Ok, first things first. Your username is awesome! As an initiation for new analysts I hire, I send them around looking for Bob Loblaw. When you write it on a piece of paper they don't notice the joke until they ask the first person where Bob Loblaw is. Then they try to say it slower like that will fix it, but just makes it that much funnier! The second one we do is to tell them to find a form one-D-ten-T. When they finally write it down out of frustration, the result is hilarious "1D10T"
Now that that's out of the way:
is the largest hub in the U.S. any way you look at it. The largest hub in the U.S. has fewer connections to Latin American markets than IAH, a hub half it's size and only 200 miles away.
The reason for this is clear that AA
doesn't want to cannibalize their money printing MIA
are MASSIVE gaps which effectively eliminate the market when you are talking about Latin America connect points. PTY
runs 3x a week. CCS
runs once. SAL
is less than weekly.
But you have to remember too, that DFW
as an O&D market is 5 times the size of CLT
. The 4th largest city in the U.S. warrants traffic to GRU
, and GIG
. But that you're missing BOG
, in particular, signals it's not seen by American as a Latin America hub. What I'm saying is that American has already proven to be extremely protective of it's MIA
hub (as they should be) to the point of keeping it's largest hub (DFW
) from cannibalizing any true traffic from MIA
. If they aren't willing to let DFW
which is 1150 miles apart, do you really think they're going to let CLT
, which is only 650 miles away? Latin America for CLT
is toast, outside of any warranted leisure O&D (CUN
|Quoting AAIL86 (Reply 79):|
DFW-GRU is one of AA's most profitable routes, period.
Don't confuse profitability with network routing. DFW
is so popular because of the local base, not the connecting base. O&D non-stop passengers are always preferred since you only divide the cost of their ticket by one flight.
In fact, what your suggesting further strengthens the point that AA
is keeping DFW
smaller than the market and hub it deserves to be. I don't question if DFW
is extremely popular. But if it is, then why isn't AA
adding to that route? The answer is clear: they don't want to cannibalize MIA
. That's what it all comes down to. How much will AA
route around CLT
because it's not the preferred launching point? As you just pointed out, they seem to be willing to route a lot around DFW
, even though it's such a large market. Just for grins, I took a look at markets into GRU
is a larger GRU
market than DFW
|Quoting Cubsrule (Reply 72):|
How are any of those superior for connecting people on a route like IND-PUJ or PIT-MBJ?
Leisure markets that would probably stay, anyway, but to answer your question, MIA
is a far superior hub for PUJ
. I've never heard anyone suggest otherwise until I read your post today.
|Quoting bobloblaw (Reply 69):|
CLT has more population, more catchment area and more buying power than CLE, CLT wont become CLE. What youre essentially sating is the third largest hub in the USA, is really infact a focus city. If this was true, US would be hemoraging money.
Yeah, it'll be bigger than CLE
, but not structurally different. But lets make sure we're comparing apples to apples here. CLT
is not the 3rd largest hub in the U.S. It's the 4th largest DOMESTIC hub. When you take into account international traffic, it drops significantly. In total hub size in terms of ASMs, CLT
ranks 21st in the U.S., certainly not 3rd and not even 4th. (source OAG)
But I see where everyone's getting caught up on the CLE
comment. I only use CLE
as an example because it's the latest. The closest example in size is STL
is still the 32nd largest market in terms of ASMs in the U.S. Not small, but nobody could argue that it's a critical AA
hub. In fact, it's quite difficult to find connections through STL
is about 1,000,000 people larger than CLT
, to put it into perspective (Source 2010 Census). When it was a hub, it had a good international base as a result of TWA's operations. Where is STL
now? American operates to 6 cities out of STL
. 6! ORD
, and LAX
(outside of what Cape Air is doing with some props in EAS markets). But the overall STL
domestic service offering has shrunk only about 25% from the other airlines that have picked up the slack.
, as an O&D market is doing just fine. STL
as a hub is gone, yet it still commands about 20% more O&D traffic than CLT
So you have a clear precedent set by American on consolidated hubs from a much larger market than CLT
. I still think CLT
will fare better than STL
within the AA
will be a market the size of STL
with the structure of CLE
. Trust me, that's a good thing!
|Quoting bobloblaw (Reply 69):|
The "latin" markets served from CLT are mostly leisure destinations that have significant feed from cities that MIA could never support nonstop service to. You think there will be DSM-MIA or OMA-MIA?
Yes, actually. DSM
in particular. This is in line with AA
's four-corners plan (as ill-fated as that is). DSM
is a prime market for MIA
service, but AA
has not had the aircraft to go after that market. Once the 81-seaters start flying en-masse, I would expect DSM
to be a market added. OMA
too, probably. This is not far fetched at all, when you consider some of the markets they hit from MIA
. You could draw an E-140 range circle with those cities, and you start to see cities such as DSM
, and MCI
that just fall off the edge, and a 737-800 or MD
-80 is just too big.
I think the more important question is, "what value does CLT
bring to DSM
can route any DSM
Florida traffic through ORD
. Circuity is about the same since CLT
is so far East. Add in that there are only 2 flights a day on RJs DSM
and you start to see that it's not even a market for CLT
to serve. The majority of the flights offered are United code-shares through ORD
You could draw a circuity map of American's new hubs that show where CLT
's new hub catchment area would be for Florida. South and East of Chicago, South of PHL
, East of DFW
, and only the leisure markets in Florida (North of Miami). That is a pretty small region that CLT
finds itself smashed into. A region, btw, about the size CLE
is currently serving. Market size, not O&D size. Some notable cities within CLT
's future catchment area: IND
, and CLE
. Every one of those cities already has non-stop service to both MCO
, by the way. How important is a hub that only connects people who had a cheaper non-stop alternative? Not much.
We all like to root for the small guy, and I'm certainly included in that. I want CLT
to stay, but I'm also a realist with a lot of data. CLT
will be larger than CLE
, and MEM
, but what AA
did to their bigger market at STL
shows just how sensitive they are to splitting traffic. Latin America is better served by MIA
, and Europe is MUCH better served by JFK
. That leaves domestic options only for CLT
, for which it has a smaller O&D base than STL
. Don't forget all of those inbound CLT
aircraft will no longer have Latin America or European traffic, which will just start to unravel a lot of those markets. The effect of dropping markets in a hub is compounding, and CLT
is extra sensitive with it's disproportionally high percentage of connecting traffic.
In the end, CLT
will be about the market size of STL
, but I think AA
will still operate the majority of those flights where they let them go to the LCCs in STL
. That means LHR
?, plus all of the major markets in the U.S. O&D market will stay the same size, but seats and departures will drastically fall. 300 is my 5-year guess. (STL
is currently 230, so I'm giving CLT
the benefit of the doubt). From what I'm hearing, the over/under is about 450. Place your bets!