SpinDoc said:
No offense to those who live and work in PHL, but US should have
thrown in the towel long ago, reduced PHL service to mini-hub
status and concentrated more emphasis on PIT as the premiere
connecting hub. No matter what they attempt to do in PHL, it will
never be successful (and WN will make sure of it). Why can't US
make PHL a mini-hub with more point to point flying for all of the
O&D traffic that supposedly makes it a better hub than PIT? If
your O&D traffic is higher in PHL, would that not make the hub
LESS efficient by taking seats away from the connecting traffic?
PIT is true hub in all the sense of the word. There is rarely an
ATC or WX delay, the airport is customer friendly, and the employees
are much more friendly than in PHL. Believe it or not, given the
opportunity to connect in PIT, CLT, or PHL, many of our DM members
actually will pay more to avoid PHL. What does that say? US Airways
senior managment have stuck with PHL and tried for over 10 years
to make it work efficiently. It does not work that way, nor will it
ever. Time to move the hub to PIT and make PHL an East Coast
mini-hub to FL and the Left Coast. IMO, PHL is the wrong place
to have the hub.
Well... I think the traditional logic goes something like this... and I am making up numbers...
If there are, on average, 300 pax per day PHL to LAX, then you could on a point-to-point basis and assuming you are the only airline in the market, fly 2 A320's and fulfill demand. However, if you are not the only airline in the market, let's say you get 1/2 the market because the other 1/2 of the people go for cheaper fares or more convienient departure times, or what ever, now you have 2 50% load A320 flights. So then you cut a flight, to try to get your 150 people on your one A320. Problem is that some of them find one flight inconvienient and you lose more pax.
Conversely, if you offer 5 PHL-LAX A320's a day, you are more likely to carry more of those 300 people as, you probably have more convienient departure times, plenty of low-fare seats etc. However, with no flow pax, you only get 60 pax per flight if all 300 choose US Airways... Thats a 42% load factor... You can downgrade the flights to 319, but that is a load factor 50%. So, in order to capture the maximum amount of local traffic, you need to offer more flights than the city pair can support. The only way to support that level of service are the connections, which bring up the load factor to 75-80%.
If US Airways were to attempt your suggestion, chances are they would lose a great deal of market share. The question is, if they do lose that market share (offer two flights instead of five), will those two flights be profitable? Maybe yes, maybe no, depending on the "switching" factor. I assumed 1/2 of the people went away... If that is only 1/3 or 1/4, then maybe your idea makes sense. If the switching facor is 3/4, then it means the end of USAirways in that market.
Your plan could potentially work, to make US Airways profitable... but it comes at the expense of market share. Traditionally, the majors don't like to give up market share, and operate at a loss to protect it (Not saying this is a good idea, it just is).
Furthermore, your idea presumably makes PIT cheaper per passenger (spead the fixed costs per pax over more pax means that fixed cost per pax declines). Whether or not this makes PIT more competitive is a different story... If the cost to take a pax through PIT declines from $8/head to $6/head, CLT is still way ahead of the game at $3/head. Presumably they looked at this during the whole "We might close PIT phase"
