Winning the West Coast

Old Nov 17, 2017, 7:08 pm
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Originally Posted by Kacee
I think you mean BART.

The population of Alameda and Contra Costa counties alone is over 2.6 million; that doesn't include the many residents of the central valley for whom OAK is more convenient than SFO.

I forgot to add that HA has a large operation at OAK as well.
correct BART. Was thinking that but out came path.
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Old Nov 17, 2017, 7:12 pm
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Originally Posted by JHake10
Reading to fast. Post updated.

Still wonder if UA would try to complete on that.

I've updated my post to reflect Delta will add Delta One from JFK-SAN (misread as SNA originally). Even so, I wonder if UA will upgauge this. However, as you mentioned, it seems it may not be in the cards aircraft wise.
United does not have the AC for any more lie flat routes, another great "changes you will like" decission dumping the 757s... I would add that DL is actually adding lie flats JFK-SEA, JFK-SAN, JFK-LAS. The first two make great sense, the last, hmmmmm.... I understood there was little premium traffic to LAS....
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Old Nov 17, 2017, 8:03 pm
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Seem United is simply not interested in PDX or SEA. On some dates in February and March, there is only two flights between ORD and SEA/PDX.

Seems DL's entry in SEA ORD market, combined with AS and AA at ORD, and WN in MDW has taken its toll on United.

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Old Nov 17, 2017, 9:17 pm
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Originally Posted by minnyfly
That vision is still there. They're the #1 legacy carrier in the West coast.
LAX-SEA is one of the biggest bloodbaths in the country. UA doesn't care much about LAX-SEA because there's little to care about from their perspective.
Originally Posted by jiburi
Seem United is simply not interested in PDX or SEA.
It's fine if UA doesn't want to serve LAX-SEA (or LAX-PDX) but I can't reconcile that with being the #1 carrier in the west. I get that the economics aren't good and maybe that means UA is doing something smart for once. My point is just that UA really only seems to care about SFO and marginally LAX, NOT the west coast.
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Old Nov 17, 2017, 10:36 pm
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Originally Posted by hoshattack
It's fine if UA doesn't want to serve LAX-SEA (or LAX-PDX) but I can't reconcile that with being the #1 carrier in the west. I get that the economics aren't good and maybe that means UA is doing something smart for once. My point is just that UA really only seems to care about SFO and marginally LAX, NOT the west coast.
Maybe that should be United Air Lines new tag line: "Marginal at best"

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Old Nov 18, 2017, 12:39 am
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Originally Posted by hoshattack
It's fine if UA doesn't want to serve LAX-SEA (or LAX-PDX) but I can't reconcile that with being the #1 carrier in the west. I get that the economics aren't good and maybe that means UA is doing something smart for once. My point is just that UA really only seems to care about SFO and marginally LAX, NOT the west coast.
There is a lot of value in having a network that is not just a single point, but ties together interconnected cities. The west coast cities are tied together for a lot of industries, and being able to service SAN, SNA, LAX, SFO, PDX, SEA (plus to a lesser extent PHX) can drive a lot of traffic for companies or individuals who operate in all/some of these cities, not just one. It is comparable to the East Coast where historically DL and US had a "shuttle" and PMCO which had EWR. At this point on the west coast Delta and SWA have the shuttle, VX/AS is building one. United, not so much.

I think lacking the same degree of interconnectedness due to c2012 decisions has hurt UA at cities other than SFO, and I also think it has hurt UA at SFO in driving away some traffic that wants an airline that will serve multiple west coast cities.

At this point United has a very bad brand reputation and throwing extra capacity at it will simply drive down United's PRASM and load factor, which is what we are seeing the last few quarters. I think the ship has to some extent sailed, despite Kirby's efforts to regain some of what was lost.

p.s. and this is not unique to UA, AA has tossed away multiple opportunities to build out its west coast network and has instead retreated to LAX....
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Old Nov 18, 2017, 7:47 am
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Originally Posted by spin88
There is a lot of value in having a network that is not just a single point, but ties together interconnected cities. The west coast cities are tied together for a lot of industries, and being able to service SAN, SNA, LAX, SFO, PDX, SEA (plus to a lesser extent PHX) can drive a lot of traffic for companies or individuals who operate in all/some of these cities, not just one. It is comparable to the East Coast where historically DL and US had a "shuttle" and PMCO which had EWR. At this point on the west coast Delta and SWA have the shuttle, VX/AS is building one. United, not so much.

I think lacking the same degree of interconnectedness due to c2012 decisions has hurt UA at cities other than SFO, and I also think it has hurt UA at SFO in driving away some traffic that wants an airline that will serve multiple west coast cities.

At this point United has a very bad brand reputation and throwing extra capacity at it will simply drive down United's PRASM and load factor, which is what we are seeing the last few quarters. I think the ship has to some extent sailed, despite Kirby's efforts to regain some of what was lost.

p.s. and this is not unique to UA, AA has tossed away multiple opportunities to build out its west coast network and has instead retreated to LAX....
Interconnectedenss is a false construct to support an on-going negative narrative.

Serving LAX-SEA/PDX does not increase relevancy to customers in SFO. Nor does flying LAX-SJC mean anything to customers in Seattle. It can be legitimately argued that United is less relevant to customers in the Pacific Northwest than it was 10 years ago (a change initiated pre-merger). United also changed its relevancy in LAX, carrying about the same number of passengers to fewer destinations. Whats ignored is that the utility for SFO-based customers is significantly improved with more destinations, flights, and capacity.

Airlines cannot be be everything to everyone. United has chosen to focus on SFO, at the expense of some local traffic in cities were it historically played a larger role, like Seattle or Portland. Conversely, Delta is trying to be more relevant to customers in Seattle and LAX, at the expense of MEM, CVG, and a host of smaller cities (or look at Delta in Portland 20 years ago). Networks and competition changes. If United (or another airline) is no longer relevant to you, trying to hold on to the past will only result in frustration.
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Old Nov 18, 2017, 9:28 am
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Originally Posted by fly18725
Interconnectedenss is a false construct to support an on-going negative narrative.

Serving LAX-SEA/PDX does not increase relevancy to customers in SFO. Nor does flying LAX-SJC mean anything to customers in Seattle. It can be legitimately argued that United is less relevant to customers in the Pacific Northwest than it was 10 years ago (a change initiated pre-merger). United also changed its relevancy in LAX, carrying about the same number of passengers to fewer destinations. Whats ignored is that the utility for SFO-based customers is significantly improved with more destinations, flights, and capacity.

Airlines cannot be be everything to everyone. United has chosen to focus on SFO, at the expense of some local traffic in cities were it historically played a larger role, like Seattle or Portland. Conversely, Delta is trying to be more relevant to customers in Seattle and LAX, at the expense of MEM, CVG, and a host of smaller cities (or look at Delta in Portland 20 years ago). Networks and competition changes. If United (or another airline) is no longer relevant to you, trying to hold on to the past will only result in frustration.
That is an assertion, not fact, and accepts a particular c2012 PMCO view of the aviation world in which focusing on fortress hubs and non-competitive routes and cutting capacity are the way to profitability as gospel. IMHO that was a mistake in 2012 and its a mistake today. I think UA bleeding traffic and dramatically under-performing from 2012-2017 show the plan has not worked, YMMV.

First, an example, company I work with has offices in LA and SF, does business up and down the coast and then periodic trips to NYC. They have 20 sales people who regularly travel mostly up and down the West Coast. At my suggestion they got a corporate deal, and it was DL that got the business. Why? Well DL covered the places they needed ex-SFO and ex-LAX, and UA lacked adequate connectivity to PDX and SEA where they do a lot of business. That combined with DL's better service and reliability tipped the deal to DL. Its not huge (likely $250K in sales) but a good example of the benefits of having a more integrated network.

Second, building out the network in a region has knock on impacts. For example, as DL has built out LAX and SEA it has made it possible for me to fly places via DL ex-SFO that would have been difficult in past. E.g. I have taken 8 trips to TUS in the last two years, easy to do via LAX connection, UA offers me no really good options. The result is that DL is now getting 70% of my $60k+ in spending, not the 25% they were getting when I started to fly them post 3/2/12.

P.s. and I might add that my opinion appears to also be Kirby's opinion (which is why he is trying to claw back some share ex-LAX) and is certainly the view behind the VX/AS merger, which attempts to build up regional strength on the West Coast.
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Old Nov 18, 2017, 11:34 am
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Originally Posted by hoshattack
Will it ever be a fortress hub like IAH or EWR? No. But I'm continually flabbergasted by the fact that UA only has one or two flights SEA-LAX (and only seasonally mainline at that). It's that kind of pitiful service that really says "we don't care"
Try living in Portland and staying loyal to UA. It's a hard proposition 'cause every damn flight involves the armpit of airports. AKA SFO, where massive delays to the PNW feeders are the norm. It gets old really quick... I build a minimum of 3 hours into every connection through SFO and have still misconnected more than 8 times this year (I'm at 130 segments BTW).
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Old Nov 18, 2017, 12:59 pm
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Originally Posted by spin88
That is an assertion, not fact, and accepts a particular c2012 PMCO view of the aviation world in which focusing on fortress hubs and non-competitive routes and cutting capacity are the way to profitability as gospel. IMHO that was a mistake in 2012 and its a mistake today. I think UA bleeding traffic and dramatically under-performing from 2012-2017 show the plan has not worked, YMMV.
Where did I say United should focus on fortress hubs and non-competitive routes? United hasn't cut capacity and has no plans to cut capacity. Yet, capacity is finite (both from an airplane perspective, but also from at airports) and airlines need to make choices about where they allocate it. Unlike AA or Delta, United doesn't have a large portfolio of fortress hubs where it can pull capacity from (without loosing market share) to grow elsewhere.

Specifically to the west coast, you need to recognize that pre-merger, there were an awful lot of RJs flying up and down the coast, including the supposedly-critical markets of PDX/SEA-LAX. This is not a post-merger phenomenon.

Originally Posted by spin88
First, an example, company I work with has offices in LA and SF, does business up and down the coast and then periodic trips to NYC. They have 20 sales people who regularly travel mostly up and down the West Coast. At my suggestion they got a corporate deal, and it was DL that got the business. Why? Well DL covered the places they needed ex-SFO and ex-LAX, and UA lacked adequate connectivity to PDX and SEA where they do a lot of business. That combined with DL's better service and reliability tipped the deal to DL. Its not huge (likely $250K in sales) but a good example of the benefits of having a more integrated network.

Second, building out the network in a region has knock on impacts. For example, as DL has built out LAX and SEA it has made it possible for me to fly places via DL ex-SFO that would have been difficult in past. E.g. I have taken 8 trips to TUS in the last two years, easy to do via LAX connection, UA offers me no really good options. The result is that DL is now getting 70% of my $60k+ in spending, not the 25% they were getting when I started to fly them post 3/2/12.
Every company and individual's travel patterns are different. Statistically, United will offer the best network for most SFO-based travelers and should be competitive at LAX in key markets. Delta is not competitive in SFO for people in SFO going to PDX or TUS, just like United is not competitive travel frequently from LAX to ATL or DTW.

Increasing network utility would benefit any carrier. Hence the decisions taken by AA, Alaska, Delta, Southwest and United over the past few years.

Originally Posted by spin88
P.s. and I might add that my opinion appears to also be Kirby's opinion (which is why he is trying to claw back some share ex-LAX) and is certainly the view behind the VX/AS merger, which attempts to build up regional strength on the West Coast.
United is gaining gate capacity that was out of service for terminal/UC construction. It is tough to grow when you don't have space to park airplanes.
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Old Nov 18, 2017, 4:16 pm
  #41  
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Originally Posted by spin88
... I understood there was little premium traffic to LAS....
I think there is little "conventional" business travel, but a lot of convention (3rd largest, I believe, after Chicago and Orlando) and "money to burn" travel. Two of four UA non-stops today are 752s. DL copying UA ?
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Old Nov 18, 2017, 5:19 pm
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It shouldn't be surprising that DL is putting D1 on JFK-SEA/SAN/LAS. Those identical city-pairs have recently or will soon see Mint. DL introduced D1-lite service on JFK-SEA around 2014, and quickly ended it, so there is reason to be skeptical about the viability of that, let alone SAN and LAS. Nevertheless, kudos to DL for the willingness to take a long cold bath on those routes. (Also kudos to B6, which has repeatedly poked DL in the eye -- we still remember Song.) But IMO, this really has more to do with posturing at JFK than "winning" on the West Coast.

UA's response? Nada.
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Old Nov 18, 2017, 5:37 pm
  #43  
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Originally Posted by sbm12
A desire to create profits for shareholders rather than get involved in a massively expensive fight for incremental traffic that already has a strong commitment to a carrier (WN) delivering far more intra-California connectivity than UA could even consider trying to build out without bankrupting the airline.
Agree with the sentiment, even if a bit hyperbolic. Im not suggesting UA fly LAX Fresno. But LAX SJC for example is a indicative of the lack of network that matters. It may not be the most profitable route but by not serving it, an LAX based GS has to fly another carrier to get there. And Silicon Valley is home to some of the most profitable businesses in the world. Why shy a way from that market? Not unlike the JFK repercussions Kirby alluded to once.
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Old Nov 18, 2017, 6:11 pm
  #44  
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Originally Posted by docbert
There was a period a few years ago when SJC-LAX was the most contested route in the world, with more airlines flying it than any other route (including UA). Clearly it was enough that UA couldn't justify it and pulled out, especially with it being a non-hub to mini-hub route, when one of their main hubs is only 30 miles away...
I suspect most people in SoCal who travel to SJC would rather go from one of the secondary airports unless they live close to LAX, particularly since traffic around LAX has gotten steadily worse. The mile or so from the Sepulveda exit off the 105 to the terminal can take as long as the flight from LAX to SJC, and unfortunately pedestrians aren't allowed in the tunnel. At peak traffic times I can get from home to a destination in Sunnyvale via BUR faster than I can get from home to LAX.
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Old Nov 18, 2017, 8:20 pm
  #45  
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Originally Posted by 3Cforme
Do you think OAK is a high yield hub? I don't - not with Southwest's presence.
Since when is Southwest cheap?

There's far more competition at SFO (and some more at SJC) than OAK. I typically find OAK to be the highest price of the 3, and SFO the cheapest.
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