From Deseret News archives:
Losing an airline hub has its advantages
The average one-way domestic fare to fly out of Nashville International Airport was $138, or about 16 cents per mile, in the second quarter of last year, according to the U.S. Department of Transportation.
From Cincinnati, the average one-way fare was 71 percent higher at $236, or 30 cents per mile.
The difference? Cincinnati is a hub, Nashville isn't.
With the nation's biggest airlines still retooling and sputtering toward financial recovery, industry experts say it's likely some hubs will continue to shrink, or disappear, stoking fears at the potentially orphaned cities that they'll have more limited airline service.
St. Louis was crushed when AMR Corp.'s American Airlines shrank what was left of TWA, which had a hub there. US Airways Group already has threatened to cut operations further at its hub in Pittsburgh, and faces a battle at its Philadelphia hub with Southwest Airlines. Northwest Airlines has been reducing service at its hub in Memphis, and Delta Air Lines has in recent months been "realigning" its hubs in Salt Lake City and Dallas/Fort Worth, cutting the number of departures by its mainline Delta carrier and increasing service by its small-jet regional affiliates. Residents of Charlotte, N.C. — where average fares are among the highest in the country — have worried that the US Airways hub there also might be vulnerable to cuts, especially with the airline back in survival mode nearly a year after emerging from Chapter 11 bankruptcy protection. In fact, US Airways recently said it plans to become less dependent on hub operations in general.
The loss of a hub means fewer flights at the local airport and the likely end of nonstop service to Europe, factors that in the past made cities less attractive to relocating corporations.
But in the current airline economy, losing a hub can actually leave a city better off. As the dominant airline shrinks, others can more readily boost service and increase competition. The airport can also more easily lure new entrants, particularly fast-growing low-cost carriers that can push down prices overall. And many companies now look to locate near airports with lower fares or less congestion for their traveling employees.
