Transcript The Air Transportation Network - Center for Air Transportation

Hub and Spoke vs. Point to Point
Evan Demick
February 28, 2013
Agenda
 Airline Deregulation
 Point to Point
 Advantages and Disadvantages
 Hub and Spoke
 Advantages and Disadvantages
 Airplane Manufacturers
Airline Deregulation
 The Civil Aeronautics Board (CAB) controlled all
airline pricing, routes, and scheduling prior to 1978
deregulation.
 Influx of new low cost carriers have entered the
market.
 Fares have decreased across the board for air travelers.
 Productivity has increased substantially.
Point to Point Network
 Airlines fly passengers from point A to point B with no
stops in between (direct flight).
 Better utilization of aircraft and crews.
 Minimize travel time
 No need to disembark and transfer to another plane.
 No need to rely on other flights being on time at a hub
airport.
 The network will not be as affected by weather or delays.
Disadvantages of the Point to Point
Network
 Many cities may not operate on a point to point
network.
 Smaller cities may not operate on these point to point
networks because of demand.
 Higher fares.
 You pay for convenience.
Hub and Spoke Network
 Many airlines operate centralized hub airports.
 Typically larger in size and located in larger cities with
the ability to handle hundreds of daily flights.
 Equation of n-1 routes.
 Network of 10 destinations requires 9 routes.
 Large hubs provide travelers with hundreds of flight
options and locations to travel to.
 Hubs fly to smaller airports that point to point
networks may avoid.
Disadvantages of the Hub and Spoke
Network
 Congestion at the hub airport.
 Airline runs a tight schedule with as many incoming and
outgoing flights as possible.
 This can lead to overcrowding at the airport.
 Passenger inconvenience.
 Passengers must disembark and connect to a second
flight to reach their final destination.
 Connecting flights may be hindered by delays and loss
of personal belongings.
 Weather and general delays can impact the whole
system.
Airplane Manufacturers Input
 Manufacturers seem to have picked sides in the
argument between the two networks
 Airbus, with the A380 has gambled that airlines will fly
smaller aircraft into its hubs, and then transfer
passengers to larger aircraft.
 Boeing, with its new 787 Dreamliner argues that
passengers demand more point to point flights on
smaller aircraft with greater availability.
Conclusion
 Deregulation occurred in 1978.
 Allowed for greater competition in the industry as well
as cheaper fares, improved scheduling, and greater
choices in destinations.
 Point to Point Networks
 Airlines fly from point A to point B.
 Simple network and great for passengers.
 Not the most efficient network.
Conclusion
 Hub and Spoke Networks.
 Airlines fly passengers from smaller airports into larger
hub airports to transfer flights.
 Airline can operate fewer flights to reach the same
destinations as a point to point network.
 Saves airline money in the long run.
JetBlue Result
Airline Comparison
 Compare different airlines that operate point to point
and hub and spoke networks.
 JetBlue – Hub and Spoke.
 Southwest – Point to Point.
 United - Pre-deregulation Airline.
 Book a flight on each airline from Dulles to Orlando.
 Look at Costs.
 Total Travel Time.
 Number of Connections if Applicable.
Southwest Result
United Result
Table of Results
Airline
Connection?
JetBlue
Yes
Southwest
Yes
United
No