Environmental Engineering Reference
In-Depth Information
Figure 2.2
Market power of hub-and-spoke networks
The hub acts as a consolidation point for passengers, thereby enabling higher frequen-
cies to be operated with larger aircraft and seat occupancy rates, hence lowering the
operating cost per seat kilometre. Airports and airlines become mutually dependent
upon each other in this system: typically, as the share of flights operated by the hub
airline increases, so does the number of transfer passengers. Examples include Delta
at Atlanta where the airline has a 75 per cent share of departures and around 80 per cent
of traffic is transfer; KLM, which has 58 per cent departures at Amsterdam; Lufthansa,
which has around 60 per cent at Frankfurt; and American, which has 70 per cent of
departures at Dallas Fort-Worth.
Hub-and-spoke operations have been criticized for reducing the number of
direct point-to-point services available for the consumer, increasing the number of
aircraft kilometres the customer has to fly via a hub and increasing trip times because
of the need to change aircraft mid trip (Dempsey, 1989). The airlines try to counter
these claims by pointing to the lower cost and increased frequency of services arising
from hubbing economics. It should also be noted that consolidation of passengers
onto larger aircraft might not be negative in terms of environmental and social sus-
tainability.
Hub-and-spoke operations may be economically beneficial for the airlines; but
they require an increase in airport infrastructure at certain locations in order to cope
with more pronounced peak operating activity and revised internal terminal config-
uration to cater for much larger transfer passenger flows.
Airbus anticipate growth of the existing system of hub-and-spoke routes in which
the growth of high-density long-haul routes requires the A380, an aircraft capable of
conveying 600-1000 passengers. Boeing disagrees and predicts the erosion of the
hub-dominated network structure and the growth of a more point-to-point route
structure for medium-density long-haul services. These would be flown by a sonic
