¨Can we take a direct flight back to reality, or do we have to change planes in Denver.¨
Why Do Airlines Love Connecting Flights?
If you are lucky to become like me, a Fifty Plus Nomad., you will soon probably discover that one of the few annoyances you experience regularly are horrible flight connections. Either you will be in an airport for hours, or you’ll sprint like a football player from one side of the airport to another. Why do airlines make us suffer so?
The simple fact is that airlines love the hub-spoke route system because, surprise, surprise, it helps them maximize their profits. If airlines cared about consumers, they would have more point-to-point (nonstop) flights at reasonable costs. They know that business travelers are willing to pay a fortune to avoid connections. Leisure travelers are not willing to pay for nonstop flights. (Often, the difference in cost between connecting (hub and spoke routes) and point-to-point flights is between 10% and 400%. Sometimes, point-to-point flights aren’t even available).
What Are the Hub-Spoke and Point-to-Point Models?
Under a hub-and-spoke model, airlines arrange the bulk of flights to go to one or more central hubs. Under a point-to-point system, most flights go directly between two destinations.
For example, let’s say you are flying between Los Angeles and Columbus, Ohio. Using a hub-and-spoke model, you would fly from Los Angeles to one of several hubs and then connect to another flight from these hubs to Columbus. (Hubs on these routes include: San Francisco (United), Chicago (United/American); Denver, Houston (United); Dallas (American); Atlanta, Detroit, Minneapolis (Delta), etc.).
Using the hub-and-spoke model, you have many options for flights per day, but the trip is long (usually a minimum of seven to eight hours). Using the point-to-point model, you fly nonstop from Los Angeles to Columbus.
Flying point-to-point (or nonstop), the trip lasts three-and-a-half hours, and there are fewer flight choices. (There are two flights a day on this route.)
Rarely nowadays; however, it was commonplace in the past that airplanes would make a stop in another city. (A flight from Los Angeles to Columbus probably stopped in Chicago or Denver). These flights are called direct flights since you do not have to change planes. If you change planes, it is called a connecting flight.
Airlines often charge more for nonstop flights than connecting flights. For example, when I checked on the cost of flights from Los Angeles to Columbus, I found that the nonstop flights, on average, cost between $50-$100 more than routes that required a connection.
Consumers (including myself) are often willing to pay more for a nonstop flight than one that requires a connection to avoid the time and hassle of making a connection.
Why Do Airlines Prefer the Hub-Spoke Model?
Airlines prefer the hub-and-spoke model to the point-to-point model. The hub and spoke model enables airlines to connect the maximum number of destinations with minimum routes.
The hub and spoke model also allows the airlines to have a central base of operations, which brings many benefits. Some of these benefits include the ability to:
- Use a small number of aircraft and pilots to cover many destinations.
- Increase routing options between any two destinations. The hub and spoke model allows airlines to keep their planes in the air for more extended periods. It also affords passengers more extensive flight choices. (This is also why airplanes usually do not stay in the airport very long before they take off for another destination).
- Quickly respond if demand increases or decreases on a given route. Let’s say that Columbus suddenly gets a significant company, which increases demand for tickets to Columbus. With the hub-and-spoke model, airlines can increase the number of flights from several hubs to Columbus to tap into the market from all over the US.
- Centralize complicated operations such as cargo sorting, accounting, and passenger switching at a few main airports. (Centralizing operations saves “beaucoup” bucks).
Disadvantages of the Hub-and-Spoke Model
Despite the above-noted advantages, the hub-and-spoke model also causes the following problems:
- Congestion and delays at hub airports. Airlines schedule multiple incoming and outgoing flights during a short time frame. Scheduling flights this way allows airlines theoretically to limit waiting times and provide many possible connections for passengers. In reality, however, this type of scheduling often causes problems including:
- Too many airplanes arrive simultaneously, causing delays due to the scarcity of taxis, runways, and gates.
- Foul weather in one significant hub routines causes hundreds of canceled or delayed flights throughout the US. (Airports could control the number of take-offs and landings).
- Airlines achieve too much dominance in the hub city. The airlines that use hubs tend to squeeze out competing airlines in their hub cities. (In some cities, like Minneapolis (Delta), more than 90% of all traffic is one airline. Only a few major airports in the US, like JFK-New York, Chicago-O’Hare, and Los Angeles, serve as a hub for more than one airline). As a result, consumers have little choice but to take the dominant airlines if they live in a hub city (or in a town with a small airport close to the hub city).
- Consumers who live in a hub city that stops functioning as a hub see:
- A substantial reduction in flight availability.
- A sometimes significant increase in the cost of the few remaining flights.
- Conversely, an airport can become oversaturated after an airline increases its operations at a particular hub airport. Newark Airport, for example, has not recovered from United Airline’s decision to make it a major hub (after United merged with Continental) in 2010. Instead of being an alternative to overcrowded JFK, Newark is now infamous for its awful facilities and frequent delays.
Want Some Suggestions on How to Improve Your Experience with Connections?
Check out this post from Traveling Moms.
Travel Economics 101 Posts
Here are several posts designed to give Fifty-Plus Nomads a basic idea of how Travel Economics works. Being armed with a better economics education should make you a better travel consumer. (These can be read in any order)
- Why Alliances are Essential to Travel Providers. Are they Good or Bad for Consumers?Travel industry alliances are essential to the business´s survival. However, alliances have both good and bad implications for consumers
- Extra Fees: What are Ancillary (Extra) Fees and Why Are They Increasingly Becoming A Travel Industry Lifeline?More and more the travel industry depends on the sale of other products to expand and maintain its profitability. Expect to be bombarded with hints to buy other things (ancillaries) on your next cruise, flight, etc.
- The Internet Has Changed the Face of the Travel Industry More than Any Other Major IndustryThe internet has changed the travel industry probably more than another industry. This article discusses how these changes affect the consumer.
- Travel Industry Cost Saving Techniques: The Good, the Bad, and the UglyThe travel industry has made several changes to save costs in recent times. Some like using more fuel-efficient planes do not affect consumers that much. Others like reducing staff have made the experience worse for consumers.
- Business Travelers Versus Leisure TravelersThe travel industry gets most of its clients from leisure travelers. However, it makes more money from business than leisure passengers. The airlines put up with us leisure travelers because they couldn’t survive without us. However, they don’t hide their preference for business travelers.
- Why Are There So Many Connecting Flights? A Discussion of Why Airlines Love the Hub-Spoke Model More than ConsumersUnbeknownst to most consumers, the cause of most of our airline-related complaints is the hub-spoke model. Unfortunately, however, the hub-spoke model is also essential to the airline industry’s financial viability.
- Airline Schedule Changes: Why Don’t Airlines Keep their Promises?Learn why airlines change their schedules after you buy your tickets and what you can do about it.
- How Many Taxes, Fees, and Other Charges Do Consumers Pay For Airfare, Hotels, and Other Travel Services?The amount and number of travel taxes, fees, and other charges added to your bill will probably surprise you. Many are hidden and like everything else, taxes keep going up.
- Airline Consolidation: What Are the Disadvantages and Advantages For the Consumer?The airlines have consolidated so fast in the USA and Canada that only 5 players dominate the market. Learn what this means for consumers.
- Travel Industry Consolidations (Non-Airlines): The Effect on Consumers (Negative or Positive)?Probably the most significant change in the travel industry in the past couple of decades has been the industry’s rapid consolidation. Read this post to discover how few travel players really exist in the market today. and how this rapid consolidation has affected consumers.
- Why the Sharing Economy Has Become So Popular in the Travel Industry?The sharing economy like Uber and Airbnb has made a major influence on the travel industry and will continue to affect the industry far into the future.
- Third World and Chinese Travelers: The Biggest Future Travel TrendThe biggest change affecting the travel industry is the gigantic increase in emerging countries and Chinese travelers. These travelers will change the future face of tourism more than anything else.
- The 3 Reasons Travel Prices Are So Radically Different than Other Products: Perishability, Capital Costs, and Yield ManagementHave you ever wondered why travel products seem to be priced so crazily? Learn the three economic factors that contribute to the pricing of travel products: perishability, high capital costs, and yield management.
- Travel Economics 101: Learn How the Industry Works and Save Yourself Money and HeadachesPaul Heller, the Fifty-Plus Nomad founder, has developed a series of posts about travel economics. Reading these posts will help Fifty-Plus Nomads deal with some of the problems with the travel industry they are likely to encounter during their long-term, round-the-world journeys.