And, as a more practical point of discussion, what will United Airlines do with the four slots they are freeing up at JFK this October? The airline currently operates four daily flights between JFK and its hub at Washington-Dulles but those are being dropped as of 25 October 2015.
United confirmed the cuts via their Twitter account this morning:
@globalsanyasi The last day is the 25th of October. ^HN
— United Airlines (@united) September 20, 2014
And so the question arises: What to do with those slots? Since the merger with Continental there have been plenty of questions about why United is keeping the flights. Prior to the merger the feed into Dulles for long-haul flights (and some other regional service) was significant; post-merger much of that traffic can be routed via the Newark Hub (yes, I know they’re not exactly the same but similar enough in total time, especially if saving a connection). Destinations like Dubai would still require a connection but many of the other long-haul routes no longer do. The other large pool of affected passengers are those who use the IAD-JFK flights as a feed for access to the p.s. transcon service. Those passengers would either need to do a JFK/LGA shuffle, fly the non-stop options or choose a different connection point.
In many ways dropping this connection makes things more efficient for United’s operations. Plus there’s the part where cuts are coming to the 50-passenger fleet and this is a great way to trim a bit of demand on that front.
But we still don’t know what is going to happen with those slots. Except for the part where United would quite likely be unable to buy them back in the future should they want to build more service at JFK it seems the best short-term move would be to sell the slots. There is still decent demand and they could probably make a decent bit of cash. The downside there is that the slots would end up in the hands of a competitor, something United probably doesn’t want.
Another option would be to lease or loan them to an alliance partner. Most of the times are particularly conducive to long-haul service and it is not clear that those partners are looking to add destinations. But that seems like the more conservative option to play. Similar deals have been struck in the past a Heathrow, for example, so it is certainly something which is likely to be considered.
It is quite unlikely that more p.s. flights are coming, both because of and in spite of the fact that the transcon market has been heating up significantly over the past 6-12 months. United doesn’t really have the planes and adding more capacity (and the commensurate depressing of yields) seems unlikely to be profitable in the near term.
So, what would you do with those slots?
Never miss another post: Sign up for email alerts and get only the content you want direct to your inbox.