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Local FL+WN Traffic At MKE Q2 2010  
User currently offlineknope2001 From United States of America, joined May 2005, 2875 posts, RR: 30
Posted (3 years 7 months 4 days 22 hours ago) and read 4501 times:

Here and elsewhere there has been a lot of speculation on what the combined Southwest might do in Milwaukee when they integrate AirTran. The MKE operation (specifically AirTran's) relies significantly on connecting flows in some markets, but serves very large local traffic in others. As such, I think that looking at the volume of local traffic market-by-market is a useful benchmark.

These are the average daily passenger boarding stats (one way) out of Milwaukee for Q2 of 2010 for AirTran + Southwest:

OW Daily is the average pax boarded in MIlwaukee for AirTran + Southwest...this is total O+D passengers reported no matter if nonstop, thru or connecting flights. (This includes both airlines if reported, but if the volume carried in a connecting market was below the reporting threshold, it is not included...for example however many passengers AirTran carried between Milwaukee and Kansas City...a connection via ATL...are not included.)

N/S Flights is the average number of nonstop flights scheduled per day. Because of signficant seasonal changes during the quarter to RSW/SFO/SEA/SAN, I used a fractional number which accruately represented the average amount.

Pax Per N/S is a simple division of daily local passengers just on the nonstop airlines by daily nonstop flights. Where that distinction matters is in markets where an airilne without nonstop service still carried a lot of passengers, such as Southwest on MKE-SAN.

OW Daily … N/S Flights … Pax Per N/S … Destination
427 ………. …… 5 ………. …… 85 ………….. Orlando
365 ………. …… 4 ………. …… 91 ………….. Las Vegas
259 ………. …… 5 ………. …… 52 ………….. Baltimore
258 ………. …… 4 ………. …… 65 ………….. New York
210 ………. …… 2 …….. …… 105 ………….. Tampa
200 …….. …… 1.5 …….. …… 118 ………….. Fort Myers
158 ………. …… 2 ………. …… 79 ………….. Los Angeles
136 ………. …… 3 ………. …… 45 ………….. Washington DC
131 ………. …… 4 ………. …… 33 ………….. Atlanta
115 …….. …… 1.5 ………. …… 77 ………….. San Francisco
114 ………. …… 1 ………. …… 81 ………….. Fort Lauderdale
104 ………. …… 3 ………. …… 35 ………….. Kansas City
101 ………. …… 2 ………. …… 50 ………….. Denver
93 ………. …….. 1 ………. …… 93 ………….. Phoenix
91 …….. …….. 1.3 ………. …… 70 ………….. Seattle
91 ………. …….. 2 ………. …… 46 ………….. Boston
78 …….. …….. 0.8 ………. …… 56 ………….. San Diego
75 ………. …….. 2 ………. …… 37 ………….. Dallas
68 ………. …….. 3 ………. …… 23 ………….. St Louis (skywest)
51 ………. …….. 3 ………. …… 17 ………….. Pittsburgh (skywest)
43 ………. …….. 3 ………. …… 14 ………….. Minneapolis (mainline)
35 ………. …….. 3 ………. …… 12 ………….. Indianapolis (skywest)
34 ………. …….. 2 ………. …… 17 ………….. Akron (skywest)
31 ………. …….. 3 ………. …… 10 ………….. Omaha (skywest)
07 ………. …….. 2 ………. …… 03 ………….. Des Moines (skywest)


The natural impuls is probably to take the daily passengers and see how many 737 or 717 flights can serve them with a decent load factor, and draw conclusions from there. That's probably not the best analytical move for a couple of reasons:

--Several markets have varying demand based on frequency. MKE-MCI generated enough local traffic on the average day to nicely fill 1x/day, but if they only flew 1x/day they would see local traffic drop.

--Some markets serve a Southwest hub, and in those cases thru and connecting traffic will fortify loads beyond the local traffic. Routes like MKE-PHX and MKE-ATL have much more traffic potential than the local market shows because of onward connections. Those markets may justify more flights than these local traffic stats suggest. On the other hand, routes like MKE-BOS and MKE-SEA really don't have much connecting traffic potential.

--Not every market is necessarily worth serving nonstop even if traffic to fill seats might appear to exist. Let's look at MKE-FLL as an example. At 114/day in Q2 it appears to be worth serving nonstop 1x/day. Why might they choose not to?
-----If the 114/day level was achieved at junk fare levels to fill overcapacity, it's probably not worth it.
-----Those 114/day may be uneven through the week; empty planes some days and lost spill on others.
-----MKE-Florida favors morning; a PM MKE-FLL nonstop sends a lot of traffic elsewhere.
-----Trying to serve most MKE-Florida traffic nonstop pulls it away from Atlanta, making MKE-ATL weak and perhaps stunting ATL-Florida a bit. Now of course it is cheapest to transport a customer nonstop versus a connection,. But in the big picture, sometimes the best option is to leave some traffic on the table by not flying a nonstop in a market where you might only break even, and instead use what traffic you do get as connecting traffic to fortify other more important segments and hubs.

--Finally, limited resources mean that not every potential opportunity is important enough to serve.


So.....looking at these numbers (and keeping those caveats in mind) it seems pretty likely that even if Southwest chooses to mostly remove the connecting functionality out of MKE, there's a lot of local traffic in key large markets they are likely to continue to serve. People (here and elsewhere) who speculate that Southwest will only have a small number of MKE filghts are probably overlooking the large volumes they serve in top markets. It doesn't seem likely they'd leave all that traffic on the table. On the other hand, as you go down the list a lot of cities seem marginal (or worse) at justifying nonstop service without the benefit of lots of connecting feed. We don't know for sure that Southwest will necessarily remove the connection element from MKE (although many think there's a good chance of that, including the likely loss of most Skywest markets and potential cuts to DCA and LGA). But if they do, the local traffic already served by FL and WN in Milwaukee seem poised to support ongoing service in several markets, but looks much more tentative in several others.

I still think Southwest will have a decent presence in Milwaukee, but after looking at these numbers perhaps my initial estimate of around 35 flights might be a little high. Maybe more like 25-30 flights seems in order if they generally remove the connection element from Milwaukee.

13 replies: All unread, jump to last
 
User currently offlinemke717spotter From United States of America, joined Dec 2005, 2445 posts, RR: 5
Reply 1, posted (3 years 7 months 4 days 18 hours ago) and read 4350 times:

I'm still holding out some hope that the merger somehow gets blocked or something - I like having the variety!!!! Also, I still haven't gotten this answered, but do you happen to know how MKE-SRQ is performing so far for FL?


Will you watch the Cleveland Browns and the Detroit Lions on Sunday? Only if coach Eric Mangini resigned after a loss.
User currently offlineyeogeo From United States of America, joined Jul 2009, 882 posts, RR: 14
Reply 2, posted (3 years 7 months 4 days 12 hours ago) and read 4249 times:

Quoting knope2001 (Thread starter):

OW Daily … N/S Flights … Pax Per N/S … Destination
427 ………. …… 5 ………. …… 85 ………….. Orlando
210 ………. …… 2 …….. …… 105 ………….. Tampa
200 …….. …… 1.5 …….. …… 118 ………….. Fort Myers
114 ………. …… 1 ………. …… 81 ………….. Fort Lauderdale

Speaking of Florida...
Pardon my ignorance, but does WN "do" seasonal non-stops anywhere in its current system?
I'd be interested in seeing Q3 vs Q2 for RSW and FLL especially.
How will the new Southwest deal with the large fluctuations that I assume occur in these markets?

yeo



Yokoso! to my world
User currently offlinegrain From United States of America, joined Sep 2008, 92 posts, RR: 0
Reply 3, posted (3 years 7 months 4 days 12 hours ago) and read 4236 times:

down here in rsw we have a seasonal increase in flights from 11 to about 15 a day. also the isp-rsw nonstop is operated during that time.

User currently offlineyeogeo From United States of America, joined Jul 2009, 882 posts, RR: 14
Reply 4, posted (3 years 7 months 4 days 12 hours ago) and read 4216 times:

Quoting grain (Reply 3):
also the isp-rsw nonstop is operated during that time.

...so I guess a seasonally operated MKE-RSW nonstop would not be out of the question in the WN system as there's precedent.

I wonder what aircraft they'd use ? (I still find it a bit hard to comprehend that WN+FL'll be using more than one aircraft type!).
yeo



Yokoso! to my world
User currently offlineYXwatcherMKE From United States of America, joined May 2007, 971 posts, RR: 2
Reply 5, posted (3 years 7 months 4 days 10 hours ago) and read 4137 times:

Quoting yeogeo (Reply 4):
I wonder what aircraft they'd use ? (I still find it a bit hard to comprehend that WN+FL'll be using more than one aircraft type!).

I would think that at first WN will use the the FL 712 a/c until they can replace the 712 a/c from the 737NG's they have on order now. But that may take a while to do with the older 737 a/c that WN already are planning on replacing. So if WN does purchase FL WN will have to increase the number of 737NG's they have now on order or while continue to operate the 712 or get Boeing to agree to making a 737NOE's sooner than they wanted too or a clean sheet replacement to the 737 but I don't see that happening. MHO is Boeing is not in a hurry to start a new project until the 787 is in full product and delivery ops.



I miss the 60's & 70's when you felt like a guest on the plane not cattle like today
User currently offlinecanyonblue17 From United States of America, joined Oct 2008, 441 posts, RR: 0
Reply 6, posted (3 years 7 months 4 days 5 hours ago) and read 3882 times:

Quoting yeogeo (Reply 2):
Pardon my ignorance, but does WN "do" seasonal non-stops anywhere in its current system?



The answer is yes....and it seems to be more and more each year. Here at PBI we vary from 8-9 daily flts out of season (mid-Aug to early Nov) to 13-15 flts in season.


User currently offlinedbo861 From United States of America, joined May 2004, 883 posts, RR: 1
Reply 7, posted (3 years 7 months 4 days 5 hours ago) and read 3776 times:

Quoting knope2001 (Thread starter):
07 ………. …….. 2 ………. …… 03 ………….. Des Moines (skywest)

Why have they kept DSM so long if it's performing so poorly?

It doesn't make too much of a case for Southwest to keep DSM around post-merger. I wonder how the weekend MCO-DSM flight is performing.

[Edited 2010-12-29 12:35:36]

User currently offlineflyinryan99 From United States of America, joined Feb 2001, 2000 posts, RR: 12
Reply 8, posted (3 years 7 months 3 days 23 hours ago) and read 3647 times:

Quoting knope2001 (Thread starter):
34 ………. …….. 2 ………. …… 17 ………….. Akron (skywest)

Ya know, reading the Akron/Canton press releases, they have been around 70% full on these flights. I am interested in what the average CAK-MKE fare is. If it's pretty decent, I wouldn't doubt it's at least breaking even for them. Despite what a lot of people say here, CAK makes markets work. I think when Skywest brought it back to 2 flights a day, that made things a heck of a lot better. Despite what a.net thinks, I believe it's more important to a smaller market to have more destinations with fewer frequencies then it is to have a ton of frequencies to large markets.

Thanks Knope...you do a great job with the stats.


User currently offlineknope2001 From United States of America, joined May 2005, 2875 posts, RR: 30
Reply 9, posted (3 years 7 months 3 days 8 hours ago) and read 3254 times:

Des Moines primarily brings connecting passengers to the MKE hub and doesn’t serve too many locals. All six Skywest markets, plus MSP, bring in a significant amount of connecting traffic to Milwaukee. Only one of those seven markets (STL) served more locals than connections.

Here’s more detailed per-flight information on all seven of these major feed markets at Milwaukee. (The pax per flight stats I posted in the original post used some quick-and-dirty rounding, but these are more precise.) I decided to also include the lowest fare nonstop carrier to Chicago, as well, to give some comparison on the local fare levels.)

Q2 2010

Akron
79.4% LF, 361 miles, $111 average local fare (UA $215 to Chicago)
Per flight
17.6 locals
22.1 connections
10.3 empty seats

Des Moines
51.7% LF, 311 miles, $124 average local fare (UA $238 to Chicago)
Per flight
3.1 locals
22.8 connections
24.1 empty seats

Indianapolis
74.2% FL, 238 miles, $93 average local fare (WN $113 to Chicago)
Per flight
12.5 locals
24.6 connections
12.9 empty seats

Minneapolis
89.6% LF, 297 miles, $103 average local fare (WN $120 to Chicago)
Per flight
14.6 locals
91.1 connections
12.3 empty seats

Omaha
74.1% LF, 426 miles, $111 average local fare (WN $121 to Chicago)
Per flight
10.9 locals
26.2 connections
12.9 empty seats

Pittsburgh
77.4% LF, 431 miles, $89 average local fare (WN $126 to Chicago)
Per flight
17.3 locals
21.4 connections
11.3 empty seats

St Louis
76.8% LF, 317 miles, $103 average local fare
Per flight
22.1 locals
16.3 connections
11.6 empty seats


All seven of these rely significantly on connecting traffic. This, of course, doesn’t address at all the quality of yield on the connecting flights, which of course can vary. If a lot of the DSM-MKE connections were last- minute $280 fares to places like PIT, versus $89 seat-filler fares to DFW, it makes a big difference.

All these markets (except DSM) do have a fair stream of local traffic, but not enough to support service without a decent amount of connecting volume (one direction or the other). And fares are already pretty low, so there likely isn’t a whole lot more low-fare stimulation available in these markets.

If some or all of these “feeder” markets do end, the loss of that feed probably hurts some of the “destination” markets out of MKE. At what level equilibrium comes….we shall see.


User currently offlineYXwatcherMKE From United States of America, joined May 2007, 971 posts, RR: 2
Reply 10, posted (3 years 7 months 3 days 6 hours ago) and read 3183 times:

Quoting flyinryan99 (Reply 8):
Despite what a.net thinks, I believe it's more important to a smaller market to have more destinations with fewer frequencies then it is to have a ton of frequencies to large markets.

Thanks Knope...you do a great job with the stats.

These figures are just FL load factors or are these the load factors for the total markets? Because both F9 and FL/OO operate these markets and I wonder what percentage of the 7 markets F9 controls?



I miss the 60's & 70's when you felt like a guest on the plane not cattle like today
User currently offlineknope2001 From United States of America, joined May 2005, 2875 posts, RR: 30
Reply 11, posted (3 years 7 months 2 days 22 hours ago) and read 3065 times:

These are strictly FL and WN. Because Chautauqua-operated flights are not included in the DoT fare and traffic reports (they are in the T100 onboard stats, but not the the fare/market stats) we don't have complete Frontier information, including any of these feeder markets.

User currently offlinePHXMKEflyer From United States of America, joined Nov 2003, 291 posts, RR: 0
Reply 12, posted (3 years 7 months 2 days 8 hours ago) and read 2964 times:

Quoting knope2001 (Thread starter):
Not every market is necessarily worth serving nonstop even if traffic to fill seats might appear to exist. Let's look at MKE-FLL as an example. At 114/day in Q2 it appears to be worth serving nonstop 1x/day. Why might they choose not to?
-----If the 114/day level was achieved at junk fare levels to fill overcapacity, it's probably not worth it.
-----Those 114/day may be uneven through the week; empty planes some days and lost spill on others

What exactly is "spill/spillage"? I have heard this term used before in regards to revenue mgmt, but am unable to figure out quite what it is.  


User currently offlineknope2001 From United States of America, joined May 2005, 2875 posts, RR: 30
Reply 13, posted (3 years 7 months 2 days 3 hours ago) and read 2873 times:

"Spill" generally refers to traffic demand which exceeds capacity on the carrier of first-choice because seats (or reasonably-priced seats) are fileld up.

For example, let's say you're Airline A and you have 100 people on the average day who want to fly your airline XXX-YYY. You fly it with a 100-seat aircraft, and you'd be fine if that demand was even from day to day. But if in fact the demand half the time was 70 passengers and the other half of the time it was 130 passengers, those 30 passengers you'd lose on the good days would be "spill". To you, spill represents lost opportunity.

Now look at the same situation from the other side. You're competing Airline B and on average only 60 people per day want to fly you from XXX to YYY. But on those "good" days when the competitor in the first example sells out, you get those 30 passengers of "spill" traffic. In this case, saying that you're getting "spill" is a negative term. You're carrying 90 passengers on those good days, but in fact those 30 passengers are only flying you becuase their desired airline is full. To you, spill represents traffic you carried not becuase you attracted them, but because someone else left it on the table for you to grab. And it may well defect when they don't have to fly you out of necessity.

So...when you're the airline of choice in a market like Airline A, having "spill" means you can't always meet your demand. It's a lost opportunity, and you are essentially spilling traffic to other airlines. But it's not necessarily a slam to say an airline is losing traffic to spill because it shows you have good demand, and trying to pursue ever last possible passenger isn't always the best economic goal.

On the other hand, if you're not the airline of choice like Airline B, being described as "carrying a lot of spill" is a negative comment. It means a lot of your traffic is only flying you because they don't have better options. And if the preferred carrier adds capacity, or when demand softens a bit, that traffic is likely to leave you.


This is a fairly simple example, and in the real world it's more complicated, with spill being created (or averted) by factors like adjusting fare bucket allocation, flight times, alternate connecting opportunities, aircraft adjustments, etc. And it's never as clear as saying Airline A is everyone's first choice and Airline B is nobody's first choice. But hopefully this explains the generall idea well enough.


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