What’s Atlantic Coast’s True Motivation?

[michael707767]

I wonder, since ACA is already part of the Delta Connection network, could they just move over and become an entire DCI carrier, and offer up the Dulles gates to Delta, allowing Delta to increase its presence at Dulles.

 

[ual06]

Why would Delta want "Express" gates at IAD?

 

[michael707767]

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On 8/2/2003 350 PM ual06 wrote:

Why would Delta want "Express" gates at IAD?

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Someone correct me if I am wrong, but I thought that many of the gates that mainline United uses at IAD actually belong to ACA. Delta would certainly want those gates, especially if a built in feeder came with them.

 

[ual06]

To the best of my knowledge, UAL controls all of its Mainline and International gates at
IAD. ACA controls its express gates. Early news releases on the matter said ACA
controlled the gates; but, later news releases on the matter stated that UAL controlled its
Mainline and International gates. Does anyone here know for sure?

 

[gimbalimit]

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On 8/1/2003 4:55:04 PM Chip Munn wrote:


UA's public announcement is likely designed to provide confidence to the traveling public and employees that the hub will continue operation. One of the major airline bankruptcy concerns is passenger defection. Unlike another commodity business, when a customer buys a ticket they spend their money, but may not receive the benefit of this expense until months later.
 
Obviously, if passengers begin booking away from UA how will this effect the airline and in particular the stringent DIP financing requirements that tighten every month.
 
It was important for UA to issue this information, but nobody truly knows ACA's intention. Furthermore, if UA was "surprised" by ACA's announcement to part company with the major airline, I believe it's unrealistic to believe two days later UA has "alternatives" in place for 40 markets.
 
Yes, there should be employee concern because this issue clearly clouds UA's future even

Chip, it is apparent to me from your numerous and volumnous posting behavior that you have an intense interest in the airline business. At the end of the day, however, you are merely just a cog in the big machine (like the rest of us) with no more access to inside thinking or decision making than any other airline EMPLOYEE.......I'm happy for you that you've been granted some status as an 'expert' - fine - you're an expert, but I find it hard to believe that your continual musings are any more accurate or informative than a typical cockpit conversation - you don't seem privy to any real inside inforamtion. Perhaps I am mistaken and you've held a position(s) at the upper tier of airline management and or regularly attande senior strategy/BOD meetingds - if so, I appologize. OTW, I feel compelled to tell you that general information gleaned from public sources and filtered through the prism of your armchair intellect aren't terribly interesting. And, Oh, BTW, with your supposed sense of insightfullness, why the hell didn't you bail out of USAir about 12 years ago when it was quite apparent to most that it was a carrier without any real future (cause it aint gonna be much more than a glorified regional carrier when all is said and done- UALs demise notwithstanding)-

Yor comments quoted above are about as insightful as those of a fashion beat reporter who got stuck covering the business page for a few days - I could make assertions 180 out from yours and end up in the right. Thanks for your time.

Best Regards,

Gimbal

 

[ColoradoFlyer]

I certainly don't know what ACA's true motivation is. Perhaps they are working with Richard Branson to become his vehicle for entry in to the US market, or maybe they just don't think that United has much of a future. What I can predict with some certainty is that United is not going to abandon Dulles if ACA jumps ship.

While United has never been a major player in the northeastern US, it has had one pocket of strength, and that's Washington, DC. This dates back to the 1961 acquisition of Capital Airlines which was based at National Airport. Dick Ferris tried to start a north/south hub at Dulles back in the early 1980's even before United had any transatlantic flights. Unfortunately, American was trying to build a hub at Raleigh/Durham, Piedmont was building up Baltimore and Charlotte, and Eastern was still in the picture. There was simply too much capacity being dumped in the market and both United and American pulled back.

Today, Dulles is really a hub once a day during the late afternoon and early evening when the transatlantic flights arrive and depart. While the ACA flights certainly add valuable feed to United's network, I strongly suspect that most domestic connections to and from the transatlantic flights are already carried on United mainline flights to a few key cities such as LAX, SFO, OAK, PDX, SEA, SAN, PHX, LAS, DEN, ORD, DFW, BDL, MCO, MIA, MSY, and TPA. If necessary, United could replace ACA service to larger cities such as BUF, ROC, DTW, CLE, IND, etc. with mainline service or another United Express carrier. I'd have a hard time believing that feed from Binghamton, NY, Greenville, SC, or Charleston, WV would make or break United's Dulles operation. In other words, it would not be necessary to replicate the entire ACA pattern of service to make Dulles work.

ACA's schedule of flight throughout the day under the United Express banner gives United a stronger presence in the local market that helps United compete for frequent business flyers and corporate travel accounts in the Washington area. Losing ACA would therefore not be good for United. However, now that USAirways is slated to join the Star Alliance and is already code sharing with United, ACA is not nearly as important to United as it once was. Even if USAirways does not directly feed passengers to the Dulles hub, the marketing combination of the top two carriers in the Washington area gives both carriers a strategic advantage over all others when competing for local traffic.

It's interesting to note that on this same topic on the USAirways board there is speculation that Dulles will be phased out and that Philadelphia will become the new Star Alliance gateway to Europe. I would be very surprised if this were to happen. Dulles is a natural gateway to Europe and the Middle East. The Washington/Baltimore metro area has one of the largest populations in the country and of course is the national seat of government. The metro area also has above average per-capita income and education levels leading to a higher proclivity for foreign travel. With government and tourism traffic a given, Dulles has a huge local market and competitive advantage over other gateway cities such as Philadelphia, Charlotte, or even Boston. I suspect Dulles could support a fair amount of tranatlantic flights with no domestic feed at all.

Given this, I would be very surprised to see United downsize or abandon its principal transatlantic gateway should ACA decide to partner with another airline or strike out on its own. If United were to do so, it would be squandering a key strategic asset, something which it cannot afford to do.

 

[AirplaneFan]

ColoradoFlyer,

Very good analysis of the situation. I would offer that Southwest is also a major player (perhaps the largest player) in the Baltimore-Washington area. Also since ACA has the most flight operations of any carrier in that region, they must be flying to more cities than just Binghampton.