Running a hub and spoke airline is a complicated business. An airline organizes a series of flights at a hub and essentially needs to be their own two-sided marketplace.
American Airlines operates a hub in Dallas-Ft Worth (a quite large one, I might add). They offer service from Washington-Dulles (IAD) to DFW and from DFW to Denver (DEN). But, they don’t offer IAD-DEN. So, they need to entice customers to fill both the IAD-DFW and DFW-DEN flights. And, they need to do so in a way that competes with other airlines offering nonstop service. Oh, and they need to fill both planes. That’s a simplification of the hub and spoke model, but I hope it helps get the point across.
American Airlines has a hub at New York JFK airport. They also have plenty of flights out of Laguardia (LGA) and Newark (EWR). For the most part, though, LGA and JFK serve as their “New York” presence. Based on some recent information I received, it seems like AA is shrinking in New York.
International Flights Disappearing From JFK?
I haven’t seen public confirmation of all these changes. But, I have spoken with a reliable source of information that says the following destinations are shrinking/going away for American Airlines out of JFK:
- Manchester (seasonal)
- Zurich (cancelled)
- Dublin (seasonal)
- Edinburgh (seasonal)
It’s worth noting that the term “seasonal” is commonly used in the airline industry and generally doesn’t mean what you think it means. It’s a term that’s frequently used as a placeholder that sounds better than saying a flight was canceled. I see Dublin and Edinburgh come back onto the spring schedule but I didn’t see Manchester. I had heard Manchester might return seasonally, but this announcement from August seems to indicate it’s gone for good. Dublin and Edinburgh look like they come back as 757 service, which is what I believe they have now.
Domestic Cuts Coming Next?
These potential international cuts take us back to that equation of an airline hub and how flights are fed. Theoretically, a flight from JFK to Zurich is filled partially by people in New York and partially by people from Raleigh, Orlando, Nashville, Indianapolis and Columbus. Those are all cities American serves out of JFK. Is the loss of a handful of daily European flights enough to affect the profitability of a route like JFK-Indianapolis?
If so, does American move to eliminate/downsize some of those routes? That’s a vicious cycle. It appears that flights from JFK to Paris and Rome are likely to continue. Flights to London and Madrid are part of the joint venture between AA, British Airways and Iberia. The revenue-sharing there puts those flights on slightly different rails. Can American sustain profitability on flights like JFK-Paris with little feed from their network?
What’s Next For American Airlines in the Northeast?
The drawdown at JFK isn’t necessarily shocking news. View From The Wing reported on this subject back in August. At that time he indicated Philadelphia was the likely place for international growth. This was further reinforced during the American Airlines Media Day I attended a few weeks ago. It’s also reinforced by some of the crew movement I’m hearing now.
The dialogue I’m hearing is that Delta is eating American’s lunch at JFK, necessitating these cuts/transfer of service. Philadelphia is much more of a fortress hub for AA. However, it’s not NYC. American Airlines is now left with only a handful of international routes from JFK that aren’t supported by the BA/Iberia joint venture.
New York City is an important market for any major airline to serve. There are lucrative corporate contracts to be had. I got the sense that routes like JFK-LAX were highly profitable prior to their merger with US Airways, due mostly to contracts and premium passengers. It will be interesting to see what the Northeast looks like for American in a year or two.
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