Obviously I am trying to show the route "could" be viable and you are not.
No, I'm simply trying to be realistic. I believe that starting the PHL-PEK route will be a massive undertaking for US, the difficulty of which should not be minimized.
The O&D numbers from cities without non-stop services are counts of passengers "flying" to the connecting hub on a different airline or the same carrier with a different flight number. While this is accurate for cities like DFW, ATL, DTW, etc., it is misleading for PHL because most travelers - and particularly tours drive/train the relatively short distance to JFK and EWR and are not counted as PHL O&D.
While it's true that any passenger that drives to EWR or JFK is not counted in the O&D statistics for PHL, can you provide any numerical (as opposed to anecdotal) support for your claim that I bolded above? If not, it's simply your opinion. That's not to say that
nobody currently drives from the Philadelphia area to either EWR or JFK to fly to PEK, but I would need to see some solid evidence before I will believe that it is a statistically significant number of travelers. With the added driving time to EWR and especially JFK, vs. driving to PHL, might not the total elapsed trip time possibly be comparable even with a connection on a PHL-ORD-PEK flight (to pick only one possibility) to largely negate the time advantage of a nonstop flight from either EWR or JFK? And don't forget the lure of frequent flier programs to entice travelers to make connections even when nonstop service is available at the same airport. So as I said, I'm not convinced that a meaningful number of Philadelphia travelers to PEK currently use either EWR or JFK airports as their point of departure. But I'm open to any real proof you might have.
Also, you need to add CLT (767-200) as an O&D fare point for this flight.
Sorry, but CLT is merely a connecting flight (albeit with a "through" flight number) using an international widebody aircraft. The only real benefits are an international business class cabin with its improved seating compared to domestic first class seats, and the ability to carry containerized cargo. But it's still a connecting flight.
Further, even in 2009, US will only be competing with one PHL-NYC metroplex U.S. carrier on the route - CO's existing EWR-PEK flight, which had a Spring(2007)/Summer (2007)/Fall (2006) combined direction Load Factor averaging 85% on the 772. I would speculate that flight already has quite a few annual PHL region business and tour passengers. Consequently, I project that the PHL flight will also draw from the entire PHL-NYC region, since again other than an Air Asia, the CO flight is their only option.
Aside from being curious about the data source for your load factor quote above, I strongly disagree with your opinion that travelers from the New York area will literally drive past an airport (EWR) with nonstop service (on CO) to PEK to drive for another 90 minutes or so to PHL to get on an equally long flight on US to PEK. IMHO, I believe it's naive in the extreme to think that any meaningful number of passengers would do so.
Additionally, it would be absurd for any airline to start this route without assuming new PHL-China business relationships would develop and flourish. Also, as I'm certain you're aware, the addition of a new non-stop flight between 2 major cities and especially countries has a strong habit of significantly increasing the O&D.
While both comments above are true as a general proposition, it remains to be seen whether either of these actions will occur to a sufficiently large extent to make the new PHL-PEK flight profitable for US. I guess we'll have to wait until 2010 or 2011 to really find out.
To my knowledge, US has never (other than during Fare Sales) reduced Trans-Atlantic fares because UA had better service on a route from a different Origin and likely will not now, especially on this route. It is also somewhat disingenuous to assume that 17 months from now, this flight will not equivalence the services of the UA IAD flight.
Isn't it equally disingenuous to assume, without any proof or actions to date on US' part, that the service on the PHL-PEK flights
will match the service levels on UA's IAD-PEK flights? OK, so we're both disingenuous!
😛 But seriously, the US flights will not have First Class or Economy Plus, and UA's redesigned Business Class will be at least one generation ahead of US' current Envoy Class. So while US might be able to match, or possibly even exceed, UA's "soft" product (meals, F/A service, etc.), I believe it will be much more difficult for US to match UA's "hard" product (premium cabins and seats).
In 2006, there were 842K passengers between the U.S. and China. Of that number, U.S. carriers accounted for 60% - 505K. Of the 505K, UA carried 42% - 212K. That leaves approx. 505-212 = 292K left for everyone else. I'd say PHL is in no worse O&D shape than anyone else not on the West Coast or in NYC regarding this - especially ATL and DTW. The projection is however that by 2010, this number will double to something like 1.7M.
Please provide a data source for the above numbers. I have access to DOT's international O&D and T100 (Onboard) databases, and those numbers are far different from the numbers you've quoted above. Any explanation you can provide would be helpful in trying to understand the differences.
As I said, I believe that US will have a difficult time breaking into the U.S.-China market since (1) it remains to be seen what the "real" size of the PHL-PEK market is, (2) other carriers won't give up their current China passengers without a fight, and (3) US needs to bring its service level up to that of other U.S. carriers operating flights across the Pacific, a process that the folks in Tempe have not given signs (to me at least) so far that they can accomplish. We'll just have to wait and see what happens in the next 17 months. JMHO.
