International traffic drops at CLT as American Airlines shuffles routes

[FrugalFlyerv2.0]

AA's RDU and BNA strategies both failed because they tried to fragment their hub presence in the SE and in the process did not gain the mass necessary to compete with, wait, wait, ATL ..........................

 
Blah blah blah, DL and ATL, DL DL DL DL DL is the greatest, blah blah blah..
 
This is the same 'mighty' DL that allowed FL to blossom at, wait, wait, wait, ATL [and B6 at JFK too]
 
But yeah, in the  Bizarro universe, the AA hubs at RDU and BNA failed because of DL and ATL.
 
Yaaaaaaaaaaaaaaawwwwwwwwwwwwn!
 
RDU and BNA were dismantled in favor of building up MIA because the management at AMR kind of foresaw the upcoming failure of EA and figured out that a void would needed to be filled at MIA.
 
There is your Whole Truth.

 

[1AA]

Will history repeat itself in CLT as it did for RDU and BNA? My opinion is that soon after Miami opened up RDU lost domestic traffic and was dehubbed. I'm sure someone on this board was working at RDU at the time. BNA to this day I can not figure out why it existed as a hub at the time.

 

[commavia]

Will history repeat itself in CLT as it did for RDU and BNA? My opinion is that soon after Miami opened up RDU lost domestic traffic and was dehubbed. I'm sure someone on this board was working at RDU at the time. BNA to this day I can not figure out why it existed as a hub at the time.

 
No.  They're dramatically different.  Not only is CLT a far, far larger hub than either RDU or BNA ever were - at the zenith of their hub scale - but beyond that, CLT also benefits from strong regional geographic, economic and demographic fundamentals, and, frankly, the fact that RDU and BNA are no longer hubs, and today the region pretty much only has CLT and ATL.  As the linked article quotes AA's own spokesman as saying, it's just reality that CLT isn't going to be some global megahub - it's not that type of market, and likely won't be (at least any time in the near future).  But what CLT is is an excellent and extremely valuable hub for domestic, particularly up and down the east coast, and to the Caribbean.  In that role, I don't think CLT is in the slightest danger of going anywhere.

 

[WorldTraveler]

FL grew in ATL before DL filed for BK and FL shrank in ATL as soon as DL starting regaining its cost competitiveness.

That is the exact same thing that happened to AA in NYC and why US pulled out of NYC as well.

The difference is that DL has more than regained its share in ATL and FL had to sell out to WN who is going after AA in N. Texas while pulling down its ATL hub.

BNA and RDU were AA's attempts to divide the eastern US and supposedly surround ATL but in the process they made neither large enough to work and were surrounded by low fare carriers that doomed both BNA and RDU. History is proof that AA's SE strategy of the 80s and 90s didn't work and they face some of the same challenges in this decade with CLT.


while it is true that the industry has consolidated and there are really just two major hubs in the SE - ATL and CLT - CLT is a far smaller market than ATL and AA relies very heavily on RJs and many of them are small RJs or turboprops where the economics are not favorable.

And there is no viable large hub that is almost entirely domestic other than PHX. AA will try to make CLT work because it doesn't have any alternative for a true SE hub but if AA can't make CLT longhaul int'l work, the chances that CLT can remain the size it is using heavily domestic to domestic connections on RJs is slim.

Let it all play out but I can assure you that CLT will shrink for AA or else they will have to give up some of their int'l presence in other hubs on the east coast. AA cannot support 4 int'l hubs on the east coast and cannot operate an almost entirely domestic operation at CLT while leaving the int'l flying at other hubs.

Just as on the west coast and to Asia, AA has significant strategic challenges in coming close to what other carriers have in the SE and on the east coast and AA can only hope to gain the advantage that the merger presented if AA is willing to pull out of some markets as hubs and build up those that remain to a size that is large enough to play on par with those carriers that have established successful east coast hubs.

 

[traderjake]

 

[WorldTraveler]

it's simply a recognition of strategic realities.

DL figured it out, UA is well on its way to realizing it and making adjustments, and just as with BK, AA is now figuring it out but will be two steps behind in the process.

AA cannot support four int'l hubs on the east coast and five total hubs including DCA which is essentially all domestic.

AA is overhubbed in the eastern US as well as in the DFW-PHX-LAX corridor.

 

[commavia]

AA isn't "overhubbed" in the slightest.  "Hub" is a marketing word - for AA, just as it is and long has been for Delta.
 
The reality is that AA's large operations up and down the east coast all serve distinct, and largely complimentary, purposes.  The NYC (JFK/LGA) operation is an O&D powerhouse, with AA and its partners offering an impressively comprehensive coverage of most of the market's largest domestic and international premium-/business-heavy O&D markets.  PHL is the northeast connecting megahub, far better a megahub than anything that any other competitor has in the northeast except EWR.  WAS (DCA) is a slightly smaller version of NYC, with an impressive coverage of major domestic O&D markets plus some connections.  CLT is another powerful megahub that offers north-south coverage and access to the southeastern U.S. unrivaled except by ATL.  And MIA speaks for itself - the alpha and omega of Latin America.
 
In short, all are and can exist just fine together - and indeed strengthen each other.  To conclude otherwise is - wholly unsurprisingly - Delta fanboy wishful thinking.

 

[traderjake]

AA is overhubbed in the eastern US as well as in the DFW-PHX-LAX corridor.

 
And yet AA's system is very profitable, just wait until the efficiencies of the merger kick in.
 
CLT doesn't need to be an international hub to succeed.

 

[WorldTraveler]

no, hub is not just a marketing word.

It refers to the fact that there are intentional connecting flights sold and schedules created to facilitate it - and the percentage of connecting traffic is verifiable thru DOT data.

You can keep holding onto the hope that AA can make NYC work as an O&D focused operation while DL and UA operate true hubs that are far larger but the reality is that no carrier has ever succeeded at having a focus city/hub like what AA is doing in NYC alongside other carrier hubs that are that much larger. NYC will shrink for AA.

PHL is simply not a megahub at all in comparison with DL or UA in NYC. of all of the hubs in the NE, DL has more seats in NYC than every other hub including AA/US in PHL - by more than 10%. And you can't argue that DL doesn't get the benefits of the O&D market at the 3 NYC airports with connections at JFK and LGA if you are going to make that argument in PHL.

CLT is precisely HALF of the size of DL's ATL hub and 1/3 smaller than AA at DFW. If you want to call CLT a megahub then ATL has to be a SUPERMEGAGIGANTIC hub.

DCA is a local market that is being infiltrated by low cost carriers such that AA will have to focus more on high volume markets esp. to Florida or lose market share.

MIA is a Latin hub and a very powerful one that has alot of European traffic but all of that int'l traffic and a great deal of that Latin traffic can flow over other hubs and on other carriers' nonstop flights to MIA or FLL.

AA is overhubbed on the east coast. It cannot defend the number of hubs it has against competitors and is limited in its ability to maximize each of them because doing so will hurt others. DL and UA simply do not have that problem.

 

[700UW]

 

[jcw]

So now we have the new AA bashing theme - over "hubbing" - it's amazing how one can go from spin to spin

 

[Phoenix]

Just an FYI to those that have argued CLT would grow because of the merger...I guess time will tell.
 
http://www.bizjournals.com/charlotte/blog/morning-edition/2015/06/international-traffic-drops-at-clt-as-american.html?ana=yahoo
 
 

 
 
Old news resurfacing with more details.   Many months ago the Charlotte Observer announced that the new "International" A Terminal" is still being built but will be used as a domestic terminal, and the new "international" center runway that was planned is being delayed.   

 

[dfw gen]

Which one is WT?

 

[traderjake]

Any or all of them, depending on the audience and subject.

 

[autofixer]

Which one is WT?

The beauty standing on the far right.