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Home » United Airlines » The Strategy Behind United’s Florida Expansion
United Airlines

The Strategy Behind United’s Florida Expansion

Matthew Klint Posted onAugust 14, 2020August 14, 2020 14 Comments

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United is describing it’s new Florida service as “aggressive” and “opportunistic” as it sheds its traditional hub-and-spoke model to add 17 new Florida routes this winter. But is that what is really going on beneath the surface? Does United have a cohesive strategy behind its new Florida routes?

Florida Strategy? Straight From The Mouth Of United

Let’s start with what United is saying about its new Florida routes, which Live and Let’s Fly outlined in detail earlier this week.

Publicly, Ankit Gupta, United’s Vice President of Domestic Network Planning, said:

“The addition of these new flights represents United’s largest expansion of point-to-point, non-hub flying and reflects our data driven approach to add capacity where customers are telling us they want to go. We look forward to offering customers in the Midwest and Northeast more options to fly nonstop to Florida this winter.”

Key word: data-driven. United noticed two things. One, demand to Florida, despite being a COVID-19 hotspot, remains strong. Two, its competitors were offering more direct service or convenient connecting options than United.

Speaking exclusively to employees, Gupta further explained the rationale:

“Today, outside our hub cities our customers can only access leisure destinations on United via a connecting flight. But we face competition from other airlines that offer non-stop options or more efficient customer connections via other hubs.”

That’s hardly a problem unique to United. But Gupta continued:

“So why Florida? We know customers, particularly in the Midwest, have a strong affinity to visit southwest Florida. These customers are second-home owners, have vacation rentals, or are just visiting friends and relatives. Likewise, customers in the Northeast have a strong affinity to South Florida and Orlando. Especially as we hit the colder winter months, this is a great opportunity to give customers more non-stop options to Florida from the Midwest and the Northeast. The new nonstop flights reflect United’s continuing entrepreneurial spirit to aggressively and opportunistically manage the impact of COVID-19 by increasing service to destinations where customers most want to fly.”

There’s no doubt people love escaping to Florida in the winter. The question, of course, is whether people will gravitate to United over the competition. United battles Frontier, JetBlue, and Spirit on many routes. It challenges Delta and Southwest on others. Will everyone just be fighting for cheap leisure travelers?

When United talks about “second-home owners” or those with “vacation rentals” it is clear United hopes that it can command a premium for its service. Why take Spirit or Frontier when you can fly United mainline and even fly in first class if you’d like? Onboard service is fairly standard across the board during the pandemic (non-existent) but United at least offers wi-fi, streaming IFE, and even seat-back monitors on some of the 737-800s it will use for its new routes. Frontier doesn’t offer anything and Spirit was supposed to begin offering wi-fi this summer but the pandemic has changed everything.

A Battle Against JetBlue?

Is this really all about punishing JetBlue for invading its Newark hub? Some have suggested this is clearly the case, but it is not clear to me. Yes, its new service from New York La Guardia and Boston directly challenges JetBlue. In that sense, this is certainly at least a token response to JetBlue’s latest expansion.

But to say this is a tit-for-tat fails to account for the unprecedented era in which we live. This isn’t a normal time in which carriers engage in turf wars with one another. This is a fight for survival with the odd addition of government mandates that compel a certain level of service and employment (I’m expecting a second payroll support package has already left the station).

Will It Work?

These flights should fill up. There’s limited in capacity and come during the high-season. In that sense, the risk is not nearly as great as trying to restart international service in an era of travel ban. But can United command a premium? It’s currently offering $14 one-way fares between Newark and Ft. Lauderdale…that’s hardly a sustainable business model.

We’ll monitor how fares progress, but I view this as a low-risk experiment to see if it can command a sufficient premium over budget carriers to avoid losing money on every seat and hoping to make up for it on volume.

CONCLUSION

To see so many new point-to-point routes to Florida on United is a barometer of the odd time in which we live. It’s too early to tell whether the plan will work, but United can always cancel flights if necessary and this limited service represents more of probationary approach than any substantive change in policy.

Finally, Florida remains a COVID-19 hotspot and that may not change by this winter. United hopes people will still visit their families, rentals, and second homes, but even looking toward November seems a bit foolish considering how the pandemic has transpired over the preceding few months. But faced with sitting by and doing nothing or trying a new experiment with otherwise unused aircraft, United has chosen to experiment.

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About Author

Matthew Klint

Matthew is an avid traveler who calls Los Angeles home. Each year he travels more than 200,000 miles by air and has visited more than 135 countries. Working both in the aviation industry and as a travel consultant, Matthew has been featured in major media outlets around the world and uses his Live and Let's Fly blog to share the latest news in the airline industry, commentary on frequent flyer programs, and detailed reports of his worldwide travel.

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14 Comments

  1. Flight Attendant X Reply
    August 14, 2020 at 12:46 pm

    Nothing says let’s help flatten the COVID curve than funneling people in and out of the state with the second highest reported COVID cases. This is all about Kirby’s ego. You don’t announce the launch transcon MINT service out of EWR and think there won’t be repercussions. Take that B6.

  2. Anthony Reply
    August 14, 2020 at 12:58 pm

    A lot of people talk about “cheap leisure travelers,” but from November through February, prices are sky high from NYC to Florida (at least on Delta), and planes are full. Demand seems to outstrip supply here, so United should do well here.

  3. askmrlee Reply
    August 14, 2020 at 1:12 pm

    COVID considerations aside, in my view this is a simply a safe market share grab. The Midwest and Northeast/New England snowbird market has been there for decades.

    Just looking at one market – CMH-RSW is served in winter by WN, NK and DL. Anyone visiting Ft Myers in winter will notice many Ohio license plates,

    Or, perhaps this is an expansion of the United’s Panama City “test” where they flew Saturday nonstops from AUS, ORD, CMH, DEN and STL in March 2020. Yeah I didn’t notice these either.

    http://www.iflybeaches.com/documents/ecp-united-more-nonstop-flights-this-spring

  4. Mike Reply
    August 14, 2020 at 1:26 pm

    I can only speak for the IND route, but as I noted yesterday this flight will be popular here for a couple reasons. 1. Back in the day Indy was the home of ATA (which was an airline somewhat like SY). Many Indy residents bought homes and time shares in Florida and took advantage of very frequent ATA flights into multiple destinations in Florida and the Caribbean. You could leave early Friday afternoon and be warm by 5pm. 2. UA has contracts with one of the large multi-national employers here, and to your point those employees like to escape to Florida and are a owners of some of the real estate in reason #1.

    While DL also has corporate contracts here and offers service as does WN an NK, the UA flights offer options for flyers holding UA status or points. UA flyers here would not schlep to ORD or EWR to get to Florida. Nice to see this line, even if it is for a short period.

    • Matthew Klint Reply
      August 14, 2020 at 1:35 pm

      Did you ever fly on the ATA L1011 Mike?

      • Frank Reply
        August 14, 2020 at 2:09 pm

        I took a few of those flights out of IND during my time at IU Law back in the ’90s. Spring break flights from IND to FLL. Really wanted to take the Mikelsons (named after the owner George Mikelsons) special flight to Riga back when it was the only direct flight to the Baltic.

  5. Mike Reply
    August 14, 2020 at 2:04 pm

    Matthew, yes! I flew it once to LAS. It was certainly a high density config, but then ATA had military contracts for troop transport. ATA was great. It was founded by J. George Mikelsons who started it as a travel club. He piloted many of the early flights and the Desert Storm transport flights. I met him several times, a very humble and super nice guy.

  6. Bob Reply
    August 14, 2020 at 2:26 pm

    Matthew, are you doing any research into the United Sales SVP Jake Cefolia that’s been missing since last Friday?

    • Matthew Klint Reply
      August 14, 2020 at 2:47 pm

      I’ve decided not to write it about (yet) as I view it as a family matter. But I am keeping up on the issue.

  7. Jason Reply
    August 14, 2020 at 2:57 pm

    This is a tactical and strategic move by United narrowly focused at what are high demand, high fare markets during what is traditionally peak period of year. They arent flying as much in several markets now due to covid, so it makes sense to at least try to enter markets where they know there is traditionally demand. It’s a two month experiment, essentially. Will be interesting to see how it works.

  8. Amy Pitts Reply
    August 15, 2020 at 2:36 pm

    Matthew, would testing in the airports make this more successful? Honestly, I have been waiting (impatiently) to fly, hoping COVID testing will become part of the check-in/security process. Thought?

    • Matthew Klint Reply
      August 15, 2020 at 2:47 pm

      I sure think this is the ultimate solution. Hopefully we can reach that point.

  9. JoEllen Reply
    August 15, 2020 at 5:38 pm

    Seriously, United?,…. millions less flying, least of all to Florida and you’re going to jump on the already limited bandwagon with Jet Blue, Southwest, Spirit, American and Delta. Give it up…. grabbing at straws for a four month seasonal window. Ridiculous.

  10. Marc Jacob Reply
    August 19, 2020 at 1:02 am

    I would like to see more direct flights from Florida to the Caribbean and South America, it’s silly to have to fly North to catch a Flight to go south passing Florida! That’s where the real market is

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