hurry to start closing hubs - CLT, ORD, or whichever.
Yes, post #1538 was sarcasm. Subsequent posts are not sarcastic.

I've posted my views/opinion of CLT before; here's a summary.

IMO, Charlotte will not be closed/dehubbed/eliminated.

But that does not mean that it will escape unscathed. It produces lower unit revenues of any East Coast hub (I mis-spoke above). 80% of its passengers are connecting, a higher percentage than any other legacy hub in the USA.

CLT is ideal for connecting people around its immediate area (the southeast states) and is ideal for connecting people from the NE to the SE and from the NE to Florida.

Thing is, AA already serves many of the biggest markets (from where the bulk of the passengers originate or end their trips) with mainline planes from ORD/DFW/MIA.

Earlier in this thread, multiple people asserted that new AA would not fly lots of 1000 mile RJ routes to connect every Mayberry with CHI or DFW. Funny thing about that: In some cases, AA already does and in other cases, it's amazing how many RJs are flown 700-1000 miles by pmUS to/from CLT. CLT is the king of long RJ routes.

Anyway, with the expected contraction of Dash8s and 50-seat CRJs (in part due to the new federal pilot regulations and in part due to their fuel inefficiency), some of the Mayberry-like towns served from CLT are going to lose their air service if they can't support larger RJs or mainline planes. Unless they come up with local subsidies.

That's going to drive some contraction at CLT. pmUS has been filling its European flights from CLT in part with bargain-hunting passengers from big cities, not just residents of Mayberry from those Dash8s and CRJs. Some of those big cities already have nonstops to Europe flown by pmAA and others have mainline AA service to the AA gateways.

Therein lies the problem. Some of the CLT destinations are RJ-only yet pmAA already serves them with mainline planes from ORD and/or DFW, so those RJs won't be as necessary once the low-fare Advantage fares disappear and AA routes its long-haul domestic passengers via ORD and/or DFW (where AA already has mainline equipment).

Example: JAX. JAX-west coast traffic can be routed via mainline planes via DFW, reducing the need for seats on the JAX-CLT RJs. Of course, that reduces the need for as many seats on the CLT-West coast nonstops. Ruh-Roh. Once the inefficient routings are reduced/rationalized, CLT's activity will likely taper off. There are other examples as well.

Yes, CLT is a very cheap airport with very low per-passenger enplanement costs. But if the choice is flying passengers on high-cost RJs to get to/from CLT v. flying them on lower-casm mainline planes (that are cheaper to operate), which one will win out? Cheap landing fees and rent at CLT won't cancel out the much higher RJ CASM issues. Notta chance.

Originally Posted by ccengct
I think most people would say that the "very small" is appropriate language for O&D at Amarillo or Burlington, Vt. Charlotte O&D is somewhere around #20-25 nationwide, depending on how you slice and dice markets and how you aggregate airports in metro areas that have more than one. That's low-end for a sustainable hub, although the O&D figure for CLT has not enjoyed the boost from WN that some other markets have.
Yes, CLT's O&D is just a little less than STL and about tied with MIA. And US doesn't even get it all. DL, UA, WN, B6 and others already serve CLT and siphon off some O&D (by definition, every passenger boarded by those airlines is an O&D passenger as none of those airlines connect passengers at CLT).

Originally Posted by ccengct
But the flip side is that if AA+US walks away from CLT, the biggest winner will be DL -- and it's all about connecting traffic in the southeast, not O&D at CLT. I don't think Doug Parker wants to give that kind of birthday present to Richard Anderson.
This paragraph confuses me. First, AA isn't going to "walk away" from CLT. Secondly, DL already serves all of its hubs nonstop from CLT, including ATL, SLC, DTW, MSP, JFK and LGA. Delta isn't going to start connecting passengers at CLT no matter what new AA does.

Some of the tiny Mayberry-like towns served by Dash8s and CRJs? The same factors that imperil their US-service also hits DL; if those towns can't support some 76-seaters, they'll likely lose their air service as the 50-seaters go away.
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Old Jun 13, 2014, 3:03 pm
  #1547  
 
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A lot of the smaller "Mayberry" cities lost service, or at least mainline service, years ago - US' cool northern efficiency at work. I remember the day that Pitt-Greenville, Goldsboro, Greenville (NC), New Bern, Jacksonville (NC), Knoxville, Asheville, etc all had mainline service with 727/737s. I still wonder where the people we used to carry in/out of those places went. And that's not counting Virginia, Tennessee (except TYS), Kentucky, Georgia, etc. There are a lot of Mayberries within 500 miles of CLT.

Of those that still have RJ service, I suspect that some frequency will be exchanged for larger RJ's. The nice thing about the east is that a lot of those Mayberries are relatively close to each other so service could be consolidated in bigger markets within comfortable driving distance - ILM, MYR, CHS, SAV, etc. Again, much of this has already happened, except for still using a number of RJ's. It it results in enough traffic going to the west, by all means use mainline to take them to DFW/ORD. But if not, and for those not going west, you still need a collection point a lot closer.

My money is on CLT remaining a hub for the foreseeable future. Sure, there will be tinkering around the margin - S America flights may move to MIA, some of the Europe may move to PHL/JFK, fewer RJ's, more mainline, etc.

Jim
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Old Jun 13, 2014, 3:06 pm
  #1548  
 
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Originally Posted by FWAAA
This paragraph confuses me. First, AA isn't going to "walk away" from CLT. Secondly, DL already serves all of its hubs nonstop from CLT, including ATL, SLC, DTW, MSP, JFK and LGA. Delta isn't going to start connecting passengers at CLT no matter what new AA does.

Some of the tiny Mayberry-like towns served by Dash8s and CRJs? The same factors that imperil their US-service also hits DL; if those towns can't support some 76-seaters, they'll likely lose their air service as the 50-seaters go away.
Not to put words in anybody's mouths, but I think what he means is that dehubbing CLT would be conceding the southeast US to Delta.
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Old Jun 13, 2014, 3:19 pm
  #1549  
 
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Originally Posted by austin_res
I assume you're being sarcastic, however I can see AA cutting ORD flights in the next few years. AA has been cutting ORD for the past decade - reducing frequencies and moving mainline flights to regional. AA is also losing share in international traffic - AA cut many flights to Europe and on ORD-NRT UA flies a 747 daily while AA flies a 777 less than daily. How does AA dominate O&D traffic at ORD? UA has always been bigger than AA in ORD and UA shows no signs of giving up ORD.

At CLT, US/AA dominate the market, which helps them maintain pricing power and in turn helps with profits. CLT also has low operating costs and better weather than ORD. At ORD, the competition is huge, not to mention it is congested and prone to weather delays. I would not be surprised if CLT is more profitable for AA than ORD. Since the merger, CLT has seen several new flights added, none for ORD.

As I have said before, Parker (through his past actions) made it clear he prefers to dominate a smaller market over competing with others in a bigger market.

Here is a wild idea: AA moves its ORD hub to CLE. AA gets a midwest hub it can dominate, UA gets ORD to itself, Cleveland keeps a hub - everyone's a winner
I think AA needs to go the opposite way and expand at ORD. First, AA wants to grow in Asia and has no other logical connecting hub for the eastern US. Second, now is the time to go on the offense as United is hurting.

Last edited by Speedracer2; Jun 13, 2014 at 3:37 pm
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Old Jun 13, 2014, 3:41 pm
  #1550  
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Originally Posted by Speedracer2
I think AA needs to go the opposite way and expand at ORD. First, AA wants to grow in Asia and has no other logical connecting hub for the east coast. Second, now is the time to go on the offense as United is hurting.
Philadelphia?

I think it's the largest metro area in the country without a single flight across the Pacific. Lots and lots of connecting flights to help fill a plane to Tokyo or Shanghai. PHL is still a vibrant business center and I'm certain that some US frequent flyer faithful in PHL have been helping to fill UA planes to Asia. If new AA can keep them in the fold, maybe a nonstop to NRT would be the ticket.

About Chicago and Asia: AA already flies to the three top destinations in Asia from ORD, and other than possibly ICN, I don't predict any other destinations will happen. HKG? Dunno, given that CX already does that (and does it better than AA could ever hope to do).

Holes in the AA network to Asia? NYC to China, PHL to anywhere across the Pacific and LAX to PEK and ICN, perhaps to TPE.

If you were thinking BKK, SIN or KUL - those ain't never gonna happen nonstop. And immunized joint venture partner JAL already does a bang-up job connecting passengers to those destinations over HND or NRT.
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Old Jun 13, 2014, 4:01 pm
  #1551  
 
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Originally Posted by FWAAA
Philadelphia?

I think it's the largest metro area in the country without a single flight across the Pacific. Lots and lots of connecting flights to help fill a plane to Tokyo or Shanghai. PHL is still a vibrant business center and I'm certain that some US frequent flyer faithful in PHL have been helping to fill UA planes to Asia. If new AA can keep them in the fold, maybe a nonstop to NRT would be the ticket.

About Chicago and Asia: AA already flies to the three top destinations in Asia from ORD, and other than possibly ICN, I don't predict any other destinations will happen. HKG? Dunno, given that CX already does that (and does it better than AA could ever hope to do).

Holes in the AA network to Asia? NYC to China, PHL to anywhere across the Pacific and LAX to PEK and ICN, perhaps to TPE.

If you were thinking BKK, SIN or KUL - those ain't never gonna happen nonstop. And immunized joint venture partner JAL already does a bang-up job connecting passengers to those destinations over HND or NRT.
Distance to Asia might be a problem with having PHL as a connecting hub for the eastern US. But with the new Asia flights from DFW, perhaps they have figured out how to make the economics work? Another strategy might be to let Delta and United battle it out for the connecting traffic and only focus on OD.
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Old Jun 13, 2014, 4:10 pm
  #1552  
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Originally Posted by Speedracer2
Distance to Asia might be a problem with having PHL as a connecting hub for the eastern US. But with the new Asia flights from DFW, perhaps they have figured out how to make the economics work? Another strategy might be to let Delta and United battle it out for the connecting traffic and only focus on OD.
Perhaps, but CO (now UA) flies to NRT, PEK, PVG and HKG from Newark. AA has planes that can do that kind of distance (its 772s).

Additionally, JFK sees CX to HKG, JAL to NRT (double daily now that AA isn't flying JFK-NRT), DL to NRT and a few Chinese carriers at JFK.

More than six years ago, Doug Parker predicted success with PHL-PEK, and the DoT believed in him enough to award US that frequency. What's changed?

Of course, US said it would go out and acquire suitable aircraft for the route, which it failed to do.

From the western half of the country, SEA is an ideal gateway to Asia - I predict that DL will see some success.

I earlier predicted failure for the new DFW flights to PVG and HKG. Just too far and not enough O&D. I may be completely wrong about that.
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Old Jun 13, 2014, 5:04 pm
  #1553  
 
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Originally Posted by FWAAA
Perhaps, but CO (now UA) flies to NRT, PEK, PVG and HKG from Newark. AA has planes that can do that kind of distance (its 772s).

Additionally, JFK sees CX to HKG, JAL to NRT (double daily now that AA isn't flying JFK-NRT), DL to NRT and a few Chinese carriers at JFK.

More than six years ago, Doug Parker predicted success with PHL-PEK, and the DoT believed in him enough to award US that frequency. What's changed?

Of course, US said it would go out and acquire suitable aircraft for the route, which it failed to do.

From the western half of the country, SEA is an ideal gateway to Asia - I predict that DL will see some success.

I earlier predicted failure for the new DFW flights to PVG and HKG. Just too far and not enough O&D. I may be completely wrong about that.
Yes AA has aircraft that can go the distance, but the question is whether or not it would be profitable. Im sure it's a complicated equation to figure out profitable routes considering distance, fuel cost, weight, OD vs connecting traffic, cargo, premium passengers, landing slots, landing costs, aircraft types, competition, etc. etc.

I agree with you on the probable success of Delta's new SEA hub and AA failure on DFW to PVG and HKG although the 787 deliveries might help AA compete? As far as the western US to Asia market, I think AA will struggle other than perhaps for the southwest.
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Old Jun 13, 2014, 5:05 pm
  #1554  
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Originally Posted by Speedracer2
Distance to Asia might be a problem with having PHL as a connecting hub for the eastern US. But with the new Asia flights from DFW, perhaps they have figured out how to make the economics work? Another strategy might be to let Delta and United battle it out for the connecting traffic and only focus on OD.
They haven't figured out how to make the economics work, they are operating the flights at a loss and hoping something happens.
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Old Jun 13, 2014, 6:05 pm
  #1555  
 
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Originally Posted by Speedracer2
Not to put words in anybody's mouths, but I think what he means is that dehubbing CLT would be conceding the southeast US to Delta.
Precisely. The only question is whether DL would have enough capacity to handle the windfall. As for Mayberry, North Carolina and South Carolina combined (what the English originally intended) would be the 5th most populous state. The biggest influx is New Yorkers and (ahem) Californians.
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Old Jun 15, 2014, 12:41 pm
  #1556  
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Originally Posted by LAXative
Random musing: If the new AA was smart, LAX-SGN with a 788 should be in their first tier of new additions, directly connecting the largest Vietnamese population center with their native land, and making a one-stop for the other significant population centers near SJC, YYZ, IAH, PHL, NYC, SEA, and others.
Interesting. Vietnam's economy continues to grow at a fast clip, and it's a very populous country. But it's almost as far from LAX as BKK, and BKK-LAX doesn't work as a nonstop (economically - planes can technically make it).

Unless fuel prices moderate (either by dropping or holding steady while prices of everything else rise), I don't see the 787s causing very many new ultra-longhaul flights to be started. IMO, 787s will make 5,000-7,000 mile flights more fuel efficient and cheaper to operate, not cause more 8,000+ mile flights to begin.

Like BKK and SIN (two fairly wealthy business-centric places where the flag carriers can't even justify nonstops to the USA), SGN is served by JAL from both NRT and HND, and those connections are the likely way for AA to route passengers.
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Old Jun 15, 2014, 4:08 pm
  #1557  
 
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Anyone ever seriously consider off the wall routes like ORD-CTS-KUL? JAL and CX provide decent connections from CTS, but there are no direct flights to south east Asia.
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Old Jun 15, 2014, 4:19 pm
  #1558  
 
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Originally Posted by Ambraciot
Anyone ever seriously consider off the wall routes like ORD-CTS-KUL? JAL and CX provide decent connections from CTS, but there are no direct flights to south east Asia.
Are you thinking there would be local traffic ORD-CTS as well as possible CTS-KUL or are you thinking of using CTS as a technical stop only? If it is the latter, then there are many more places where a more efficient technical stop might be made, notably ANC & FAI where fuel is likely less costly than at CTS. There are also points in both Canada and Russia which would save quite a bit of difference on the trek to KUL.

http://www.gcmap.com/mapui?P=ord-kul...ks,mjz,ner,pwe
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Old Jun 15, 2014, 4:30 pm
  #1559  
 
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Originally Posted by Indelaware
Are you thinking there would be local traffic ORD-CTS as well as possible CTS-KUL or are you thinking of using CTS as a technical stop only? If it is the latter, then there are many more places where a more efficient technical stop might be made, notably ANC & FAI where fuel is likely less costly than at CTS. There are also points in both Canada and Russia which would save quite a bit of difference on the trek to KUL.

http://www.gcmap.com/mapui?P=ord-kul...ks,mjz,ner,pwe
CTS is one of the largest airports in Japan, clearly the most logical one to serve north of Tokyo, a JAL focus city (a bank of 737s heading south) and currently its only US carrier service is through HNL or Guam. It's almost a practical destination in its own right and AA can operate and sell tickets ORD-CTS and CTS-KUL independently.

DL and UA both run flights like that through NRT, but that would be directly competing with two of AA's partners instead of opening up a new intra Asia O/D route.
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Old Jun 15, 2014, 5:20 pm
  #1560  
 
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Originally Posted by FWAAA
Example: JAX. JAX-west coast traffic can be routed via mainline planes via DFW, reducing the need for seats on the JAX-CLT RJs. Of course, that reduces the need for as many seats on the CLT-West coast nonstops. Ruh-Roh. Once the inefficient routings are reduced/rationalized, CLT's activity will likely taper off. There are other examples as well.
But doesn't this cut both ways, at least to some degree? I totally agree with the example above concerning west coast traffic from a large-ish east coast city. But what about an AA loyalist who lives in JAX and has to travel up the eastern seaboard? If I were an AA flier and had to fly JAX-RIC, for example, I'd currently probably go JAX-MIA-RIC. But now it makes way more sense to go through CLT.

Now, I realize legacy AA doesn't have a huge presence in JAX, and this "reverse" type of behavior may not be as common as your example, but I've still gotta think it happens.
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