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Old 06-12-2012, 06:00 AM
 
Location: Rocky Mountain Xplorer
954 posts, read 1,549,525 times
Reputation: 690

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This ancient lesson, unfortunately, was lost on Houston's city council, which voted 16-1 last month to enable Southwest (LUV_) to build an international terminal at Houston Hobby Airport, diminishing United's (UAL_) hub at Houston Bush Intercontinental. There United operates the third biggest U.S. hub, with 650 daily departures to 177 destinations including 64 international destinations.
As John Kasarda, professor at the Kenan-Flagler Business School at the University of North Carolina, has said, in the 18th century the great cities were ports. In the 19th century, the great cities were railroad cities. In the 20th, they were cities with good highway access. In the 21st century, they are cities with non-stop international flights.

What misled the Houston council? First, it is far too easy to argue that competition is wonderful and solves every problem and government should never stand in the way. Also, the 2010 merger between United and Continental bred resentment because the hometown carrier closed its Houston headquarters. And who can resist the promise of lower fares to Mexico City and Cancun and San Jose del Cabo and the engaging charm of Southwest CEO Gary Kelly?
Houston: You Blew It on United Hub - TheStreet
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Old 06-12-2012, 06:34 AM
 
23,177 posts, read 12,210,827 times
Reputation: 29354
No matter how many times you repeat your propaganda the people and city have spoken. United "blew it" in this town. Seldom has a company so alienated an entire major urban area and inspired them to rally around... another corporation.
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Old 06-12-2012, 07:12 AM
 
Location: Houston, TX (Bellaire)
4,900 posts, read 13,733,169 times
Reputation: 4190
Why does United hate the free market?
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Old 06-12-2012, 07:25 AM
 
613 posts, read 1,002,058 times
Reputation: 662
Why does United's spokesperson keep posting here? We don't care. Houston has the fastest growing economy in the US. United can serve it or let others do so.
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Old 06-12-2012, 07:29 AM
 
Location: Washington DC
686 posts, read 1,167,470 times
Reputation: 675
Quote:
Originally Posted by mibs98 View Post
why does united's spokesperson keep posting here? We don't care. Houston has the fastest growing economy in the us. United can serve it or let others do so.
+1
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Old 06-12-2012, 07:45 AM
 
2,628 posts, read 8,831,345 times
Reputation: 2102
JimBaker do you work for United or what? No sale on your BS.
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Old 06-12-2012, 08:28 AM
 
Location: Houston
391 posts, read 922,763 times
Reputation: 468
Quote:
Originally Posted by JimBaker488 View Post
This ancient lesson, unfortunately, was lost on Houston's city council, which voted 16-1 last month to enable Southwest (LUV_) to build an international terminal at Houston Hobby Airport, diminishing United's (UAL_) hub at Houston Bush Intercontinental. There United operates the third biggest U.S. hub, with 650 daily departures to 177 destinations including 64 international destinations.
As John Kasarda, professor at the Kenan-Flagler Business School at the University of North Carolina, has said, in the 18th century the great cities were ports. In the 19th century, the great cities were railroad cities. In the 20th, they were cities with good highway access. In the 21st century, they are cities with non-stop international flights.
What misled the Houston council? First, it is far too easy to argue that competition is wonderful and solves every problem and government should never stand in the way. Also, the 2010 merger between United and Continental bred resentment because the hometown carrier closed its Houston headquarters. And who can resist the promise of lower fares to Mexico City and Cancun and San Jose del Cabo and the engaging charm of Southwest CEO Gary Kelly?
Houston: You Blew It on United Hub - TheStreet
I don't even know where to being with my response to this. First off, I am not a fan of United Airlines in any way, shape, form or fashion! United Airlines needs to learn how to adapt to industry competition no matter what city they operate in! This incident could happen in other cities as well. United isn't slowing down flights at IAH because of competition, they are doing it AT WILL!!!! Southwest's international operations won't take effect until 2015, but United already chose to start reducing flights through Houston. This shows that United is a very sore loser!

Not only is United a sore loser, but they are looking for any reason get rid of flights because United doesn't know how to operate flights at a profit. How in the world is Southwest so successful and United so terrible at business? The airline industry and business world changes constantly and if your airline cannot change, it will fail! This is a sad lesson United is in the works of learning.

Next, read the article you posted. US Airways says that IAH is the 3rd most profitable airport hub in the nation. Now with that said, what REASONABLE thinking airline (as we know United is NOT reasonable in its thinking at all whatsoever) would abandon or even slow down service through such a profitable hub??? I am not a rocket scientist, genius or even a fortune teller, but I will tell you this, Houston's airport system will be even stronger with 2 international airports in our metro area. Back in 1971 when Braniff was outraged that Houston reopened its old international airport for domestic flights, Braniff said that it would criple IAH... 41 years later it is a very strong airport. Oh yeah, and where is Braniff today... that's right out of business! The same thing will eventually happen to United because they clearly don't have the ability to adapt to industry change.

Houston City Council did the RIGHT thing by opening the international skies to HOU. How in the world by flying 20 daily international flights from a small airport disrupt international operations at a major nearby airport. The fact of the matter is IT WON'T! I don't care what kind of BS story you tell me and about business models in the past and this and that! Like I said before the business world changes CONSTANTLY and by dwelling on old data associated with doing business the old way, you are basically walking into a new business enviroment blindfolded.

In conclusion, the city of Houston, the Houston Airport System, Southwest Airlines and the other airlines that service Houston will do just fine in the future. If United decides to significantly slow down service in Houston or even pull out of Houston it will invite ample opportunity for another airline to take advantage of IAH's profitability.

I've said it before and will say it again... GO HOUSTON!!!
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Old 06-12-2012, 10:07 AM
 
4,875 posts, read 10,069,331 times
Reputation: 1993
Many industry analysts believe that the whole "we are punishing you, Houston" was just a smokescreen, and that in fact United was already trying to draw down service.

But everyone should agree that this was a PR disaster. If United was trying to extort its employees (I suspect that's what it was trying to do), it failed.
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Old 06-12-2012, 10:30 AM
 
1,290 posts, read 5,436,799 times
Reputation: 724
United is using this as an excuse to cancel the Aukland flight that they were never going to get up and running anyways.
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Old 06-12-2012, 12:55 PM
 
Location: Tysons Corner, VA by way of TEXAS
725 posts, read 1,240,499 times
Reputation: 875
LMAO. Mark my words. Absent any extenuating circumstances (terrorist attack, economic meltdown, etc.) United will be offering more capacity at IAH by the time Southwest begins international service in 2015 than they are now - with or without this temporary 6% drawdown.

The hub is simply too profitable and potential O&D grows by something like 200 people a day. AA said the same thing when the Wright Amendment was loosened at DAL a few years ago and two years later they had - wait for it - expanded service. The amount of money they might lose competing with Southwest will look like peanuts compared to the amount of money they will lose if they chop flights from their cash cow.
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