Dear All,

in order to consolidate the AA/US merger threads (and after input from users, which we highly appreciate) the moderators decided to start separate threads each discussing one aspect of the AA/US merger and its impact to both the industry and the two airlines involved.

Please continue discussing this hot news in their individual official threads:

AA/US Merger Impact: Fleet
AA/US Merger Impact: Hubs (THIS THREAD ONLY)
AA/US Merger Impact: Employees
AA/US Merger Impact: HQ
AA/US Merger Impact: Livery
AA/US Merger Impact: Unions
AA/US Merger Impact: Routes
AA/US Merger Impact: Inflight Service

Enjoy & have a nice weekend!

The Airliners.net Moderator crew

Well, since PHX is a US hub that is about to be absorbed into AA, I hope AA would have the foresight to add the PHX-MSY route that HP abruptly canceled just before Hurricane Katrina made landfall and never resumed when they merged with US.

I'm pretty sure BA will come back to CLT. That will be nice to see.

The Wall Street Journal has an article discussing AA/US's post merger hub network. They surmise that, unlike DL and UA who used their mergers to trim capacity, AA/US would keep their network intact. And that the purpose of the merger is to make AA bigger, again, and not to remove capacity. I tend to agree with their analysis.

To read the article type in "AMR stands to gain vast network" to Google news.

In the other merger discussion threads everyone keeps speculating the three US hubs, CLT, PHL and especially PHX would be slashed. I disagree, I think CLT will perhaps be reduced a little with the removal of some of the smaller regional flights but overall will continue to grow to the Caribbean and Latin America. PHL I took see getting a trim to some smaller communities but overall growing by adding routes like AUS, SAT and perhaps NRT long term on AA or JAL via a 787. And PHX keeps getting compared to CVG, STL, PIT, MEM etc.. It's not, PHX is a booming sunbelt city. It doesn't have the biggest business community, but it has tons of O&D. PHX might get realigned, but it's not going the way of PIT, CVG or STL. The local market is just too big, and unlike the rust belt hubs PHX is growing.

As for AA hubs, I don't see anything changing in ORD. I see MIA continue to grow and as for JFK/LGA, there's not going to be any to really spark any renewed growth. US doesn't have that large of a slot portfolio anymore, what I see is US A330s replacing AA 763s on routes from JFK.

Quoting STT757 (Reply 3): And PHX keeps getting compared to CVG, STL, PIT, MEM etc.. It's not, PHX is a booming sunbelt city.

What your link says:

Quote: There also are questions over whether the combined carrier could support eight hubs and, if not, which U.S. city might be on the chopping block. In most recent airline mergers, at least one hub has suffered deep cuts to its service, such as Cincinnati following the 2008 merger of Delta and Northwest Airlines. In the expected American tie-up, analysts point to Phoenix as the likely target, partly because it is sandwiched between American hubs Los Angeles and Dallas.

Since we're treating this as if it's already happened, my predictions on the hubs ...

I suspect the higher costs (relative to either independent, post-bankruptcy AA or US) will lead to inevitable optimization and capacity rationalization in the domestic network. For the markets below specifically the (#, #) represents my approximate prediction for the overall net % change in departures followed by overall net % change in seats over a period of 2-3 years following the merger (all estimates pro forma to each carrier’s independent operations today):

CLT (-5, -10): reduction in both departures and capacity simply driven by higher costs of combined entity; CLT remains the prime north-south connecting hub for the eastern U.S., and the key gateway into the southeastern U.S.; loses some longhaul flying to MIA but otherwise retains key international linkages

DFW (+2, +3): relatively minor overall growth driven primarily by picking up some connections previously handled by PHX, and some current PHX-exclusive US (and former AA) destinations such as LGB and OAK; offset by somewhat reduced capacity to the southeastern U.S. where connections are shifted over CLT and DFW sees markets like SAV, CHS, CAE, GSO, etc. lose some frequency in favor of larger, 2-class RJs

LAX (unchanged, +1): little change as a result of the merger, with a potential for some targeted domestic additions (e.g., PIT) to take advantage of combined strength, increased capacity on hub routes (e.g. 767 on 1 LAX-PHL rotation), and rationalization on overlapping routes (e.g., ending current Eagle schedule LAX-PHX)

MIA (+2, +2): continual growth, with MIA picking up some international connections from CLT (Caribbean, South America, CLT-FCO shifting to MIA-MXP); MIA continues to add new domestic and international markets (e.g., AUS, MCI, SAN, MKE)

NYC (JFK/LGA) (unchanged, +2): with domestic and some international connections shifted to PHL, NYC (both JFK and LGA) operations freed to focus on utilizing slots more effectively for local O&D, taking advantage of stronger combined AA presence to expand AA NYC links to major domestic (MCI, IND, IAH, MSY, CVG, DEN 1-3x daily each) and international (FRA, TLV 1x daily each) O&D markets

ORD (+7, -5): increase in departures but decrease in seats driven by shifting more mainline flying to large regional jets; in addition, ORD gains back connectivity to markets in northeastern U.S. where it had either shrunk or lost AA connections entirely in the last decade (BDL, PVD, ROC, BUF, ALB, etc.) and in select western markets (PDX, possibly SMF) where it is a more convenient connecting point than PHX for some city-pairs/itineraries

PHL (-5, -3): relatively small reduction in capacity and seats, but nothing major as PHL becomes the singular AA hub for handling connections to/from the northeastern U.S., as well as AA’s primary gateway to continental Europe

PHX (-40, -50): gradual but substantial reduction, with PHX shifted to focus on the large PHX outbound/inbound O&D market; PHX retains connections to 40-50 major U.S. markets (including HNL and probably OGG) plus YYC and YVR in Canada and the major Mexican beach markets, but with a substantial amount of the intra-west flying either eliminated or shifted to smaller (likely non-mainline) aircraft; of the 50% of capacity eliminated, approximately 35% is simply exited altogether, with 10% shifted over DFW and 5% over ORD and/or other hubs

WAS (DCA) (-2, -1): slight reduction in both departures and seats driven largely by forced slot divestitures at DCA (focused primarily on overlapping RDU/BNA routes), but offset by expanded presence in key hub markets (near-hourly shuttle to ORD, increased capacity to DFW, etc.)

Other Markets/Point-to-Point: combined strength of AA supports (re)introduction of nonstop flying in select O&D markets (e.g., BOS-RDU, BOB-SFO, etc.)

Quoting commavia (Reply 5): PHL (-5, -3): relatively small reduction in capacity and seats, but nothing major as PHL becomes the singular AA hub for handling connections to/from the northeastern U.S., as well as AA’s primary gateway to continental Europe

Do you really think AA is going to give up JFK in favor of PHL, as the primary gateway to Europe? I don't think so. PHL's problems are well known and documented and I'm certain that PHL will be the biggest loser in this deal. JFK will grow as a TATL hub, CLT will grow as a North-South hub, MIA will grow as a Caribbean/Americas hub and PHL will slowly shrink into a "focus city", over time.

Quoting airbazar (Reply 6): JFK will grow as a TATL hub

With what slots?

Quoting airbazar (Reply 6): Do you really think AA is going to give up JFK in favor of PHL, as the primary gateway to Europe?

It's not a matter of "giving up" one in favor of the other. It's the sheer reality of slots and competition. PHL has no slots, and virtually no competition. JFK has onerous slot constraints, and tons of competition. In that environment, and given that US already has a bigger transatlantic operation out of PHL than AA does out of JFK, why would they cut one in favor of the other? Both serve a viable purpose, and can nicely compliment each other.

Quoting airbazar (Reply 6): PHL's problems are well known and documented

True, although the "problems" one could ascribe to PHL could essentially be said of virtually every hub in the northeast.

Quoting airbazar (Reply 6): I'm certain that PHL will be the biggest loser in this deal.

I'm near certain you're wrong. If this merger happens, the biggest loser - from a hub standpoint - is almost certain to be PHX. Nearly everyone seems to be in agreement on that.

I still don't understand why people think PHL is due for massive cuts. It's a huge hub, serving a huge market, with little meaningful competition, and in a relatively good location. JFK would also be a great asset for a combined airline - great terminal, huge local market, (relatively) large holding of slots, etc. But JFK cannot ever be a hub for AA the way PHL is for US and may soon be for AA. It's simply not possible.

Quoting airbazar (Reply 6): PHL becomes the singular AA hub for handling connections to/from the northeastern U.S., as well as AA’s primary gateway to continental Europe

JFK relies on O&D, whereas PHL would serve as the primary "connecting" hub to Europe.

I wouldn't expect AA to diminish the NYC market more than it already has.

Quoting commavia (Reply 8): It's not a matter of "giving up" one in favor of the other. It's the sheer reality of slots and competition. PHL has no slots, and virtually no competition.

PHL has no competition because no one wants to go to PHL  Sorry that's the reality. If you think people in NYC are going to chose AA and fly NYC-PHL-Europe you are out of your mind. The reality is that NYC is the single biggest market to/from Europe and to leave NYC in favor of PHL is ludicrous. JFK's slot restrictions are artificial. No one has ever been denied access to JFK. A truely slot restricted airport wouldn't be able to close a runway for 4 months for repaving. B6 hasn't had any problems growing at JFK. They're even expanding their terminal. And So is DL. So the idea that AA can't grow at JFK doesn't pass the sniff test.

Quoting seatback (Reply 9): JFK relies on O&D, whereas PHL would serve as the primary "connecting" hub to Europe.

Fair enough but why not do that thru CLT which is already US's biggest hub and it's a better airport than PHL in every category? To/From Europe, the northeast can connect via JFK while the southeast can connect via CLT. PHL is the third wheel in my opinion   For domestic connections, I can see PHL's usefulness because CLT is too far south but there's also DCA. So I really don't see PHL growing at all.

Quoting airbazar (Reply 11): Sorry that's the reality. If you think people in NYC are going to chose AA and fly NYC-PHL-Europe you are out of your mind. The reality is that NYC is the single biggest market to/from Europe and to leave NYC in favor of PHL is ludicrous.

Nobody is suggesting that.

AA will retain NYC-Europe service. It will also retain PHL-Europe service for the majority of the country who will not be connecting at JFK.

Quoting airbazar (Reply 11): Sorry that's the reality.

Reality according to who?

Quoting airbazar (Reply 11): If you think people in NYC are going to chose AA and fly NYC-PHL-Europe you are out of your mind. The reality is that NYC is the single biggest market to/from Europe and to leave NYC in favor of PHL is ludicrous.

Nobody said that. I'm not suggesting AA just leave NYC and route everything through PHL. I'm suggesting AA keep their already-robust JFK-Europe schedule - and actually expand it somewhat - alongside the already-robust PHL-Europe schedule. I continue to be fascinated that many - apparently including you - seem to think the two cannot coexist.

Quoting airbazar (Reply 11): JFK's slot restrictions are artificial. No one has ever been denied access to JFK.

  

Quoting airbazar (Reply 11): So the idea that AA can't grow at JFK doesn't pass the sniff test.

Well I don't know what it is you're "sniffing."

Quoting HPRamper (Reply 12): Nobody is suggesting that. AA will retain NYC-Europe service. It will also retain PHL-Europe service for the majority of the country who will not be connecting at JFK.

  

Thank you.

Quoting airbazar (Reply 11): PHL has no competition because no one wants to go to PHL  Sorry that's the reality. If you think people in NYC are going to chose AA and fly NYC-PHL-Europe you are out of your mind. The reality is that NYC is the single biggest market to/from Europe and to leave NYC in favor of PHL is ludicrous. JFK's slot restrictions are artificial. No one has ever been denied access to JFK. A truely slot restricted airport wouldn't be able to close a runway for 4 months for repaving. B6 hasn't had any problems growing at JFK. They're even expanding their terminal. And So is DL. So the idea that AA can't grow at JFK doesn't pass the sniff test.

And even though PHL has no slots (although it probably should since it's always had delay issues), it's still a very, very congested airport with little room to grow. Can that airport handle more traffic with it's horrible runway configuration? Not really. And didn't US say they'd de-hub PHL if that new runway proposal goes through? Surprised nobody has mentioned that.

Quoting corinthians (Reply 14): And even though PHL has no slots (although it probably should since it's always had delay issues), it's still a very, very congested airport with little room to grow.

Welcome to doing business as an airline in the northeast U.S. Just about every northeast airport is congested, crowded, overtaxed, run down, etc. PHL is hardly unique.

Quoting corinthians (Reply 14): Can that airport handle more traffic with it's horrible runway configuration? Not really.

I don't think "more traffic" is really realistic. I think the PHL hub will shrink somewhat, both in terms of flights and capacity.

Quoting corinthians (Reply 14): And didn't US say they'd de-hub PHL if that new runway proposal goes through?

There's plenty of money involved. I suspect they'll work something out.

Quoting commavia (Reply 5): PHX (-40, -50): gradual but substantial reduction,

You realize you are implying that AA will drop their west coast market share significantly? While DFW and ORD could be up some of that traffic, cutting PHX that much means a retreat Eastward that would cost AA revenue. It might be what has to happen... But I would not suspect that level of cuts. Not unless DFW cuts their costs more than I anticipate.

Lightsaber

Quoting corinthians (Reply 14): And even though PHL has no slots (although it probably should since it's always had delay issues), it's still a very, very congested airport with little room to grow. Can that airport handle more traffic with it's horrible runway configuration? Not really. And didn't US say they'd de-hub PHL if that new runway proposal goes through? Surprised nobody has mentioned that.

It's a combination of a few things
-Poor terminal design with tight alley ways between terminals
-Average to Poor airport design that impedes aircraft movement
-Tight airspace stuck in between NYC and WAS

US is just throwing around some weight to negotiate the deal and I imagine the combined carrier will do the same. It is in the best interest of both US (AA) and PHL to improve (expand) the airport. That is why US and PHL just came to a short term agreement for improvements.

[Edited 2013-02-08 06:37:32]

Quoting commavia (Reply 5):

Pretty good overall. Not sure that NYC loses anything though.

Will AA retain props? Props are very important to CLT and to a lesser degree PHL.

This tie up benefits ORD the most. Larger RJs, 319s and E90s for ORD are needed badly. Helps AA in the east as well.

How big is AA at DCA? That will certainly affect how many slots AA/US has to give up at DCA.

BOB-SFO-you mean BOS-SFO, right? A flight to Bora Bora woukd be awesome... 

Quoting usairways85 (Reply 17): It's a combination of a few things -Poor terminal design with tight alley ways between terminals -Average to Poor airport design that impedes aircraft movement

The main parallel runways are just too close together and they can’t be used independently. Even the proposed new runway will be too close to allow for simultaneous independent operations. Won’t increase capacity all that much, as US Air said. Not even with NextGen. Very big cost considering limited to no operational improvement.

Quoting usairways85 (Reply 17): -Tight airspace stuck in between NYC and WAS

Even with the tight airspace, PHL always had more operations than any of the NYC or DC airports. Just too many scheduled flights there.

Quoting southwest737500 (Reply 2): I'm pretty sure BA will come back to CLT. That will be nice to see.

No, they will be less likely to come back to CLT because of the relationship that AA has with BA outside of their alliance tie up. Now, in the future I think that may be say in 10 years if AA survives that long, you may see AA flying directly to LHR, but I doubt that.

Quoting corinthians (Reply 20): Even with the tight airspace, PHL always had more operations than any of the NYC or DC airports. Just too many scheduled flights there.

I don't have specific numbers so anyone feel free to provide them but I suspect EWR has more movements than PHL and I suspect NYC (EWR/JFK/LGA/TEB) has almost triple the number of movements as PHL.

I suspect PHL does have more than the WAS airports individually but once again BWI/DCA/IAD probably have over double the number of movements than PHL. Don't forget about Dover AFB, Andrews AFB, Mcquire AFB, ACY, IST, etc.

Didn't CLT recently announce plans for a large expansion of the airport? I wonder if this will affect their plans.

Quoting airbazar (Reply 6): Do you really think AA is going to give up JFK in favor of PHL, as the primary gateway to Europe? I don't think so. PHL's problems are well known and documented and I'm certain that PHL will be the biggest loser in this deal. JFK will grow as a TATL hub, CLT will grow as a North-South hub, MIA will grow as a Caribbean/Americas hub and PHL will slowly shrink into a "focus city", over time.

I totally agree. I think PHL will be one of the most affected hubs. It is extremely close to NYC and Philadelphia is not an economic powerhouse or booming city in the States today... with little to absolutely no appeal for Europeans (which are most if not all of its long-haul routes). Also, for congestion and weather, PHL is not even a good airport to be as alternative to JFK, and even its layout can be annoying (for instance the connection for the international side to I think it is T5). If AA+US wants to keep an alternative airport to the West Coast, Midwest, they could keep CLT, which has no congestion or weather issues, and can probably compete more with the likes of ATL in terms of geography (of course I am not saying CLT is or is going to be ATL, but they can target some same secondary markets). For me PHL was an oddity that US Airways used to have access to the Northeast, and conveniently located between New York and Washington, keeping also a monopoly in Philadelphia.

I have even flown myself a couple of times Europe-PHL-LGA (since it was much cheaper than direct Europe-NYC) and every other person in the PHL-LGA seemed to be connecting from Europe (including half of my flight). Of course it doesn't mean PHL can retain some major hubs like LHR (like BA flies to BWI in addition to IAD).

Just look at who flies in addition to US to Europe: BA to LHR and LH to FRA... that is all.



[Edited 2013-02-08 07:08:43]