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Old Feb 15, 2014, 7:42 pm
  #31  
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Originally Posted by pbarnette
As for DTW being a "strong international business market", the lack of non-DL international service suggests somewhat otherwise. BA couldn't wait to drop service once Bermuda II died. Yes, it fares somewhat better than MSP, but it isn't that strong.
Agreed. I've made the argument several times that if Detroit really had such demand for international markets (Asia, in particular) we would see service from airlines other than DL. To hear people talk you would think the likes of ANA, Cathay, and JAL would be salivating to enter DTW.
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Old Feb 15, 2014, 7:59 pm
  #32  
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Originally Posted by pbarnette
...As for DTW being a "strong international business market", the lack of non-DL international service suggests somewhat otherwise. BA couldn't wait to drop service once Bermuda II died. Yes, it fares somewhat better than MSP, but it isn't that strong.
The domestic auto industry has subsidiaries, suppliers and plants all over the planet. That they'd negotiate contracts with and fly on the local carrier only makes sense.

Yes, metro Detroit has its share of issues economically. Nevertheless, for all its problems, it has emerged as a big winner in the reorganization of the industry by having a disproportionate amount of international service by virtue of being a Delta hub.

I grew up in Toledo, which is about 50 minutes away from Metro. There is an influx of Chinese investment into the city that was chronicled in a recent NYT piece. http://www.nytimes.com/2013/12/27/us...ents.html?_r=0 I am convinced that part of this has to do with the city's proximity to Metro Airport and its non-stop flights to China.

As the world shrinks, distance becomes measured by time rather than miles. The fact that the region is closer to the world by this measure than most of the nation may prove to be its salvation. Somebody somewhere with a hot start-up is going to figure out that SE Michigan is now a very good location for doing international business where costs are low and a good wage goes very far. There simply aren't that many cities in the nation that can boast of nonstop service to Europe, Asia and South America as well as every major business center in North America.
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Old Feb 15, 2014, 9:02 pm
  #33  
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Originally Posted by BobH
To be more precise, they closed their research lab in A2 which used to employ 3000 people. They also had their own fleet of planes which flew out of Willow Run to /from places like St Louis, New Jersey and Conn. but the people who took these flights didn't get frequent flyer points !

Along the same line, Chrysler flew a 319 to Germany every day when they were owned by Daimler.

Bob H
I heard that it was a 757, with only about 48 seats, and NW actually flew it for them. I don't think the A319 can go that far nonstop nor would they normally be ETAPs certified.
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Old Feb 15, 2014, 9:17 pm
  #34  
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Originally Posted by Bagels
LOL, you enjoy skewing points around. The discussion was clearly about legacy airline growth, and I clearly wrote the UA's hub became regional as WN captivated the price-sensitive traffic.
Actually, I enjoy posting facts. UA serves nearly 150 destinations from DEN year-round (more than DL servers from MSP or DTW). Maybe that is "regional" to you. Maybe being the 15th busiest airport in the world is "regional" to you. Maybe growing traffic from 2011 to 2012, while DTW lost traffic is "regional" to you. To the rest of us, that is one big region.

Yes, UA has lost some share. Yes, UA has retrenched a bit. But DEN remains a national hub with outsized service by UA.

Originally Posted by Bagels
BA's withdrawal had more to do with Pfizer withdrawing from the A2 market and the subsequent loss of its lucrative contract.
So... BA was entirely dependent upon connecting a single research outpost to a regional office for one company? In other words, you agree with me that DTW's international reach is exceedingly limited? I mean, if the closure of one site of one company causes a major European airline with 20-odd destinations in the US and an extensive connecting network beyond LHR to abandon you in favor of Orlando, Tampa, Phoenix, and Austin, doesn't it call into question the strength of that international demand?

Originally Posted by Bagels
Regardless of who operates DTW's direct intercontinental services, it's still strong for the market size, especially given that the actual city of Detroit is primarily a welfare state.
Not really. DTW is the 14th largest MSA in the country. It does not seem to rank that highly in terms of international gateways. What do they get? Roughly 3.5m international passengers? Miami punches above their weight. ATL punches above their weight. DTW? Not so much.

Originally Posted by Bagels
And this may be the first post I've read from you that you didn't attempt to mention rich, wealth, etc. Good job .
Funny, you speak with an air of authority, hoping we believe that you not only plan routes for a living, but are good at it. But then you seem to misrepresent DEN's traffic and DTW's relative international traffic. But thanks for the condescension.

Last edited by pbarnette; Feb 15, 2014 at 9:23 pm
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Old Feb 15, 2014, 9:33 pm
  #35  
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Originally Posted by MSPeconomist
I heard that it was a 757, with only about 48 seats, and NW actually flew it for them. I don't think the A319 can go that far nonstop nor would they normally be ETAPs certified.
It was a A319CJ (corporate jet) which has additional fuel tanks -- http://commons.wikimedia.org/wiki/Fi...9CJ_Pinter.jpg
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Old Feb 15, 2014, 9:49 pm
  #36  
 
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Originally Posted by BobH
To be more precise, they closed their research lab in A2 which used to employ 3000 people. They also had their own fleet of planes which flew out of Willow Run to /from places like St Louis, New Jersey and Conn. but the people who took these flights didn't get frequent flyer points !

Along the same line, Chrysler flew a 319 to Germany every day when they were owned by Daimler.

Bob H
Chrysler'ss 319 flew out of PTK(Pontiac Oakland)
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Old Feb 16, 2014, 12:48 am
  #37  
 
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Originally Posted by TheMadBrewer
Assuming two flights a day (one each way) with $71M in revenue that means each flight earns on average just under $100K. I don't follow prices in that market but if you say $1500 for a non-stop RT that means 130 or so Y tickets makes up the $100K. Since I'm guessing that BE earns a bunch so that is fewer Y seats sold. Anybody fly this regularly enough to give an idea of loads?
I fly this route 7-8 times per year and my wife flies another 4-5 without me. Almost every flight is sold out especially in business. I had about a 50% success rate last year when I tried to upgrade with certs or miles and paying for M, B, or Y fares for the business upgrade which makes me so mad because of the huge difference in fares from the cheapest economy to the cheapest upgradeable fare and then having to sit in back. If I do book an economy fare and do not book early enough, many times the economy comfort section is full and I have to wait until the 24 hour check-in to get one of the better seats. I have mostly switched to buying the cheapest business class ticket and trying to book at least 2 months in advance to get a decent fare and assurance of the front cabin. Of course, work demands usually mean booking with less notice.

This is a very important route for Delta especially on the non-stop. I flew it 4 times since the middle of Nov 2013 and almost every flight asked for bids on taking a different flight (VDB) when I did the 24 hour on-line check-in. Delta could probably justify another daily flight or at least 3 days per week with 2 daily flights based on the loads I have seen.
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Old Feb 16, 2014, 3:18 am
  #38  
 
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Originally Posted by mrdebit
Depending on what you include as "major," AC and RJ also fly to DTW.
Royal Jordanian is twice weekly, with no practical onward connection opportuinies to the rest of Asia. AC does offer some options to connect to Asia and Europe, so thats good.
I would wish Airlines like Jal, Ana, Ba, CX, Ke, TK, CA, LX, emirates, to fly direct to DTW, giving us atleast a choice for international travels other than Delta. When all your travels are international, it get really boring to be only flying Delta and partners for over 5 years.
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Old Feb 16, 2014, 6:31 am
  #39  
 
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Originally Posted by Bagels
$71M is the contribution from the LOCAL market (people traveling to/from DTW) - in other words, it excludes revenues from connecting flows.
AHA! Missed that part. Thanks for the clarification.
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Old Feb 16, 2014, 7:31 am
  #40  
 
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Originally Posted by pbarnette
You are looking at the wrong table. You are looking at a table of large MSAs, ranked by median income, not all MSAs by median income. When measured by real per capita income against all MSAs, Detroit comes in at 86, one spot behind Memphis. Atlanta comes in at 53 and 10% higher than Detroit, and MSP comes in at 23, some 30% higher than Detroit. A place like Houston, with high pay and low costs, is some 46% higher, and the highly-educated, highly-compensated places like Boston, RDU, SF, Seattle, etc. are 50% higher or more. When you account for cost of living, Atlanta moves up the list, while Boston and SF would slip.

As for flight to the suburbs... Detroit's level of population loss is pretty much unparalleled among large cities and is why it has such massive problems with depopulation (fiscal issues, urban blight, etc.). Atlanta has actually grown since 1990 in population (and that growth has accelerated faster than in Minneapolis) and retains pockets of extreme wealth (Buckhead) that do not have parallels in Detroit.

Detroit is relatively poor. Sorry. It isn't the barren wasteland some urban decay porn would lead you to believe, but it is a stagnant, decidedly middle-income market that lags Minneapolis and Atlanta in income and, especially lags Atlanta in economic and population growth.
You are cherry-picking data and mixing terminologies to support your claim. Yes Detroit the city is poor, as is Atlanta the city poor. The metro areas of both cities is were the money is in both cases.

You don't provide any granularity to your assertions as to wealth and income. We know that Detroit, the city has a large, hard-core group of poor individuals. Further we know that Atlanta, the metropolitan area, has Forsyth county, which is one of the wealthiest counties in in the U.S. In both cases you may have outliers driving and skewing income stats. You have presented no data as to income distribution, which might give a more granular picture of actual demand and spend from the consumer. Further, as others in this thread observed, individual income stats. are only a partial picture and have no relationship to business spending.

You lack any granularity as to what, from a marketing perspective, is actually going on in terms of spend/demand in each each respective market; or any analysis of the correlation between income stats. and demand

Last edited by hazelrah; Feb 16, 2014 at 7:47 am
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Old Feb 16, 2014, 8:30 am
  #41  
 
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DTW is a good Asian gateway for DL. We can argue metrics all we want, but the reason they use DTW is as much geographic as it is financial. DL needs a midwest Asian gateway and DTW serves it better than MSP (sorry MSP), it's as simple as that.

DTW was and is the manufacturing/automation hub of the US. That's unlikely to change in the foreseeable future. In the current environment of escalating non-value added employee costs, such as law suits and Obamacare, it's even more likely that companies will resort to more automation to replace humans. That bodes well for all the robotics, engineering, and mechanization companies with major operations in DTW.

Comparing DEN and DTW is about as valid as comparing BOS and BNA.
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Old Feb 16, 2014, 8:40 am
  #42  
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Originally Posted by hazelrah
You are cherry-picking data and mixing terminologies to support your claim. Yes Detroit the city is poor, as is Atlanta the city poor. The metro areas of both cities is were the money is in both cases.
1) I'm not cherry-picking, but nice try at a recovery. Next time, be more careful which statistics you try to offer.
2) Atlanta is significantly less poor than Detroit - median household income is roughly $15k higher and per capita income is some $20k higher.

Originally Posted by hazelrah
You lack any granularity as to what, from a marketing perspective, is actually going on in terms of spend/demand in each each respective market; or any analysis of the correlation between income stats. and demand
Atlanta's MSA is roughly 27% larger, yet has around 43% more o/d. MSP is roughly 20% smaller, yet has around 7% more o/d. Not much more needs to be said.
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Old Feb 16, 2014, 9:23 am
  #43  
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Originally Posted by Lulu Chen
Royal Jordanian is twice weekly, with no practical onward connection opportuinies to the rest of Asia. AC does offer some options to connect to Asia and Europe, so thats good.
I would wish Airlines like Jal, Ana, Ba, CX, Ke, TK, CA, LX, emirates, to fly direct to DTW, giving us atleast a choice for international travels other than Delta. When all your travels are international, it get really boring to be only flying Delta and partners for over 5 years.
LH has a daily flight to FRA.
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Old Feb 16, 2014, 11:58 am
  #44  
 
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Originally Posted by pbarnette
Actually, I enjoy posting facts. UA serves nearly 150 destinations from DEN year-round (more than DL servers from MSP or DTW). Maybe that is "regional" to you. Maybe being the 15th busiest airport in the world is "regional" to you. Maybe growing traffic from 2011 to 2012, while DTW lost traffic is "regional" to you. To the rest of us, that is one big region.

Yes, UA has lost some share. Yes, UA has retrenched a bit. But DEN remains a national hub with outsized service by UA.
Too bad your facts are wrong.

Last year, UA's DEN hub PEAKED at 122 daily destinations. MSP served 131 and DTW 138. Weekly/non-daily service levels at each hub was similar. About a half-dozen of DEN's markets are purely OO at-risk flying; OO sets the schedules and pricing, not UA. No similar service exists at MSP & DTW. And don't confuse the Great Lakes operation to be part of the UA hub... it's not.

This year UA's DEN operation will PEAK at about 36K daily seats -- nearly 10K less than MSP & DTW. What's even more remarkable is that UA continues to shed capacity at DEN -- it's dropped nearly 50% from where it peaked whereas DTW & MSP are down less than 20%.

And yes, UA's capacity is regionally orientated -- the crux of it serves Mountain West destinations; capacity to its largest markets continues to drop, and many of the east / west flows have been reduced to one or two daily regional jets.

DEN has always enjoyed high levels of local air traffic. Not because it's "rich," not because it's a flourishing business market, but because it's in the middle of nowhere. And the problem is that much of that traffic is price-sensitive, which is why F9 and WN have successfully damaged the hub operation. UA can't even make a flight to LHR work -- who knows how long NRT will last.

So... BA was entirely dependent upon connecting a single research outpost to a regional office for one company? In other words, you agree with me that DTW's international reach is exceedingly limited? I mean, if the closure of one site of one company causes a major European airline with 20-odd destinations in the US and an extensive connecting network beyond LHR to abandon you in favor of Orlando, Tampa, Phoenix, and Austin, doesn't it call into question the strength of that international demand?
No, it was the tipping point that coincided with the collapse of the local economy - which has since begun rebounding. A solid portion of the local international market is leaking to other gateways ... B6 stated that one of primary reasons in establishing service here was to interline to international services at BOS. BA may very well return in the near future.

Not really. DTW is the 14th largest MSA in the country. It does not seem to rank that highly in terms of international gateways. What do they get? Roughly 3.5m international passengers? Miami punches above their weight. ATL punches above their weight. DTW? Not so much.
MIA is a huge tourist draw and the primary gateway to Latin America. Its most lucrative traffic is to/from & feeding into LatAm... beyond that, it's somewhat like MCO (but on steroids)... the level of service is impressive, but these are largely price-sensitive passengers flocking to see Mickey Mouse. You're just not going to make a lot of money off these services if you're a US network carrier.

And most of ATL's intercontinental service is a derivative of the huge DL hub sitting there. Not to mention on many of these flights, Florida connections to DL are like rental fleet sales to GM. And do you know how many people really fly from Atlanta to JNB and LOS? Nonetheless you flipped on your argument from earlier, complaining about DTW's lack of international service beyond DL. What about ATL's?

Originally Posted by pbarnette
1) I'm not cherry-picking, but nice try at a recovery. Next time, be more careful which statistics you try to offer.
2) Atlanta is significantly less poor than Detroit - median household income is roughly $15k higher and per capita income is some $20k higher. Atlanta's MSA is roughly 27% larger, yet has around 43% more o/d. MSP is roughly 20% smaller, yet has around 7% more o/d. Not much more needs to be said.
1) We'd need to make adjustments to cost of living & determine discretionary income. It's part of an analysis, but doesn't carry nearly as much weight as you'd like it to. Wealth certainly does not dictate air service in this country -- quite far from it actually. A $50K income in SoCal doesn't have nearly the same buying power as $50K in Des Moine. Especially if you make adjustments to debt:income. And then there's local culture... a good portion of the SoCal market may choose to spend their discretionary income on travel. People with smaller discretionary incomes in colder climates are more willing to spend it on Winter travel. People with high discretionary incomes in Mobile, AL ... maybe not so much. There's just too many factors and I'm just rambling/touch on some here.

2) Location, location, location. E.g. like Denver, M/SP has always enjoyed high levels of air traffic in relative to its population. As much as you'd like it to, it has nothing to do with wealth but rather M/SP's isolated location. In the East, a day's drive can get you pretty much anywhere. Definitely not true at MSP.

In fact, in the 2000s MSP supported one of the highest GDP in the country, was one of the fastest growing communities & saw its position in household income increase. Meanwhile, LCC finally arrived at MSP, bringing its average airfares in line with those of other large hubs across the country. And yet the local air traffic only grew at a clip of less than 2% (and closer to 1%) most years -- less than DTW most years (until the collapse), far less than what the MAC projected in the late 1990s, far less than the national average, and way far less than what your assertions should make it.

Funny, you speak with an air of authority, hoping we believe that you not only plan routes for a living, but are good at it. But then you seem to misrepresent DEN's traffic and DTW's relative international traffic. But thanks for the condescension.
LOL, you're the one misrepresenting here. Your arguments are the same tired, childish a.net ones. Have you considered signing up there? They'd enjoy your rhetoric on how wealth and MSAs primarily dictate air services...

Last edited by Bagels; Feb 16, 2014 at 12:58 pm
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