rafflesking
Posts: 124
Joined: Thu Mar 15, 2007 10:08 am

Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 1:43 am

This question stems from the thread DL to Announce Latest International Expansion This Week' , where a few fellow a.netters speculated which US Gateways will get some of the 3 LHR slots DL purchased.

What are the benefits of a US carrier operating at both airports? I read lots that LHR is the more desirable airport and can attract more premium traffic, but with a fragmented operation, DL incurs the cost of overlapping personnel, furnishing, and probably a Crown Room and/or arrivals lounge.

I took a quick sample of advanced purchase coach and business fares from BWI and PHL to LHR and LGW, and they're relatively similiar. Assuming loads are the same, I suppose the revenue upside must be with JFK and other markets.

One viable theory is the business traveler FF that prefers LHR would be more inclined to migrate to DL and its growing international route network.

Sidenote, but I'm sure an occasional traveler will show up at the wrong airport  

[Edited 2007-09-24 18:44:02]
 
MAH4546
Posts: 24723
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RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 1:45 am

There will still be a market from Gatwick to the US, and with reduced service by other carriers, it can be even more profitable than it is today. American Airlines also plans to remain at Gatwick.
a.
 
LAXdude1023
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Joined: Thu Sep 07, 2006 3:16 pm

RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 1:57 am

Quoting MAH4546 (Reply 1):
There will still be a market from Gatwick to the US, and with reduced service by other carriers, it can be even more profitable than it is today. American Airlines also plans to remain at Gatwick.

Ive wondered something. Why doesnt AA switch both frequencies from DFW to LHR and put the LGW frequency at ORD? ORD-LON market is a lot bigger than DFW and instead of serveing both LON airports from DFW, why dont serve them from ORD?

ORD currently doesnt have LGW service.
It is what it is...
 
Cubsrule
Posts: 11644
Joined: Sat May 15, 2004 12:13 pm

RE: Benefits Of DL Operating Flights To LHR And LG

Tue Sep 25, 2007 2:36 am

Quoting LAXdude1023 (Reply 2):

Ive wondered something. Why doesnt AA switch both frequencies from DFW to LHR and put the LGW frequency at ORD? ORD-LON market is a lot bigger than DFW and instead of serveing both LON airports from DFW, why dont serve them from ORD?

ORD-LGW will be a MUCH stronger possibility if AA and BA get ATI, as the two would have a ridiculous frequency advantage on ORD-LHR even if AA ran a flight to LGW. The departure schedule to LHR looks like this now:

AA 90 0910
BA 294 1640
AA 56 1700
BA 296 1740
AA 66 1800
AA 46 2015
BA 298 2015
AA 98 2150

[Edited 2007-09-24 19:54:53]
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cloudyapple
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RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 2:45 am

So is it worthwhile for BA to fly to both JFK and Newark? Of course. The catchment areas are different so are the demographics of the passengers.
A310/A319/20/21/A332/3/A343/6/A388/B732/5/7/8/B742/S/4/B752/B763/B772/3/W/E145/J41/MD11/83/90
 
rafflesking
Posts: 124
Joined: Thu Mar 15, 2007 10:08 am

RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 2:52 am

Quoting Cloudyapple (Reply 4):
So is it worthwhile for BA to fly to both JFK and Newark? Of course. The catchment areas are different so are the demographics of the passengers.

Different scenario - those passengers use LHR for connection opportunities whereas most passengers' destination will be London on DL.

But why is LHR so much more desirable than LGW that it justifies operating to two stations? I see the incremental cost, but I don't see the incremental revenue (I'm only assuming a shift of flights from LGW to LHR, not increased frequency).
 
bobnwa
Posts: 4485
Joined: Fri Dec 22, 2000 12:10 am

RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 2:57 am

Quoting RafflesKing (Thread starter):
This question stems from the thread DL to Announce Latest International Expansion This Week' , where a few fellow a.netters speculated which US Gateways will get some of the 3 LHR slots DL purchased.

Please give the details of the 3 LHR slots that DL has purchased. From who, how much, when etc.?
 
panamair
Posts: 3774
Joined: Fri Oct 12, 2001 2:24 am

RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 2:58 am

Part of the reason comes down to practicality. DL won't be able to get enough slots (at least at desirable times anyway) to move all of their London operations to LHR initially even if they wanted to.
 
rafflesking
Posts: 124
Joined: Thu Mar 15, 2007 10:08 am

RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 3:10 am

Quoting Bobnwa (Reply 6):
Please give the details of the 3 LHR slots that DL has purchased. From who, how much, when etc.?

Air France/KLM, how much was not released, in April or May

I think the deal also said that AF/KL codes would be placed on the flights.
 
bobnwa
Posts: 4485
Joined: Fri Dec 22, 2000 12:10 am

RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 5:39 am

Quoting RafflesKing (Reply 8):
Air France/KLM, how much was not released, in April or May

I think the deal also said that AF/KL codes would be placed on the flights.

Neither Delta or AF/KLM have announced any such slot sale.
 
nickofatlanta
Posts: 1272
Joined: Tue May 23, 2000 1:06 am

RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 6:37 am

Anyone think they may announce LHR on Tuesday?
 
ConcordeBoy
Posts: 16852
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RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 7:49 am

Quoting Cubsrule (Reply 3):
ORD-LGW will be a MUCH stronger possibility if AA and BA get ATI, as the two would have a ridiculous frequency advantage on ORD-LHR even if AA ran a flight to LGW.

One may not lead to another... remember, intercon carriers are often not allowed to invoke ATI on hub2hub routings.

However, with the amount of non-OneHeathroWorld competition on ORD-LHR, AA/BA may be allowed (some) collusion after all.
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deltal1011man
Posts: 4752
Joined: Mon Sep 19, 2005 9:17 am

RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 9:50 am

http://business.timesonline.co.uk/to...ctors/transport/article1654231.ece
there is a link and yes 3 slots and AF and KL code on the flight

Quoting Nickofatlanta (Reply 10):
Anyone think they may announce LHR on Tuesday?

maybe if so look for BA to change ATL to LHR
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avek00
Posts: 3168
Joined: Mon Oct 25, 2004 5:56 am

RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 10:39 am

Quoting ConcordeBoy (Reply 11):
One may not lead to another... remember, intercon carriers are often not allowed to invoke ATI on hub2hub routings.

However, with the amount of non-OneHeathroWorld competition on ORD-LHR, AA/BA may be allowed (some) collusion after all.

To be brutally honest, I expect that, even if AA/BA were granted ATI tomorrow, they'd collude far less on North Atlantic flying than was envisioned a decade or so ago.
Live life to the fullest.
 
worldtraveler
Posts: 3417
Joined: Tue Aug 05, 2003 6:18 am

RE: Benefits Of DL Operating Flights To LHR And LGW?

Tue Sep 25, 2007 10:50 am

DOT data has shown that DL and CO do better on their LGW flights than UA has on its eastern US- LHR routes. UA typically has only had a revenue premium to LHR from the western US. AA has had a significant revenue premium over UA from eastern US gateways due to AA's stronger position and because AA has had at least some relationship with BA for years - although AA/BA LHR has still been excluded from codesharing.

So, there is a market for service to LGW as MAH (my favorite Swede  Smile) points out. And, having the most flights in a market or to/from a city can very well translate into a revenue premium. So, CO, DL, and NW know they will not become the dominant carrier in London - and their task may become even harder now that they may have their operations spread over multiple airports. They will get some help from AF/KL who will help market the flights in the UK (although they are not big players there), but they also will share in some of the profits which is why they were willing to part with the slots in the first place. The only reason AF/KL would sell their slots at LHR is because they will be able to share DL/NW's revenue (not sure that CO has agreed to revenue sharing); the revenue gain for AF/KL by sharing revenue on a transatlantic flight is greater than what they could operating flights within Europe.

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