AirCanadaA330 From Canada, joined Aug 2008, 304 posts, RR: 0 Posted (4 years 7 months 1 week 6 days 14 hours ago) and read 13427 times:
I was just wondering how airlines choose their routes, do they just decide where they are going to fly, or do they figure out what routes have demand? And how would they do that? Its something that has kept me up at night. I mean does Air Canada just say "ok we are now flying from Edmonton to Victoria" or do they do some research into where they are flying next? Also How do they know where the demand is? Does Transport Canada advise them on where to fly...or is it just a guessing game?
Any help would be great thanks!!
flymia From United States of America, joined Jun 2001, 7434 posts, RR: 6
Reply 1, posted (4 years 7 months 1 week 6 days 13 hours ago) and read 13415 times:
I do not have a detailed answer I am sure someone will. But airlines have teams of marketing researchers and economist etc.. You name it the airline will use it to find routes to fly. Also there are a lot of statistics out there for example O/D stats between cities.
"It was just four of us on the flight deck, trying to do our job" (Captain Al Haynes)
QANTAS747-438 From United States of America, joined Jan 2001, 2036 posts, RR: 2
Reply 2, posted (4 years 7 months 1 week 6 days 9 hours ago) and read 13368 times:
I can speak for Southwest. At WN, lots of thought goes into figuring out what routes to fly as well as what new cities to open. They look to see where the demand is. They also look to see what routes currently have high fares and limited competition. That's when WN loves to come in and drop the price. On a more operational level, you need an airplane to fly the route... so where does the plane come from? Are you anticipating new deliveries? If not then you may need to cancel or alter an existing route. That can have a huge chain reaction down the line. Other things to consider are flight crews and their overnights, gate space at a certain time period that the flight will be operating, can you profitably fill the airplane you are using on that route, etc... When it comes to new cities, you also have to take a look at demographics of the new city. Are people willing to pay high airfare to fly out of there (like SNA or SFO) or is it a liesure market where people save up their money in order to fly (like HNL).
By no means is it as easy as "just adding a new route". Everything gets affected.
My posts/replies are strictly my opinion and not that of any company, organization, or Southwest Airlines.
Jetmatt777 From United States of America, joined Jun 2005, 3002 posts, RR: 31
Reply 5, posted (4 years 7 months 1 week 4 days 20 hours ago) and read 13135 times:
Demand data can come from many sources, mainly (in the USA) the Department of Transportation. When you book a flight from, let's say XXX to YYY, but with a stop in ZZZ, you are counted as a passenger from XXX to YYY. Not a passenger to ZZZ then YYY. So, on a given day, the average number of people between XXX to YYY may be 215.36 people, yet there are no nonstop flights. You are counted as if the flight were nonstop anyway in that market, assuming you are on the same itinerary. So, there is data for markets that don't have nonstop service.
Viscount724 From Switzerland, joined Oct 2006, 27339 posts, RR: 22
Reply 6, posted (4 years 7 months 1 week 4 days 17 hours ago) and read 13074 times:
Quoting etherealsky (Reply 4): Quoting QANTAS747-438 (Reply 2):
They look to see where the demand is.
Quoting AirCanadaA330 (Thread starter):
do they figure out what routes have demand? And how would they do that?
^ That's something I've often wondered as well. Where does the 'demand' data come from; just surveys?
In many cases, the demand data comes from their own statistics. Since AC was mentioned, if, for example, AC O&D data shows that they carry 100 connecting passengers a day YEG-YVR-YYJ, they may decide that YEG-YYJ can justify a nonstop flight.
robso2 From Switzerland, joined Jun 2010, 221 posts, RR: 0
Reply 7, posted (4 years 7 months 1 week 2 days 19 hours ago) and read 12894 times:
Demand information also comes from market research companies such as Nielsen who compile figures.
Quote: Other things to consider are flight crews and their overnights, gate space at a certain time period that the flight will be operating, can you profitably fill the airplane you are using on that route, etc...
Another thing to consider on some routes which may have smaller passenger demand is cargo revenues. Airlines will also look at the year round demand (i.e. does demand highly vary between seasons)... What is the premium/economy split like... some routes such as GVA-IAD is a very premium heavy segment and UA capitalize on this.