Hobby expansion passes; Southwest wins fight with United

[Andy]

Do you really believe what you write?
10% job cuts in the Fall of 2012 because SWA will begin service to Mexico sometime in 2015?
Please.

We haven't even announced what international cities we are going to serve in 2015. How can the UAL management team know that there is even going to be competition on any of their routes from IAH?

OK, I can see that most don't understand the problem here. Diverting Customs officials from IAH to HOU means that the IAH Federal Inspections Services Facility (FIS) won't be able to process passengers efficiently. I've been through the IAH FIS and it's very fast with current staffing. Cut the staff and there will be bottlenecks in the IAH FIS. I've been through understaffed FISs and have seen how they can have nightmarishly long lines that remind me of Disneyworld in the middle of the summer. ... it's a small world after all ... How do you do? Mighty pleasant greetin' How do you do? Say it when you're meetin' ... yo ho yo ho it's a pirate's life for me ... please stand clear of the doors - Por Favor Mantenganse Alejado de las Puertas ... (the last one took months to be erased)


What some suggest is that United should build up their international ops in IAH today because they can operate it normally for the next three years. What happens at the end of three years? They have to shift international flying to different hubs in order to alleviate the IAH bottleneck.
Questions. Why would you build up your hub when you know you have to draw it down in three years? Why not start shifting your international flying to other hubs that offer more efficient future processing of your international passengers?

At the moment, United has excess capacity at most of its hubs. The simple solution is to draw down international flying out of IAH and move it to other hubs that have current or projected future FIS passenger processing issues.

I know that Flop's been lamenting the projected loss of 1300 UAL jobs at IAH. Yes, many legacy CAL workers have moved from IAH. But those were office workers; UCH has moved headquarters to Willis Tower and do not need duplicate staff in IAH.
With the likely drawdown of UCH (legacy CAL) personnel at IAH, the groups that will be most impacted will be the baggage handlers and CSRs. Both of those jobs have a high turnover rate. Because of this, I suspect that there will be very few displaced workers - and that any displaced workers in these groups will be volunteers to go to DEN or LAX.
UCH will do some drawdown at IAH and expand in DEN and LAX. I expect all this means is that there will be a lot of hiring in DEN and LAX for baggage handlers and CSRs.

Will there be some shrinkage of crews at IAH and growth at DEN and LAX? Absolutely. But that won't create any problems; 737 DEN slots for pilots went extremely senior in the last bid. While LAX isn't quite as desirable, they shouldn't have problems remaining adequately manned.

 

[humveedriver]

http://articles.latimes.com/2011/nov/19/local/la-me-lax-customs-20111119

http://www.airlinequality.com/Airports/Airport_forum/iah.htm

LAX also has an issue with customs. Looks like long waits at IAH many times. Maybe Hobby can do more with less, as the aircraft will be smaller and you won't have hundreds of pax coming off of widebody's jamming up the system. Also those foreign wide body crews take forever to process in the crew lane. Each one has to get scanned and verified through interpol or something. Takes about 5-7 min per crewmembers versus a us crewmember takes less the one minute.

Checked USAjobs, no hiring of ICE agents right now. So you get what you get and you don't pitch a fit.

 

[Andy]

Exactly. Jeff had the press release typed up and was waiting to hit the Send button on the Fax machine when the City Council voted. SEE I TOLD YOU WE WOULD LOSE JOBS!

Weak, weak arguement. He planned it all along.

With respect to airports/capacity, I look at this as the complete inverse of 2000. I know - eons ago. Back in 2000, American Airlines ran out of airport capacity in both ORD and DFW. Their solution was to try to buy Northwest with their DTW and MSP hubs. They settled for TWA and STL. Fast forward two years and AMR had excess gate/airport capacity across their hubs.

With the current flying drawdown at most airlines, there's quite a bit of excess gate/airport capacity. When's the last time you read about airline slot limitations at an airport?

I see United's current situation the same way. Excess gate/airport capacity. I think that they're trying to rebuild the DEN hub which has been neglected for quite a while.
I'd say that UCH has fortress hub status at IAH and can reduce flying out of there for a while, especially with the B concourse construction that's currently taking place. I don't see a competitor moving into IAH; SWA was offered the bait and turned it down. I think that SWA moving to IAH would have been a big strategic problem for UCH; since they declined, there isn't likely anyone who will move in in large enough numbers to do damage to the UCH IAH hub.

Do I think that Houston will be undermanned by customs personnel in the long run? Not likely. But it may require another 50 cents/passenger in PFC fees in order to ensure that customs personnel are adequately manned. The stage is now set where that 50 cent charge will be assessed on both IAH and HOU passengers.

There are so many different levels to this chess game that we are unable to see. Someone who looks at any of this at face value is missing a very complex competition that's being waged. There are a lot of feints by each competitor; I don't know what's real and what's a deceptive maneuver.

I can say that the Houston city council thinks that United is bluffing, based on their comments on the news last night. While watching the news, I felt like I was watching rubes who were about to get fleeced by a dimunitive carpet bagger.

Let's fast forward 3 years. UCH has shrunk IAH personnel by 1300. The city of Houston is taking a revenue hit due to less passenger traffic through IAH. UCH offers to increase passenger traffic in exchange for some concessions, including securing additional customs personnel. What's the city of Houston going to do? I think that they'll give UCH whatever they want.

 

[Andy]

http://articles.latimes.com/2011/nov/19/local/la-me-lax-customs-20111119

http://www.airlinequality.com/Airports/Airport_forum/iah.htm

LAX also has an issue with customs. Looks like long waits at IAH many times. Maybe Hobby can do more with less, as the aircraft will be smaller and you won't have hundreds of pax coming off of widebody's jamming up the system. Also those foreign wide body crews take forever to process in the crew lane. Each one has to get scanned and verified through interpol or something. Takes about 5-7 min per crewmembers versus a us crewmember takes less the one minute.

Checked USAjobs, no hiring of ICE agents right now. So you get what you get and you don't pitch a fit.

I confess that I wasn't aware that LAX had customs delay issues.

The aircraft going into Hobby won't be smaller. You're flying 737s. There are a few widebodies coming into IAH but the bulk of the flights are narrowbodies - A320s and 737s. In fact, there are quite a few international RJs that fly into IAH.
Of the top 10 international destinations out of IAH in 2010, only 3 had widebodies (LHR, AMS, FRA). I suspect that AMS is no longer on the list and has been replaced with a narrowbody destination in Central/South America.

 

[Flopgut]

SWA doesn't have to worry about FIS and customs they have AT to 'splain it to them. 1. Bring passport 2. Stand in line 3. Don't use your cell phone . That should do it. That's some good propaganda though Flop. It's a shame you are wasting that talent here. You should be an op-ed writer or you could start a blog or something.

I'm talking about agents and rampers.

It sounds like some of these SWA guys are reffering to some sort of AOPA guide and stating "customs" already exists?! FIS is a much bigger deal than trying to catch some random Baron pilot trying to sneak in oranges and Cohibas. Bag match is the big deal. The CAL rampers and agents that SWA has caused to be displaced know all that stuff.

Don't think these CAL people deserve a shot? Fine. Go ahead and let each member of the City Council know that. Explain to them that even though GK claimed he would create 10,000 jobs, there is no room at SWA for them. People who've been in Houston for 20+ years, or in some cases generations. Show us all who you really are. Do it while the ink is still wet on your new deal.

*the last two paragraphs were more of a general statement and not directed directly at Humveedrvr

 

[Flopgut]

Exactly. Jeff had the press release typed up and was waiting to hit the Send button on the Fax machine when the City Council voted. SEE I TOLD YOU WE WOULD LOSE JOBS!

Weak, weak arguement. He planned it all along.

Tell yourselves whatever you want. CAL kicked you out of IAH and you were too scared to come back. Had to have the govt prop you up.

Remember the other thread? About two months ago I told you guys that GK's real plan was to get a deal at Hobby that was exclusive. He wanted some deal that limited competition. Well what are we looking at here? 5 gates, with four of them for SWA only. That's been the plan all along. You guys can't compete.

 

[redflyer65]

We don't compete?

What about LAX, SFO, and DEN? I think we are doing quite well in more than a few cities. Again, weak Flop. Very weak.

The point is, your CEO planned on using this to cut IAH, plain and simple and you know it.

 

[737tanker]

Flop
Since United is cutting jobs at IAH because Hobby will take FIS staffing from IAH then why didn't United cut jobs at ORD because with the new announced SWA/AirTran service from MDW to Mexico the staffing for the MDW FIS had to come from ORD?

 

[SWA Bubba]

Tell yourselves whatever you want. CAL kicked you out of IAH and you were too scared to come back. Had to have the govt prop you up.

Remember the other thread? About two months ago I told you guys that GK's real plan was to get a deal at Hobby that was exclusive. He wanted some deal that limited competition. Well what are we looking at here? 5 gates, with four of them for SWA only. That's been the plan all along. You guys can't compete.

Hey Flop,

Please take some time away from this thread soon, so you don't have a coronary. However, I do have to take some issue with a few of these claims. As for CAL kicking us out of IAH, you can believe what you want. We had that one city pair (DAL-IAH), 3 or 4 times daily, and it wasn't profitable. Why? Because none of our passengers could connect anywhere. All of our other Houston flying was out of Hobby, as it's been since our inception in 1971. Turns out that flying that one particular city pair wasn't enough to justify the station.

By the way, that's the one thing I'd like to you actually explain to me--you kept saying we should do our international flying out of IAH for a "level playing field," and for "fair competition." In all honesty, how could that be fair? Please answer that, Flop. If we did our international flying out of IAH, all we could take would be local Houston passengers. NO connections; that would be 90% or more of Southest passengers couldn't fly over the border on us. NOBODY is going to fly into one airport and connect to their Mexico flight by getting their bags, leaving the airport, taking a 30 minute cab ride, and then going to a different airport to check their bags again and go through security again. Please tell me how you can see how competition where OUR connecting passengers do all that, while your connecting passengers merely walk from one gate to another, could be considered "fair" by any metric. Please tell me that.

Two other minor points: first, I think you have it backwards; I think it was United that the government has a history of propping up, not Southwest. Tell me ONE instance where the government "propped us up." Second, you bemoan us controlling 80% of the international gates at Hobby, yet Unical controls >85% of the international gates at IAH. That doesn't seem any more fair. At least we're paying to build all of our gates ourselves. If and when more carriers fly international at Hobby, they (or the airport) can build more gates. Seems easy enough.

Bubba

 

[humveedriver]

I'm talking about agents and rampers.

It sounds like some of these SWA guys are reffering to some sort of AOPA guide and stating "customs" already exists?! FIS is a much bigger deal than trying to catch some random Baron pilot trying to sneak in oranges and Cohibas. Bag match is the big deal. The CAL rampers and agents that SWA has caused to be displaced know all that stuff.

Don't think these CAL people deserve a shot? Fine. Go ahead and let each member of the City Council know that. Explain to them that even though GK claimed he would create 10,000 jobs, there is no room at SWA for them. People who've been in Houston for 20+ years, or in some cases generations. Show us all who you really are. Do it while the ink is still wet on your new deal.

*the last two paragraphs were more of a general statement and not directed directly at Humveedrvr

I know, I was just having fun. But here is the thing. Even AirTran had to have a first day of international operations. You live and learn. SWA will look at our model and adapt it to fit their operation. I predict that the procedural changes that SWA makes to handle international baggage, will have a dramatic effect on overall mishandle baggage reports for domestics ops.That's an area SWA is currently struggling with. So this will help I think.
It's not just SWA/other airline pilots calling UAL out over the latest job cut announcement. Many industry experts and reporters are making the same call against UAL as well. Also your boss plans to fire these people this year and Kelly isn't planning on launching intl ops until 2015 out of Hobby. Makes it hard to hire them. I hope those who can move do. Although on a much smaller scale SWA was not able to accomadate all of our DFW rampers and agents. They got put on a wait list for future openings (no transfer opportunities).

 

[FlyinGuy]

Holy Cow!!!

These guys actually believe this stuff.

 

[Britpilot]

Holy Cow!!!

These guys actually believe this stuff.

Really.

Jeff planned these cuts and is using the SWA Hobby Intl Ops as an excuse.


Nothing is going to happen for three years yet his cuts start in a few months.

imp:

 

[redflyer65]

As for CAL kicking us out of IAH, you can believe what you want. We had that one city pair (DAL-IAH), 3 or 4 times daily, and it wasn't profitable. Why? Because none of our passengers could connect anywhere. All of our other Houston flying was out of Hobby, as it's been since our inception in 1971. Turns out that flying that one particular city pair wasn't enough to justify the station.


Bubba

These facts don't fit well into Flops rant. This is exactly how it went down.

 

[Flopgut]

These facts don't fit well into Flops rant. This is exactly how it went down.

Understand that part of what SWA argued about not going to DFW all those years ago was that they never wanted to go there in the first place, that it was too expensive, delay prone, etc, etc. I'm pointing out that those same arguments seemed to surface recently about IAH, even though you had a station there at one point. Your argument changes to suit the airport you are trying to exploit.

Uh, so this "southwest effect" thingy, why didn't it work in IAH? I mean, it's suppose to be impervious to any legacy competition, right? Why are you citing the WA as some problem to your ongoing success at IAH? You could have left IAH and flown anywhere in the country. Point to point, is what you do, I thought. If we're suppose to belive all the stuff you claim you can do, why didn't you get it done at IAH?

Truth is, you weren't about to poke us with a stick, we would have got right after you at Hobby. We were a tough competitor you could not handle.

 

[Flopgut]

It's not just SWA/other airline pilots calling UAL out over the latest job cut announcement. Many industry experts and reporters are making the same call against UAL as well. Also your boss plans to fire these people this year and Kelly isn't planning on launching intl ops until 2015 out of Hobby.

In the relationship between CAL and the City of Houston, someone had to blink first. It was either CAL when they merged with UAL, or Houston when they approved SWA's terminal. Idk. But for now, it's spoiled. Maybe we can get it back on track. The cuts are very much tied to the windfall SWA was given. Period. Does not matter how far off it is. We have to cut our losses and go elsewhere.