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chrisnh
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Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:08 am

I don't know how to answer that, so I thought I'd ask! I get the sense that 'hub-and-spoke' has declined as an operational model. NW at Memphis; DL at DFW; UA at IAD. But there are thriving hubs out there, too. So I'll put it to experts here: Do you see Hub-and-Spoke as a still-viable operational model for U.S. domestic airlines?
 
HPRamper
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:12 am

Hub and spoke will exist as long as small markets exist. Not everyone feels like driving to a large metropolitan area to fly anywhere.
 
Mir
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:14 am

Quoting HPRamper (Reply 1):
Hub and spoke will exist as long as small markets exist. Not everyone feels like driving to a large metropolitan area to fly anywhere.

 checkmark  Hub and spoke isn't going anywhere anytime soon.

-Mir
7 billion, one nation, imagination...it's a beautiful day
 
PSU.DTW.SCE
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:29 am

The hub and spoke model is far from dead. As said there are many instances where small and medium sized communities cannot justify nonstop service to many destinations. Even large cities could not solely rely on O&D between some smaller communities. The need for national and international connectivity requires the hub & spoke model which is still very much effective today, just as it was years ago.

What has happened though, is that there were too many hubs at one point and with newer, longer range aircraft, some hubs proved to be redundant and that airlines hubs generally didn't work financially on connections alone in low O&D markets.

With the A320 series and 737NG's, airlines how had narrowbody aircraft capable of flying Trans-cons. The RJ's allowed for service into smaller airports with a greater range than prop aircraft.

Of the examples you list, only DL at DFW no longer exists. DL leaving DFW isn't really an example of the hub & spoke model being broken, but more or less DL reallocating resources to their strongholds (ATL) and giving up on a losing battle with AA (and to a lesser extent WN). UA at IAD is doing just fine, as is NW at MEM. Both operate a hub that is scaled appropriately for market and competition.

I think we have passed the time of closing hubs. Right now, across the board, the airlines have appeared to all have rationalized their hub operations by either closing/scaling back/ or consolidating operations at other hubs to provide an adequate level of service.
 
Flighty
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:32 am

Hub and spoke is the most efficient way to run the show. Compared to the WN model, hub/spoke lets you cover the same 50 cities (between each other) with far fewer aircraft and less fuel. Consider that Frontier has only 59 aircraft but they cover 62 cities. Southwest has 500 aircraft and they cover 64 cities. To run constant nonstops between all points, you need zillions of aircraft and lots of fuel.

Clearly, point to point does not work for most city pairs, and never will. But where p2p can work, it is great.
 
FCYTravis
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:35 am

Hub-and-spoke is dead? Someone better let AA @ DFW, UA @ ORD, DL @ ATL, CO @ IAH, NW @ MSP know about that, stat!

Markets such as Elmira/Corning, Fresno, Grand Junction, Rapid City, Shreveport, Boise, Jacksonville and dozens, if not hundreds, more will never be able to support point-to-point service outside limited markets. The modern hub-and-spoke system enables these places to have one-stop connectivity to just about anywhere in the world.

[Edited 2007-06-11 20:37:02]
USAir A321 service now departing for SFO with fuel stops in CAK, COS and RNO. Enjoy your flight.
 
Analog
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:38 am

Quoting Flighty (Reply 4):
Consider that Frontier has only 59 aircraft but they cover 62 cities. Southwest has 500 aircraft and they cover 64 cities. To run constant nonstops between all points, you need zillions of aircraft and lots of fuel.

Not really a fair comparison; but WN carries a lot more pax than F9. I could cover 100 cities with 1 aircraft; I just wouldn't carry very many pax or have frequent service.

Assuming similar aircraft and load factors, hub and spoke uses more fuel, as pax need to fly greater distances and have an extra cycle (which takes a fair amount of fuel). OTOH nonstops only work where the demand is sufficient, otherwise the comparison becomes somewhat moot.
 
Flighty
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:49 am

Quoting Analog (Reply 6):
Not really a fair comparison; but WN carries a lot more pax than F9. I could cover 100 cities with 1 aircraft; I just wouldn't carry very many pax or have frequent service.

That is true. Haha.

Quoting Analog (Reply 6):
OTOH nonstops only work where the demand is sufficient, otherwise the comparison becomes somewhat moot.

Right, and it's usually not sufficient. So the 2 models really feed on different customers. Each model is best in its own niche. For most journeys, point-to-point is not possible since the model is impractical for things like BTV-SJC. But for things like JFK-MCO, clearly p2p is the most efficient way to go. So it depends on the market. The 2 models do not compete per se nearly as much as the press would have us believe.
 
baron95
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:53 am

Hub and spoke will be alive and well for a long time. But we will also see a number of new point-to-point routes develop.

It amazes me that people think that it is one or the other. As most things in life, it is a bit of both. Airlines with strong hubs (AA, DL, BA) will be in a great position to opend point-to-point destinations. They go hand in hand.
Killer Fleet: E190, 737-900ER, 777-300ER
 
DLPMMM
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:55 am

Hub and spoke is not dead.

The biggest change is that the spokes are getting longer. The need to change planes twice in a trip is becoming more and more rare, even on intercontinental trips.

Southwest's route structure is more like a bunch of minihubs (or nodes). There are alot of people who connect in a lot of wierd places (and often multiple times) on WN to get where they are going.
 
EXAAUADL
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:55 am

No, but the US is/was clearly overhubbed..

Remember hubs in:

GSO-CO
DAY-PI/US
IND-US
MCI-US/BN/EA
SYR-PI
RNO-QQ
SJC-AA/QQ/AA
CMH-HP


Some would agrue that MEM, CLE, PIT, CVG should go away.

Hubs are necvessary or else how will someone get to EUG from BGR? In the old dthere was extnsive interlining ays, there werent "hubs" per se, but there was extenive interlining (Changing from OZ to UA in ORD or NC to NW in MSP is still a hub isnt it?) and some of the local service carrires received a subsidy.
 
dnl65
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 3:58 am

What makes any of you think that WN doesn't hub? They are less dependant than say AA or AU but they still hub. Ever try to go up the east coast on WN? there is a really high probabilituy you will get the chance tho visit either BWI or PHL and change planes. How about east west? Welcome to Midway. The whole idea of WN's point to point model is that it doesn't really exist.
 
swissy
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 4:01 am

It never will...........

If global traffic will increase based on some predictions more airports (world wide) will have slot restrictions, I would say
"The Hub" will be re defined.

Cheers,
 
Poitin
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 4:14 am

Quoting Flighty (Reply 4):
Hub and spoke is the most efficient way to run the show.

Only if there is not enough traffic to warrant point-to-point. There are many markets were it will be more efficient to fly a regional jet with twenty or thirty people to a larger airport and forward them on. However, the number of "hubs" will increase as more and more secondary airports start to develop city pairs. Thus you might see Manchester UK and Manchester NH have direct service instead of flying MHT-BOS-LHR-MAN.

The hubs will become smaller and smaller and more and more numerous to the point they will look like point to point, but still have have little airplanes coming in from somewhere else so people can catch the plane.
Now so, have ye time fer a pint?
 
flytuitravel
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 4:16 am

Can someone please tell me what the hell "Hub-and-Spoke" is ?!


FLYTUITRAVEL.
 
baron95
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 4:24 am

Quoting Poitin (Reply 13):
There are many markets were it will be more efficient to fly a regional jet with twenty or thirty people to a larger airport and forward them on. However, the number of "hubs" will increase as more and more secondary airports start to develop city pairs. Thus you might see Manchester UK and Manchester NH have direct service instead of flying MHT-BOS-LHR-MAN.

Particularly when smaller supper efficinet aircraft like 787s and the 757-200 replacement (probably a 737RS-800LR) start flying around the pond. 20 years ago, the choices to cross the pond were 747-200/300 and DC-10s. Now we also have 777s, 767s, a330s and even the odd 757-200. Soon there will be scores of 787s, A350s, 737RS and A320RS flying the pond. Combine that with open skies and what Poitin mentioned will become more and more common.
Killer Fleet: E190, 737-900ER, 777-300ER
 
baron95
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 4:27 am

Quoting FlyTUITravel (Reply 14):
Can someone please tell me what the hell "Hub-and-Spoke" is ?!

Think of a bycicle wheel. If you want to fly from one end of the wheel to the other side you have two options:

1 - Go directly around the perimiter of the wheel.
2 - Take a spoke to the center (hub) and onother spoke out.

The advantage of the hub and spoke is that the flights around the spokes can be shared by passangers going to many other destinations. However 2 flights instead of one would be required.
Killer Fleet: E190, 737-900ER, 777-300ER
 
FCYTravis
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 4:28 am

Quoting Poitin (Reply 13):
Thus you might see Manchester UK and Manchester NH have direct service instead of flying MHT-BOS-LHR-MAN.

There's no flights from MHT-BOS  Smile

I doubt you'll ever see service like MHT-MAN. That's way too thin of an O&D market to serve. There's already one-stop service over several hubs, including PHL.
USAir A321 service now departing for SFO with fuel stops in CAK, COS and RNO. Enjoy your flight.
 
rwsea
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 4:28 am

I think what we're seeing is that in today's environment, hub and spoke definitely has a place, but airlines are figuring out that O&D traffic is an important part of the equation.

For instance, take the case of DL. In the 1990s, CVG was one of the most profitable hubs out there. But after 9/11, things changed - the availability of non-stop service has increased with new LCCs, and people no longer have to connect. Airlines are realizing that they can't continue to operate mega-hubs in small cities with little O&D profitably. That's why, in DL's example, SLC and CVG will always have a place, but at the same time there has been lots of expansion in places like LAX and JFK which offer much more O&D business.

And of course, airlines seem to have preferences. UA and CO have almost no non-hub routes, while DL, AA, and US all have multiple focus cities and non-hub routes. NW is somewhere in the middle. B6 has many focus cities, same with WN. F9 is almost entirely based in DEN. AS has a large hub, a few smaller hubs, and a good amount of P2P.

Hub and spoke will always be important, but I think the airlines will add more P2P if they see increased yields.
 
Poitin
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 4:38 am

Quoting FlyTUITravel (Reply 14):
Can someone please tell me what the hell "Hub-and-Spoke" is ?!

In my example, BOS and LHR are the hubs on the spoke of the wheel branching out to smaller airport. Thus MHT-BOS would be a spoke. BOS and LHR are hub to hub, and LHR to MAN is a second spoke. On the other hand, MHT to MAN is called point to point.

Quoting Baron95 (Reply 15):

Particularly when smaller supper efficinet aircraft like 787s and the 757-200 replacement (probably a 737RS-800LR) start flying around the pond. 20 years ago, the choices to cross the pond were 747-200/300 and DC-10s. Now we also have 777s, 767s, a330s and even the odd 757-200. Soon there will be scores of 787s, A350s, 737RS and A320RS flying the pond. Combine that with open skies and what Poitin mentioned will become more and more common.

Absolutely. And it will be the new Long Haul LCCs doing it.

Quoting FCYTravis (Reply 17):
Quoting Poitin (Reply 13):
Thus you might see Manchester UK and Manchester NH have direct service instead of flying MHT-BOS-LHR-MAN.

There's no flights from MHT-BOS Smile

I doubt you'll ever see service like MHT-MAN. That's way too thin of an O&D market to serve. There's already one-stop service over several hubs, including PHL.

Never say never, particularly with people like Micheal O'Leary working the issue. You are right about no MHT-BOS at this time, but that is more the exception. This is where I can get from MHT.

http://www.flymanchester.com/flightinfo/
Now so, have ye time fer a pint?
 
Flighty
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 4:40 am

Quoting RwSEA (Reply 18):
I think what we're seeing is that in today's environment, hub and spoke definitely has a place, but airlines are figuring out that O&D traffic is an important part of the equation.

That is a great point. Really good hubs with O&D can outcompete connect-only hubs. Those "connect" hubs are the particular species that ended up dying.

The really big hubs are fine because guess what, they are a p2p network first and a connect hub second. The stronger your local O&D, the cheaper you can offer connects, and you kill the weak hubs of your enemies that way.
 
Poitin
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 4:54 am

Quoting Flighty (Reply 20):
The stronger your local O&D, the cheaper you can offer connects, and you kill the weak hubs of your enemies that way.

That is an excellent point. O&D is an important issue, and I think you will see more and more P2P as cheaper, smaller and efficient aircraft become available as Baron95 points out. Will BOS and JFK continue to be hubs? Yes, but to a lower level. They will never go away completely, but there will be some point that the local O&D traffic makes up the bulk of the overall traffic as other P2P city pairs take up part of the current hub traffic.
Now so, have ye time fer a pint?
 
Boeing7E7
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 5:00 am

Quoting ChrisNH (Thread starter):
I don't know how to answer that, so I thought I'd ask! I get the sense that 'hub-and-spoke' has declined as an operational model. NW at Memphis; DL at DFW; UA at IAD. But there are thriving hubs out there, too. So I'll put it to experts here: Do you see Hub-and-Spoke as a still-viable operational model for U.S. domestic airlines?

If it were the entire air transportation system would implode.

[Edited 2007-06-11 22:01:01]
 
FCYTravis
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 5:08 am

Quoting Poitin (Reply 21):
Will BOS and JFK continue to be hubs?

BOS is not a hub for any airline - it's a focus city for AA, DL and US, though.
USAir A321 service now departing for SFO with fuel stops in CAK, COS and RNO. Enjoy your flight.
 
FCYTravis
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 5:12 am

Quoting Flighty (Reply 20):
The really big hubs are fine because guess what, they are a p2p network first and a connect hub second. The stronger your local O&D, the cheaper you can offer connects, and you kill the weak hubs of your enemies that way.

There are a few exceptions, and those are generally dictated by geography. CLT is not an O&D powerhouse, for example, but it's the best location for a Southeastern hub other than ATL, so US has been able to retain and even build their services there by providing a competitive counterbalance to Delta and outcompeting MEM's even worse O&D and less-central location.
USAir A321 service now departing for SFO with fuel stops in CAK, COS and RNO. Enjoy your flight.
 
CitrusCritter
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 5:19 am

Quoting RwSEA (Reply 18):
And of course, airlines seem to have preferences. UA and CO have almost no non-hub routes, while DL, AA, and US all have multiple focus cities and non-hub routes. NW is somewhere in the middle. B6 has many focus cities, same with WN. F9 is almost entirely based in DEN. AS has a large hub, a few smaller hubs, and a good amount of P2P.

FL is right in the middle somewhere as well. ATL is huge, but they are developing a lot of P2Ps, especially to the Florida focus cities, as well as the odd P2P route like MSP-MDW or PHF-LGA.
 
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chrisnh
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 5:28 am

Quoting Poitin (Reply 13):
Thus you might see Manchester UK and Manchester NH have direct service instead of flying MHT-BOS-LHR-MAN.

As a rather selfish hope, that would be cool. Not to mention a small bit of marketing cache by being the first-ever Manchester-Manchester nonstop. Open skies, eventually (read: e-v-e-n-t-u-a-l-l-y) might make this a worthwhile route...especially for a European discount carrier that sees 'Boston' like Southwest Airlines sees Boston (i.e. MHT/PVD).

Chris in NH
 
Kevin777
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 5:32 am

Quoting Flighty (Reply 4):
Hub and spoke is the most efficient way to run the show. Compared to the WN model, hub/spoke lets you cover the same 50 cities (between each other) with far fewer aircraft and less fuel

Indeed,

Quoting Dnl65 (Reply 11):
What makes any of you think that WN doesn't hub? They are less dependant than say AA or AU but they still hub.

WN makes the best of two worlds IMO - the bread and butter is point-to-point, but no reason not to take on connecting pax too if people want to do so. I think FR and U2 could learn a lesson here; for instance, FR serves an incredible amount of small regions all over Europe from STN, and offering connections could appear lucrative IMO, as you'd still have a monopoly on onestop-connections. I know about costs of connecting, liabilities of through ticketing etc., but still - could be viable in many instances I reckon.

Quoting EXAAUADL (Reply 10):
No, but the US is/was clearly overhubbed..

Indeed, and so was/is Europe. In Scandinavia, it also weems that we have been over-hubbed here at CPH. After the split up of SAS, much more nonstop from Scandinavia to Europe has started, and it's doing fine - CPH's transfer traffic has declined 35 % in recent years because of this. Clearly, there was way too much hubbing at CPH instead of flying people nonstop where a route could actually justify nonstop service.

Hub and spoke will live, and so will point-to-point - for an airline it's in general not a question of which, but both.

Regards,

Kevin777  Smile
"I was waiting for you at DFW, but you must have been in LUV" CPH-HAM-CPH CR9
 
flynavy
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 5:37 am

I've seen folks connect thru PHF on FL, ususally heading south after arriving from BOS and/or LGA. It's definitely a cash cow for them, and a very convenient airport to fly in and out of.
Change is: one airline, six continents!
 
ptugarin
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 5:40 am

I think the trend is to eliminate multi-hub operations with overlapping markets; The airlines have figured that having overblown hub operations in geographic proximity of each other is an overkill.
 
COSPN
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 5:48 am

People just need to uderstand the United states and how growth happens....

Mr/Ms. Businesspoerson needs to grow their business......therefore requres travel to the "Big Places" to secure capitol sell their stuff ect so the need to get from "Smallville USA" to New York City, Dallas, Boston, LA ECT..and return.no ptp will ever serve every market required.. the Hub system works to grow America
 
luvfa
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 7:02 am

WN is a p2p model for the most part but does do some hubbing through BWI, PHL, MDW, MCO, TPA, MCI, STL, DAL, HOU, BNA, PHX, LAS, LAX, OAK. However we have many p2p routes that don't involve those focus cities, JAX-IND, ISP-PBI, BOI-GEG etc WN ican best be described as a p2p with focus cities.
 
InnocuousFox
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 7:28 am

Do we have to discuss this every single month?
Dave Mark - Intrinsic Algorithm - Reducing the world to mathematical equations!
 
InnocuousFox
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 7:32 am

What IS the function of a hub and star system? To be able to connect passengers from across your entire network specifically so you don't have to run a ton of point to point flights to accomodate every possible O&D combination.

THAT is why the H&S system logistically CANNOT die. If you serve 200 cities, you would have 40000 potential city pairs. Serve 300 cities and you now have 90000 city pairs! Not cool. Even at one flight per day, that is impossible to deal with. So now, you have to arrange for people to connect to another flight someplace. And, in order to avoid pissing people off, you have to do so in such a way that they don't wait hours... or even overnight... between those flights. As you can see, the logical progression here is to start scheduling flights so that they arrive and depart in waves to simplify those connections. The more connections you have in a group, the more exponential the potential service you are providing.

For each destination you add to a hub (and bank) that already serves n, you are now connecting that new city to those n destination... both directions. (n cities get a new potential destination). As you can see, the mathematics are exponential.

If you truly beleive in the premise that people (unlike US) want to get to their desination in the shortest time with the least number of connections, then the ONLY solution is a H&S system. In a single-hub arrangement, for any non-hub city to a non-hub city, you can guarantee that they get there in 2 hops.

For a multiple-hub arrangement where each hub supports different cities (with possible overlap for larger cities) and where the hubs are connected, for travel from any non-hub city to a non-hub city, you can guarantee that the maximum number of flights is 3. (Origin->Hub->Hub->Desination)

Additionally, with a banked hub, you can arrange it so that connection times are a reasonable amount for ALL connections. (Banked hubs have their own issues surrounding use of resources, however. Rolling hubs can be done better).

Of course, as the number dictate, a H&S system can, and should, be augmented by direct traffic between city pairs that warrant it by their demand numbers. For example, if you have 4 full planeloads of people a day who are specifically going between A and B, why not run 4 planes between them directly (bypassing hub H). There's no need to make them change planes or tie up resources at H. After all, chances are you have flights from H to A and B anyway that will serve the flow from the rest of your network.

So, the answer is that the H&S system will be intact forever. It is the only logical way to move people in the most efficient way.
Dave Mark - Intrinsic Algorithm - Reducing the world to mathematical equations!
 
XT6Wagon
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 7:40 am

International is going to Spoke -> hub -> international desitnation instead of spoke ->hub ->international flight -> hub -spoke


Domestic will IMO disolve down to hubs for international airlines, with small "mini" hubs if needed regionaly outside of the international hub area. Domestic only or limited international Airlines will more and more move to the WN flight system where small hubs exist everywhere, but direct flights between any two points is also common. This way WN has high frequency, AND high utilization of Aircraft all while seriving as many destinations as possible with as few planes as possible.

It essence you can arrive at many destinations in WN's network that is moderately far by 3 or 4 routings that all make sense. Maybe a morning direct flight, one that stops in one city, another that stops in a 3rd, etc.

It might seem strange to do it that way from a complexity standpoint, but its very positive for customer satisfaction compared to the major hubs. PDX => ABQ for example. I can fly to PHX or DEN, then get a CRJ to finish the flight. Or I can catch WN's early 737 direct. Want to leave later? well I have IIRC 4 other options most days with WN, compared with maybe 2 other time slots total for the other airlines by the time it comes down to it.

Now if WN would start serving more exotic locales like SNB I'd be set.
 
Lexy
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 9:56 am

Quoting Flighty (Reply 4):
Consider that Frontier has only 59 aircraft but they cover 62 cities. Southwest has 500 aircraft and they cover 64 cities.

But WN's frequencies to those cities eat F9's lunch on a daily basis. WN is about frequency, not numbers of destinations.
Nashville, Tennessee KBNA
 
cloudboy
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 10:20 am

Right now it's kind of a chaos situation - really, really conventional thinking says that hubs are good, the "new" conventional thinking (a.k.a the LLC lines) say that hubs are bad and people want direct flights. But new, new thinking is that a well planned hub and spoke system, not overdone, actually can increase profits by making fewer flights reach more destinations. Of course, right now all the airlines are pursuing different strategies. But I think that in the long run, you will find a flip flop. The low cost carriers, where price is more important than time, are going to turn to a hub and spoke system, and bring prices down further. The more traditional airlines, focusing more on service, will start to do more point to point, because they can charge more for a shorter flight. In the really long picture, I might even think that you will find the legacies flying more and more smaller jets, while the LLCs switch to larger jets at less frequent departures.
"Six becoming three doesn't create more Americans that want to fly." -Adam Pilarski
 
itsnotfinals
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 10:36 am

Quoting Lexy (Reply 35):
But WN's frequencies to those cities eat F9's lunch on a daily basis. WN is about frequency, not numbers of destinations.

F9 has 59 aircraft

http://www.frontierairlines.com/fron...o-we-are/company-info/our-fleet.do

WN has 490 aircraft

"Southwest currently operates 490 Boeing 737 jets (as of April 19, 2007)."


F9 serves cities 47 Cities (Mainline)

http://www.frontierairlines.com/frontier/who-we-are/cities-served.do

WN serves cities 63 cities

http://www.southwest.com/about_swa/press/factsheet.html#cities


Hub and spoke allows F9 to do more with less than WN's P2P /Quasi P2P. This is a good example.

F9 has some P2P to Mexico but not a large percentage.
Speedbird 178 Heavy, FINAL runway 27L
 
rampart
Posts: 1798
Joined: Sun Aug 07, 2005 5:58 am

RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 11:15 am

Quoting FCYTravis (Reply 5):
Markets such as Elmira/Corning, Fresno, Grand Junction, Rapid City, Shreveport, Boise, Jacksonville and dozens, if not hundreds, more will never be able to support point-to-point service outside limited markets. The modern hub-and-spoke system enables these places to have one-stop connectivity to just about anywhere in the world.

However, I would argue that hub-like systems existed in the 60s and 70s already so that cities like these could be served by "trunk lines". Delta was the best example, Braniff a good second example. Small cities with several airlines were effectively connected in much the same way that they are today, except with more stops.

Take CO in the mid 70s. (refer to Departed Flights archive of route maps http://www.departedflights.com/CO043078.html). Lots of p2p, seemingly - they resembled a local service carrier in many respects. On the referenced map, many of those routes don't actually exist, they are showing 1-stop service. But most of the remainder are connecting to the several key cities where passengers could transfer. For instance, COS to DEN, ORD, and LAX. ICT to DEN (hub) and TUL (milkrun). TUL to DEN, IAH (hubs) and ICT, MCI, and OKC (milkruns). As a kid in COS, I always felt gypped! Really, my choices (as if I flew more than once every 5 years) were essentially DEN (couple dozen flights a day on BN, CO, Frontier, TW, and RMA), and single shots to DFW, ORD, or LAX. Maybe Liberal on the way to OKC.

Western is another example (http://www.departedflights.com/WA090673.html ) in 1973, already established in LAX, SLC, and DEN. UA in 1973 had large establishments in DEN, LAX, SFO, ORD and IAD connecting smaller cities like Lincoln, Grand Junction, Fresno, and Richmond.

Of course, the Local Service airlines like Piedmont, North Central, Texas International and particularly Frontier and Ozark were simply built around "fortress hubs" connected by many-pointed milk-run spokes.

I think that pre-Derugulation p2p is largely misclassified. The p2p that existed were not so much p2p as they were stops on the way to a connecting hub. Since airlines had not consolidated into 2 or 3 connecting hubs per airline, minimal frequency in several directions accounted for the nonstop choices. The exception are the Local Service airlines, where many spokes existed on a true hub, but low passenger counts could not justify more than a few flights at most on each spoke.

I'll stop now before I ramble further.

-Rampart
 
FreequentFlier
Posts: 638
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 1:27 pm

Quoting ChrisNH (Thread starter):
I get the sense that 'hub-and-spoke' has declined as an operational model. NW at Memphis; DL at DFW; UA at IAD. But there are thriving hubs out there, too. So I'll put it to experts here: Do you see Hub-and-Spoke as a still-viable operational model for U.S. domestic airlines?

Huh? Granted, DL dehubbed DFW, but only because it lost out to AA's larger DFW hub. Meanwhile, MEM is not huge by any means but I've seen no indication from NW whatsoever of a move to eliminate MEM as a hub. Likewise, UA at IAD seems like an even worse example as UA has added numerous international flights to it in the past year alone.

Hub and spoke is not going to die anytime soon, in fact it will never die. There may be increased point to point service, but as long as people want to get from FSD to GSO, they're going to be needing a hub and spoke system to get them there.
 
access-air
Posts: 1576
Joined: Thu Sep 21, 2000 5:30 pm

RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 5:27 pm

Quoting HPRamper (Reply 1):
Hub and spoke will exist as long as small markets exist. Not everyone feels like driving to a large metropolitan area to fly anywhere.

Actually I thinks that it is becoming passe, not everyone in a small town is fond of having to funnel into a major hub to get where they are going....but airlines are too entrenched in major hubbs to revamp and go back to being more linear. I'm afraid that we are stuck with the Hub and Spoke system.
For some airlines it works and others it doesnt....

The only hub operationms that I can say that I truly miss booking people thru are Reno and St. Louis (pre-AA massive downsize). Funny that both hubs have suffered at the hands of the same carrier...

Oh well, all we can do is sut back and watch as it all unfolds....

Access-Air
Remember, Wherever you go, there you are!!!!
 
InnocuousFox
Posts: 2556
Joined: Sat Dec 06, 2003 1:30 am

RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 10:05 pm

Quoting Access-Air (Reply 40):
not everyone in a small town is fond of having to funnel into a major hub to get where they are going...

That's tough. Enid, OK is not going to see direct service to Pocatello, ID. It's mathematically impossible to NOT funnel small town traffic through hubs. Get over it, people.
Dave Mark - Intrinsic Algorithm - Reducing the world to mathematical equations!
 
DiscoverCSG
Posts: 544
Joined: Wed Jan 31, 2007 2:22 am

RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 10:46 pm

Well, when I fly out of ATL Thursday morning, I'll check to see if there's any hint of a DL hub left there.
 
itsnotfinals
Posts: 1573
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RE: Is 'Hub-and-Spoke' Dead?

Tue Jun 12, 2007 10:48 pm

Especially now that CRJ's (<50 seats) are seen as the expensive non productive mistake of the last 5 years by most analyists.

Also, as air travel has recovered, large hubs are becoming quite suggested. The majors are going to seriously have to think about cutting their regional flying and add capacity with mainline aircraft at places like ORD in the near future.
Speedbird 178 Heavy, FINAL runway 27L
 
DAYflyer
Posts: 3546
Joined: Wed Sep 08, 2004 9:35 pm

RE: Is 'Hub-and-Spoke' Dead?

Wed Jun 13, 2007 12:15 am

Quoting PSU.DTW.SCE (Reply 3):
The hub and spoke model is far from dead. As said there are many instances where small and medium sized communities cannot justify nonstop service to many destinations. Even large cities could not solely rely on O&D between some smaller communities. The need for national and international connectivity requires the hub & spoke model which is still very much effective today, just as it was years ago.

I think this sums it up rather well. Places like DAY do not have enough O & D traffic to justfiy a hub or many non-stop services. As a result the airlines who desire to serve this market fly into hubs where connecting flights are offered. It is really the only economical way to make air service here viable.
One Nation Under God
 
Flighty
Posts: 7860
Joined: Thu Apr 05, 2007 3:07 am

RE: Is 'Hub-and-Spoke' Dead?

Wed Jun 13, 2007 12:57 am

Quoting Access-Air (Reply 40):

Actually I thinks that it is becoming passe, not everyone in a small town is fond of having to funnel into a major hub to get where they are going....but airlines are too entrenched in major hubbs to revamp and go back to being more linear. I'm afraid that we are stuck with the Hub and Spoke system.

No. Airlines are not entrenched. They do exactly whatever the best thing is, since they can easily launch a million nonstops IF it will make more money. The problem is, Des Moines - Seattle would not make money. Therefore the hub-spoke model wins that citypair.
 
RJNUT
Posts: 1187
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RE: Is 'Hub-and-Spoke' Dead?

Wed Jun 13, 2007 1:20 am

Airlines do not do exactly what the best thing is!!! never have , never will..!!
 
Flighty
Posts: 7860
Joined: Thu Apr 05, 2007 3:07 am

RE: Is 'Hub-and-Spoke' Dead?

Wed Jun 13, 2007 1:45 am

Quoting RJNUT (Reply 46):
Airlines do not do exactly what the best thing is!!! never have , never will..!!

They do lots of forecasts all the time. Sometimes they're right, sometimes wrong. But they do what they _think_ is right. If they see a new nonstop that would make money (in North America), it costs very little to launch it. There is lots of freedom to get everything perfect (according to your forecast, not reality).

At the very least, if a p2p market exists, AirTran Airways will find a way to fly it. There is not a massive untapped demand for nonstops. The low hanging fruit is gone.
 
ckfred
Posts: 4762
Joined: Wed Apr 25, 2001 12:50 pm

RE: Is 'Hub-and-Spoke' Dead?

Wed Jun 13, 2007 3:43 am

At one point, AA had too many hubs. It created RDU to funnel traffic from the Northeast, upper Midwest, and West into Florida, while BNA was supposed to funnel traffic into the Southeast.

There were four problems with these hubs. First, AA bought EA's MIA hub and started funneling traffic into Florida through that hub. That made RDU unnecessary.

Second, BNA also had flights to Florida, and RDU served a number of cities in the Southeast. So, those two hubs overlapped.

Third, there were a number of hubs in existance before AA started RDU and BNA, so AA had trouble gaining market share. DL had ATL, and loyal DL customers were also willing to go through CVG. Southern/Republic/NW had MEM. Piedmont/US had CLT and BWI.

Fourth, the Raleigh/Durham/Chapel Hill metro area and the Nashville metro area simply could not generate enough O&D traffic. Even though hubs are created to connect people, they still need O&D traffic to make them profitable. The metro areas that RDU and BNA served were much smaller than the Miami metro area, Chicagoland, and the Metroplex, and they had far fewer Fortune 500 companies and other employers that generate business traffic.

For AA, SJC was also a problem, because UA had a bigger operation at SFO, and WN started running all of the legacies out of the north-south routes on the West Coast. SJC II ran into trouble when the tech sector went south, causing a major decline in O&D traffic.

So, the hub-and-spoke system is a great system, provided that any given airline has the right number of hubs, that they are sized correctly, and the surrounding metro area generates enough O&D traffic.
 
PGNCS
Posts: 2249
Joined: Sun Apr 15, 2007 5:07 am

RE: Is 'Hub-and-Spoke' Dead?

Wed Jun 13, 2007 6:06 am

Quoting ChrisNH (Thread starter):
I don't know how to answer that, so I thought I'd ask! I get the sense that 'hub-and-spoke' has declined as an operational model. NW at Memphis; DL at DFW; UA at IAD. But there are thriving hubs out there, too. So I'll put it to experts here: Do you see Hub-and-Spoke as a still-viable operational model for U.S. domestic airlines?

Just because certain hubs are not doing well (or die) doesn't mean the model is dead. Hub and spoke will be dead as soon as there are three roundtrips a day from Boise to Savannah and all other comparable markets.

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