Global321

Nothing alleged. 92% of traffic in an airport is 92% market share of the airport traffic. That is all I said.

O&D is certainly a great way to look at a market. I did not see the O&D numbers for CLT recently, but your share numbers seem out of wack...

From a gate standpoint...

B6 - 1 gate (A4 I think)
WN - has 1 gate (A6 I think)
UA - has 4 gates (A8,10,11,12)
LH - use 1 gate (D12?)
Others jointly use A2

DL has relatively few gates in CLT... 4-6? All in (part of) A

US/AA has all of B, C, E & F, about 21 gates each + most of D.

How small is Delta in CLT? So small it does not have a club! And Delta is known to put clubs in very small markets. Just not CLT.


While it seems the general consensus that AA will shrink at CLT, I will be the black sheep that says no. I have no inside information, just looking at the competitive landscape.

Col Ronson

I will say that most US hubs will shrink and consolidate at pmAA hubs. Just look what happened to PHX, its not even a hub anymore haha.

cmd320

I'm pretty sure little to nothing has changed at PHX thus far...

CMK10

There's been a definitely reduction since the HP/US merger. A number of cities have been cut (COS, BDL, IAD, RDU, CLD and probably more, that's just off the top of my head) and there's been a lot of frequency reduction on western US cities but it's still a hub.

FWAAA

No, that's not all you said. Here is exactly what you said:

It's impossible for any airline to exercise "strong price influence" (or pricing power or market power) over connecting passengers who presumably "have a choice in air travel." AA can exercise pricing power over the 65% market share that it does currently possess at CLT, but for the vast majority of the CLT passengers boarded - AA was probably the low bidder - that's why many of them are not connecting at ATL on Delta. Or flying nonstop on another airline (like pmAA). The Department of Justice detailed the methods pmUS used to undercut AA's fares at MIA and DFW with the Advantage Fares program.

Had you said that new AA has a 92% share of passengers boarded, that would be correct. That's not "market share."

When discussing pricing power or market power, it's the only way to look at a market.

The numbers come straight from the CLT airport website, so while they may not reflect desirability, they're the cards that new AA has been dealt at CLT. Only to the extent that other airlines are connecting passengers at CLT would the numbers be incorrect or out of whack. I think it's a safe assumption that new AA is the only airline connecting passengers at CLT in non-trivial numbers (perhaps WN or DL connects a passenger or two at CLT).

The Delta numbers provided by the CLT airport are consistent with other sources, such as RITA, so in the absence of contradictory data, the facts are as provided. On weekdays, DL operates about 16 mainline departures at CLT in addition to various DL connection carriers.

DL does appear to be very efficient in its CLT operations, as it must be, since new AA controls most of the existing gates. That's why CLT is building new domestic gates - WN and other airlines have been clamoring for them for years. Jerry Orr was very effective at running the airport for the benefit of US for many years, but he's out and new management may not see their role as chief AA protector at CLT. That would align new management with the mandate of the DOT on that issue.

I have no inside info either, but the facts demonstrate that CLT's connecting percentage is much larger than any other hub in the USA. That's not to say that CLT will cease being a connecting hub, but new AA need not connect quite as many passengers at CLT in the future (passengers who have been connecting at CLT because they were attracted by the low Advantage Fares offered by pmUS to take business away from pmAA nonstops prior to the merger).

Here is just one example: Prior to the merger, low-wage, low-fare US had every incentive to connect passengers between MIA and lots of other cities via CLT, competing with AA's attempts to build up its nonstop offerings at the MIA hub. MIA O&D passengers don't connect at CLT because it's a fun airport to visit; they've been connecting there because of the low US fares. New AA no longer has any incentive to undercut its own nonstop fares to/from MIA from lots of cities across the USA. There are some one-horse towns that require connections because they'll lack sufficient O&D to support a nonstop, but they'll now be the exception rather than the rule at CLT.

Lots of other examples like the above where network optimization means fewer flights at CLT (at least until CLT's population increases substantially). Still, 300-350 daily AA departures at CLT instead of 650 would be a large hub.

Global321

Wrong. That is a very overly simplified version of market elasticity. (Facilities, service, route structure, etc. are all factors in pricing.)

Additionally, I believe the numbers you are quoting are breaking out Mesa, Wisconsin, etc as separate carriers, diluting the US/AA number.

From the Charlotte Business Journal (February 2015)... "American accounts for more than 90 percent of local traffic."


According to you 16 weekday flights (less on the weekend) = 19% share in Charlotte. Wrong.

So using your math, 80 flights is all CLT needs to have 100% of its local people taken care of? Wrong.

Your math would say that 11,000 people (or less) fly in and out of Charlotte each day. Wrong!

On airport parking has more than doubled in the last 10 years. (Over 26,000 spots now... plenty of times, they are full. Are people driving 2-3 cars each?!?! ) No one drops off passengers? No offsite parking?

Your 19% market share for Delta is not even close.


I believe it is down to just 8-12 gates. Just 8-12. For all carriers.

If they follow through with all the big plan, we are talking 40+ new gates. But then that would go against what you say here....

If AA was going to literally cut the number of flights in half, why would there be a need for expansion of the airport?!?! That would leave 20-30 gates free (at a minimum!!!) without expansion and 60 gates if they did fully expand!

You can't have it both ways.

FYI - CLT airport passenger numbers are up, not down, year over year.

FYI - Inbound lanes for drop off will go from 3 lanes to 8! Construction started.

FYI - Ticketing and baggage claim increasing size by 150,000 square feet. A lot for such a small, shrinking airport.

FWAAA

That belief is incorrect.

I provided a link to the source data, the Charlotte Airport Annual Report in post #359 and in that report, Charlotte clearly provides the data organized by marketing carrier.

Thanks to the DOT, we know the total annual CLT O&D of just under 10 million passengers (9.4 million domestic and about 600,000 international). That's five million passengers departing and five million passengers arriving each year, for an average of 13,700 departing O&D passengers per day. Thus, total O&D was an average of 27,400 passengers per day.

Total passengers enplaned and deplaned averaged about 120,550 per day, reflecting the high connecting percentage. For fiscal year 2014, O&D traffic comprised about 22.7% of the total passengers at the airport. That percentage is lower than any other hub.

To arrive at the share of O&D traffic carried by US/AA (as explained in post #359), I simply subtracted the passengers carried by other airlines, on the safe assumption that DL, UA, WN and the others are not connecting meaningful numbers of passengers at CLT.

The annual report shows that DL mainline enplaned 708,000 passengers, or 950,000 passengers including all of the DL-marketed passengers are included. The annual report breaks down the number of passengers on each commuter airline.

RITA/BTS data agrees with the data provided by CLT; in the 2014 fiscal year, RITA shows DL mainline carrying 1,399,000 passengers, very close to 1.4 million.

http://www.transtats.bts.gov/airports.asp?pn=1

Unlike RITA/BTS, the CLT annual report breaks down every commuter carrier's share and organizes it by marketing carrier.

950,000 passengers enplaned by DL (including all of its commuter carriers) equals 1.9 million total O&D passengers each year, or 19% of the total 10 million O&D passengers each year. Yes, the data show that DL has a 19% market share of the O&D traffic. Subtracting the DL, UA, WN, LH and other airline enplanements and deplanements from the 10 million total CLT O&D leaves 6.4 million O&D passengers for US/AA, or 64% of the total.

Well, now, that proves everything. Yes, the phrase "local traffic" can be synonymous with "O&D traffic" but in this context, it clearly does not. The Charlotte Business Journal uses that phrase (or variations of it) in many of its articles about US/AA:

http://www.bizjournals.com/charlotte...-from-clt.html

http://www.bizjournals.com/charlotte...s-for-clt.html

The data shows that US/AA account for more than 90% of total traffic at the CLT airport and about 65% of the "local" or "O&D" traffic, notwithstanding the imprecise language employed by the Charlotte Business Journal.

That's not what I posted. Your sentence above is based on the faulty premise that the DL commuter passnengers aren't counted. DL's 16 weekday flights plus its commuter passengers (what I actually posted) equals a 19% share of the CLT O&D. That's factual, supported by the data above. It's all in the CLT annual report linked in post #359.

Today, DL has 19 departing mainline flights at CLT (plus, of course, 19 arriving flights). On Saturday, it was just 12. On Sunday, it was 17.

In the 2014 fiscal year, DL mainline enplaned 708,000 passengers at CLT. That's an average of 1,940 per day or 121 per mainline flight (at an average of 16 daily flights). The DL-marketed seats on commuter carriers accounted for another 242,000 enplaned passengers in 2014, adding up to the total enplaned passengers of 950,000 carried by DL and DL-branded commuters.

False. This sentence is based on the faulty premise, discused above.

That's not what I posted. 13,700 O&D passengers depart (and 13,700 O&D passengers arrive) each day at CLT. DL sold tickets to an average of 2,603 passengers each way, or 19% of the total.

Don't see how parking lots prove the O&D market shares, but not all passengers fly in and fly back on the same day, so typically, airports need more spaces than the average local passenger count because people often park for several days.

False. It's precise. Nobody has posted any data to the contrary.

Global321

This is where you start to go wrong. As I stated, add back the regionals flying under US Express, AA Express ~ over 30% of the traffic at CLT.

THAT is the point. You claimed a single overly simplistic way of looking at pricing power (and share). Now you are backing away from it. (As you should.)

16 DL flights PLUS its commuter passengers? Umm... how did they come and go from the airport? I think it would be the 16 weekday flights.

The exact number of originating and departing passengers will NEVER be exactly equal. You have a better chance of winning the lottery than lining up the exact number of passengers. So you are simply wrong.

Finally, you are mixing and matching numbers here and creating many wrong conclusions. And I think we have gotten far away from the fun topic of what will be the next AA focus city.

You believe CLT may get cut in half. I do not.

Let's move on with our own beliefs.

FWAAA

The regionals flying US/AA marketed passenger were not excluded from my calculations, as the RITA/BTS was not my primary source. I simply subtracted the other airlines' CLT passengers (provided by the CLT airport) from the total O&D to arrive at the 6.4 million O&D passengers carried by US/AA, including all regional passengers. Repeating that I've excluded them over and over does not make it so.

I merely pointed to the RITA/BTS data as corroborating evidence of DL's mainline market share. Nothing more.

"Commuters" in this context are not NRSA flight attendants, they're synonymous with "regionals." In addition to this week's 20 DL mainline departures (DL added a flight), there are numerous DL regional flights.

"Mixing and matching numbers?" False. Someone's having trouble following the math.

aztimm

When was the last time US (or perhaps HP) flew PHX-IAD? From what I remember it was cut shortly after the HP/US merger.
If I remember correctly, that was about the same time PHX-BDL went away.
True, US did hang onto a few PHX-RDU nonstops, but it went from 4-5 daily under HP to I think 2 a few years after the HP/US merger.

Let's just be sure we're referencing the correct merger, and not the one 10 years ago

Global321

We agree 100%.

CMK10

That might be right, like I said I was just trying to remember which cities went away off the top of my head, things up there are not exactly in chronological order

Fanjet

I flew PHX-IAD right before it was axed. At at that point, it was just one flight per day (it was an am PHX departure and a pm IAD return). The LAS-IAD flights were already gone by then. I want to say it was in the spring of 2008 (or maybe 2009). It was when the F catering hit its lowest level and before they made the catering improvements, if that helps.

cltwheel

So to summarize the situation at Charlotte:

-Building a 10 gate expansion of Concourse E for American Airlines
-Building a 9 gate expansion of Concourse A for everyone but American
-American will cut about 200+ flights once the DOJ agreement expires.

Yep, that all makes perfect sense!

Global321

There are still plans for a 4th parallel runway, but, not confirmed and will not start for several years. They did nix an international terminal.

There does seem to be a consensus out there among FT that AA will contract significantly in CLT. I do not share that view.

The DOJ agreement expires near the end of 2016. Most of the expansions will be complete long after that. If AA was going to drop 200 flights from CLT, I do not think CLT would be investing so much in expansion. Clearly CLT has a plan to keep more than the current flight load.

FWIW - In the paper today, CLT is the 4th most connected airport in the world, behind ATL, ORD and DFW. That's a pretty strong position for AA to be in... 90% share/traffic of two of the top four most connected airports in the world.