The future of the LAX hub?

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Old Feb 2, 14, 10:46 pm
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The future of the LAX hub?

With the latest developments re CLE and AA*) stating to be the largest mainline carrier at LAX, I am wondering what the future holds for LAX as a UA hub?

*) http://online.wsj.com/news/articles/...48482328175834

Last edited by cesco.g; Feb 2, 14 at 11:00 pm
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Old Feb 2, 14, 10:50 pm
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Care to copy and past or at least a summation? It requires a subscription to access.
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Old Feb 2, 14, 11:01 pm
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Originally Posted by UrbaneGent View Post
Care to copy and past or at least a summation? It requires a subscription to access.
Search "American Air Sees Merger Gains" with google, a subscription free link will be the first result.

It is about recent finacial results for AA/US -- with a passing reference to LAX improving profitability. Probably a bit of a stretch to extrapolate the closing of LAX as a hub for UA.
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Old Feb 2, 14, 11:03 pm
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Originally Posted by UrbaneGent View Post
Care to copy and past or at least a summation? It requires a subscription to access.
Originally Posted by WineCountryUA View Post
Search "American Air Sees Merger Gains" with google, a subscription free link will be the first result.
Correct, WineCountry,

UrbaneGent, here you go:

"Mr. Kirby said American's operations at Los Angeles International Airport are improving now that it is the largest carrier there with the highest offering of premium-price seats. He said Los Angeles was profitable last year but "not by much," while this year he expects it "to be nicely profitable." He also said American is focused on winning back business from corporations that switched their travel away from the old American in recent years."
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Old Feb 2, 14, 11:16 pm
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Originally Posted by cesco.g View Post
Correct, WineCountry,

UrbaneGent, here you go:

"Mr. Kirby said American's operations at Los Angeles International Airport are improving now that it is the largest carrier there with the highest offering of premium-price seats. He said Los Angeles was profitable last year but "not by much," while this year he expects it "to be nicely profitable." He also said American is focused on winning back business from corporations that switched their travel away from the old American in recent years."
And this leads to your thread title?

Kind of a stretch if you ask me.

That being said, AA has to focus on LAX. DL has SEA. UA has SFO. AA needs a strong and growing presence at LAX for what, I hope, will be the expansion of their Asia routes.

DFW - HKG and Shanghai is interesting, but growing out the network from LAX seems like a better long term plan to me.
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Old Feb 2, 14, 11:32 pm
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AA is definitely going after the HV business out of LAX with a $2911 RT F fare LAX-JFK on its new 321.

UA is not competitive with a $3572 P fare for an inferior J product.
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Old Feb 2, 14, 11:47 pm
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UA isn't going to reduce its presence at LAX. The fact that they're spending money on the new UC/GF lounges supports that. Too much money in San Angeles to abdicate to other carriers. AA is now larger there by merger, just as UA increased its presence there by merging w/ CO. Don't read too much into situation at CLE as a omen for LAX. There's no similarity. Los Angeles is also unlikely to allow a hugely dominant carrier.
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Old Feb 2, 14, 11:51 pm
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UA at LAX has a number of factors helping it that CLE doesn't have.

1. LAX is a much bigger market and one of the most important ones in the US for corporate contracts.

2. LAX is much less reliant on connecting traffic than pretty much any other remaining UA hub.

3. Despite the relatively low connecting traffic, LAX is less reliant on 50 seat RJ's than most other hubs (notably EWR, IAH, and ORD).

4. Many 50-seater routes out of LAX could support larger RJ or mainline service if available/necessary (this was not the case in CLE). For example, UA could easily fill a 737 or airbus on LAX-PHX. The yield would just suck. However mainline on a route like CLE-ATL or CLE-BDL was pretty much a non-starter from a load perspective.

5. LAX has significant Star Alliance feed and significant international capacity of their own at LAX.
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Old Feb 3, 14, 12:04 am
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I've always been interested in LAX's place in UA's route system. In what way is it a hub? I can understand it being something of a TPAC gateway and also a gateway to Mexico, but does it serve in any way as a banked domestic hub?

It's also very interesting as a hub since it has massive O&D traffic and so it doesn't have to be a great *hub* in order to be profitable.

Also, regarding AA "building up" at LAX: What does that mean WRT their PHX hub?
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Old Feb 3, 14, 12:09 am
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Originally Posted by lensman View Post
I've always been interested in LAX's place in UA's route system. In what way is it a hub? I can understand it being something of a TPAC gateway and also a gateway to Mexico, but does it serve in any way as a banked domestic hub?

It's also very interesting as a hub since it has massive O&D traffic and so it doesn't have to be a great *hub* in order to be profitable.

Also, regarding AA "building up" at LAX: What does that mean WRT their PHX hub?
Please share your definition of what a hub is, and what it is not.

PHX is AA's CLE.
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Old Feb 3, 14, 12:25 am
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Originally Posted by LarkSFO View Post

PHX is AA's CLE.
PHX is a much larger metro area than CLE - literally twice as many people (4 million vs. 2 million). It was also much more important to US than CLE ever was to CO.

Though when it comes to geographics, I agree - The biggest argument for de-hubbing PHX's is its position between DFW and LAX, much like CLE between ORD and EWR.
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Old Feb 3, 14, 12:46 am
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AA has long been the largest mainline carrier at LAX; it's been UA's Express ops that have made it the larger carrier. Though now, with the merger, AA is the largest airline at LAX.

Still, I don't see how one can draw any conclusions. I think UA's presence at LAX will remain largely unchanged for the foreseeable future, although I certainly don't imagine any significant growth.
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Old Feb 3, 14, 12:48 am
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Originally Posted by Zappity View Post
For example, UA could easily fill a 737 or airbus on LAX-PHX.
With the loss of US as a "partner" on this route, I'm hoping UA will up gauge their service PHX-LAX. I'd personally be happy with anything other than the current frequent CRJ200s.

Originally Posted by Kacee View Post
PHX is a much larger metro area than CLE - literally twice as many people (4 million vs. 2 million). It was also much more important to US than CLE ever was to CO.
Yeah. HQ is usually important.
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Old Feb 3, 14, 12:50 am
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I don't see any changes with UA's presence at LAX. The O&D traffic for the metro area is too great to give up.
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Old Feb 3, 14, 1:25 am
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Originally Posted by lensman View Post
...but does it serve in any way as a banked domestic hub?...

...Also, regarding AA "building up" at LAX: What does that mean WRT their PHX hub?
UA serves as a hub for connections to/from Hawaii, almost as important as SFO in that respect.

Again, AA's "build-up" at LAX is primarily due to gates gained from US. AA may use increased gates for more TPAC. I bet PHX gets hit, but not as hard as CLE, because AA still doesn't have major West Coast hub, even w/ increase in LAX gates.
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