Cody
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Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 2:44 am

I have no inside info. or anything I would just like to get a few opinions on the future of the STL hub. Press releases are saying that AA wants to eliminate 2500 pilot jobs. I realize the F-100's are leaving soon, but I don't think that will cover 2500 jobs. So speculating, where else would the cuts come from? I can't imagine ORD or DFW. Plus, when the TWA operation was taken over, wasn't STL supposed to cover leisure connections while DFW and ORD were to be for the business traveler? I seem to remember every hub having a purpose. With the declining demand in business travel, is the STL hub still justified being that close to ORD?
 
FlyPNS1
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 2:58 am

I think AA will try to keep STL going. However, STL will get downsized to being primarily an RJ hub...think CVG. Remember, the new AA pilots contract also allows for lots of new RJ's in the system.
 
Ryefly
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 3:05 am

I am sure if AA were to leave STL, US Airways would jump on the opportunity and ditch PIT for STL. They have always expressed interest in STL.
 
AA717driver
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 4:26 am

USAir isn't going to jump on anything. They came out of Ch. 11 48 hours ago and have a negative cash flow. Their job is to try to recapture some of the business they have lost to SWA, AirTran, JB AND fend off Song and UALCO... Get the picture?

They are going to be busy just trying to gain a little speed and altitude--not trying to go to the moon.

I'd bet on SWA cranking back up in STL once it becomes a RJ hub or possibly AirTran, JB or, even, Midwest's LCC. No one has moved into CVG to try to capitalize on pax's growing disdain for RJ's. STL may well be dominated by AA RJ's without competiton.TC
FL450, M.85
 
flyCMH
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 4:59 am

My take on American's St. Louis hub is that the airline will try to keep it running as a major hub, but like as many others have said, with an increased focus on regional jet operations. However, I would think more along the lines of CLE and PIT than CVG, considering while Delta's hub there is crawling with CRJs, it also sees more than its fare share of 757s, 767s, and 777s.

Also, no one has tried to compete with Delta in CVG becuase the people of Cincinnati don't want it. Delta and Delta Connection control over 90% of the market in CVG. Over a dozen low fare carriers have attempted serving CVG, all of them failing due to Delta matching the competition and local travelers continuing to flock to Delta.
 
ouboy79
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 5:11 am

Don't be too quick to judge what U will do outside of Ch11 now. If the STL card was drawn and the opportunity there - Bronner and RSA will pony up the cash for it and then merge it into U. They'll have the ability to move a lot of the extra 73s and 319/32Xs around with the 175s coming onboard this year...and assuming it happens, the eventually dissolving of the PIT hub will just open up the resources all the more.

US Airways has always had a thing for STL...they want it, always have...always will.
 
elwood64151
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 6:43 am

I don't know if AA will phase out STL. However, if they downsize it, expect to see slowly increased operations from all LCCs (F9, B6, FL, and WN).

Also, just because STL might be downsized doesn't mean it will see only RJs. PIT, CVG, and other lower-scale majors' hubs still see lots of 73X, 75X, D9X or M8X, and A32X traffic, and even a little wide-body traffic.

Still and all, if AA pulls out entirely and just has O&D/outstation in STL, expect to see all the LCCs come in quick. When NJ went under, FL announced the next day they would start flying to MCI. Las Vegas, sans N7, will soon start seeing more B6 traffic and new FL traffic. When Midway went under, RDU saw increased service from a lot of carriers. UA declared bankruptcy, and FL was soon to announce service to DEN, as was B6 to increase it.

As the majors down-size their hubs, we'll see more such increases in OAL traffic and we'll also find out who's strong enough to survive it.
Those who fail to learn history are doomed to repeat it in summer school.
 
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STT757
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 7:11 am

If/when UAL emerges from bankruptcy they will most likely have a lower cost structure than AA, UAL can then exploit their new lower cost advantage and really put a hurting on AA in ORD.

If AA can remain competitive at ORD then I think they will concentrate there and pull down St.Louis (aka CLE, CVG), however if UAL does come out of Chapter 11 strong and with a lower cost structure than AA might pull down at ORD and concentrate on STL.

Im not saying they would pull out of ORD, but they could definetly suffer a similar problem DL had at DFW.

Long story short it all depends on UAL and ORD, a stronger leaner UAL at ORD would probably take away business from AA and force them to pull down (a little) and focus more on STL.

If UAL is weak or does not come out of bankruptcy then AA is going to drop STL and quickly swoop in to fill the void at ORD.

Just my opinion.
Eastern Air lines flt # 701, EWR-MCO Boeing 757
 
DCA-ROCguy
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 7:14 am

They'll have the ability to move a lot of the extra 73s and 319/32Xs around with the 175s coming onboard this year...and assuming it happens, the eventually dissolving of the PIT hub will just open up the resources all the more. US Airways has always had a thing for STL...they want it, always have...always will.

That's an interesting hypothesis. STL would certainly balance the other two hubs geographically, and give US excellent reach throughout the middle of the country. It's all up to Bronner; if he wants to keep fronting money to keep US going through the next couple of years (US told Reuters earlier this week they dont' expect to be profitable through 2004), he might be willing to buy resources for an STL hub.

If AA pulls out, though, I think the low-fares would move in as TC and Elwood argue. US would have to consider whether they want to run a 10.5-9.9 cent CASM the next couple of years up against WN's 7.5. WN could crank up that separate STL terminal of theirs to 100 flights a day easily without needing terminal expansion.

FlyCMH--What "dozen" low-fare airlines have tried to compete in Cincinnati? In what span of time? None of the well-managed, serious current LCC's--WN, B6, FL--have attempted Cincinnati. One flight to MCO by old mid-90's AirTran doesn't count.

FL and B6 probably wouldn't bother trying, but I'll bet there are enough leisure folks and budget-minded business folks in the Tristate that WN could get a foothold if they really wanted it. It would just be a matter of waiting out Delta's predatory b.s., which Southwest could easily afford to do. But there are much easier pickings out there, so it's unlikely.

Jim
Need a new airline paint scheme? Better call Saul! (Bass that is)
 
PSU.DTW.SCE
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 8:10 am

Lots of rumors, if's, and's, and but's flying around here.....

Fact...for the time being, AA has no intention in pulling out of STL. In fact, there really hasn't been any writing on the wall about this. You would see more downsizing in terms of reduced flights, for RJ's, route cuts. For the most part, this hasn't been done. Now say if AA were to pull out of STL, then what the heck would they do with about 100 MD-80's, 30 757's, and their contracts with American Connection. Many of those aircraft are on long term leases. Some of the 757 leases expire at the end of this year and over the next two years as about half of the former TWA 757's will be leaving the fleet then. However, about 15 or so of the 757's are leased through the end of the decade and will be reconfigured to AA standards. Leases and service contracts with the Connection airlines, not to mention airport leases cannot easily be broken, outside of bankruptcy court. In some ways it is more economical to continue to operate the hub than to pull out.

Also, like Jim has pointed out, US may be out of Ch 11, but they aren't out to conquer the airline world. Same thing goes for UA, everyone is saying how dangerous they'll be, but we've yet to see then make any real plans for trying to get out of Ch. 11. AA is assuming they will be fine, if the TA get ratified by their unions. Fine for a while at least. Regardless of airlines in, out, or on the brink of Ch. 11, they are all still having a revenue problem, even WN will admit that too.
 
Scott4AA
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 8:13 am

When will the remaining 757's and the MD80's be up to AA standards? Has this been put on hold due to their financial situation?
American Airlines - We Know Why You Fly
 
PSU.DTW.SCE
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 8:23 am

TWA LLC 757 Fleet:
11 757's to be returned to lessors between Dec 2003 - August 2004 as leases expire
16 757's will be converted to AA standards beginning in July 2003 at a rate of 2-3 aircraft per month. Leases expire between Jan 2007-Jan 2008.

TWA LLC MD-80 Fleet:
44 MD-80's to be converted by year-end 2003
28 MD-80's to be parked and put in storage until 2005
Remaining 32 MD-80's to be converted by year-end 2004 (approx)

Conversion involves interior cabin configuration, galley configuration, and aviaonics upgrades.
 
flyCMH
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 11:18 am

Jim,

Remember Vanguard? They tried to servce Cincinnati not once, but twice and failed both times. The fact of the matter is, with Delta's continued dominance of the Cincinnati market, it will be extremely hard for a low fare carrier, or any other carrier for that matter, to increase service in CVG. In addition to the low fare carriers, Air Canada has tried and failed to serve CVG twice.

From the Cincinnati Enquirer:

Board members say part of the blame lies with passengers. Board members argue that when they succeed in luring a low-fare carrier, passengers abandon the new airline once Delta and Comair match the competition's low fares.

That's happened at least 10 times in a dozen years, said airport spokesman Ted Bushelman.


Also from the Enquirer:

Vanguard's departure from the Cincinnati/Northern Kentucky International Airport on Thursday will be at least the 13th time a discount carrier has failed to make it here, either because it went out of business or did not attract enough local travelers. The others are:
• New York Air (came and went twice)

• Best

• Florida Express

• Midway Express

• People Express

• Presidential

• Braniff Express

• Mark Air

• Sunair

• Air Tran

• Vanguard (came and went twice)

 
ual777contrail
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 11:34 am

psu.dtw,
UNITED has an 18 month goal, you wouldn't see much yet. AA Will be in bankruptcy by mid April, they can try all they want but they cant avoid it.
2500 pilots jobs aren't going to save the mighty AA.

AA717DRIVER,
you said"their job is to try to recapture some of the business they lost from WN,AIRTRAN,JETBLUE, and fend off song and ualco...Get the picture?"
no I don't get the picture, explain the part about USAIRWAYS having to fend off UALCO, I guess I missed something.

ual 777 contrail
 
AA717driver
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RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 4:42 pm

Ual777--With UAL starting up a LCC, they will have to dive into the fray on the East Coast--or don't bother starting up. That's the new battle ground for the LCC's because SWA still owns the West Coast(claims about Shuttle's profitability notwithstanding).

Please explain how AA will be in bankruptcy by mid-April? Can't avoid it? I think we just did(if I hadn't signed confidentiality agreements, I would go into more detail, sorry). However, if any one of the AA employee groups follows 141 M's lead and turns down their TA, you will be correct.TC
FL450, M.85
 
Guest

RE: Is The End Of AA's STL Hub Close?

Thu Apr 03, 2003 4:59 pm

Ual777contrail,

When a persons discloses that he/she is a UA employee, as you have in previous posts and your profile, that that person – you in this case – represents the UA community in other persons eyes. Personally, I find many of the comments/statements you’ve made to be nothing short of offensive, considering they’ve been written by a UA employee. You’re entitled to your opinion, but you should not be “shooting off your mouth” while representing the UA community (again, which you have been identifying yourself as a UA employee). And, as a frequent business traveler whose company spends hundreds of thousands of dollars each year on transportation, my opinion counts. This isn’t intended to flame you – it’s intended to (hopefully) get you to think twice before you post some outrageous comments (e.g. NW should be bankrupt because we’re so much better than them, AA should be bankrupt as well, etc.).
 
m717
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RE: Is The End Of AA's STL Hub Close?

Fri Apr 04, 2003 1:26 am

IndustrialPate,

Don't forget to add CAL to your list. It seems that Ual777contrail seems intent on reviving and reliving the "Screw CAL" campaign that went on at DEN in the 80s.
 
captcjmac
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RE: Is The End Of AA's STL Hub Close?

Fri Apr 04, 2003 1:45 am

Wouldn't be surprised. There is another article this morning stating that 2,000 more flight attendants will be layed-off in addition to the 2,500 pilots that will be layed-off/furloughed. Of those 2,000 flight attendants, all 1,800 STL based flight attendants are rumored to be layed off. Not looking good.  Sad

Here is the link:
http://www.usatoday.com/travel/today/sky.htm
 
DCA-ROCguy
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RE: Is The End Of AA's STL Hub Close?

Fri Apr 04, 2003 2:24 am

FlyCMH,

No surprise that any of the carriers listed failed at Cincinnati; almost none of them fit the conditions I described. At a medium-size market with a Cartel-network carrier hub, typically only a low-fare carrier with a large connecting network can make it. The only carrier on the list that fits that definition is People Express, and they were at CVG until they were bought in 1987 by CO who is still there today. Back when I was flying from there in the mid '80s, People was still keeping a lid on fares to a lot of places.

Because the business community in Cincinnati is indeed as addicted to DL FF miles as the Jem H'adar are to ketracel white, it would cost WN so much to establish a foothold that they go elsewhere. If folks in Cincy want to perpetuate their own fare oppression, that's up to them, but it's a real loss to many in the Tristate who either drive to Columbus or Dayton, or can't afford to fly. It's not like a WN station of 20 flights or so would actually threaten Delta's hub, either.


Jim
Need a new airline paint scheme? Better call Saul! (Bass that is)
 
twalives
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RE: Is The End Of AA's STL Hub Close?

Fri Apr 04, 2003 2:35 am

I certainly agree with a great deal of what has been said in this post and I do believe that AA's committment to STL is fragile but I think we are a long way away from them moving out of their central midwest hub.

It has been reported time and time again that the STL hub has been one of the largest revenue generators in the company since the acquisition. The fleet running out of STL is simple (only 3 aircraft - md80's, 757, 767), reliable and the passenger loads have been strong.

Although extremely unsatisfying to passengers (main terminal sucks), flights usually run on-time through STL and this will only get better when the new runway opens in 18 months. Plans are also in discussion to build another terminal as well as total rehab of the existing (much needed). For the short term, AA just put up almost 20 million dollars to help freshen up the look and feel of its terminals.

If UAL falls and half of the gates at ORD are suddenly free then I would bet on AA pulling out of STL. But, AA must look long-term and 2, 3 or 5 years down the road when the economy hopefully will be rolling again and landing slots through America will once again be hard to find and a refreshed STL will be a strong asset. In the meantime, I see operations thining (as they already have been) and layoffs to ex-TWA employees (best employees around in my opinion) who have refused to relocate to Chicago or Dallas as requested by AA.
 
TWFirst
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RE: TWALives

Fri Apr 04, 2003 2:41 am

>>For the short term, AA just put up almost 20 million dollars to help freshen up the look and feel of its terminals.<<

I believe it was closer to 13 million, but nothing has been done yet. I'm betting that the project has been postponed indefinitely.

Also, ex-TWA employees weren't allowed to relocate to Chicago or Dallas... they were required to be fenced in at STL. I'm very saddened to hear all the TW FA's will now be furloughed. Many of them have 20+ years of experience, and have extensive international experience.
An unexamined life isn't worth living.
 
twalives
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RE: Is The End Of AA's STL Hub Close?

Fri Apr 04, 2003 3:00 am

TWFirst -

I apologize if my information regarding TWA employees ability to relocate to Chicago or Dallas is incorrect but reports from the Post Dispatch (newspaper in St. Louis) support what I have said. I feel horribly for the ex-TW employees either way...its been a rough ride.

--------------

The entire situation at STL has been unfortunate and probably has as much to do with the airline industry as it does with the lack of political leadership/support for the airport's expansion...but that is a whole different thread.
 
LV
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RE: Is The End Of AA's STL Hub Close?

Fri Apr 04, 2003 3:21 am

My question to you St. Louis area folks....after this latest news (not a surprise as AA has had it in for the TWA folks from the beginning) you think next election Carnahan is still going to claim to be the champion of the AA-TWA deal. I bet whoever her opponent is could bring that up and use it against her, especially if the MCI MX center takes any hits
 
TWFirst
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RE: Twalives

Fri Apr 04, 2003 3:31 am

>>but reports from the Post Dispatch (newspaper in St. Louis) support what I have said.<<

Well, then perhaps that's a recent development... I do know for a fact that initially, all TW FA's were forced to rebase in STL and they could not transfer out to other AA bases (all the NY attendants would loved to have stayed in NY, for example). As the integration of the STL ops has continued over the last year, perhaps AA started taking the fence down... I hadn't heard that, although I do know they had started routing FAs from other bases through STL.
An unexamined life isn't worth living.
 
ScottB
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RE: Is The End Of AA's STL Hub Close?

Fri Apr 04, 2003 3:45 am

I don't see the logic behind US Airways moving into STL if American were to end hub operations there. They'd still face significant low-fare competition from Southwest, which offers 70+ daily depatures, and moreover they'd be starting from an extremely weak customer base (US doesn't even offer mainline service to STL at present). While US Airways' cost structure has improved, its ASM costs are *still* 20-25% higher than Southwest's. And opening a new hub is an extremely expensive proposition -- unwise when the economy is still recovering and travel demand is weak. And what would keep WN from responding to the same opportunity by increasing its presence in STL?

In the event of UAL liquidating, I think we'd see AA taking the opportunity to increase its presence at ORD, but I still don't see them abandoning STL. I do believe they'd take planes out of the desert to increase service at ORD and might downsize STL a bit, but not to the point of ending the STL hub. STL is still a better market than BNA and RDU were.

You don't see WN at CVG because their strategy for the last 10-15 years has been to avoid fortress hubs. They learned important lessons at DEN and SFO (and even STL). Southwest has the financial wherewithal to make a go of CVG and accept losses in the short to medium term, but it makes no sense for them to do so. Why absorb losses for several years when it is so much easier to make money by adding low-fare service to uncompetitive, medium-sized, non-hub markets? And, moreover, Delta has historically had relatively low costs and a strong balance sheet, meaning that they could certainly fight a fare war for a long, long time. Not to mention that terminal facilities at CVG are poor at best unless you're Delta.
 
atcboy73
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RE: Is The End Of AA's STL Hub Close?

Fri Apr 04, 2003 6:36 am

Ya know I just cant see AA totally closing down the hub at STL. At one time the STL (pre 9/11) was one of the largest hubs in the country. It represents a huge amount of capacity right in the middle of the country and a great opportunity for low cost carriers to expand if AA were to close hubbing operations.
 
UN_B732
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RE: Is The End Of AA's STL Hub Close?

Fri Apr 04, 2003 7:40 am

ST. Louis should be like CLE for CO. It should be mostly EGF, but the possiblities for such an area, are just to high to give it up to the low-fares. It's right smack in the middle of the good ol' USA>
-Transaero Boeing 737-200
What now?
 
twalives
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RE: Is The End Of AA's STL Hub Close?

Fri Apr 04, 2003 8:54 am

Total speculation but wouldn't STL make for a great central hopping point for Jet Blue if AA was to hang it up?
 
PSU.DTW.SCE
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RE: Is The End Of AA's STL Hub Close?

Fri Apr 04, 2003 9:56 am

JetBlue at STL for a "hub"?

Not likely anytime soon. They would be spread too thin across their system in terms of aircraft and resouces. They are intent on building up JFK, LGB, and FLL. They aren't at the point where they are looking into creating a focus city in the midwest. Their focus right now is on transcon's and NE-Florida runs. They aren't at the point yet where they are expanding into the Midwest and not ready to start headbutting WN and Airtran, not to mention everyone else too.
 
atpcliff
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RE: Is The End Of AA's STL Hub Close?

Sun Apr 06, 2003 9:09 am

Hi!

AA will have less flights in STL than before, but there are a crapload of Chautauqua, Corporate and Trans States Airlines flights in STL, and they are expanding, replacing mainline flying. Chautauqua flies ERJs, Corporate flies J32 props, and TSA flies ERJs, ATRs, and J41 props.

Cliff
GRB
TRY. It's all you have control over, and it's what God wants.
 
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OzarkD9S
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RE: Is The End Of AA's STL Hub Close?

Sun Apr 06, 2003 10:00 am

It's kind of sad to see STL becoming a backwater hub for AA when at one time STL was a 2 airline hub, OZ and TW. For a brief period it was a 3 airline hub (remember Air1?). For awhile we even had international service from British Caledonian and Mexicana, now just Air Canada RJ's.

However, the long term survival of the industry will involve "right sizing" operations and I think several hubs will be downsized, maybe even disappear altogether, tho I don't think STL will disappear.

The industry was overhubbed for awhile, with multiple airline hubs (DFW, MSP, STL, ATL, ORD as an example). Some of those hubs are now single carrier hubs, while other cities (BNA, DAY, RDU, MCI, BWI as another example) have lost their hubs completely, tho in all those cases except DAY Southwest has stepped in to provide a fairly good coverage.

I think the next 5 years will see a tremendous structual change, with the big hubs getting bigger and the smaller hubs taking on a more regional flvaor within their respective airline's networks. That, with the domestic alliances now forming and the rise of the LCC's, will alter the landscape dramatically.

STL still has 2.5 million-plus population to draw on, so there will always be a decent level of airline operations here.
Coast to Coast and Border to Border, Ozark Flies YOUR Way!