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Old June 14th, 2005, 04:56 AM   #1
hkskyline
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Avoiding Connecting Flights Across the Atlantic - Growth of Smaller European Hubs

Market opens up as passengers avoid long trips to the airport
EUROPEAN REGIONAL HUBS: Sarah Murray looks at expansion of the transatlantic route and why airlines are so enthusiastic about operating away from main destinations.
13 June 2005
Financial Times

Business executives travelling to Hamburg from the US - tired of waiting in London or Frankfurt for connecting flights - have been looking forward to this month.

On June 6 Continental Airlines began flying non- stop between Newark, New York, and Hamburg. But this route is just the latest in a growing line up of flights between the US and Europe's regional hubs.

Many of the routes are being operated by Continental. In Ireland, for example, the airline operates a daily Boeing 767-400ER non stop service between Dublin and Newark and a daily Boeing 757 service between Shannon and Newark. The airline has led the way in transatlantic flights between the US and UK regions. It has served Birmingham, Manchester and Glasgow since the late 1990s and last year it added a service between Newark and Edinburgh.

For many of Continental's European destinations the key to its strategy lies in the fact that Newark is a hub for the airline. "A lot of these flights are based out of Newark Liberty," says Jim Compton, executive vice-president of marketing at Continental.

"The importance of that is that it's a world class facility in the largest local business market. So Newark became the foundation of what we're trying to do."

Newark also allows Continental to offer travellers arriving in the US connections with flights to the rest of the country. "We're the only carrier with a hub in New York," says Mr Compton. "So we're able to supplement the large local market in New York with connecting traffic from the US on to these destinations. That allows us to serve these secondary markets - so it's a nice niche for us."

Continental is continuing to expand this niche by adding cities to its portfolio of European destinations. As well as starting the Hamburg-Newark flight, the airline is also launching daily non-stop services between Newark and Bristol, Belfast, Stockholm and Berlin this year. "We joke that Newark is our European hub," says Mr Compton.

But Continental is not the only operator in the wave of transatlantic flights to European regional hubs. American Airlines has started a direct service between Boston's Logan International Airport and Shannon.

At the same time, the airline initiated a non stop service between Boston and Montreal, Canada, and resumed its seasonal non stop services from Logan to Paris and Manchester.

Many routes are aimed at leisure travellers. Amy Kudwa, of US Airways, says main customers for the airline's seasonal transatlantic flights from its Philadelphia hub to destinations such as Dublin, Shannon, Glasgow, Barcelona and Venice are tourists. "Summer is the peak travel time for Americans visiting Europe so we serve those destinations," she says. "We do see business travellers as well."

Zoom Airlines is also carving out a niche by flying from its home in Canada to UK destinations such as Manchester and Glasgow. This month the airline began to operate a weekly flight to Cardiff from Toronto. Zoom uses aircraft with two classes, premium and economy. More than 25 per cent of seats are premium class.

"We are predominantly a leisure airline but because of our prices, we're attracting a good number of business travellers," says Debbie Marshall, UK director of Zoom Airlines.

"Because we offer such good value for money, business travellers who are prepared to be flexible are flying with us, and largely in premium class."

In 2006, Zoom is planning to offer a Cardiff-Vancouver route and Ms Marshall says the airline will continue to expand to other destinations.

In the UK, the opening in April of Robin Hood Airport in South Yorkshire, the country's first new intercontinental airport in more than 30 years, presents additional opportunities for flights into the northern England.

Part of the appeal of these routes, says Ms Marshall, is the shorter time needed to travel to the airport.

"We did some analysis on those flying from Gatwick last year and about 40 per cent were travelling more than two hours to get to the airport to travel with us," she says. "So that, along with other things, led us to realise that there was a regional demand for long-haul flying."

In spite of the growing popularity of the regional routes, Mr Compton does not believe they present a threat to the traditional hubs. Rather, he says, they will create business.

He cites the example of a US company that wanted to hold a meeting in Berlin but, because no direct flights were available, held it elsewhere.

"Now they might decide to have that conference in

Berlin, so that's new traffic that you didn't see before," he says.
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Old December 26th, 2005, 07:10 PM   #2
Fabio
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this descentralization is pretty good, it increases the offers and sales as consequence.
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Old December 28th, 2005, 03:49 PM   #3
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Yes, and it decongests airports like London Heathrow too.
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Old December 28th, 2005, 04:11 PM   #4
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That's always good. Passenger levels at Heathrow and Frankfurt will still increase probably.

This market will really increase with the release of the Boeing 787.
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Old December 28th, 2005, 06:52 PM   #5
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The daily connection Hamburg - Newark with Continental already exists since 10th June this year. And since 30th October '05 you can also fly from Hamburg to Dubai with Emirates Airlines. Also there are direct connections to Toronto and Shanghai planned.
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Old December 28th, 2005, 08:51 PM   #6
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CO is doing a good job on capitalizing on the location of the Newark Hub as a transfer place between Europe and the US. This allows them to operate financially viable routes to smaller european cities such as shannon and bristol while other US carriers cannot do this as well
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Old December 28th, 2005, 10:38 PM   #7
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Air Canada is making good use of its hub in Toronto to connect Latin America with Asia and Europe and vice-versa, bypassing US customs.
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