Hubs, route structure, etc

[hulagirl]

Regarding antitrust issues - I think it's going to be a bloodbath. Every politician from the major of Phoenix to the Governor of VA is going to making hay in the media over this. Congress is going to hold hearings, you can be sure. There's going to be little overall sympathy for the poor betrodden airline industry.

NW/DL is going to have enough trouble getting this past the DOJ. UA/US? Even shakier prospects, imo.
Major divesting to low-cost carriers required to even have a chance of getting it done.

Well then I'd love to see the politicians do something about the price of fuel. No one can survive this...is it better to have us all out of work?

 

[Pacemaker]

Well then I'd love to see the politicians do something about the price of fuel. No one can survive this...is it better to have us all out of work?

Well, that would require that we have some sort of plan on a national level, wouldn't it?

 

[Coffee_Tea_Or_Me]

I am not sure why people forget that Charlotte is a huge banking center now. It is home to Bank of America and Wachovia, two companies that give US a lot of business and look for direct flights. Charlotte has more going for it than people give it credit for -- including being one of the fastest growing cities in America. In the southeast, your main cities are CLT and ATL. No one is going to give up CLT as a hub city. To say CLT is halfway to nowhere is a joke, too. People think it is halfway to nowhere because it is 3 hours north of Atlanta? Joke.

 

[davo77]

Charlotte seems the worst, its proximity to ATL, it really is too far north to properly serve the Caribbean. It is kinda half way to nothing.

If one wants a goad to DAL and their ATL hub, then keep CLT, but it really does not work for Caribbean destinations, at all. MCO would be far more advantageous to US. Other than BMW and the occasional NASCAR bent-metal fest, CLT really has no industry, to speak of.

Ive never posted, but I just had to reply to this. Charlotte having no industry. Hmmm. Lets see. There are 9 fortune 500 companies headquartered in Charlotte, ranking the city 5th in the Us.. Two of them being Bank of America and Wachovia. Charlotte is part the fifth largest urban area in the US with 7.1 million people. (Urban Area is defined as total population in a 100 mile radius) Atlanta by comparison has 7.6 million. 487 foreign companies have facilities in Charlotte. Uptown Charlotte has the tightest office vacancy rate in the country at around 2%. According tho the US Census the Charlotte metro area was the 6th fastest in the country in 2007. Charlotte is the only major city in the country to see home values rise in feb 08. The list goes on, but I think it is safe to say that Charlotte can hold its on. Oh btw. Donald Trump is also going to build an office/retail/residential complex in Charlotte. Will Charlotte remain a major hub in the wake of a merger? Only time will tell.

 

[USstew23]

True true....I think a couple of people also work at the 2 community banks down on main street...doubt you've ever heard of them. Bank of America and Wachovia?

Doubt they do much flying though....Kenny (that's the president of both banks, its an easy job) sometimes rides up to a place called NEW York....don't know what makes it so special though...he could get to regular old York (S.C.) in a couple of hours by horse.

LOL.. I just shot water through my nose.hahahahlolol!!

 

[zethya]

I refer back to my post and suggestion as part of an earlier Poll. I believe that if US and UA merge, parts of UA (and now, also possibly US) will be sold off to other airlines as part of the deal. If this is done by intelligent resources, a "lean and mean" combined carrier could result. This would seem to negate a lot of the naysayers doomsday predictions that the merger would create a "bloated elephant" of 2 less than stellar airlines and result in a single huge disaster (i.e., 1 Bad + 1 Bad = 2 Bad). One of the biggest ? IMO is what will be the tradeoff between IAD and PHL. IAD has better general Yields, but only over 1/2 of the PHL Domestic O&D. U.S. carrier International O&D is very close to equal (near 3M each). One major item, which could easily offset the domestic yield differences in favor of PHL, is the Cost Per Enplaned Passenger. At PHL it's approx. $8, at CLT only $2-$3, but at IAD a relatively gigantic, near $22 ! This also illustrates the potential costly endeavor in switching major Hub services to IAD from CLT. Based on this, I don't think it's unreasonable to predict that PHL will survive and grow, especially since the airport is now finally in firm "growth mode", and IAD will be downsized, or the routes and appropriate slots, sold to someone like AA. I feel there would be government pressure for some U.S. carrier to retain at least a significant portion of the IAD international routes. Also, similar to DL at ATL, if Parker is the merged CEO, he would likely favor PHL over IAD for the emotional/ego reason that he has been/is able to influence decision making - especially with the new city administration.

Another sticky situation would be SFO versus PHX. IMO, because SFO is the ideal Asian gateway, both location wise and environmentally (not Hot and High = Less MTOW), it would supplant PHX as a Hub. PHX would then be either Focused or AW would be sold as a Regional carrier - much like it's former life to someone like DL/NW.

Regardless of whether US merges with another Legacy, or stands alone, it will have to somehow optimize it's route structure relatively quicklyto offset the current economic down turn. A major tool to accomplish that is a significant increase in high yield international routes.
Unfortunately, US is now caught in a situation that, because of lack of suitable aircraft, it will loose that opportunity for the (now) all important 2008 Trans-Atlantic/Asia season. Endeavors, such as "no more free Peanuts", will essentially be "Peanuts" to the bottom line, potentially just irritate customers and fuel the already mediocre service reputation of the airline. Higher fares to support better competitive service is one of the key offsets to surviving this major downturn, IMO.

 

[Cosmo]

I refer back to my post and suggestion as part of an earlier Poll. I believe that if US and UA merge, parts of UA (and now, also possibly US) will be sold off to other airlines as part of the deal. If this is done by intelligent resources, a "lean and mean" combined carrier could result. This would seem to negate a lot of the naysayers doomsday predictions that the merger would create a "bloated elephant" of 2 less than stellar airlines and result in a single huge disaster (i.e., 1 Bad + 1 Bad = 2 Bad). One of the biggest ? IMO is what will be the tradeoff between IAD and PHL. IAD has better general Yields, but only over 1/2 of the PHL Domestic O&D. U.S. carrier International O&D is very close to equal (near 3M each). One major item, which could easily offset the domestic yield differences in favor of PHL, is the Cost Per Enplaned Passenger. At PHL it's approx. $8, at CLT only $2-$3, but at IAD a relatively gigantic, near $22 ! This also illustrates the potential costly endeavor in switching major Hub services to IAD from CLT. Based on this, I don't think it's unreasonable to predict that PHL will survive and grow, especially since the airport is now finally in firm "growth mode", and IAD will be downsized, or the routes and appropriate slots, sold to someone like AA. I feel there would be government pressure for some U.S. carrier to retain at least a significant portion of the IAD international routes. Also, similar to DL at ATL, if Parker is the merged CEO, he would likely favor PHL over IAD for the emotional/ego reason that he has been/is able to influence decision making - especially with the new city administration.

See my earlier replies on this subject in different threads here, where I noted that your so-called "O&D" numbers were wrong, and here, where I provided links to the IAD and PHL airport websites to prove that the numbers were enplaned/deplaned passengers and not O&D passengers. And with regard to your CEP argument, suffice it to say that United's average international O&D fare at IAD during 2007 was so much higher than US Airways' average international O&D fare at PHL that it covered IAD's higher CEP many, MANY, MANY times over. This makes your reliance on each airport's CEP as a decisional factor almost meaningless in determining whether IAD or PHL would be the primary east coast international gateway for a merged UA/US (should such a merger actually take place). The fact remains that IAD is simply a much stronger international traffic generator, at much higher fares, than PHL. Thus, IMHO, while I don't expect the PHL hub to be significantly downsized in a UA/US merger, I do expect that IAD would almost certainly be the merged carrier's primary east coast international gateway. The numbers just don't lead to any other rational conclusion.

 

[Dog Wonder]

The problem with Charlotte is it pretends to be Mayberry with skyscrapers.

Unfortunately, it is Charlotte with a serious crime problem and Mayberry cops.

 

[N903AW]

I am not sure why people forget that Charlotte is a huge banking center now. It is home to Bank of America and Wachovia, two companies that give US a lot of business and look for direct flights. Charlotte has more going for it than people give it credit for -- including being one of the fastest growing cities in America. In the southeast, your main cities are CLT and ATL. No one is going to give up CLT as a hub city. To say CLT is halfway to nowhere is a joke, too. People think it is halfway to nowhere because it is 3 hours north of Atlanta? Joke.

Whenever I work flights into and out of CLT, I have noticed a significant higher number of business passenger types than Kettles. First Class is all elites or full fare passengers and there are always at least 30 or more elites in the main cabin. That includes working the redeye from PHX into CLT.

 

[LD3]

I refer back to my post and suggestion as part of an earlier Poll. I believe that if US and UA merge, parts of UA (and now, also possibly US) will be sold off to other airlines as part of the deal. If this is done by intelligent resources, a "lean and mean" combined carrier could result. This would seem to negate a lot of the naysayers doomsday predictions that the merger would create a "bloated elephant" of 2 less than stellar airlines and result in a single huge disaster (i.e., 1 Bad + 1 Bad = 2 Bad). One of the biggest ? IMO is what will be the tradeoff between IAD and PHL. IAD has better general Yields, but only over 1/2 of the PHL Domestic O&D. U.S. carrier International O&D is very close to equal (near 3M each). One major item, which could easily offset the domestic yield differences in favor of PHL, is the Cost Per Enplaned Passenger. At PHL it's approx. $8, at CLT only $2-$3, but at IAD a relatively gigantic, near $22 ! This also illustrates the potential costly endeavor in switching major Hub services to IAD from CLT. Based on this, I don't think it's unreasonable to predict that PHL will survive and grow, especially since the airport is now finally in firm "growth mode", and IAD will be downsized, or the routes and appropriate slots, sold to someone like AA. I feel there would be government pressure for some U.S. carrier to retain at least a significant portion of the IAD international routes. Also, similar to DL at ATL, if Parker is the merged CEO, he would likely favor PHL over IAD for the emotional/ego reason that he has been/is able to influence decision making - especially with the new city administration.

Another sticky situation would be SFO versus PHX. IMO, because SFO is the ideal Asian gateway, both location wise and environmentally (not Hot and High = Less MTOW), it would supplant PHX as a Hub. PHX would then be either Focused or AW would be sold as a Regional carrier - much like it's former life to someone like DL/NW.

Regardless of whether US merges with another Legacy, or stands alone, it will have to somehow optimize it's route structure relatively quicklyto offset the current economic down turn. A major tool to accomplish that is a significant increase in high yield international routes.
Unfortunately, US is now caught in a situation that, because of lack of suitable aircraft, it will loose that opportunity for the (now) all important 2008 Trans-Atlantic/Asia season. Endeavors, such as "no more free Peanuts", will essentially be "Peanuts" to the bottom line, potentially just irritate customers and fuel the already mediocre service reputation of the airline. Higher fares to support better competitive service is one of the key offsets to surviving this major downturn, IMO.

From:
Sent: Tuesday, October 30, 2007 11:14 AM
To: _Aviation
Subject: CLT's Cost per Enplaned Passenger
From time to time you hear Jerry talk about the cost to the Airlines for each enplaned passenger here at CLT. Our cost for each enplaned passenger last year was $1.21 This rate is the lowest in the country. The clipping below is self explanatory and indicates the importance of maintaining low costs. I thought you might find this article interesting. We have a lot to be proud of...

 

[WCT]

Begining to think PHX and LAS will be shrinked down to half there size if this merger happens. IF no contracts are put in place by then, furloughs on the West will be heavy, especially on the HP side. Sad but true. PHX will only be TED flights.
WN will start massive hiring for both bases, and some of us might have to change Ship.

 

[RowUnderDCA]

The problem with Charlotte is it pretends to be Mayberry with skyscrapers.

Unfortunately, it is Charlotte with a serious crime problem and Mayberry cops.

Yes, as a short time N.C. transplant, we called this the "Mayberry Syndrome:" an inability to address the challenges and opportunities of a big city, because of engrained cultural mind-sets.

Hey, in some ways its good. GSO is beautiful. But I bet the traffic today is a nightmare.

 

[galley princess]

WCT, just to give you some options, the fairness of DOH will most likely protect you in the unlikely event of a merger. AFA affirmed DOH during the beginning of the AWA - US merger. If there is a AWA-US-UA combination, even absent a contract, AFA would most likely insist on voluntary leaves and something like what happened for our junior furloughed people who went to AWA until such time as we get a contract and they spring back to their own seniority. Dependent on needs of the specific airline (Iknow this is a complicated sentence).

As tough as it would be, the people who should worry are the ones that are coming back to US right now, or were hired by AWA in the last few years. Same for UA.

Anyway, I wouldn't worry too much about it short term. We are what? Three years post merger and no contract in sight. If this did happen, unless they had someone smart at the helm who would learn from Parker's mistake, and negotiate quickly to combine the work groups, you're probably not talking about any change in your contract for another 3+ years. And if it was someone smart he'd develop a favorable retirement package for the seniors who would take it and run.

I realize that you guys feel really junior, but the fact is, most of our senior population is wedded to European flying, and other than vacation bidding (don't get me started) you may not see much of a tumble once US-AWA is combined, and this applies doubly if they do really operate a China flight.

This all fits unless you don't want to commute.

Just dig in and hang on, this stuff never works out the way they say it will.

 

[Travelpro72]

If a merger of US and UA does come to fruition I don't think it will take as long to integrate everyone. For some reason regardless of who's in the drivers seat I don't think we'll see the hansy pansy negotiations like today. On a grand scale I just don't see it. I also think hub and focus city shifts and closures will be swift and quick. No thinking and pondering what do to. They probably have it all lined out already.

 

[iwantout]

If a merger of US and UA does come to fruition I don't think it will take as long to integrate everyone. For some reason regardless of who's in the drivers seat I don't think we'll see the hansy pansy negotiations like today. On a grand scale I just don't see it. I also think hub and focus city shifts and closures will be swift and quick. No thinking and pondering what do to. They probably have it all lined out already.

So what is everyone's prediction on which bases will close?