You might know American and United as large airlines that compete with each other head-to-head. But if you’ve been reading the headlines lately, you might think they were real estate companies working together on projects in both Chicago and LA.
The Chicago move is pretty straightforward. The two gates that US Airways currently leases from United in Terminal 2 will be returned to United. The entire US Airways operation will be consolidated in Terminal 3 with American. Makes sense for both airlines since United has a large Express operation in Terminal 2 already and American wants to operate in one terminal. But the transaction occurring in LA is much more interesting.
Above is a map of LAX as it will look eventually (though things will continue to change further as time goes on). The transaction that’s happening now involves that green bit in Terminal 6. The 4 gates there that United currently uses (formerly the Continental gates before the merger) will now be leased to American.
Why would either airline want to do that?
Ever since United won a battle to allow regional flights to operate from the central terminal area instead of at remote gates, the airline has been able to consolidate its operation in one place. When the Continental merger went through, it was very convenient since Terminal 6/7/8 are all connected behind security. Now, however, United must have decided that it would rather have some extra cash instead of just squatting on gates it doesn’t need.
I asked United, and I was told that no cuts to the operation will be required, but a slew of cuts were just revealed. The airline is ending United Express service from LA to Kelowna, Bakersfield, Portland, and San Jose. Terminal 8 tends to be the United Express bastion, but you would think they’d need to move mainline over there if they’re going to be losing the mainline gates in Terminal 6. Sure enough, United is making changes to allow 737s to operate from Terminal 8. (If you remember Shuttle by United 737s operating at Terminal 8 before, those were Classic 737s which had a smaller footprint.) With that, the airline can operate just fine without the Terminal 6 gates. Though, it does make me wonder if more cuts are coming to the regional operation.
But if you’re United, why give up gates to your competitor when it will just help their position in LA? I would hope the rationale is that it’s time to stop playing games like that and instead just run an operation that you need, but I don’t know the real rationale. (Maybe there were some back-room dealings with the airport and United is getting something good out of it. I have no clue, and nobody would explain whether this is a sublease or something else.)
Meanwhile, American will become the most spread-out airline at the airport with operations in or planned for 5 different terminals. That’s nuts.
US Airways moved into Terminal 3 recently to allow Southwest to take over all over Terminal 1. The plan is to get US Airways out of Terminal 3 eventually, so the gates in Terminal 6 will help make that happen sooner. That being said, there is no timetable for it.
Meanwhile, Terminal 4 continues to be American’s main, overburdened operational center. There are gate constraints in the near term because of work being done on the Bradley Terminal, so Terminal 6 should help alleviate that temporary burden as well. When the Bradley Terminal is further along in its 10,000 year renovation, American will get some gates there too. A connector behind security is being built now, so that’s a nice little arrangement.
Then there’s the regional terminal that’s east of United’s terminal, outside the central terminal area. There’s a bus from Terminal 4 but it’s a pretty poor experience to have to shuttle between the two. My assumption had been that we’d see the smaller regional destinations shrink from LA once the merger went through. Apparently I was wrong. We’ve already seen big increases. American is adding US Airways Express CRJ-900s in several markets from LA, replacing fewer flights on smaller airplanes. So apparently American thinks that with a better-sized fleet, there is opportunity to grow.
That’s surprising to me, but if that’s the plan, than the Terminal 6 move makes even more sense. They are just going to need more gates. And having gates in a partner’s terminal, (Alaska uses most of the rest of Terminal 6) isn’t a bad plan either.
I wonder if down the line, we see American consolidate its operation in Bradley and Terminal 4 with some flights partnered with Alaska in Terminal 6. The gates in Terminal 3 would be gone as would the gates at the remote terminal.
At least, that’s one theory. But so far my track record at understanding what American will do at LAX is not very good.
