Monday, October 22, 2007

Houston becoming an "Emerging Global Portal"

Michael Boyd is an aviation expert and consultant who is frequently quoted in articles on the airline industry. He posted today on emerging trends from his recent Boyd Group Aviation Forecast Conference:
International-generated traffic is now the #1 most important sector for airlines.
The Emerging Global Portal. Because of growing intra-regional traffic flows, particularly between Asia and Latin American, certain US points have potential to become "international" connecting hubs, or Global Portals. These will inter-connect traffic from points just as do domestic hubs, but will do so between points in each region which by themselves cannot support nonstops.

The net result will be enormous economic growth for the cities where the Global Portals are located. This is because, just as domestic hubsites are over-served by virtue of the inter-connecting traffic support, the Global Portal will have far more international service access, supported by the feed traffic going through the hubsite. Potential Global Portals: AA/DFW, NW/DTW, CO/IAH, and DL/ATL. These will also enhance the value of alliances, both domestic and international.
Not sure how Detroit got on that list, given that they have minimal nonstop international service to Asia, Europe, or Latin America. But Houston definitely has tremendous potential here. If you use a string on a globe to find the shortest "great circle" route from the Asian Pacific Rim to Central America and the most populated parts of South America, you'll find it goes right through Houston. I've heard before that there is actually a reasonable amount of traffic that connects through from Continential's Tokyo flight on to Latin America. Asian trade with Latin America is increasing dramatically as they supply China and other countries with much-needed food and raw materials.

This will be key to Houston supporting nonstop flights to China, since, geographically, we are badly positioned to feed domestic traffic there. Now that Continental has been awarded slots to both Beijing and Shanghai from Newark, we have to hope that they will apply for future slots from Houston.

Competition will be stiff. American is at a bit of a disadvantage with DFW, because most of their Latin America flights are concentrated out of Miami, and there also seems to be some issue in their pilot contract which prevents flights to China because they're too long. But Delta is growing strongly out of Atlanta, not only to Europe and Latin America, but they were also recently awarded a China slot starting next year - and they already have flights to Tokyo and Seoul. We have the natural advantage with more regional ties, more Latin American flights, and the port, but they're a bigger hub with more total flights and destinations, and certainly have the potential to beat us to "global portal" status if we don't move aggressively.

Are you listening, Continental? Maybe time to order some more 787s?...

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At 8:54 AM, October 23, 2007, Anonymous Anonymous said...

I hope this speeds up the IAH's master plan which in the end would provide the efficient layout utilized by Atlanta/Hartsfield.

I know the plan is in place and moving forward, but speeding up the terminal re-alignments and re-construction proposed would greatly give IAH a major advantage.

At 9:04 AM, October 23, 2007, Blogger Tory Gattis said...

I have concerns about going to an Atlanta terminal configuration. I've read that forcing all arriving and departing passengers through a single giant check-in terminal creates huge traffic jams and long lines. One commenter said it's common knowledge to get to ATL *3 hours* before a flight, which is nuts. It's better to distribute the traffic load over several different terminals like we do now.

Besides, what we're talking about here is not necessarily a whole lot more flights relative to the ~800/day CO has now, but more like a handful of big planes to big international destinations.

At 9:06 AM, October 23, 2007, Blogger Tory Gattis said...

P.S. I'm all for IAH expansion over time as demand warrants it - I'm just worried about ATL as a terminal model.

At 10:58 AM, October 23, 2007, Blogger Brian Shelley said...

Having been to Atlanta/Hartsfield just a few months ago on business I can verify that the security lines are much longer than at IAH. They moved relatively quickly, but it was still a few hundred people deep. It took about 10 minutes to even see the actual security checkpoint.

It wasn't a nightmare, but it took quite a while longer than my experiences elsewhere.

At 1:27 PM, October 23, 2007, Anonymous Anonymous said...

I've gone through Atlanta a couple of times at 3 and 6pm on a Friday to head back to Houston. I got there about and hour and a half before my flight and made it fine to the terminal.

Checking in at the curb and/or online prior to getting in the terminal does save time. I haven't used a formal terminal check in desk for several years now.

One of the first times I went to ATL, the security line scared me at first, but it moved quickly. Houston has several smaller security checkpoints instead of one massive one, but in the end it is about the same amount of time and security lines.

The train system between the terminals also moved people fairly quickly too. If any of you seen the projected final layout for IAH, it looks drastically different from the current configuration. It will utilized a high speed underground train with the terminals spread apart like individual islands. Denver also has this layout.

The big difference between ATL and future IAH is the runway capacity. IAH blows away ATL for runway capacity and stills has some expansion room.

ATL is currently land locked for expansion of its airplane facilities and any terminal expansion. No more room is available for runway expansion. They are stuck with the 4 parallel configuration (which is a lot capacity though).

I need to go back and look at the projected build out. I know demand is the main driver, but i think there is an overall phasing that will move forward regardless.

At 7:11 PM, October 23, 2007, Anonymous Anonymous said...


Getting a non-stop flight from Houston to China is going to be a mighty big stretch, though being an optimist I won't say that it is impossible. I first made the trip to Beijing from Houston from my time I lived in China and have flown back from Beijing, Shanghai, and Hong Kong. I've crossed back and forth across the Pacific (I think) about 14 times.

Last October I flew into a typhoon when flying from San Francisco to Tokyo. The 747 was out of fuel and the pilot aborted the landing. We ended up refueling at the Yakoda air force base on the other side of the city. We then flew back into Narita. We were stranded overnight in Narita and did not get out until 4:00pm the following afternoon. We were taken to the Hokkaido airport (Tokyo's domestic airport, rarely seen by foreigners) by bus, which gave me my second look at Tokyo, before heading out of the country via a connecting flight at Osaka.

A flight from Houston to San Francisco is 1,650 miles. The connecting flight from San Francisco to Narita is 5,250 miles, and a connection from Narita to Beijing is some 2,300 miles. Add all of that up and you are talking about a 9,000 mile trip. Trips to Southeast Asia, such as to KL, Jakarta, and Bangkok are even further. Generally, flights take off from Houston early in the morning and arrive in Asia late the following night. The flights themselves take 20-22 hours, but the full trip usually takes 24-28 hours to complete, with transfers.

There is a difference of a few hours in flight time flying west since the trade winds blow across the Pacific in an easterly direction. This causes drastic differentials in flight times. It is possible to fly from Tokyo to O'Hare in 10 hours, but it takes 11 hours flying west from San Francisco to Tokyo, even though the flight is 1,600 miles shorter.

I know the 777 and 787 are long range planes (indeed the 777 has made it east bound from Hong Kong to London non-stop), as will be the new Airbus, but one thing I believe to be true is that the feds require, by regulation, that planes have at least 1 hour (it may be 90 minutes) of fuel on top of what they think they will need to complete the flight as a cushion just in case they need to abort landing, hover, or land somewhere else. Someone more knowledgeable than me can correct me here, but I believe that if pilots and airlines are found to be flying in on fumes (so to speak), then they can get reprimanded by the authorities.

All that said, if we can (safely!) get a non-stop flight from China, then more power to us!


At 10:12 PM, October 23, 2007, Blogger Tory Gattis said...

I don't think distance is an issue with the longer-range widebodies, esp. the new 787s. In fact, Emirates is starting nonstop Houston-Dubai service starting this December (on an Airbus, I believe), and that's 8,200 miles - at least 16-17 hours each way, probably one of the longest flights in the world. Houston-Shanghai would 'only' be 7,600. Hong Kong would be 8,400, not much more of a stretch.

Great site for calculating distances:

As far as getting China slots: IAH and DFW will soon be the largest hubs in the country without China service, so we should be pretty high in the queue when new slots get handed out for 2010+. LA, SF, Chicago, NYC, DC - even Philly, Detroit, and Atlanta - are all getting service.

Interestingly, under open skies, Houston might have trouble. It might make more sense for CO to just add more frequencies from Newark, where they might be easier to fill. But with controlled slots, the FAA wants to see service from new cities, and that makes a IAH-China proposal from CO very likely, and likely to win an award as well.

At 8:52 AM, October 24, 2007, Anonymous Anonymous said...

One thing that might be overlooked by you Houston people is the importance of direct flights to smaller towns. I come from a smaller town whose only airline connection is a daily flight to Houston. I could easily live in Houston as a result. Going home to visit my parents and friends would be very convenient. Don't forget about smaller lower capacity planes that make flights to Del Rio and other small towns possible. They also play an important role.x


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