Exclusive: Anchorage sees passenger opportunities as a connecting hub
Ted Stevens Anchorage International Airport (ANC) does not usually come to mind when thinking of a connecting hub. Despite being a lifeline in connecting Alaska’s small communities to the rest of the world and being one of the largest freight hubs in the world, the airport is now turns to passenger operations. In particular, Jim Szczesniak, Director of Anchorage Airport, sees the potential of the airport to serve as a hub for scissor-type passengers.
Anchoring as a connection hub
Alaska Airlines is the ANC’s largest carrier. Although it brings a lot of traffic to and from Anchorage and the lower 48 US states, the airline also uses Anchorage to route some of the connecting passenger and cargo traffic to smaller communities in Alaska, like Nome or Cold Bay, from the lower 48 states and the rest of the world.
At one time, Anchorage was an incredibly important international passenger connection hub. Until the late 1980s, airlines routed flights between Europe and Asia via a stopover in Anchorage. The reason was that the airspace of the then Soviet Union was closed to many airlines. To get around this problem and open up travel between Europe and East Asia, carriers routed their flights through a stopover in Anchorage.
Turn Anchorage into a scissor hub
Szczesniak sees the potential to bring Anchorage back onto the world stage for connecting passenger traffic. At the end of 2020, the airport received authorization from the United States Department of Transportation (DOT) to extend international passenger transfer rights. This gives foreign carriers the same rights as air cargo in Anchorage.
This could have huge implications for how airlines set up their operations in Anchorage. Mr. Szczesniak envisions the following type of scenario for bringing passengers from a place like Asia to points in the United States:
“With these transfer rights, you have the possibility of making a change of gauge, if that interests you. So you can bring a big plane here, you cut up and cut up the passengers, and then you can send small planes to the North American market. “
So, unlike many other hubs, an international airline can fly a widebody like a Boeing 777 or an Airbus A330 to Anchorage. These passengers can then connect to Anchorage and travel to points in the United States aboard a smaller aircraft like a Boeing 737 or Airbus A320, essentially creating a scissor hub.
The potential extends even further to international markets, according to Szczesniak:
“Carriers are looking to connect the world’s financial capitals. Now, you have the option to come here, and star, and then you can fly a plane to Mexico, a plane to New York, and a plane to Toronto, and you can hit those big three financial capitals.
Basically, the operation would be to set up Anchorage as a secondary connecting hub to allow airlines to add flights to North and South America.
The anchor is well placed to manage it
While the main connection hubs that come to mind include London, Frankfurt, New York, Toronto, Dubai, Doha, etc., one of the main factors for a hub’s success is the accessibility of these locations. to the rest of the world. For example, on an eight-hour flight from London, a passenger can reach points in North America, Africa or Asia. But from a city like Sydney, passengers can mainly only touch points in Asia and Oceania within an eight-hour radius.
The anchor is positioned in the same way. According to Szczesniak, the airport has a claim to fame where it is less than 9.5 flight hours from 90% of the industrialized world. This is what helps support Anchorage’s prowess as a freight hub.
More opportunities for airlines
While Anchorage may seem like a great option for creating a connecting hub, airlines need an incentive to actually add flights to and from the airport. Mr. Szczesniak sees this potential in the form of ventral cargo. He discussed the advisability of transporting passengers from India to the west coast of the United States:
“Geographically – from India to the west coast of the United States – [flying to] one of those destinations on the west coast of one of the Indian destinations, stopping in Anchorage adds less than 1% to the trip from a flight [distance] perspective.”
Planes do not fly in a straight line on a map. Instead, they follow the Great Circle route, which requires many flights between Asia and the United States to fly over Alaska. But while a stop in Anchorage can add a few extra miles to the trip, the biggest incentive for airlines is freight.
“But then [stopping in Anchorage] gives them the ability to carry a full belly cargo. You could theoretically have a plane from Bangalore, a plane from Mumbai, and a plane from New Delhi, all three come to Anchorage at the same time, you swap passengers, a plane goes to LA, one goes to San Francisco, and we go to Vegas. All of this is possible.
There is another layer to this example. The three major carriers in the Middle East strongly dominate the Indo-American market. However, a connection to Anchorage could actually help Indian carriers consolidate a better position than Middle Eastern carriers:
“A lot of the carriers in the Middle East basically go to India to pick up, pick up the passengers, get them to the Middle East, and then distribute them. Well, that leg from the Middle East to the west coast of the United States – it’s too long for air freight too, and it’s actually longer to go that way. So if you were to actually go through Anchorage instead of the airports in the Middle East, it would save you about two hours of flying time, and then you have a full load of cargo. So it’s a market that we’re really trying to look at and see if we can develop it. “
One of the biggest benefits for passengers would be the ability to go through customs in Anchorage and land at their final destination in the United States as a domestic flight. This would mean avoiding the long lines at customs at major gateways like San Francisco, Los Angeles or Chicago. If passengers make a further connection at one of these three airports to a point in the United States, it can be much easier to get to your next flight when you can arrive directly as a domestic passenger.
Could this become a reality?
Already, there have been murmurs of an Icelandair-style model airline coming to Anchorage. However, the Icelandair style model is probably the kind of hub-and-spoke that could develop in Anchorage.
Non-stop itineraries between the United States and Asia generally arise due to the ease and convenience for the lucrative business traveler. This saves time by flying non-stop from San Francisco to Shanghai rather than adding a stopover in Anchorage.
Any model that comes to Anchorage this way should be aimed at leisure travelers, who are generally more price sensitive and may be inclined to choose a cheaper fare going through Anchorage than flying nonstop. Airlines could also pass on some cost savings to their customers on such a route by offsetting the lower fares by carrying cargo at full capacity.
Plus, Anchorage is a cheaper international airport than Los Angeles, Chicago, San Francisco, or New York. Coupled with some of the incentives for international flights, there could be an opportunity for a leisure or low cost carrier to enter the market.
Anchorage, in general, hopes to increase its portfolio of international routes. The airport is hoping to add some Asian flights, especially to a major Asian gateway where an airline could offer connections. One of the most likely options remains that a athe global carrier comes to Anchorage and offers hub connections on Alaska Airlines, which, while not a scissor hub model, could still give Anchorage that lucrative Asian route.
In the end, no major airline announced plans to develop any type of star model in Anchorage. Although there is a precedent for airlines developing scissor hubs in other countries to channel passengers, Anchorage has yet to benefit from these types of operations.
Do you think the airlines should come to Anchorage and build a scissor hub? Let us know in the comments!