Airport hubbing
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    Airport hubbing Airport hubbing Presentation Transcript

    • 1 THE DEVELOPMENT OF AN AIRPORT AS A HUB Dr Nigel Dennis Senior Research Fellow Department of Planning and Transport University of Westminster
    • 2
    • 3 LONDON AMSTERDAM FRANKFURTPARIS
    • 4 A C E B D F
    • 5 A C E B D F X A C E B D F
    • 6 GROWTH IN THE POWER OF A HUB n spokes n(n-1)/2 conn markets + n local markets 2 1 + 2 = 3 6 15 + 6 = 21 10 45 + 10 = 55 50 1225 + 50 = 1275 100 4950 + 100 = 5050
    • 7 CHARACTERISTICS OF AN EFFECTIVE HUB •  Central Geographical Location •  Efficient Processing (Low MCT) •  Local Traffic Base •  Co-ordinated Scheduling and Ample Runway Capacity
    • 8 GEOGRAPHY AND HUB LOCATION Increase in passenger km required to interlink 36 airport network relative to optimal location Hub Brussels 0% Paris + 2% Cologne + 3% Dusseldorf + 4% Frankfurt + 6% Amsterdam + 7% Stuttgart + 11% London + 12% Zurich + 14% .. .. .. .. Athens +196%
    • 9 MINIMUM CONNECT TIMES FOR A SELECTION OF AIRPORTS Different MCTs apply for other airlines/terminals at LGW, LHR, CDG, ATL There are also specific exceptions to the general MCTs shown Airport MCT (min) Between MCT (min) Between Amsterdam 40 short-haul short-haul 50 otherwise Birmingham UK 45 Brussels 40 short-haul short-haul 50 otherwise Frankfurt 45 London Gatwick (N Term) 45 London Heathrow (BA) 60 T5 T5 90 T3 T5 Madrid (IB) 45 T4 T4 55-90 otherwise Munich (LH) 30 Paris CDG (AF) 45 Vienna 25 OS OS 30 otherwise Atlanta (DL) 35 domestic domestic 50-80 otherwise Sydney 30 domestic domestic 60-75 international all Delhi 90 domestic domestic 180 international domestic
    • 10
    • 11
    • 12 IMPORTANCE OF THE HUB Source: ACI/CAA/ADV/IATA various years Transfers as % of total traffic Frankfurt 54 Amsterdam 44 Paris CDG 38 London Heathrow 36 Cincinnati 75 Charlotte 74 Atlanta 63 Chicago O'Hare 53
    • 13
    • 14 MCT DEPARTURES DEPARTURES ARRIVALS ARRIVALS time time THE WAVE CONCEPT
    • 15
    • 16
    • 17
    • 18 WAVE SIZE AND LENGTH For comparison BA at LHR has about 18 departures in every hour Hub Departure wave No of aircraft Time FRA-LH 0810-0955 68 105 min AMS-KL 0930-1045 63 75 min CDG-AF 0935-1030 52 55 min
    • 19 London Heathrow arrivals Thur 13 Nov 1997 (scheduled services) 0 5 10 15 20 25 30 35 40 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Half hour period commencing Numberofarrivals Other airlines BA + partners
    • 20 London Heathrow departures Thur 13 Nov 1997 (scheduled services) 0 5 10 15 20 25 30 35 40 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Half hour period commencing Numberofdepartures Other airlines BA + partners
    • 21 Amsterdam arrivals Thur 13 Nov 1997 (scheduled services) 0 5 10 15 20 25 30 35 40 45 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Half hour period commencing Numberofarrivals Other airlines KLM + partners
    • 22 Amsterdam departures Thur 13 Nov 1997 (scheduled services) 0 5 10 15 20 25 30 35 40 45 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Half hour period commencing Numberofdepartures Other airlines KLM + partners
    • 23 RUNWAY FACILITIES AT MAJOR EUROPEAN AIRPORTS * indicates airports with two parallel runways Source: ACI, CAA, Airports Airport No of principal ATMs ATMs runways 2006 2011 Paris CDG 4* 542 000 514 000 Frankfurt 4* 489 000 487 000 London Heathrow 2* 477 000 481 000 Amsterdam 5* 440 000 437 000 Madrid 3* 435 000 429 000 Munich 3* 411 000 410 000 Barcelona 3* 328 000 303 000 Rome Fiumicino 3* 316 000 328 000 London Gatwick 1 263 000 251 000 Zurich 3 261 000 239 000 Copenhagen 3* 258 000 247 000 Brussels 3 255 000 214 000 Stockholm Arlanda 3* 227 000 204 000
    • 24 RUNWAY CAPACITY SITUATION Major European airports - 2006 Source: Capacities from Eurocontrol Medium-Term Forecast 2005-2011 Aircraft Movements from ACI and individual airports + airport with significant new runway capacity available by 2010 Below 70% of capacity Copenhagen (43) Palma (48) Brussels (54) Vienna (55) Rome Fiumicino (57) Stockholm Arlanda (61) Dublin (66) sufficient for 5-10 years 70-90% of capacity Amsterdam (73) Manchester (73) Munich (75) Zurich (75) Barcelona (78) Istanbul (78) Madrid (87) + Paris CDG (87) full within 5 years Over 90% of capacity London Stansted (90) Dusseldorf (92) Frankfurt (92) + Paris Orly (93) London Gatwick (99) London Heathrow (100) full now
    • 25 HOURGLASS HUB HINTERLAND HUB
    • 26 DIRECTIONALISING WITHIN A WAVE Excerpt from Brussels Airlines (SN) morning schedule MCT = 40 minutes From BRU arr BRU dep To MRS 0840 0920 OSL MXP 0840 0930 MAN ZRH 0840 BHX OSL 0900 0950 MRS BHX 0900 MXP MAN 0910 1000 ZRH 0950 0930
    • 27 COSTS RELATING TO A WAVE SYSTEM Example: Air France - Paris CDG •  Upgrade ground handling in T2 $10 million (AF) $12 million (ADP) •  Add new module to T2 (Hall F) $275 million (ADP) Source: Jane's Airport Review
    • 28 BACK-TO-BACK WAVES American Airlines pattern at Dallas/Fort Worth 2001 arr dep 0610 1 0710 0800 2 0830 0920 3 1000 1050 4 1150 1240 5 1310 1400 6 1500 1550 7 1620 1710 8 1750 1840 9 1940 2030 10 2120 2210 2230
    • 29 IMPACT OF CONNECTING PASSENGERS ON AIRPORT REVENUES •  Commercial activities - two passenger movements, one passenger - no car parking or car hire - no meeters and greeters - limited need for retail facilities/catering (wrong currency problems) - scope for special promotions •  Aeronautical charges - downward pressure due to competition - passenger charge may be reduced
    • 30 TRAFFIC GROWTH AT US AIRPORTS SINCE DEREGULATION Passengers (millions) 1977 1997 2007 % change Av annual 1977-2007 growth (%) Salt Lake City 3.6 21.1 22.0 +511 6.2 Minneapolis 7.8 30.2 35.2 +351 5.2 St Louis 6.7 27.7 15.4 +130 2.8 Kansas City 4.8 11.0 12.0 +150 3.1 New Orleans 5.4 8.8 7.5* + 38 1.1 Cleveland 6.4 12.2 11.4 + 78 1.9 Source: ACI North America * 9.7 in 2004 before Hurricane Katrina
    • 31 HUBS V POINT TO POINT SERVICES Hub airlines more efficient - routes from major hub airports - thin markets <200 pax per day - long-haul markets Point-to-point airlines more efficient - dense routes not involving major hub airports - holiday routes
    • 32 ALTERNATIVE AIRLINE NETWORK STRATEGIES LOW-COST DOWN-SIZE NETWORK CARRIER e.g. Ryanair e.g. Iberia e.g. KLM easyJet Alitalia Air France Norwegian SAS Lufthansa Low unit costs Concentrate on Efficient hub can support high yield Wide coverage low yields local traffic (short/long-haul) Issue of Only likely to Yields will 'Flow traffic' as work at capacity improve as network grows constrained airports rival hubs close
    • 33 THE 'CONTINUOUS' HUB DEPARTURES ARRIVALS time ‘A new paradigm’?
    • 34 THE SHORTCOMINGS OF A 'CONTINUOUS' HUB based on 450 departures per day, 30 min MCT Number of marketable connections is cut by 50%-75% Arrival MCT Departure 0830-0900 30 min 0930-1000 60 flights 60 flights (East) (West) 0830 30 min 0900-1000 1 flight 30 flights (of which 15 West) (East) 1000-1100 30 flights (of which 15 West)
    • 35 WHEN MIGHT A 'CONTINUOUS' HUB MAKE SENSE? •  For low-cost airlines •  At hubs which generate a large amount of O+D traffic •  At hubs where most routes are operated at least 8x per day In Dec 2013, US Airways management start to reinstate wave pattern at American Airlines’ hubs following merger
    • 36 SOUTHWEST AIRLINES Example of linkages via Baltimore Providence dep Baltimore arr Baltimore dep Destination 0700 0820 0855 Phoenix 0900 Norfolk 0910 Columbus 0920 Buffalo 0920 Nashville 0925 Raleigh 0950 Jacksonville 1010 Albuquerque 1020 West Palm Beach
    • 37 BANDING OF FLIGHTS BY DIRECTION with 90 minute MCT arrive depart North 0900-0930 1000-1030 North East 0930-1000 1030-1100 East South 1000-1030 1100-1130 South West 1030-1100 1130-1200 West North 1100-1130 1200-1230 North etc
    • 38 THE GROWING IMPORTANCE OF TRANSFER TRAFFIC •  At London Heathrow the proportion of passengers that are making a transfer connection has risen: 22% in 1987 26% in 1991 33% in 1996 31% in 2001 35% in 2007 36% in 2010 (CAA Surveys) •  69% of KLM's passengers at Amsterdam are making a transfer connection there (KLM) •  47% of BA’s passengers at London Heathrow are making a transfer connection there (CAA data) •  On-line or code-share connections generate 4 times as many passengers as those involving a change of airline (BA/CAA data)
    • 39 TREND TOWARDS ON-LINE CONNECTIONS •  In domestic US in 1977 52% of transfer passengers were on-line now it is over 90% •  At London Heathrow in 1984 27% of transfer passengers were BA-BA in 1996 this had grown to 55% by 2012 it was 73% within BA and oneworld •  At Amsterdam it is estimated that over 80% of transfer passengers are connecting between KLM and partners Source: DOT/CAA/TSG/DIIO FMg Database used by InterVISTAS for LGW
    • 40 SCHEDULED SERVICES FROM HUMBERSIDE 2 Routes are operated •  ABERDEEN 0700, 1015, 1415, 1735 Eastern Airways J41 (29 seats) •  AMSTERDAM 0600, 1000, 1720 KLM city hopper F70 (70 seats) CONNECTS AT SCHIPHOL TO 160 KLM WORLDWIDE DESTINATIONS PLUS 37 MORE SERVED BY OTHER CARRIERS KLM figure includes partner and associate carriers There is also a weekly seasonal service from Humberside to Jersey by flybe Source: OAG March 2013
    • 41 PROPORTION OF PASSENGERS CONNECTING AT EUROPEAN HUBS Route Airline % connections at hub Cardiff-Amsterdam KLM 68% Manchester-Amsterdam KLM 58% Birmingham-Frankfurt Lufthansa 53% Manchester-Paris Air France 51% Manchester-Paris flybe 6% Liverpool-Amsterdam easyJet 1% Cardiff-Paris bmibaby 1% Bristol-Amsterdam easyJet 0 Source: CAA Survey N.B. easyJet is 10-20% on UK regions-London airports
    • 42 AIR BERLIN HUB AT PALMA Origin Palma Palma Destination arr dep Frankfurt 0910 1015 Porto Leipzig/Halle 0910 1020 Lisbon Salzburg 0910 1020 Jerez Dusseldorf 0915 1025 Bilbao Dortmund 0920 1025 Malaga Vienna 0920 1030 Barcelona Munich 0925 1030 Madrid Amsterdam 0930 1035 Alicante Berlin Tegel 0935 1040 Seville Hamburg 0935 1040 Valencia Source: OAG
    • 43 DOMINATION OF HUB TO SPOKE ROUTES Daily Frequencies Summer 1989 and Summer 2012 •  AMSTERDAM-GOTHENBURG 1989 1xKL, 1xSK, 1xAY 2012 5xKL •  LONDON-MARSEILLE 1989 1xBA, 1xAF 2012 3xBA, 2xU2, 1xFR •  FRANKFURT-VENICE 1989 1xLH, 1xAZ 2012 5xLH, 1xFR
    • 44 HUB DOMINATION IN THE US Hub Airport Hub Airline % of flights operated by Hub Airline (May 2005) Atlanta Delta 76 Chicago O’Hare United 48 American 39 Dallas Fort Worth American 83 Minneapolis Northwest 80 Houston G Bush Continental 86 Detroit Northwest 80 Charlotte US Airways 84 Philadelphia US Airways 70 Salt Lake City Delta 79 Cincinnati Delta 87 Source: OAG/Airline Business
    • 45 UNITED ROUTES FROM CLEVELAND October 2013 Cleveland depart Aircraft type Total daily seats Memphis depart Aircraft type Total daily seats To San Francisco 334 To Indianapolis 140 0826 739 0840 E70 1739 739 1757 E70 To Milwaukee 94 To Dubois, PA 38 0840 ER4 0835 BE1 1735 ER4 1750 BE1
    • 46 STABLING AT THE HUB STABLING AWAY FROM THE HUB 0930 1430 1930 0700 1200 1700 2200
    • 47 HUB REPEAT CYCLES AND AIRCRAFT UTILISATION AMSTERDAM 0930 1330 AMSTERDAM BRUSSELS 1015/1245 MILAN 1110/1150 ROME 1150/?
    • 48 DEVELOPMENT AND DEMISE OF HUB ACTIVITY AT DAYTON Figures are for Monday-Friday services * Non stop + USAir from 1989 April 1982 March 1983 Nov 1985 Nov 1989 Jan 1993 DEPARTURES 78 91 152 187 94 Piedmont+ -- 28 89 142 45 Other 78 70 63 45 49 DESTINATIONS* 19 29 41 43 21 Piedmont only+ -- 13 25 34 10 Other only 19 15 11 7 8 Piedmont+ & Other -- 1 5 2 3
    • 49 ABANDONMENT OF SECONDARY HUBS SWISSAIR/CROSSAIR/SWISS ROUTES FROM GENEVA 1997 (24 routes) Alicante Amsterdam Athens Barcelona Basel/Mulhouse Berlin Tempelhof Bilbao Brussels Dusseldorf Lisbon London City London Heathrow 1997 continued Lugano Marseille Moscow Nice Paris CDG Prague Rome Fiumicino Seville Stuttgart Toulouse Vienna Zurich 2010 (9 routes) Athens Barcelona Budapest Lisbon London City London Heathrow Moscow Prague Zurich Short-haul routes with at least one weekday frequency; Excludes code-shares operated by other carriers
    • 50 LOSS OF LONG-HAUL SERVICE AT BRUSSELS 2013 v 2005 v 2001 Source: Compiled from OAG data; includes all points outside IATA Europe Feb Feb Feb 2001 2005 2013 WEEKLY FREQUENCIES 174 80 161 SN (including code-shares) 107 35 108 Others 67 45 53 DESTINATIONS 47 26 42 SN only 22 12 26 Other only 17 10 14 SN and Other 8 4 2