![]() ![]() ![]() ![]() ![]() ![]() ![]() BAD WEATHER+CLOSED HUBS=BAD NEWS By Joe Brancatelli February 13, 2014 --Word leaked last week that United Continental Holdings would cut its flight nexus in Cleveland, "de-hubbing" the Ohio city that for decades played host to both pre-merger United Airlines and pre-merger Continental Airlines.But chances are you missed the news because you were otherwise engaged, desperately trying to rebuild your travel schedule as delays and cancellations mounted during this seemingly endless winter. United's decision to reduce flights in Cleveland by 60 percent during the next few months is no surprise—chief executive Jeff Smisek claimed the operation "hasn't been profitable for over a decade"—but you may be shocked to realize there's a connection between bad weather and airline hubs. Simply put: the more hubs that airlines close, the harder is it for us to get around when the weather stinks. "Bad-weather ops are all about options and alternatives," a major carrier's scheduling wizard told me last week as storms in the Midwest and Northeast caused more than 11,000 flight cancellations and 40,000 delays. "Every time an airline de-hubs an airport, that's one less place you can reroute passengers when Mother Nature isn't cooperating." As you surely have experienced, Mother Nature has not cooperated with business travelers lately. In December, FlightStats.com recorded 23,000 cancellations and more than 225,000 delays. On-time operation dropped to 70 percent compared to 83.44 percent in November, 2013. January was even worse. The aviation-data service MasFlight says the nation's airlines scrubbed 49,000 flights and there were more than 300,000 delays. As bad as the weather has been—another snow and ice storm is playing havoc with travelers in the South as I write this, and is grounding planes in the Northeast as it's posted—it's the lack of options that causes the real damage to our lives on the road. In the generation since airlines were deregulated in 1978, the nation's four remaining "legacy carriers" have shuttered at least 18 hubs around the country. More and more, our flights connect through just a few major cities and, when Mother Nature gets ornery, business travelers nationwide pay the price. If the weather is simultaneously awful in more than one region of the country, the entire air-travel system is in danger of grinding to a costly, time-consuming standstill. Consider these numbers pieced together from data compiled by the Bureau of Transportation Statistics (BTS). Six hub airports--Atlanta, Chicago/O'Hare, Dallas/Fort Worth, Denver, Los Angeles and Charlotte--accounted for 25 percent of the nation's annual enplanements in 2012. That's up from just 22 percent in 2002. The nation's Top 12 airports accounted for 38 percent of the traffic, up from just 35 percent in 2002. The eight hub airports in the 400-mile air corridor between Boston and Washington now account for 14.7 percent of the nation's enplanements in 2012, up from 11.8 percent in 2002. Hub concentration and its impact on our ability to fly on business during poor weather has been largely obscured by the rapid-fire mergers since airline deregulation. But it's instructive to recap just how many important airports have been de-hubbed, restricting our ability to fly around and away from bad conditions. United Airlines, which carries the DNA of at least a dozen carriers, once had hubs in Kansas City (Eastern Airlines), Greensboro (Continental Lite) and Orlando (both Eastern and the original United). American Airlines, now part of the American Airlines Group (Nasdaq: AAL) since December's merger with US Airways, has closed no fewer than six hubs in the last 20 years. American built, then abandoned, connecting-flight facilities in Raleigh/Durham, Nashville and San Juan. It dumped St. Louis, the mid-continent hub it acquired along with TWA in 2001. It also shut down San Jose, California, and Reno, Nevada, hubs operated by Reno Air, which American snapped up in 1999. US Airways has been at least as ruthless as it successively merged with Piedmont Airlines in the 1980s and America West in 2005. Gone are USAir's once-huge Pittsburgh hub; the Dayton and Baltimore-Washington operations built by Piedmont; and Las Vegas and Columbus, two flight centers created by America West. Denver-based Frontier Airlines, amalgamated with Midwest Express in 2009, dropped Midwest's Milwaukee hub the following year. Delta Air Lines (NYSE: DAL) has been slashing its Cincinnati hub for years. Since its 2008 merger with Northwest Airlines, it also de-hubbed that carrier's Memphis hub. Over the years, it shuttered hubs in Dallas/Fort Worth and Orlando. One respected aviation analyst I spoke to this week admitted he hadn't done a systemic survey of hub closures and weather, but said he had no doubt the cutbacks made life worse for business travelers. "The flexibility is gone in awful weather," he said. "A storm blankets the Northeast and the country is crippled because the delays cascade. A Midwest storm often knocks out [Delta's hubs in] Minneapolis or Detroit and {the American and United hubs in] O'Hare in the middle. And these Southern storms have the ability to wipe out DFW, Atlanta and Charlotte in successive days." Airline executives don't care about this, of course. Just as they don't care that their shriveled calls centers are overwhelmed when they cancel flights and travelers try to arrange alternate itineraries. As they have downsized the airline industry to squeeze profits from an inherently low-margin business, they have cut anything that looks like excess capacity or underutilized facilities. In the old days, airlines built operations to handle the worst weather crises. Now they've slashed hub networks and call centers because it's cheaper to cancel flights and inconvenience travelers in bad weather than fund standby capacity. "My CEO says the weather's not our fault," one midlevel airline executive told me recently. Shareholders don't want to lose money "keeping excess hubs open because they are helpful when it snows." |
ABOUT JOE BRANCATELLI Joe Brancatelli is a publication consultant, which means that he helps media companies start, fix and reposition newspapers, magazines and Web sites. He's also the former executive editor of Frequent Flyer and has been a consultant to or columnist for more business-travel and leisure-travel publishing operations than he can remember. He started his career as a business journalist and created JoeSentMe in the dark days after 9/11 while he was stranded in a hotel room in San Francisco. He lives on the Hudson River in the tourist town of Cold Spring. THE FINE PRINT This column is Copyright © 2014 American City Business Journals. All rights reserved. Reprinted with permission. JoeSentMe.com is Copyright © 2014 by Joe Brancatelli. All rights reserved. |