United Domestic Network

There has been a lot of chatter in recent days and months on United fine tuning their domestic network, specifically their hubs. Like most airlines United has evolved through M&A over time and most recently with Continental in 2010. Some would say it was a reverse merger since most of Continental management stuck around but the United name lived on. Others would say the airline still operates two companies under the hood. This is partially true due to labor agreements. pmCO staff fly on pmCO planes and pmUA staff fly on pmUA planes. What does this mean? Your Continental flight crew could time out (due to FAA regulations) and even though there could be a flight crew sitting in the concourse right next to you, if they’re pmUA they can’t work your flight. 

With staffing issues aside, another item that comes through M&A is redundant routes and hubs. Delta acquired Northwest Airlines and eventually closed the Northwest Memphis hub (since Atlanta is nearby) and heavily downsized Cincinnati (since Detroit is nearby).

The new CEO of United, Oscar Munoz, has noted in previous investor presentations has noted United will continue to

Refine the mission for each geographic region, hub and spoke

Many people read into this as the possibility of a hub closure.

What most people agree on is, if United were to close a hub it would be either LAX or IAD as all other hubs are strong in their markets. The Motely Fool has speculated that United is on the verge of closing a hub as well. However, while closing a hub can make sense it doesn’t look good for growth; and growth is the mission of the new CEO.

So if United were to close a hub, which would it be LAX or IAD? Well this is a fiercely debated topic on FlyerTalk. Many people see LAX as too crowded and United has no chance to really grow there (due to competition and space). LAX has had renewed interest from American and Delta each launching new routes. Others say IAD has been in decline for some time while United has been shifting to EWR. What I do know is that each LAX and IAD are a few hundred miles south from United fortress hubs at SFO and EWR respectively.

Survey Says

We’ll see what happens in the long run. As airlines are in the business of making money, they need to fine tune their network to maximize their profits. If downsizing operations at LAX or IAD would be better for United as a company then that is what they need to do.

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