dsm1k

As I am not sure what the NW strategy will be coming out of Bankruptcy, I believe they must 1) focus on serving the south and west; 2) operate more like a LCC.

Cost control will be a major issue and operating three (3) hubs so close to each other seems to be inefficient.

Some time change is required to survive and frankly due to the high labor costs in MSP, I do not see long term hub survival there. As un popular as it will be, the bean counters should look at either combining MSP to MEM or perhaps moving both MSP and MEM to a location farther west, say MCI.

any thoughts?

oliver2002

Merge with DL/HP/US, they would have plenty of hubs and coverage...

dsm1k

I would welcome a merger with US/HP.

SchmutzigMSP

High labor costs in MSP? What in particular makes labor so much more expensive in MSP than in any other city you might recommend to become a hub?

I do think we'll see more focus on the Western U.S., but MSP will not be de-hubbed.

dsm1k

I work in the construction industry and I drew my labor cost theory from labor cost comparisons from that industry.

my gut tells me that the HUB operational costs would be more economical outside of MSP.

also, fuel consumption would be lowered if the hub was moved south and west. There are many many city pairs that you must fly north to fly south using MSP.

I have not written a business plan for this, it is only an idea.

SchmutzigMSP

Construction costs and operating costs are two very different things. I'm sure you know this.

De-hubbing MSP would cost NW a lot of money they don't have and loyalty they need to retain. It's simply not a feasible option. And, FWIW, moving to a southern hub would only increase the fuel costs for the northern routes.

NW already has strong partnerships with CO and DL, both of whom have hubs in the south in IAH and ATL, plus NW's presence in MEM. It makes little sense to move MSP somewhere to the south.

crimguy1976

I never did understand having two major hubs so far north and one small hub centrally located. DTW is fine where it is, MSP needs to go.

james318

If anywhere has high labor costs it's DTW. Land of the Union...

dsm1k

DTW is more convenient to the Northeast than MSP. Only in a merger with CO, would it make sense to close down DTW

humanoid94

I have no idea why NW would want to abandon either of the two last remaining "Fortess Hubs." Read NW's financial statements, their operations are turning a profit before exceptional expenses related to the BK. (Paper expenses, not actual cash expenses) This airline is heading out of BK and will be fine, at least until the next down cycle.

trekwars2000

NWA would never close down detroit esp after the new terminal in 02.

socrates

NWA's overall strategy has been International (especially PAC) and in the Midwest to be the dominate carrier, their strategy has been successful....dont confuse their bankruptcy filing with a bad business plan...remember they self financed their trip to court which is highly unusual and could lead one to believe the trip to court was to obtain lower wage costs as other airlines had done

james318

Even if there were to be a CO merger, I would gather DTW to survive and CLE to close. But I digress.

NW does need a westerly hub, but I don't see a doom sentance without one.

itsaboutthejourney

I'd love to see that business plan! ROTFL

I question your idea of moving the MSP hub. It's taken NW decades to build it's base of loyal (and captive) customers in MN. Not only would there be huge costs to build a new hub, NW would give up it's 75% + market share of the MSP traffic. The marketing & public relations costs to attract customers in a new hub market would be staggering and NW would never be able to get the market share they have in MSP. You'd have to pay relocation fees to managers. Also, remember MSP has an abnormally high concentration of Corporate Headquarters than most cities it's size (3M, Target, General Mills, Ameriprise/AMEX, Ecolab, St. Paul Travelers, Toro, Medtronic, etc. etc.) Those companies pay top $$ for executives to fly nonstop flights to business destinations.

BearX220

MCI is physically/architecturally completely inappropriate for hubbing. It's a terrible airport for transferring flights.

NW is sitting on the best airport hub in the country (DTW) and a midwest hub that routinely runs better than ORD (MSP). There is virtually no cost/benefit case for uprooting from either and trying to hub somewhere else.

If NW stands alone (unlikely) MEM will continue to wither, but MSP and DTW will stick around.

If NW merges with DL, the hubs will be SLC, MSP, DTW and ATL; CVG and MEM will get drawn down.

If NW merges with CO, the hubs will be IAH, MSP, DTW and EWR; CLE and MEM will get drawn down.

If NW merges with AA, the hubs will be DFW, MSP, MIA and DTW, with ORD remaining a focus city, but MEM getting drawn down.

Get the picture? No matter what merger scenario you paint, MSP and DTW are always more attractive than some other city/cities that'll get the chop.