KCRag Forum

beautyfromashes wrote: ↑Wed Dec 15, 2021 11:08 am

normalthings wrote: ↑Wed Dec 15, 2021 11:02 am The cost St. Louis is paying is well above what peers paid for what they are getting.

Can someone give a brief explanation of airport economics? Are they worried that the flights from St. Louis won't be full? Why are flights more expensive to smaller cities while still getting subsidies that (I assume) larger cities like Atlanta aren't paying? Are they just charging the cities these fees because they can or is there some financial reason for it?

beautyfromashes wrote: ↑Wed Dec 15, 2021 11:08 am

normalthings wrote: ↑Wed Dec 15, 2021 11:02 am The cost St. Louis is paying is well above what peers paid for what they are getting.

Can someone give a brief explanation of airport economics? Are they worried that the flights from St. Louis won't be full? Why are flights more expensive to smaller cities while still getting subsidies that (I assume) larger cities like Atlanta aren't paying? Are they just charging the cities these fees because they can or is there some financial reason for it?

dev49 wrote: ↑Wed Dec 15, 2021 12:23 pm Airlines know they can fill flights in New York, chicago, etc. mid sized cities aren’t proven markets to Europe so they want some guarantees they won’t lose money if they flights don’t sell well. So they basically want incentives as insurance. Plus when you have 5 cities fighting for a route why not make them compete against each other and pay you more money.

Flights are cheaper in larger cities because there is more competition.

normalthings wrote: ↑Wed Dec 15, 2021 11:02 am The cost St. Louis is paying is well above what peers paid for what they are getting.

beautyfromashes wrote: ↑Wed Dec 15, 2021 1:02 pm

dev49 wrote: ↑Wed Dec 15, 2021 12:23 pm Airlines know they can fill flights in New York, chicago, etc. mid sized cities aren’t proven markets to Europe so they want some guarantees they won’t lose money if they flights don’t sell well. So they basically want incentives as insurance. Plus when you have 5 cities fighting for a route why not make them compete against each other and pay you more money.

Flights are cheaper in larger cities because there is more competition.

So, why not avoid the competition? Why make $600 on a flight to Europe from NY or Boston where competition is crazy when you can make $1200 from St. Louis or Kansas City PLUS get an incentive to cover more than any risk?

dev49 wrote: ↑Wed Dec 15, 2021 3:38 pm

beautyfromashes wrote: ↑Wed Dec 15, 2021 1:02 pm

dev49 wrote: ↑Wed Dec 15, 2021 12:23 pm Airlines know they can fill flights in New York, chicago, etc. mid sized cities aren’t proven markets to Europe so they want some guarantees they won’t lose money if they flights don’t sell well. So they basically want incentives as insurance. Plus when you have 5 cities fighting for a route why not make them compete against each other and pay you more money.

Flights are cheaper in larger cities because there is more competition.

So, why not avoid the competition? Why make $600 on a flight to Europe from NY or Boston where competition is crazy when you can make $1200 from St. Louis or Kansas City PLUS get an incentive to cover more than any risk?

You are preaching to the choir here.

But apparently it isn’t that simple.

herrfrank wrote: ↑Thu Dec 16, 2021 5:18 pm Upon reflection, I think this Lufthansa win for STL may be a negative for KC. Trying not to be zero-sum, but consider:

1. It looks pre-emptive. Missouri has one state government, and even if this was funded largely by the St. Louis (ahem, Clayton) "city fathers," this smells of some insider negotiations in Jeff City. Also, by announcing now, they jump the gun on our younger city with its shiny, new airport about to debut next year. And the timing is just after DL unveiled its large Kansas City SkyClub. (STL has only one, small lounge, the AA Admirals Club -- however LH will almost certainly pay American Airlines for access -- like they do in Charlotte and formerly at other outstations)

2. Frankfurt? Doesn't everyone here think that AMS or LHR or CDG are much likelier destination airports for a mid-sized midwestern metro? United also is not big here nor at STL. This looks like a way to cut the legs out from a Delta KLM MCI-AMS move or even (a now, admittedly less likely) BA/ AA MCI-LHR service.

3. Subsidies are a fact of life for European service. Who would shell out in KC? MOBAY (don't know the new name) seemed like a possibility, but anyone travelling for Bayer now would rather take a car service to STL for a nonstop rather than connect in Amsterdam. In fact any German intercontinental traveler would probably take the four-hour hit here rather than a schlep between terminals in a non-German European country.

GRID wrote: ↑Thu Dec 16, 2021 6:04 pm Frankfurt is a major hub to most of Europe. It actually makes more sense than even London or Paris. Maybe KC could pull off a non stop to London or something, but I still think it has to get its domestic numbers up first and it needs more flights to regional cities like Omaha, Des Moines, Wichita etc to feed into international flights. I may be wrong, but I think StL has a lot more of those regional type flights.

normalthings wrote: ↑Thu Dec 16, 2021 6:31 pm

GRID wrote: ↑Thu Dec 16, 2021 6:04 pm Frankfurt is a major hub to most of Europe. It actually makes more sense than even London or Paris. Maybe KC could pull off a non stop to London or something, but I still think it has to get its domestic numbers up first and it needs more flights to regional cities like Omaha, Des Moines, Wichita etc to feed into international flights. I may be wrong, but I think StL has a lot more of those regional type flights.

Yes, because southwest has a connecting operation in St. Louis. KC will not get those types of flights otherwise.

herrfrank wrote: ↑Fri Dec 17, 2021 11:18 am ^ I am having continued difficulty understanding the LH decision. UA is their "domestic legacy" Star Alliance partner. They fly nonstops to STL from Chicago, Houston, Denver, Newark, IAD (Washington Dulles), and San Francisco. Those cities all have separate service, direct to Germany, I think it includes Lufthansa to Frankfurt in every case.

So there is zero "natural" connecting traffic that will happen within the alliance for this new STL-FRA service. During IRROPS there will be a dribble (say, if DEN-FRA cancels, UA could route some traffic to STL and then onward to FRA).

As mentioned above, a few hardy souls will connect from Southwest (possibly even some KC folks) rather than at O'Hare or some other hub.

But in the end, the STL metro has to provide the draw for this flight. Apples-to-apples, I think the KC metro would have had a better draw for a nonstop to Europe. My hope is that the existence (or eventual failure) of this STL flight does not deter another airline from taking a chance on MCI.

Speaking of air service I had a nice chat with the director earlier today. Here’s what he shared with me (that he allowed me to share)

- The Delta sky club likely won’t be the only club, negotiations ongoing with other operators.
- The airport is prepared to offer up to 1.5 million in incentives for new TATL service. Obviously far below what STL fronted but might enough for DL, BA or even Condor to bite. Currently working with businesses and the state to increase it but that takes time and data.
- He wouldn’t say exactly where DL stands on adding a TATL but new domestic flights could arise such as RDU once the new terminal opens.
- Even though FI pulled out, TATL traffic actually increased and stated airlines have responded positively to recent meetings. He met with six carriers in Milan a few months ago. Reading between the lines, landing BA and resumption of FI are our best chances.

The demand is there and airlines are noticing. We just need to grease their palms. It’s a matter of time but expect to wait a few more years. The immediate goal is getting back lost routes. Of course he knows more than what he told me but still something to take in consideration.

GRID wrote: ↑Sat Dec 18, 2021 11:40 am ^ I thought KC's numbers were more comparable or would even beat out most of the cities on this list. So this tells me that StL should be fine ,but KC getting a TATL flight is very much a long shot at least right now.

dev49 wrote: ↑Sun Dec 19, 2021 11:52 pm

GRID wrote: ↑Sat Dec 18, 2021 11:40 am ^ I thought KC's numbers were more comparable or would even beat out most of the cities on this list. So this tells me that StL should be fine ,but KC getting a TATL flight is very much a long shot at least right now.

Little bit newer numbers. Should include some of the time these routes had service to Europe which pushed them up.
Data based on the 12 months to September 2019.

US airport Traffic to/from London --- Traffic to Europe
St. Louis 38,800 --- 260,700
Cleveland 37,500 --- 269,600
Cincinnati 37,100 --- 239,100
Kansas City 35,400 --- 217,400
Indianapolis 34,769 --- 201,000
Columbus 31,100 --- 177,000

https://www.anna.aero/2019/12/17/britis ... -st-louis/