I think Phoenix is a unique case. As a recent resident of PHX for 4 years, the economy there was booming. If we take a look at the socioeconomics of the region, I think it’s safe to assume Phoenix only looks better in the eyes of the consumer post-pandemic. The city has low taxes, large swaths of real estate, booming tourism, almost no natural disasters, and high quality of life. And thus far it hasn’t been overwhelmed with COVID cases. Given that the economy functions cyclically, it’s safe to assume PHX will come roaring back. ESPECIALLY because so many Phoenicians are transplants - which means a lot of O&D traffic.
Having watched the airport’s transformation and the slow transition from US to AA liveries in Terminal 4 North, AA has really grown into quite the large operation. It would be shortsighted of them to dehub this market. I echo the sentiments of past posters - this debate has raged on for years and despite the discourse the airline has only continued to grow up until now. Phoenix is a unique sleeping giant.
People oftentimes seem to look at PHX as autonomous of other hubs and don’t see the bigger picture. People argue about the importance of remaining at airports like LGA and LAX despite its lack of profitability because it paints a bigger picture of the airline’s entire network. Why is Phoenix never viewed the same way? The capacity is there in Phoenix. If AA loosened their grip, another airline would pounce and it would strengthen theirs. Somebody needs to serve the city’s capacity whether it makes sense or not.
It's interesting to see the differing views of people who have lived or live in Phoenix, vs outsiders. While it is a sizable O&D center(thanks in part to inbound visitors) it does lag behind in terms of business, GDP wise it ranks behind MSP & DTW, and has half the GDP of similar sized metros like SFO & BOS.
LGA is not negotiable, airlines have slots at LGA (and JFK), & once you give them up it is extremely hard/expensive to get them back. UA has realized this since they left JFK.
Furthermore, LA & NYC are the most important air markets in the US, there is no two ways around it. Nearly every major corporation does at least some business in either metro, and thus it is imperative for the US3 to maintain sizable operations in both metros. PHX is not on the same tier as those markets, as it does not serve a large corporate base, and is a seasonal market.
Your comparison of GDP to SFO & BOS (Tech & Health centers) is a bit off though as PHX is not the center of a specific industry (other than snowbirds). DEN, SAN and MSP are good comparisons though and PHX is only $10B dollars behind MSP while being $8B ahead of SAN and about $34B ahead of DEN. PHX population wise is bigger, but a larger number of those are retirees so it would make sense that it's production would lag slightly behind.
For contrast, the GDP of PHX is more than twice that of LAS and is about the same as AUS and SAT combined (populations of the combined areas are similar too).
I'm confused what you are trying to say, if you are arguing that the number of retirees brings down the economic output number, then you are essentially arguing it is a less valuable market....especially considering AA splits it with WN. A market you mentioned as a peer, MSP, is essentially a monopoly market
I was responding to this comment initially: "People argue about the importance of remaining at airports like LGA and LAX despite its lack of profitability because it paints a bigger picture of the airline’s entire network. Why is Phoenix never viewed the same way? The capacity is there in Phoenix."
What you are saying I think explains why PHX is often not viewed as vital of a hub to AA's network, while PHX is a large area (similar to BOS or SF) its traffic relative to its size is small. Business activity in the area also lags behind similar markets due to population make up, & while it may be larger economically than DEN, DEN is ideally suited for connecting traffic for UA.
I am excluding LAS, SAN, & AUS/SAT as those aren't hubs for the US3, and as a result the hub strategy/network is much different
I think you’ve highlighted something with some of the airports you’ve mentioned. Because of constraints at all the west coast airports, PHX plays a great role in being the connector eastbound. SFO, LAS, SAN come to mind. Time and time again AA FF’s say how much they prefer connecting via PHX rather than LAX. Plus, if you look at destinations served, a large portion of LAX traffic is to Mexico, Hawaii, and to other core hubs. PHX connects everyone in the southwest to almost each and every metropolitan eastbound destination. There’s no room for that at LAX. And no flight connecting to Phoenix from LAS, SAN, SFO, LAX is more than an additional 90ish minutes or so.
And they don’t really have to cut back much international travel either because it was just budding. So that helps PHX’s case too.
Last thing I’ll tack on here: PHX is a great feeder for a lot of the inland empire, BUR, and coastal cities in Southern California like SBA albeit seasonally. It really gives AA the vast expanse of the west coast while sitting comfortably in a mild, delay-free (but hot!) climate.
What significant westbound flows cannot be served through DFW/LAX from SFO that can be from PHX? I went through the connection data to be sure, and of the top 30 markets AA connected through Phoenix from SFO, only 5 were west of Dallas, and of those 5 only FLG didn't have service to LAX on AA.
Same thing holds true for BUR, most traffic departing BUR is terminating east of DFW.
With the new AS partnership those customers in SFO, SAN, e.t.c can fly nonstop to most major western destinations, and anything east could theoretically be connected in DFW or LAX.