Tag: IAH

Seasonal Route Cuts at United

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Recently I waslooking for a ticket to Hamburg in late January and had a found a decent deal on United via Newark. Today I went back to book it and found that the non-stop Newark-Hamburg flight was no longer being offered. Turns out, United is seasonally cutting a few routes, including Houston-Munich and Newark-Hamburg. The cuts will run between January 8 and May 5, 2017. Confirmation of these cuts was made by the United Twitter team.

The transatlantic market must be much softer than the airlines are letting on. Both Newark-Hamburg and Houston-Munich were year round options for the last few years. Has the economy dipped so much so that they just aren’t selling as well? For me it is an inconvenience. I really wanted to fly the route this January but it looks like I will have to wait until summer to get that cool line.

If you are booked on one of these flights during the listed dates you will likely no longer see the affected segments in your reservation but the automatic rebooking engine should list a new option soon. If you are unhappy with what you are rebooked on, give United a call with options that you find acceptable.

Will the Emirates A380 Cause Houston to Suffer?

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An OpEd in the December 12, 2014 Houston Chronicle by a United Airlines employee really has me scratching my head. In it, Mark Segaloff posits that Emirates’s status as an airline hinges on them being state owned and that they are able to hurt U.S. airlines because of their use of the Import/Export bank to finance their aircraft. He continues, stating that state-owned airlines cause domestic U.S. carriers to lose business and suffer, costing jobs. While my heart is with Mr. Segaloff, my head is not.

Emirates A380 - Mark Harkin
Emirates A380 – Mark Harkin

It is true that there has been some concern about state-owned airlines coming into the U.S. and hurting domestic carriers. Even European carriers have stated that the Middle East carriers pose a serious risk to their business in the region. Here’s the kicker though, the European carriers are really the only ones with skin in the game. They are the ones with multiple flights to multiple destinations in the Middle East. U.S. carriers fall well behind when it comes to service to places like Dubai, Abu Dhabi, Doha, Kuwait City and others. In fact, United could not make their Washington-Dulles to Doha, Qatar (with a stop in Dubai) route work, so they pulled that service.

Mr. Segaloff’s key point is that the Emirates flight will cost Houston jobs. I fail to see any facts in the article as to why that would happen. United offers a once daily flight to Dubai from Dulles. If they want to compete directly for those dollars from potential customers out of Houston, maybe start non-stop service? Maybe offer a product that is not being degraded by installing slimline seats, reducing seat pitch, and generally making the travel experience sub-par. I know that Mr. Segaloff would probably retort, “But they are a state-owned airline with all the money in the world to make service improvements.” to which I would simply give him a link to United making a record profit in Q3 of 2014. There seems to be some money for improvement there, yet United offers 2-4-2 seating in business class on the Dubai flight. No thanks, I would rather take the non-stop from Houston (avoiding Dulles) in 1-2-1 seating on the A380. United does offer a number of one-stop options to a number of Emirates destinations via their antitrust immune joint venture with carriers such as ANA and Lufthansa. Granted, the service standards are not the same as Emirates but there are options that make money for United and their partners.

Something that Mr. Segaloff fails to mention is that the Emirates service to Houston is not new, it is simply bigger now. Truth be told, Emirates used to offer two daily flights to Houston from Dubai and with those two flights they actually had more seats (532) flying to Dubai than they do now with the A380 (489/517 depending on version). Where were the complaints when Emirates was running that second flight?

There have been a number of announcements of service to Houston by carriers that are not state-owned and not from the Middle East but these seem to do little to upset employees. But from an airline business perspective, these new routes are the worrisome ones. Korean has started non-stop service to Seoul, which I had heard was off to a rocky start but is doing better now. ANA announced service to Tokyo, EVA has schedules loaded to Taipei, and there are rumors that British Airways wants to bring an A380 to Houston for one of their two flights a day. ANA and EVA are Star Alliance partners with United, but Korean brings a good product and a fantastic network in Asia. Where is the uproar against that?

The Import/Export Bank is actually a valid concern, especially when the money is not spent the way it was meant to be spent, helping a foreign company grow by buying American goods. However, I do not think Emirates has any problem letting that money fall away. In fact, that money is specifically for Boeing jets, not for the Airbus A380 that Emirates is bringing to Houston.

I think one place where Mr. Segaloff could apply is argument is to the new Emirates flight linking New York City with Milan, Italy. This is a city pair that is served by two U.S. carriers, Delta from JFK and United from Newark. Now you have a third foreign carrier on the route who is trying to bring down the prices but not having much success. But I do not think it’s a question of letting foreign carriers operate routes from the U.S. to their respective hubs but whether or not those foreign carriers should be allowed to operate so called “Fifth Freedom” routes like New York-Milan ad infinitum. A number of carriers do this but use that fifth freedom flight to connect to their hub at the end. Out of Houston, Singapore Airlines flies to Moscow and then onward to Singapore. They are allowed to sell tickets to Moscow or Singapore out of Houston and they fill their plane. It’s a win/win. But when do those flights become anti-competitive? That’s for the FAA and DOT to sort out.

It is one thing to cry wolf when there is a valid concern but to say that Emirates and their A380 is going to hurt Houston is simply fiction. If anything, the Emirates service is helping strengthen the Houston economy by offering one-stop service to places that were previously unreachable without 2 or more stops. It will also continue to keep prices relatively competitive, which is good for the consumer. Sure, United may not like that, but how many passengers are they really flying a day to Dubai? How many are they flying to Europe for Middle East connections? United has a choice to make, they can up their game and focus on becoming a world class international carrier or they can relegate themselves to a middle-tier domestic focused carrier with a product that just barely keeps up with the competition. That decision will dictate the fate of those jobs that Mr. Segaloff is concerned about, not a single Emirates A380 flight a day to Houston.

Korean Air Arrives in Houston

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Korean Air - 777-200ER

Today is the big day, Korean Air is arriving from Seoul around 8:30am CT, bringing the first non-stop passenger service between Houston and the capital of South Korea. The flight is being operated by a Boeing 777-200 with three classes of service, first, business, and economy. It appears they will be featuring their new product on the route, the Kosmo suite in first and the Prestige sleeper seat in business, both of which are lie-flat seats. The economy seat is also a new product featuring audio and video on demand and power and USB ports available for each seat. The seat map below shows the layout of the cabin.

Korean Air 772 Seatmap

Korean Air has an extensive route network and gives Houstonians another great option for getting to Asia. Seoul’s Incheon International Airport, while far from the city center, is a great airport for connections and offers plenty of amenities, including free shower rooms for transiting passengers. They also offer free tours of Seoul for transiting passengers, which is a great way to see a city rather than sitting an airport waiting for your connection.

I should note that Korean also flies into Gimpo International Airport, the smaller, closer to the city airport, with flights only serving Asian destinations. But, if you are spending a few days in Seoul and then continuing on elsewhere in Asia, Gimpo is a great option with frequent flights and an easily accessible location close to the city center.

This is a fantastic option for travelers to get to Asia. Of course, I wish it was Asiana Airlines with their ties to the Star Alliance and United, but another carrier at Houston offering more flights is never a bad thing.

The Korean Air flight departs Houston for Seoul at 10:40am and arrives in Seoul at 3:10pm the next day. Current summer prices on the route range anywhere from $1500 round-trip to $2000 round-trip in economy. Korean Air is a member of the Skyteam airline alliance.

SAS to Start Stavanger-Houston Service

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SAS has announced they will start a new flight from Stavanger, Norway to Houston on August 20, 2014. This flight has been rumored for a while (no it’s not an April Fool’s joke) and it looks like it is coming to fruition. With ExxonMobil and Shell both having large facilities in Houston and Stavanger and Exxon’s Dallas campus, the flight is a great way for these companies to move their people between offices and offshore operations centers.

The flight will be operated by a PrivatAir 737-700 in an all business class configuration with 44 seats. The service will operate every day of the week except Saturday.

I will definitely be trying to move one of my reward tickets to Europe to this flight as soon as it becomes bookable later this month.

Notable Fares from Houston

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As of yesterday there were a number of really good fares to places like Istanbul, Doha, Dubai, and Kuwait City. The most attractive fare is Houston-Istanbul on Turkish Airlines’ new non-stop service starting in April. The fares are good from April through June and requires that return travel not start before the first Sunday after departure.

Want to search for these fares? Simply use your favorite booking website and search IAH and IST departing some time in April-June and returning no earlier than the first Sunday after you left. One note, Turkish’s non-stop service is only offered five times a week, but United has daily service via Newark.

The United 787

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About a month ago I had the opportunity to be on the tarmac at IAH for the delivery of United’s new Boeing 787. I took a bunch of photos and have just really started going through them. As I edit them, I’ll add them to this post.

The United Boeing 787 Arrives in Houston

United Boeing 787

Update

A United spokesperson has now confirmed that the remaining 787 deliveries have been delayed and they will be adjusting the schedules as a result. In a bit of good news, they will allow free changes/refunds for these special flights. If you have a 787 flight booked and are affected by the schedule changes you should receive a communication from United. If you do not, give their reservations number a call.

The current status of United’s 787 is that it is still undergoing FAA certification. A few domestic flights were to start in early November but there have been reports and rumors of issues. A few tweets from the AirlineRoute account seem to suggest that some of the November schedule is going to change. United is to receive their second 787 some time next week. If that schedule holds, then some domestic routes will still be operated by the 787. If you’ve booked one of these flights just to fly the 787, check the your reservations after this weekend’s schedule changes take place.

The United Boeing 787 Arrives in Houston

 

 

 

United Airlines Playing Fast and Loose with IAH

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The news of Houston’s Hobby airport receiving permission from the city to start international flights was big. Lots of people are happy, making the assumption that Southwest Airlines is going to significantly lower costs in the Houston-Latin America market. That is a different discussion, the real focus of my attention lately has been United Airlines’ reaction to the news.

United Express

Three big things were announced by United shortly after the news that Hobby would become an international airport; There would be 1,300 employees laid off in the Houston area, the Houston-Auckland route would be going away, and there would be other capacity cuts. For all three of these announcements, United directly blamed Houston city council and their approval of the Hobby expansion plans.

Laying off 1,300 employees now, due to an expansion that will not be complete until 2015 seems a bit strange doesn’t it? That is probably because these cuts have been planned for a while now and United is using the Hobby news as cover. United has not been specific over who will be laid off, but I would be willing to guess that a lot of the layoffs will not be focused on airport employees. United is going to try and consolidate their operations staff and their headquarters staff. Look for layoffs of back office employees and some front line folks.

The Houston-Auckland route cancellation is a bit different. There is a very real possibility that the route being cancelled is partially due to the Hobby Airport news. The idea behind the route was the connecting of Latin and South America to the Oceania region. Currently, the market is only served by Aerolineas Argentinas and Qantas, both offering limited coverage in South America. I have had a few people say to me that there’s no way United was basing this route on this traffic alone. Sure they were. The 787 is perfect to make money on the Houston-Auckland route with connecting traffic split between the U.S. and Latin and South America. Between passengers and cargo, the route could have been very successful. However, between fuel costs, the economy, and now the news about Hobby, United must have reevaluated the route and decided against it.

Lastly, United has said there will be capacity (flight) cuts due to the Hobby expansion. These cuts too, were probably planned before the Hobby changes ever gained traction. First, United is retiring all of their 737-500s and a lot of the older, pre-merger, United 757-200s. That’s a lot of capacity cut simply because the planes are older and inefficient. But blaming such cuts on the expansion of Hobby is a stretch.

In all of this, United is doing something that in my mind is very dangerous. They have been very vocal against the expansion of Hobby. The news organizations picked up on this and started calling it an “airline war” when the issue of Hobby’s expansion is one that concerns the city as a whole (or, at least it should). Instead, United has dived straight in and tried to fight this as bad for them instead of focusing on impact to the city, the city’s growth, and the infrastructure around Hobby. These are the issues that we as Houston citizens should be asking about.

I think United should have been upfront on why exactly international flights from Hobby would affect international traffic out of Bush Intercontinental, rather than just painting some broad strokes and hoping that people understood. What United has done has left a bad taste in a lot of people’s mouths because they can see through the “we’re laying people off because of Hobby expansion” rhetoric. The timeline does not match up.

In reality, the merger has made some inefficiencies in the IAH hub, especially for southern east coast to northwest coast connections. Why have all of that traffic go through IAH when you’ve got flights with empty seats leaving from Denver and an incentive from the city of Denver to push more traffic through that hub? But, using the Hobby news to cover your butt on such changes is bad public relations and passengers are able to see through the charade.

What United should have done is immediately offer some specials to the markets that Southwest considering entering. The goal should be to convince customers that you are the best carrier for a particular route, not to create ill will by announcing layoffs and route reductions. Compete on service, price, and reach and go head to head with Southwest.

The future of IAH is simple, United is not going to abandon a fortress hub. They’ll attempt their political game but it will backfire, we’re already seeing that, then they will be forced to compete but will now be digging themselves out of a public relations hole. I am willing to give United a little leeway but they are trying my patience and I’m sure other Houstonians feel the same way.

The city pulled the trigger on this plan solely focused on the wrong thing, airfare. City council needs to evaluate the impact to the surrounding neighborhoods and what improvements to infrastructure will cost (Southwest will not be picking up those costs) rather than thinking about how much the flight for their wild Cancun weekend will cost. The impacts to air traffic and passengers should be examined more closely as well. The CAPA study is a great resource. At the same time, United needs to reevaluate their “protest” of the city’s decision. Focus on how you can make the traffic you are relying on for these routes stick with you United rather than doing everything in your power to drive them away. This is Marketing 101.

Fight Brewing Over O’Hare and Parallels with Intercontinental

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There is a little bit of a fight brewing in Chicago over the future expansion of O’Hare.

Mr. Emanuel is at odds with airline boss Jeff Smisek over expansion of O’Hare International Airport. The CEO of United Continental Holdings Inc. jabbed at Mr. Emanuel recently, saying there’s no need to finish the multibillion-dollar project launched seven years ago.

Both men have the best interests of their businesses (Chicago is Mr. Emanuel’s “business”) in mind as they discuss the upgrades and expansion of Chicago’s O’Hare airport. Mr. Smisek is trying to control United’s costs by limiting their involvement in the expansion of the airport.

Mr. Emanuel can’t afford to let O’Hare fall behind rival airports. Mr. Smisek, on the other hand, has a different agenda. Unlike airline execs of the past, whose expansionist strategies dovetailed with the city’s desire for an ever-bigger O’Hare, he’s focused on the bottom line. He aims to boost profits by reducing capacity and competition in the airline industry, which has a long history of big spending, bloody fare wars and monumental losses. His merger of Houston-based Continental Airlines Inc. and Chicago’s UAL Corp. advanced those aims while creating an airline with unprecedented market power, the largest in the industry.

The interesting take away here is that apparently Mr. Smisek hates competition, yet none of this came up during the merger of United and Continental, which truly reduced competition. And why is no one bringing this up in the possible merger of US Airways and American Airlines? If competition is so important, then enforce it when carriers try to remove competition directly by merging.

All of this should be a warning sign to those looking at the airline industry from the outside. The airlines are struggling and they are trying to do all they can to survive. For some, that means merging, for others that means looking at operations and reducing capacity and for others it’s a combination of both. And this is not just a problem in the United States, just look at Lufthana’s announcements about reducing regional jets from the fleet, removing first class from some aircraft, etc.

Then there is this article I came across. What stuck out to me was this:

The terms of the debate are different in Chicago, but the bottom line is the same. What’s best for the city may not be best for United Airlines, and vice versa. There’s nothing particularly remarkable about a large company with near-monopoly control in a given market doing whatever it can to keep competition out. What is remarkable is that the argument to allow such competition would somehow be damaging to consumers is given any credibility.

We sure are getting lax with our throwing around of the “m”-word. United and American Airlines both have major hubs at Chicago O’Hare but that has not kept carriers from starting service to the airport. Virgin America has a number of new flights to and from Chicago. And neither airline has tried to limit Southwest’s operations at Chicago Midway. During the city council meeting in Houston the word “monopoly” was thrown around a lot as well. United does not control the Terminal D/E FIS facility. Other airlines are free to come and go as they please. Southwest used to even have gates at IAH. They gave those up to move to Hobby and in doing so, gave up their option to fly international flights. TACA, Aeromexico, and VivaAerobus all fly to Latin America from IAH, clearly, United does not have a monopoly. The other airlines’ operations are not huge but that isn’t because of a monopoly, it’s because IAH is not their hub. By this monopoly logic, American Airlines has a monopoly in DFW even though plenty of other airlines have flights there. Or, heaven forbid, Southwest has a monopoly at Hobby and Love Field.

Let me refer you back to the two posts in which my wife Tiffany Tyler analyzed Southwest’s proposal and the claims United was making at the time, which seem to have evolved somewhat. I understand United’s fear of this proposal. I understand their threats regarding Terminal B at IAH, though given the growth projections for IAH and the fact that they want to close down the former Continental hub in Cleveland it’s hard for me to take those threats too seriously – where else are they going to go? Unlike Southwest, which says it will go to San Antonio for their Latin American and Caribbean business if Hobby is not available to them, they’re pretty much locked in. What I don’t understand is how having more competition, even if it’s just for a handful of Latin American routes, can be bad for travelers. It makes no sense to me, and according to his press release it makes no sense to CM Andrew Burks, either. I hope in the end it makes no sense to the rest of Council.

The problem is not necessarily that there is competition, it’s the fact that the competition is based on false figures ($133 Houston-Bogota fares). Where will United go if Hobby is allowed to have international flights? Denver. They have plenty of gates there and can serve the connecting traffic just as well from there as from IAH. In fact, I’m sure the city of Denver would be happy to have more people flying through their airport. During the city council meeting Southwest offered to build the necessary gates and pay for the FIS facilities at Hobby. I say let them do that. If the city does not have to pick up the cost then there is no reason not to let them try to compete in the Latin-American markets.

Turkish Airlines Tentatively Starting Flights to Houston

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In February the City of Houston and a group of Turkish representatives announced new service between Houston and Istanbul on Turkish Airlines.

If you follow airline announcements you know how quickly such rumors turn into pipe dreams or disappear completely. In the cast of the Istanbul-Houston route, I have been very skeptical, especially with fuel prices being what they are, but, this investor announcement from Turkish makes me a little more confident the service will actually launch. The page is in Turkish but here’s a poorly translated version:

Incorporation; aircraft availability and depending on the permissions in 2012, Istanbul-Houston-Istanbul and the Istanbul-Constanta-Istanbul route open, Mogadishu-Istanbul-Khartoum-Khartoum-Istanbul flights and Istanbul in Istanbul, Turkey-Djibouti-Djibouti-Mogadishu; Istanbul-Nakhchivan-Istanbul flights to Istanbul, the Istanbul-Ganja, Nakhchivan, it was decided to perform.

So, based on aircraft availability and the ability to obtain government permission, the Istanbul-Houston flights will start this year, possibly as early as this summer. I am really looking forward to this service starting! Turkish Airlines offers a great connection point to the Middle East, Europe, and Asia from their Istanbul hub and as a plus, Istanbul looks like a city I would have no problem having a stopover in. This announcement does not mean that flights are guaranteed to start between the two cities, but it adds a little credibility to the rumors and speculation.