N649DL wrote:I'm still curious as to how DEN is UA's most profitable hub after almost shunning it after the merger with CO. The competition is tough out there with WN and Frontier as well.
I lived in DEN for about 2 years and returned back to LAX as I was there for work. UA needs to be careful with DEN expansion because the cost of living is out of whack (especially real estate) and a lot of people are fleeing it almost as much as people are coming in. Local O&D could tank as a result and then they'll be right back to where they were at DEN back in 2010. And DEN will never be on the same level as a hub as ATL or DFW. It's really just hype by UA expanding DEN and far too late. Great hub nonetheless for them though.
A lot has changed in 2 years UA has gone from a summertime high of 350 departures just 2 years ago to 515 this coming summer according to Kirby. Denver, the surrounding suburbs and Colorado are growing. In addition to having a strong O&D market UA at DEN is in a unique position because we are able to connect DEN to a lot of smaller cities through UAX neither WN or F9 serve many of these surrounding communities. Kirby never stated he envisioned DEN being DL's ATL hub with over 1,000 departures or AA's DFW. But he did make it clear UA will continue to grow DEN and UA is in talks to acquire more gates/terminal and I believe in 2-4 years UA will have 700 daily departures from DEN in the summer and at least 550 during the remainder of the year.
Just because you don't understand how DEN is profitable doesn't mean its hype or far to late. In fact UA's overall success at all our hubs since Kirby's arrival speak volumes that his vision and plan are working. UA under Tilton and then Smisek ran from a fight. UA adopted the policy shrink your way into profitability opening the doors for airlines like WN, F9, even DL and AA to take advantage. As good as Oscar Munoz is I think the greatest thing he ever did at UA was hire Scott Kirby. Now image if Doug Parker had kept Kirby where would American Airlines be today and where would United Airlines be. I think before Kirby we had people like Andrew Levy and others who either had no vision for UA's future or agreed with Smisek's plan, shrink to profitability. Even Wall Street thought Munoz and Kirby were nuts when Kirby announced a few years ago a complete reversal of Smisek's plan and instead said UA would be growing and fighting and defending all of our hubs. Kirby has upguaged quite a few routes out of ORD, DEN and IAH he has also added more flights out of these hubs, IAD and LAX are no longer on the verge of being de-hubbed in fact before Kirby, Wall Street was actively pushing for UA to de-hub both these hubs (shrink your way into profitability) CLE fell victim to this policy, now those hubs instead of shrinking are growing. In the New York City market UA was loosing to both DL, AA and B6. We were loosing corporate accounts, high value premium passengers, and just everyday regular passengers. Kirby comes in changes all of it and now UA at EWR is winning back corporate accounts and high value premium passengers so much so that UA now is rolling out a high J version on 17 of our 763s. And its not just New York, UA is winning back corporate accounts a high value customers in Washington D.C. and surrounding areas. While UA has always enjoyed dominance at SFO we are also winning back corporate and high value customers in the San Francisco area. Before Kirby I don't think anyone at sUA considered EWR a crown jewel perhaps sCO did, but the then merged UA didn't. However so much has changed at both SFO and EWR and these high value accounts and customers are returning making both these hubs the crown jewels of our network.
UA still has some work to do in Los Angeles to win more corporate and high value accounts, however UA has made some steps in the right direction at LAX by first stabilizing the hub, next will be growth.
Look at all Kirby has accomplished in his short tenure here at UA including stabilizing and growing all our hubs including DEN expanding UA's international network while managing to keep United Airlines profitable and keeping Wall Street happy and you have the audacity to say it just hype, its to late. The results speak for themselves and the results are saying it never to late to turn it around and this is what UA is doing we are turning it around and making a profit while doing it.
It was interesting to watch from the sidelines as DL went through this process some years ago and I'll admit I was jealous. DL seemed to be doing everything right ash was growing by leaps and bounds,while UA was the exact opposite. I've said this many times on a.netters that I believe UA is 4-6 years behind DL is terms of growth and profitability. UA lost a lot during bankruptcy and the merger. But having worked for UA through through both of those events and having seen UA hit rock bottom it is exciting to see UA turn a corner and start to live up to it potential. Again I ask where would UA be if Doug Parker had kept Kirby at AA and Munoz had kept the likes of Andrew Levy at UA? My answer to that question is I believe neither LAX, or IAD would exist as a hub today and DEN instead of preparing for 515 daily departures summer 2019, would probably have been on the chopping block down to 150 daily summer 2019 departures because WN would have chocked the life out of us at that hub. To put if bluntly UA would have probably been on life support, still trying to shrink to profitability and it would have opened the doors for AA and DL to pounce. If UA had continued to shrink at some point the US3 would have become the US2 in my opinion because once DL turned the corner and became profitable they also became a take no prisoners airline. There was blood in the water and DL could smell it and they were coming hard for UA, if AA would have gotten it house together as well and kept Kirby I don't see how UA could have survive. We would have had DL attacking from one side, AA another, WN from another then airlines like AS, B6, F9, and NK would have joined in and drove the final nail in the coffin. By 2025-2030 UA would have been out of business if not sooner.