United Airlines President: Leaving New York’s JFK ‘Was the Wrong Decision’ {2017}
 

https://skift.com/2017/04/21/united-...rong-decision/

What? SMI/J made a mistake? It can't be!!!! He was perfect :D

Now if they'd only realize that 10-across seating on the 777 is also a mistake... there's still time to reverse that one.

Don't worry - Boeing has apparently carved out an additional 5 inches interior space on the 777-9x through a redesign of the interior cabin walls, so 10 wide will be fine on those aircraft. ;)

Bring back the helicopter from EWR, and throw in 500 PQM for the ride, and all will be forgiven.

.....only if that tenth person is just four inches wide.

Don't be so negative - instead of a 17.05 inch seat in Y, the new 777x seats will be 17.55 inches wide! :)

It's pretty clear, to me, that he's making the point leaving JFK has impacted corporate traffic at the West Coast point of sale, which is understandable. EWR clearly misses out on a significant portion of the greater NYC market (as do LGA/JFK), but before, United at least offered customers service to both EWR and JFK. LAX has clearly become more competitive in the time since the merger, due in no small part to the door swinging wide open because of UA.

The move probably made sense from a cost perspective, in terms of getting out of JFK leases, reallocating 737/A320 capacity on EWR-LAX/SFO to other markets to reduce 50-seaters, etc. It also probably strengthened the EWR hub, but again, at the expense of LAX/SFO. I suppose there is no reason UA could not have done both.

15% margins at EWR is the other pretty impressive takeaway I have from that piece, especially compared to AA/DL. It's not surprising that the former JV management team let EWR languish while going to work mucking up pretty much everything else they touched... if it ain't broke...!

They are also killing all the possible *A connections via JFK. It's still a head-scratcher. To some of us, going out of JFK may make the upgrades easier, because any connections through EWR wouldn't go out of their way to JFK to try that PS.

It was a wrong decision, but it's not impossible that it couldn't undone.

Interesting article.

I have posted many times about what I perceived as a lack of strategic thinking with some of the decisions coming out from the Smisek Regime. A bit satisfying to hear the vindication.

And I am still amazed American let Kirby go without a strong non-compete. :eek:

I still think this was, in the scheme of things, a pretty minor consideration. UA wasn't co-located with any reasonable connecting partners at JFK and didn't even codeshare with all of the Star carriers there. If anything, *A connections are easier at EWR given the behind-security transfers available to LH/OS/SK/LX/TP/AI/ET.

The NYC transcons are about O&D first, and for UA, secondarily feeding the Pacific network.

It's very insightful, but still leaves me scratching my head. I got to New York a lot, and it's way easier to get into the city from EWR than JFK. JFK is 1:10 on the train. EWR is like 40 mins on the NJ Transit.

The article sites actors - do they care which airport? (I honestly don't know). It talks about flying F...well, they could have kept 3 cabin on the EWR routes, and could still bring it back. But that point seemed more to be about aircraft config than airport.

I'm genuinely curious if people going to Manhattan really prefer JFK over EWR. I certainly don't, but maybe I'm an anomaly? I prefer LGA to JFK, it's 30 mins into the city!

It wouldn't be easy or cheap...those slots the gave up at JFK are long gone, and not may airlines are interested in selling them.

You underestimate the Flyertalk community :p
I, for one, would. LOL.

I live in Manhattan (on the UWS). Theoretically, it is easier for me to fly in and out of EWR (geographically closer) than out of JFK. However, I avoid EWR like the Plague.

IME (and mileage varies widely on this, obviously), traffic heading out to EWR is just as bad as heading out to JFK, so that is a wash. Coming back from EWR, depending on the time of day, can be much worse, so unless you time it exactly right, and hope that the flight arrives exactly as scheduled (and that, on an international flight, customs is not an unmitigated disaster), coming in from EWR can take forever and a day.

There are also fewer cabs coming in from EWR to Manhattan. What there are are (obviously) Jersey-based, and like to play games with Manhattanites. Manhattan-based car services charge more to go to/from EWR than to go to JFK (still better than those damnable Jersey cabs, though).

Then there is the EWR experience itself. JFK needs some work. EWR is a disaster. Dirty, dingy, overcrowded, poorly managed. And that is as an F/J passenger. The lounges are a joke. My husband once said to me that the BA lounge in TXL, the one everyone makes fun of for being a time capsule, is an oasis of tranquility, with decent quality teas, good coffee making machines, and constant cleaning. It never feels crowded, the staff keeps it clean and tidy, and it feels like a sweet, quaint way to say good-bye to Berlin.

Go to any J lounge in EWR, and it's like the beginning of the zombie apocalypse. Someone is always yelling at some poor staff member, finding a clean spot -- scratch that -- finding an empty spot at which to set down your things becomes an ever more stressful challenge. The minimal offerings are of questionable quality and look like they have been sitting out a bit too long. The bathrooms too often look like they were, perhaps, given a quick once-over in the morning, and then were opened to a frat house for the rest of the day (if that's the bathroom in a J lounge, what on earth do the bathrooms in the rest of EWR look like?).

And then there are the interminable lines, too often unrelieved by status or class of service. No real fault of the airline -- it's just the lack of personnel at EWR that makes the lines so unrelentingly long and the experience feel like a cross between the last flights out of Cuba when Batista fell and checking into minimum security prison.

I realize that I exaggerate (but not by a lot). Flying in and out of EWR is an unpleasant experience for most of us who live in the area and have a choice. It has made UA a non-factor in making travel plans.

They can request a waitlist for that, just like the rest of us waitlisting for upgrades. The chance of it to clear is probably similar to us competing for TODers. :)

Definitely right, but imagine a passenger would like go with UA in SFO/LAX(might be SAN/SEA-JFK) and go to a non-JV partner to EU/MidEast, when you need one more connections at FRA/MUC in their JV agreement anyway. Not all the EU carriers fly direct to SFO/LAX or other West Coasts. LO is one of those, of course you can make an argument people can go through ORD or even YYZ to WAW.

Oh don't get it wrong, if it's easily accessible to JFK, definitely. But I certainly get what the West Coasters think. Who in the right mind would like to go from Newark to Manhattan with two bridges/one tunnel at any hour after landing? I certainly wouldn't. From any Northeastern states and DC/NC area, going to LGA/JFK kills EWR any time, unless their final destination is Jersey area

I lived in Manhattan for 10 years, work there, have friends who live/work there, running the gamut from airline agnostic to hardcore brand loyalists. For locals who know how to get around, there really does not seem to be a dramatic preference of one versus the other when it comes to EWR and JFK. I think the perception is both are mildly inconvenient. LGA is a different story, historically the local Manhattan market has a strong preference for LGA over both EWR/JFK, but the construction there is a major, albeit temporary, headache.

In my estimation, it's the inbound NYC traffic which looks at EWR as substantially less convenient than JFK to Manhattan. That's why Kirby's comments make sense to me. Previous management, coming from the Continental side, thought about the market from the position as an incumbent carrier in the NYC market and a distant also-ran on the West Coast.

Thanks for sharing the article, very interesting. It is one more example of why I think FT is so interesting. The airline business is just a fascinatingly complex model. Loyalty programs matter because of all the knock-on effects of capturing near-100% of a person's spend. The importance of JFK to LAX<>LHR premium fares makes total sense but is something that seems really difficult to model/optimize. Again, thanks for posting.

Or, airlines think about adding an 11th seat per row. Wouldn't that be fun!

From NE commuting to Manhattan at times, I can definitely tell you I wouldn't want to go to EWR just to get to Manhattan, keep waiting in the traffic and pay that petty $20USD for the bridge/tunnel fees. I'd agree with EWR764 that if you take train/subway anyway. For Uber/taxi, I'd like to get from LGA/JFK, because there's one less bridge that you have to worry about, and it's usually busy at any hour. Definitely I'd love to go to LGA all the time, but for some West Coasters, you'd think it's still going to save time to get to JFK when non-stops are everywhere vs connections to LGA. The longest flights to LGA are probably SLC/DEN/PHX-LGA, but anything farther would definitely require a connection to get to LGA.

When you commute to Manhattan often enough, the last thing you wanna do is to wait in the traffic going through the toll roads/highways.

I seem to recall some chatter about lifting that distance restriction out of LGA on the back-end of the remodel. Maybe that's one thing UA can help lobby for to attempt to recover some of what they lost by leaving JFK.

Confirmation what many of us have been saying . . . high J loads on EWR-LAX/SFO doesn't mean dumping JFK was the right move.

Kirby makes strange statements. It was "wrong" to leave, but it's also "wrong" to return. Okaaaay. That means JFK was a marginal operation at best, and one then can't easily say it was "wrong". Also UA doesn't have the aircraft to operate PS at both JFK and EWR at a reasonable frequency. Have to take this with a grain of salt since his former airline doubled down on premium service from JFK and is a fraction of the size of UA's PS at EWR.

Yes, to SLC or PHX on sometimes weekends, definitely saw SLC/PHX non-stops before, but it looks like it's also gone, just DEN now.

Kirby is the current President of UA. Why should we believe your assessment over his?

It takes 19 minutes on the LIRR from Jamaica Airtrain Station to Penn Station. It's only a few dollars more than the E train.

Part of the difficulty with EWR, as others have mentioned, is if you are not going to take public transit. EWR originating cabs to the city aren't cheap with the trans-Hudson tolls. I live in Brooklyn, and I avoid EWR like the plague. A cab or car service easily runs $80-100, plus the concerns of tunnel traffic make it a risky option. Also, the train connections aren't particularly convenient unless you're going to Penn Station or willing to hop on the PATH to downtown. For me to get to Brooklyn by train from EWR is: Airtrain to NJ Transit to Midtown and a long subway ride to BK or Airtrain to NJ Transit to PATH to shorter subway ride. JFK to Brooklyn is a $35 car service.

Location of Manhattan - Huge difference.
 

To be fair, it also depends on your hotel and your final location in Manhattan. If you are in West Manhattan with only minutes after getting off the Jersey-NYC bridges, then EWR can end up being even faster. Everywhere else in Manhattan it would be either JFK/LGA.

And why should we believe your assessment?

Here's why we take it with more than a grain of salt:

-he has been in the business of dissing the United he didn't participate in
-his belief about leaving JFK isn't supported well by the evidence and logic tests

I don't care who makes the statement and what it is. I look at the evidence. Executives are paid to lie if they have to.

^

Likely because the barrier to re-entry is too high. They would need to buy slots again, re-allocate fleet, crew base, terminal space, etc. Don't be surprised if UA is back at JFK at some point.

This is key. Lots of HVF are based in Lower Manhattan for work, but live in UES, Brooklyn, Queens etc. When I used to stay in the UES, JFK was much much easier to get to. Plus, the terminal set up in JFK was a breeze compared to EWR.

I live on the UWS, and the last time I flew into EWR, the cab ride home cost me $120, plus tip. Steep, you say? I agree. But the cab driver insisted that was the price. I was absolutely exhausted, after a day of weather delays that had turned what should have been a couple of short hops (FLL-CLT-EWR) into a day-long nightmare. Add to that the fact that I had developed a migraine and I was further muddled. So I gave him the $120, and gave him a tip on top of that. Later on, I realized he had included his tip as part of the $120, so I tipped twice. I felt like a fool, but as I had a headache that was not fully under control and was nauseated from the migraine, I was not in a position to beat myself up too much.

This is exactly the point. They sold the slots too cheap (at least in cash terms - you could argue that the real value was to be connected with tieing up EWR) and the price has gone up since then. However asset prices go up and go down - my guess is that they will wait for a dip in prices (someone else pulling out, perhaps) and buy in again.

Like I said. If that's the reason why a return isn't worth it, which is reasonable, that means JFK was a marginal operation at best on the overall bottom line. That makes his blanket "wrong move" statement very suspicious. If an operation is only worth the capital already placed into it, then it's not lucrative and worthy to be cut if that capital can be used elsewhere for better effect (which has happened at EWR).

A return to JFK would be a mistake according to his own admission unless capital costs (including the need for more aircraft) plummet.

I live in Chelsea and feel the same way. Most of my travel out of JFK/LGA is with OPM so I'm in a cab about 90% of the time. Every cab I've taken from EWR has ended up as a hassle. I've excluded EWR from every personal trip flight search for as long as I can remember because of the annoyances. I also haven't flown UA metal since the 90's so maybe they should stay out at EWR so my JFK flight delays don't get any worse. :D

The JFK operation may not have been profitable, but the knock-on effect was losing NYC, LAX and SFO based HVF, which has reduced profits across the whole network.

I said "overall bottom line", which means the entire network. Again, if every factual statement he says is correct, that means JFK was only worth the capital already invested. That's actually an admission that JFK was worthy to be cut. At that point it's a sunk cost scenario (except for the aircraft and some equipment and employees which can be reallocated), and the only question that needs to be answered is if higher returns can be found by moving capital elsewhere.

The "admission" was that JFK was important to big corporate accounts that fly a lot across the network. So, if they lost $10M a year on JFK, but those accounts contributed $100M overall profit across the network, they lost $90M getting out and losing those account.

At this point they probably have to sleep in the bed they've made, since going back to JFK means buying slots, getting real estate , building a polaris lounge, etc.

Leaving New York’s JFK "Was the Wrong Decision"...

What a coincidence: that's exactly what I said on my UA post-flight survey asking about my p.s. EWR->SFO in March. ;)

As a once/twice a year "P" fare customer on this route, I've never run an airline but, esp. coming back to pick up p.s. from Brooklyn or W. Conn., there's no question which terminal is easier and quicker to get to: JFK. And while JFK has some serious traffic issues getting to/from, so can EWR.

Once one gets to JFK, the customer experience is infinitely better in so many aspects: signage, check-in, TSA Pre check, distance between TSA or baggage claim and the gate/UC Club, avoiding the hordes of people in poorly designed piers in this mega-plex which EWR is, helpfulness of UA staff, etc., etc.

Only Q. I have is: when is UA returning p.s. to JFK??

What assessment did I make? oh, that's right, I didn't offer one. :)

"We?" Who else are you speaking on behalf of? :confused:

How do you have better evidence than the current president of United?