Sky Harbor Terminal 3 expansion - still necessary?

[Ztonyg]

Originally Posted by azriverfan.

Southwest has grown and increased flights over the past 10 years and has not remained stagnant. The argument is that Southwest would likely increase their market share to compensate for the reduced number of flights by AA/US. Furthermore, with the increase in population, there will other carriers that will arrive to offer service such as Virgin America and even some international carriers. The reality is a 5-6 million population is going to attract other carriers because that's too many people to ignore. Ultimately, we will need space to meet this demand.

Southwest has absolutely not grown and increased flights over the past 10 years at all (in fact, it has less flights now than in 2004).

Per data from a web archive on southwest.com, on February 13, 2004, Southwest had 183 daily departures to 39 nonstop cities from Phoenix (and Phoenix was their 2nd largest operation). Per the Southwest fact sheet revised March 8, 2014, Southwest now has 174 nonstop daily departures to 47 nonstop cities.

I'll buy that Southwest has grown in the number of cities, but it operates 9 fewer flights than it did 10 years ago and therefore as it is flying LESS flights, it shouldn't need MORE gates.

Southwest is also looking to grow in New York and Washington, DC and will likely continue any growth in those markets (and not in Phoenix).

Virgin America offers nothing that the market isn't already over-saturated with (flights to LAX and SFO) and I don't honestly think that they'll enter the market unless they decide to fly from PHX - somewhere on the east coast. Alaska Airlines has been rumored to want to expand in Phoenix and very well could take over some of the PHX - Mexico flights if AA/US drops them. Spirit is also in expansion mode (although they're an ultra low cost carrier that is routinely ranked as the worst airline in the United States by consumer reviews) and they may slightly expand. However, any expansion likely will not offset the AA/US cuts (at least over the next 10 years or so)

Still, Terminal 3 and Terminal 4 (in their current state) with a closed Terminal 2 can probably adequately serve the market for the next 10 years or so.

[phx1205]

Originally Posted by Ztonyg

It is a known fact amongst anyone with any knowledge of the situation (pretty much anyone except local politicians) that American Airlines / US Airways is going to significantly cut their operation after the 3 year moratorium on cuts that they signed to get the deal passed ends. Less flights = less need for gate space = less need for an expansion.

You must have some insider information because I haven't seen anything that would make it a "known fact" that AA will significantly cut their operation. Lots of speculation and everyone has an opinion on what will happen. Will AA use LAX to expand their Asia route? There isn't unlimited capability to expand at LAX. UA has hubs at both DEN and SFO. AA can keep Hubs at LAX and PHX where LAX is focused more internationally and PHX is focused more domestically. But Sky Harbor has to plan for the future and enhancing T3 is not a bad idea. Not only for potential future capacity but also as the first impression of people visiting Phoenix. The improvements in food at T4 have been great and the improvements planned for T3 are much needed IMO.

[Ztonyg]

Originally Posted by phx1205

You must have some insider information because I haven't seen anything that would make it a "known fact" that AA will significantly cut their operation. Lots of speculation and everyone has an opinion on what will happen. Will AA use LAX to expand their Asia route? There isn't unlimited capability to expand at LAX. UA has hubs at both DEN and SFO. AA can keep Hubs at LAX and PHX where LAX is focused more internationally and PHX is focused more domestically. But Sky Harbor has to plan for the future and enhancing T3 is not a bad idea. Not only for potential future capacity but also as the first impression of people visiting Phoenix. The improvements in food at T4 have been great and the improvements planned for T3 are much needed IMO.

I don't have insider information but in prior mergers (DL/NW) and (CO/UA) the "weakest" hub is almost always eliminated. In DL/NW that was MEM although CVG is also a "shell" of its former self. In CO/UA that was CLE. AA has had this experience before when it purchased TWA and subsequently "de-hubbed" STL.

PHX is the "weak" hub in the AA/US system. I believe this is public knowledge.

What is also public knowledge is that AA just this week agreed to sublease 4 additional gates at LAX from UA. Plus, it is also known that AA will have access to (and operate) its international flights from the renovated/expanded Tom Bradley International Terminal at LAX.

If AA expands at LAX (which it is showing every intention of doing) the cuts have to come from somewhere. The logical answer as to where the cuts likely will likely come from PHX.

[phx1205]

Originally Posted by Ztonyg

I don't have insider information but in prior mergers (DL/NW) and (CO/UA) the "weakest" hub is almost always eliminated. In DL/NW that was MEM although CVG is also a "shell" of its former self. In CO/UA that was CLE. AA has had this experience before when it purchased TWA and subsequently "de-hubbed" STL.

PHX is the "weak" hub in the AA/US system. I believe this is public knowledge.

What is also public knowledge is that AA just this week agreed to sublease 4 additional gates at LAX from UA. Plus, it is also known that AA will have access to (and operate) its international flights from the renovated/expanded Tom Bradley International Terminal at LAX.

If AA expands at LAX (which it is showing every intention of doing) the cuts have to come from somewhere. The logical answer as to where the cuts likely will likely come from PHX.

The sub lease of 4 gates is exactly my point. There isn't any spare capacity to expand flights at LAX, and the gates that open up with the intl flights moving will just help them to consolidate to one terminal. I just don't see where they will find the space to add a large number of flights that would move out of PHX.

[azriverfan.]

Originally Posted by Ztonyg

I don't have insider information but in prior mergers (DL/NW) and (CO/UA) the "weakest" hub is almost always eliminated. In DL/NW that was MEM although CVG is also a "shell" of its former self. In CO/UA that was CLE. AA has had this experience before when it purchased TWA and subsequently "de-hubbed" STL.

PHX is the "weak" hub in the AA/US system. I believe this is public knowledge.

What is also public knowledge is that AA just this week agreed to sublease 4 additional gates at LAX from UA. Plus, it is also known that AA will have access to (and operate) its international flights from the renovated/expanded Tom Bradley International Terminal at LAX.

If AA expands at LAX (which it is showing every intention of doing) the cuts have to come from somewhere. The logical answer as to where the cuts likely will likely come from PHX.

The question isn't whether AA/UA will reduce it's number of Phoenix flights. It will but that doesn't mean Terminal 3 doesn't need to be expanded. Furthermore, UA has a large presence in Phoenix and they don't want completely give up that market share.

[azriverfan.]

Originally Posted by Ztonyg

Southwest has absolutely not grown and increased flights over the past 10 years at all (in fact, it has less flights now than in 2004).

Per data from a web archive on southwest.com, on February 13, 2004, Southwest had 183 daily departures to 39 nonstop cities from Phoenix (and Phoenix was their 2nd largest operation). Per the Southwest fact sheet revised March 8, 2014, Southwest now has 174 nonstop daily departures to 47 nonstop cities.

I'll buy that Southwest has grown in the number of cities, but it operates 9 fewer flights than it did 10 years ago and therefore as it is flying LESS flights, it shouldn't need MORE gates.

Southwest is also looking to grow in New York and Washington, DC and will likely continue any growth in those markets (and not in Phoenix).

Virgin America offers nothing that the market isn't already over-saturated with (flights to LAX and SFO) and I don't honestly think that they'll enter the market unless they decide to fly from PHX - somewhere on the east coast. Alaska Airlines has been rumored to want to expand in Phoenix and very well could take over some of the PHX - Mexico flights if AA/US drops them. Spirit is also in expansion mode (although they're an ultra low cost carrier that is routinely ranked as the worst airline in the United States by consumer reviews) and they may slightly expand. However, any expansion likely will not offset the AA/US cuts (at least over the next 10 years or so)

Still, Terminal 3 and Terminal 4 (in their current state) with a closed Terminal 2 can probably adequately serve the market for the next 10 years or so.

When UA/AA reduce their number of flights, there will be demand for those flights. Southwest could easily and will likely expand to meed that demand. In fact, this is one of the reasons UA hasn't just completely abandoned the Phoenix market because of this perceived threat.

Virgin America offers a unique concept. It's a nightclub in the air. Many people gravitate and prefer to fly that airline for that reason. All of their seats offer televisions and a great infotainment system. They play house music in their check ins. The lighting is neon on board like a club. It has nothing to do with its routes. Virgin is most certainly expanding and it will definitely reach the Phoenix market at some point. This is just one example.

[Valley Native]

Originally Posted by exit2lef

Keep in mind that the T3 expansion is vastly scaled back compared to previous plans to build a brand new "West Terminal" that might have rivaled T4 in size. Sky Harbor's most ambitious expansion plans, formulated before the housing crash / recession and the US Airways / American merger, called for a lot more than what is actually being built in the near future.

Expanding Terminals 3 & 4 would actually be more sensible than building another huge terminal separately. Sky Harbor has always been confusing as far as which terminal to go for flights, especially for those who are new or visiting. Expanding the two main terminals and linking the SkyTrain is, I believe, a much smarter, more economical, and more compact solution to accommodate long term growth.