Do the hubs have a future.

The hub system will never totally disapear but just right now there are too many. There is too much capacity currently in the air than there is demand. Airlines are loosing revenue and they need to bring their seats more in line with the actual demand. Your quickest and most efficient way of doing this is closing a few hubs. In the U.S as a prime if not the best example, there are over 30 hubs yet not enough connecting travellers to supprt this number. No airline wants to blink first yet the reality is that one has to as their operations are excessive in terms of economics in the current environment. Hubs such as Cleveland for Continental, St. Louis for American, Memphis for Northwest and Delta at Dallas are just prime examples but the airlines have a big promblem shaking them off to the extent needed.

It is the same in Europe. While airlines such as Swiss seem to have dropped airports such as Geneva and British Airways at Gatwick, the truth is that they cannot litterally drop hubs because the benefits they get from dropping are wripped out when they park those aircraft and the situation just intensifies. While I except airlines in Europe will continue to operate hubs, I think many will dissapear along with airlines due to the much needed consildation.

Interesting WD , if you are right it might mean that both airbus and boeing are in trouble since none of them has any RJ to sell to his customers

The only way to fill a 747 or 767 international flight is to have a hub and spoke system. But in the US we’re seeing a hugh shake up of the domestic structure thanks to the introduction and improvement of the ERJ and CRJ. With both capable of 3-4 hour flights companies are realizing new possibilities in flight frequency and destinations. They can seriously compete on 4 hour (previously 737 flights) routes. Now you don’t send 3 737’s from NYC to Chicago, you send 9 ERJ’s. The traveling public has 3 times the choices in departure times which is great and the airline needs less people per airplane to start making money.

Up until this point we’ve only seen a shift in the hub system as airlines replace larger equipment with smaller. As the airspace gets more conjested with the increase flight frequencies in smaller jets I think we’ll see a shift to more point to point flying. Southwest is really the only airline that I know of that survives on almost total point to point service. No one has dared follow yet but if anyone does I think it will be with the ERJ/CRJ due to their lower costs. Jetblue put in that big order for the 190’s, perhaps they’ll be the first.

I believe that the hub strategy will definitely continue to be successful for international travellers and business travellers. They all need the convenience and amenities of a hub and spoke system. The leisure traveller has time to commute between these more remote airports. Also, sooner, rather than later, as we are witnessing in some areas, the majors will adopt this low frills policy and bring it into the hubs to feed their own needs (international, alliances, etc.). For example, Air Canada is switching to a reduced level of inflight service domestically (from now on all flights under 3 1/2 hours require pax to buy their meals on board “restaurant style meals”). I am sure they will set out to beat the no frills at their own game, and they will have brand loyalty behind them.