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"Which Airline Owns Your Airport: Strategies To Beat AirportDomination"


 

Tuesday, July 18, 2017

 

Which Airline Owns Your Airport: Strategies To Beat Airport Domination

By Michael Goldstein,  Contributor

Forbes

 

         Rep. Duncan Hunter, R-Calif., speaks during a news conference on Capitol Hill, Thursday, April 7, 2011, in Washington.

 

America may be politically divided, but from Ann Coulter to Bernie Sanders, there’s widespread discontent with the US airline system. When Congress held hearings in May prompted by the violent “bumping” of United passenger Dr. David Dao, there was rare bipartisanship in the air.

 

Duncan Hunter, R-Ca., said "It’s an absolute joke that there’s competition in the airline industry.” In 2005 there were 9 major airlines: Delta, Northwest, US Airways, America West, United, Continental, Southwest, AirTran, and American. Now the big four (American, United, Southwest, Delta) carry 80% of air traffic.

 

(Full disclosure, I own stock in Southwest Airlines.)

 

While the stock prices of the survivors have soared, (UAL went up 27% in 2016, Southwest 16%) the consequences for passengers haven’t been as positive. For example, it's impossible to fly non-stop from Hunter’s San Diego-area district to New York without ‘choosing’ United. Air fares, baggage and other fees and customer complaints have soared.

 

In the board game RISK, a key tactic is to gain (and keep) control of continents in order to get additional armies, an incremental advantage that builds up over time. For the carriers, the ‘continents’ they control are their airport hubs, and they don’t seem interested in expending resources to break into each other’s strongholds. At 93 of the top 100 airports, one or two airlines control a majority of the seats.

 

Statistics from the US Department of Transportation (April 2017) show just how dominant each airline is at its hubs. Newark Airport is United's fortress of solitude. UA's passenger share at EWR is 50.82%, followed by ExpressJet, 8.82%, American 7.72%, JetBlue, 6.62%, and Southwest, 4.8%. If you are one of nine million New Jerseyans, unless you are willing to deal with traffic, tolls and time to get to Philadelphia or JFK, Newark is your airport. And if you want to fly non-stop somewhere, United is your airline.

 

If Newark belongs to United, Atlanta Hartsfield-Jackson (ATL) is definitely Delta’s domain, with 72.64% of the passenger traffic. Delta’s nearest competitor, Southwest, has just 11% of Atlanta traffic.

 

American Airlines, unsurprisingly, owns Dallas Fort Worth, with 67.83% of DFW passengers, dwarfing Mesa, 7.53%, Envoy, 7.48%, Spirit, 4.07% and ExpressJet, 3.74%.

 

Chicago’s O’Hare (ORD) is a duopoly, with United, (31.43%) and American, (26.54%) controlling the lion’s share, followed by Envoy, 10.2%, SkyWest, 7.21%, and ExpressJet, 4.77%. That’s because Southwest controls an astounding 95.6% of the traffic at Chicago Midway, followed by Delta, 2.35%.

 

Although airport hegemony is real, flyers do have some choices.

 

Points first? Are you all about the miles and status with your ‘favorite’ airline?  Then by all means fly them always, build your status, go for those partner programs, platinum credit cards and year-end mileage runs. Just remember that might mean a few inconvenient and/or connecting flights along the way.

Maybe you’re lucky enough to live where you can play a double game: In Dallas, Chicago or LA, for example, you could get status on American (or United in Chicago or LA) but fly shorter hauls on Southwest out of Love Field, Midway, or Burbank or LAX.

 

Time first? Do you always need a non-stop? Then switch to the dominant airline at your airport, which will always have the most non-stops; but don’t be too loyal; your real loyalty is to the “Total travel time” search line and who gets you there the fastest. Be prepared to pay.

 

Dollars first? If you’re like most of us, your search will be for the cheapest flight. Are you willing to take a connecting flight—or two? How about picking a different day to travel? A different month (January after New Year’s is good?) Are you willing to drive? Pay tolls to and parking fees at a distant airport?  Learn to accept being in the lowest boarding class, do without luggage and on-board amenities, and spend your savings wisely.

 

Travel expert Joe Brancatelli of joesentme.com says that as for most people nonstop flights are the goal, “You have to fly the airline that dominates. The airlines that are not dominant in a market almost always only fly you to their respective hubs, the airports THEY dominate. So if you fly them, you end up taking a connecting itinerary almost everywhere you fly.”

 

Brancatelli’s example: “In Atlanta, dominant Delta can literally fly you around the world on a non-stop basis. If you fly United from Atlanta, however, you're going to end up changing at one of United's hubs (Denver, Washington/Dulles, Newark, Houston) then have to connect at one of those cities to your ultimate destination.”

 

As Brancatelli observes, in the Washington, DC area, Dulles, BWI and National all offer different flight options. “But if you live in Arlington, the last thing you want to do is drive to Dulles. If you are in Maryland near Baltimore, going to Dulles is bad.” But being willing to change your behavior and travel a little further may be what it takes to escape airport domination.

 

Otherwise, your choice is to swear loyalty to the dominant carrier at your airport. Only you can decide if your local airline is worthy of such financial fealty.

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