Hub and Spoke vs Point to Point Evan Demick February 28 2013 Agenda Airline Deregulation Point to Point Advantages and Disadvantages Hub and Spoke Advantages and Disadvantages Airplane Manufacturers ID: 267430
Download Presentation The PPT/PDF document "The Air Transportation Network" is the property of its rightful owner. Permission is granted to download and print the materials on this web site for personal, non-commercial use only, and to display it on your personal computer provided you do not modify the materials and that you retain all copyright notices contained in the materials. By downloading content from our website, you accept the terms of this agreement.
Slide1
The Air Transportation Network
Hub and Spoke vs. Point to Point
Evan DemickFebruary 28, 2013Slide2
Agenda
Airline Deregulation Point to PointAdvantages and DisadvantagesHub and Spoke
Advantages and DisadvantagesAirplane ManufacturersSlide3
Airline Deregulation
The Civil Aeronautics Board (CAB) controlled all airline pricing, routes, and scheduling prior to 1978 deregulation. Influx of new low cost carriers have entered the market. Fares have decreased across the board for air travelers.
Productivity has increased substantially. Slide4
Point to Point Network
Airlines fly passengers from point A to point B with no stops in between (direct flight). Better utilization of aircraft and crews. Minimize travel time
No need to disembark and transfer to another plane.No need to rely on other flights being on time at a hub airport. The network will not be as affected by weather or delays. Slide5
Disadvantages of the Point to Point Network
Many cities may not operate on a point to point network. Smaller cities may not operate on these point to point networks because of demand. Higher fares.
You pay for convenience. Slide6
Hub and Spoke Network
Many airlines operate centralized hub airports.Typically larger in size and located in larger cities with the ability to handle hundreds of daily flights. Equation of n-1 routes.
Network of 10 destinations requires 9 routes. Large hubs provide travelers with hundreds of flight options and locations to travel to. Hubs fly to smaller airports that point to point networks may avoid. Slide7
Disadvantages of the Hub and Spoke Network
Congestion at the hub airport.Airline runs a tight schedule with as many incoming and outgoing flights as possible. This can lead to overcrowding at the airport.
Passenger inconvenience.Passengers must disembark and connect to a second flight to reach their final destination. Connecting flights may be hindered by delays and loss of personal belongings. Weather and general delays can impact the whole system. Slide8
Airplane Manufacturers Input
Manufacturers seem to have picked sides in the argument between the two networksAirbus, with the A380 has gambled that airlines will fly smaller aircraft into its hubs, and then transfer passengers to larger aircraft.Boeing, with its new 787
Dreamliner argues that passengers demand more point to point flights on smaller aircraft with greater availability.Slide9
Conclusion
Deregulation occurred in 1978.Allowed for greater competition in the industry as well as cheaper fares, improved scheduling, and greater choices in destinations. Point to Point Networks
Airlines fly from point A to point B.Simple network and great for passengers.Not the most efficient network. Slide10
Conclusion
Hub and Spoke Networks.Airlines fly passengers from smaller airports into larger hub airports to transfer flights. Airline can operate fewer flights to reach the same destinations as a point to point network.
Saves airline money in the long run. Slide11
Thanks for Watching!Slide12
JetBlue ResultSlide13
Airline Comparison
Compare different airlines that operate point to point and hub and spoke networks.JetBlue – Hub and Spoke.Southwest – Point to Point.
United - Pre-deregulation Airline. Book a flight on each airline from Dulles to Orlando.Look at Costs.Total Travel Time. Number of Connections if Applicable. Slide14
Southwest ResultSlide15
United ResultSlide16
Table of Results
Airline
Connection?
JetBlue
Yes
Southwest
Yes
United
No