Philadelphia has always been a USAir town and of course now an American Airlines town. This is both good and bad. Unlike many, I actually like American. Of course, I’ve had a share of bad experiences, but overall the airline has been good to me. However, I couldn’t help but notice how high fares are to Europe out of Philadelphia.
The reason for the high fares is the sore lack of competition on trans-Atlantic routes. In the map below, the blue routes are those that American operates with no competition. The red routes are those that American competes over with other airlines.
Lack of competition creates an unfortunate paradigm, especially for those of us based in Philadelphia. Let’s compare airfare to Europe from New York. For the purposes of this example, I’ll use New York to Rome, non-stop, on a random date in June.
Prices from NYC-area airports:
Prices from Philadelphia:
As you can see, flying out of the New York area to Rome can save you 50% or more as opposed to flying out of Philadelphia. This is primarily due to the intense competition in the New York area for this route. If I’m not mistaken, five airlines fly non-stop to Rome — American, Delta, Alitalia, United, and Norwegian.
Only American flies direct to Rome from Philadelphia. This pattern is similar on Philadelphia’s other trans-Atlantic routes. Philadelphia does have some competition on European routes like London, Frankfurt, and Dublin with British Airways, Lufthansa, and (soon) Aer Lingus.
According to a report, American occupies 59% of the gates at PHL, based on a 2008 leasing agreement. I’m certainly no expert in airport lease administration so feel free to correct me if I’m wrong, but my understanding is that once a lease is up the airlines have to negotiate with the airport to keep/add gates. This negotiation almost always includes some sort of financial commitment by the airline to assist with airport maintenance, marketing, etc.
Though it’s encouraging to see new airlines like Aer Lingus and Icelandair joining the PHL family, I can’t help but be pessimistic that any real competition will come to fruition.
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Featured image courtesy of Oliver Holzbauer.
Take away Comcast and UPenn and Philly has no real business going on. Plenty of international companies have their headquarters in NJ about half way between PHL and EWR and most of them will pick EWR for convenience. Even LH can’t support a daily FRA flight during the winter so that tells you that O&D here is pretty weak.
agreed, PHL with USAir was competition and there were a number of corporate centers in PHL at that time. However, Airlines aren’t the only businesses that have consolidates over the past decade and the result is a lot of the corporate centers that used to occupy center city have moved to suburbia and most into NJ or MD both of which have existing INTL service with rail connections direct (without backtracking like Septa loves to do) to their international gateways DCA(marc) BWI (marc) EWR(NJT/PANJNY), JFK(NJT/PANJNY) This makes the drive and parking at PHL easily avoidable. Yes it is about a… Read more »
Up until this year, DL operated seasonal CDG service and year round LHR service. Obviously it wasn’t profitable. Philadelphia may just not be a big enough city (especially in regards to business travel) to support enough O&D traffic to be viable without hub connections to other cities.
Flights to Rome from Atlanta are consistently around the same price. I know the distance is marginally longer, but it’s the same idea.
Why do you call British Airways competition with American given their J/V?
Fair point, Brian, thanks for the comment. Looking at it that way, I wouldn’t say BA is a true competitor by those standards. I just look at it as another player for those routes as opposed to American only. Sorry if it was misleading!
I recently booked a trip to Athens Greece from JFK because it was way cheaper. I wanted to fly out of philly being it being my hometown but couldn’t do the high fares. I heard Norwegian is looking to start service in 2019-2020 to London Gatwick see if that happens
Oh, really? That’s interesting. I was recently in Dublin and saw a 737 MAX 8 from Norwegian taxi in from I believe LaGuardia and I couldn’t help but think how uncomfortable that ride must have been 😀
Yea Norwegian plans to get new Airbus 321LRs next year and mentioned Philly, Detroit and Minneapolis as potential markets. Yea I’ve flown philly to LHR on delta 757 and it wasn’t fun lol