scotron11
Posts: 1181
Joined: Tue Feb 10, 2004 4:54 pm

Airlines Under Seige

Tue Mar 30, 2004 4:47 pm

An article in this weeks Economist magazine lists the top ten airlines in market capitalization as follows:

WN
SQ
CX
JL
LH
BA
AN
QF
Ryanair (Sorry, dont know their code)
AF

On passengers flown, however, it completely changes:

AA
UA
DL
NW
JL
BA
AF
LH
WN
QF

Interesting to see WN make both lists. Article states the case that over the long term, airlines should concentrate on O&D traffic rather that connexions thru so-called hubs as connexion traffic requires much more manpower and is a lot less productive. for groundcrew and equipment alike, than straight point-to-point. A recent study by Booz Allen observed that O&D traffic is 1.6 to 2 times more profitable that connexion traffic.
 
FRA2DTW
Posts: 236
Joined: Wed Feb 11, 2004 6:51 am

RE: Airlines Under Seige

Wed Mar 31, 2004 12:17 am

I think that's why you are seeing an explosion of regional jets to serve point-to-point traffic where loads don't justify large planes. The question then becomes, what will become of the hubs? If you keep diverting passengers away from them, at what point do they become unprofitable to operate? They do require a certain economy of scale to justify the employees, infrastructure, large planes, etc.