Will the Hub-and-Spoke System Disappear? (Ask Cranky)

It’s been awhile since I ran an Ask Cranky post, but that doesn’t mean the questions have stopped coming in. This question came in earlier this month, and I thought it was a good one. So let’s talk about it.

Hey there, Cranky! I’m really enjoying your blog. Obviously, you have a really deep knowledge of the airline industry. Do you foresee the hub-and-spoke system going away? It’s one of my least-favorite aspects of air travel.

Keep up the great work! Justin

Will the hub-and-spoke system go away? In short, no, I can’t imagine it will.Ask Cranky As Southwest continues to grow (much more slowly than in the past) and other low cost carriers follow similar point-to-point models, wouldn’t it make sense for the hub-and-spoke system to go away because of its inefficiencies involved?

It may seem that way if you’re in a bigger city, but what about those people who live in Springfield, Illinois or Waco, Texas or Bakersfield, California? See the point-to-point system make work wonders for those who live in bigger cities, but in smaller cities, the hub-and-spoke model is their best bet by far.

Let’s think about Springfield, Illinois. There probably isn’t enough demand to fill a single airplane to almost any city from Springfield at a given point in time. But, if you can send a bunch of passengers to Chicago and then let them fan out around the globe, all of a sudden you do have the ability to fill it up because you’re combining a bunch of passengers going to different places in a single plane.

This doesn’t mean the point-to-point model won’t grow, and maybe one day we’ll see someone try the ExpressJet model between smaller cities again, but I doubt we’ll see the day where Springfield, Illinois can hold its own on many routes on a convenient business-friendly schedule. (Sure, any town can support a couple flights a week to Vegas on Allegiant, but that’s a different story.)

Remember, a hub doesn’t exist solely as a hub. There are a few minor hubs that still exist that don’t have tremendous local traffic, but for the most part, those have disappeared (Pittsburgh, Columbus, etc). Now, most hubs exist in cities where there is a great deal of local demand. Chicago, Atlanta, Dallas, etc are all very big local areas that can support flights to many other destinations on a point-to-point basis. But when you throw in the connecting traffic from smaller cities, you enable the existence of even more flights.

Think about how many places you can get to from Springfield with a single stop. It’s pretty incredible. And you can nearly cover the entire globe with two stops. So the hub-and-spoke model isn’t going anywhere, because it still is the best way to serve many smaller cities around the world while at the same time providing better point-to-point service for those large hub cities.

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20 Comments on "Will the Hub-and-Spoke System Disappear? (Ask Cranky)"

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Nick Barnard
Member
Compared to the days of old the Hub and Spoke model is amazingly efficient. It used to be if you wanted to get across the country you’d stop at every airport between here and there. (Take a look at old route maps.) Like an elevator or a train they were collecting passengers and letting them off as they go. By collecting everyone into hubs, you reduce that milk run mentality into two legs. Which would you rather have? One connection where you change planes and get to where you need to be, or landing and taking off four times staying… Read more »
Nick Barnard
Member

CF – I’d agree. I think my mom’s flight had 2 or 3 stops…

BLR
Guest

I think the total opposite is going to happen – we’ll start to see more airlines become more “hub and spokey” than we have in the past. In an environment where total traffic is shrinking, your variable costs are now higher than your fixed costs, it only makes sense to fly fewer trips with more people onboard, maximizing your returns. Look at Southwest’s recent announcements: MSP-DEN/MDW, LGA-BWI/MDW, and BOS-BWI/MDW. Smells like hub and spoke to me!

b757capt
Guest

Don’t look know but Myrtle Beach’s Direct Air back at it again. Looks like they will start SPI. Good luck filling that up.

http://www.visitdirectair.com/

theboardingpass
Guest
I think the only thing which will go away are the outdated terms such as hub-and-spoke. Everyone is going to continue to converge to a hybrid route structure. Network carriers put on flights primarily due to point-to-point traffic, even out of there hubs. Flow passenger yields are notoriously poor as most airlines won’t internally unbundle the value of each leg. So, because they are worried about losing a passenger to another carrier, the connect leg will often be ‘free’ or below cost. The unfortunate people wanting to fly solely to the hub find they are charged a fortune as they… Read more »
David
Guest
CF – while I can certainly see merits in your argument for the good people of Springfield, I’m not totally convinced that economics prescribes only the hub-and-spoke model. I think that if you offer people the chance to fly non-stop to where they want, they’ll take it – the time spent going via the hub compared to non-stop gives considerable leeway to vary the flight time, while still beating the hub operator on schedule. Consider the case of Europe with a load of LCCs, from the big players of Easyjet / Ryanair down to the smaller outfits. Most of them… Read more »
jaybru
Member
Certainly not an easy answer to the question. Particularly where you’re dealing with an industry that these days doesn’t seem to place much emphasis on providing top-notch service to its paying customers, on treating its employees well, and on making, to the extent its shareholders desire it, a fair and reasonable profit, but instead, operating in a hellbent manner simply to kill off its competition. Hub and spoke is mostly the rule in transportation. Take ocean shipping, trucking, rail freight air freight, what have you. But, does every airline have to operate a spoke to every city? Doesn’t seem to… Read more »
Nick Barnard
Member

CF/JK – while I was never around when this model was in place (the industry deregulated before I was born.) I’ve got some ticket stubs from when my family went to California from Upstate New York. Indeed it was exactly like this. They took Allegeny Airlines (aka USAir, aka USAirways) to Chicago’s O’hare then United took them to San Francisco. Looking at it this seems kindof odd, but I guess thats how the industry worked back then.

The Traveling Optimist
Guest
The Traveling Optimist
It’s possible still to see a vestige of that pre-regulation system still in operation today. Ever lose a bag while traveling on more than one airline? The standard industry response is: “The last carrier you flew is responsible for finding your luggage.” That comes right out of the Allegheny/United example provided earlier. Even if Allegheny was clearly at fault, United eats the cost. Yet because of the prevalence of lost luggage all carriers gentlemanly agree that it comes out even in the end, that no one airline pays more than its fair share for re-uniting luggage with customers than the… Read more »
botamern
Member

Traveling Optimist,

While not always done (and the delivery charge has to pass a certain threshold), airlines can and do bill each other for interline bags that are not transfered properly. If memory serves there’s an IATA procedure for doing this. The same applies to damaged bag claims, although this is a little more time consuming taking the time to prove when/where the damage occurs, as ramp agents aren’t often looking out for broken bags.

MathFox
Guest
In the early days of aviation “milk-runs” were almost a necessity because the planes needed refueling every two hours (or more often). Only a few of the most modern planes are capable of flying halfway around the globe without a stop for fuel. Now the planes are bigger and can fly bigger legs, the problem becomes to get them filled. The hub-and-spoke system allows for decent coverage of airports and reasonably filled planes. However, I would not be surprised to see airlines declare more “focus cities” (secondary hubs) when travel picks up again. Passengers are interested in minimising their trip… Read more »
David SF eastbay
Member
What the hub/spoke system did was do away with flying between small cities or small to medium cities. In a large state like California you used to be able to fly between many smaller cities. Now you have to connect in SFO or LAX to get say between Santa Barbara and Fresno or Bakersfield. Also now there are states where you can’t fly between any two cities in that state because the small local stand alone carriers are no longer around. Take Alabama as an example, if someone needed to go from Mobile to Huntsville for business they would have… Read more »
jaybru
Member
I have grave doubts about the future of our airline system, and how people are going to get to their air service. Can’t believe we won’t be paying a lot more for air travel soon, assuming there will be an industry still operating. Sure, I live near a big hub here at Dulles. Fine, now nobody else move here, please! It’s getting more and more difficult to get to and from Dulles, as close as I am to the airport. Getting out here from downtown? Lot’s of fun! Still boggles my mind that FedEx flies into DCA each morning with… Read more »
jaybru
Member
I think most small communities, even the mid-size ones, really are “blowing smoke” in their attempts to get any air service at all. They seem ill-equipped, lacking in much knowledge of what their local folks need or want, lacking in financing to do any sort of needs/wants studies prior to arguing for air service, or to do a good job of marketing their service should they be lucky enough to get some service. And, do these people really have a clue how any airline wants to operate and how their needs/wants would benefit any airline’s operations? It seems to me… Read more »
Alex
Guest

I read the article and all comments. Nobody don’t represent any numbers. How many passengers in U.S. use non stop flights and how many use HUBS and fly with 1 or 2 stops. May be you know this statistic?

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