It seems like over the last few years, there have been almost weekly announcements of new routes from one of the ME3, the three major middle east airlines (Qatar, Emirates, and Etihad), to the United States. As of now, these three airlines fly, or have announced, routes from the middle east to the thirteen U.S. cities.
As a Denver-based flyer, I have heard a lot of talk about whether we can expect to see some exciting new liveries at Denver International Airport in the near future. I keep finding myself going back and forth between thinking, “yes, we’ll hear an announcement any day now” and “nope, it’s never going to happen.”
Warning: lots of analysis and numbers below. If you want the short version, skip down to the bottom. Otherwise, settle in and let’s look at some numbers.
As an engineer, I decided to do what I do best – start analyzing things and putting some numbers on paper. The first thing I did was chart the geographic reach of the ME3 within the United States. That resulted in the map above. The green areas are within 100 miles of an ME3-serviced airport, the yellow areas are 100-to-250 miles out, orange areas are 250-to-500 miles out, and the red areas are more than 500 miles away from any ME3-serviced airport.
Combining this information with the 2010 U.S. Census data gives us some interesting numbers. Of the U.S. population in the lower 48 states, approximately 44% live within 100 miles of an ME3-serviced airport, 64% live within 200 miles, and 95% live within 500 miles.
The next piece of information I dug up was a list of airports, ranked by their total passenger count. I combined markets with multiple major airports (e.g. JFK, EWR, and LGA for New York). In this list, the markets already served by the ME3 are highlighted in grey. Again, my hometown of Denver is looking pretty ripe for a new route.
The above list doesn’t tell the whole story, however. As a hub to United and Frontier, and a major transit point for Southwest, Denver International Airport has a lot of connecting passenger traffic. And while the total passengers going through the airport is a major draw for any carrier, a lot of the appeal of flying an ME3 carrier is one-stop travel to far reaching destinations in Asia and beyond. This kind of traffic relies on an airport’s capacity as an Origin and Destination (O&D) facility.
The following list ranks U.S. markets based on domestic origin and destination; that is, if each market had one airport, and all flights were nonstop, these would be the biggest airports.
Again, the markets already served by an ME3 airline are greyed out, with Las Vegas now in the lead for a new route and Denver in the number two spot. Like the total emplanement numbers, these figures can be skewed by airports that overperform within their region – i.e. passengers who have a choice between two airports choose the airport that has the airlines and the departures to meet their needs. To determine which markets would be likely to draw passengers, we can take a look at population and demographics.
The following lists the top 25 Primary Statistical Areas of the United States.
As with the other tables, the markets already served by an ME3 carrier are shown in grey. Comparing this table to the above tables illustrates a different story – really part of a bigger demographic story of the United States as a whole. Now, the top unserved market is Detroit, followed by Phoenix, and Minneapolis/St Paul (MSP). My favorite airport, Denver, falls to #5 on the list.
Too many numbers? Okay, here’s a plane to break them up.
Let’s continue, shall we? Combining the Census data with GIS geoprocessing allows us to go into some greater detail about the populations surrounding each candidate airport. The first thing I looked at is the total population within various ranges of the airport that is not already served by another ME3 airport within the same range. That is, how many people live within, for example, 100 miles of each airport that do not live within 100 miles of an airport already serviced by and ME3 carrier. I did this math at the 100-, 200-, and 500- mile ranges, then ranked the cities based on inverse distance weighting the population.
Interesting – even more so than the statistical area lists, this list favors some of the bigger rust belt cities with large surrounding populations (Cleveland, Columbus, Detroit, and Pittsburgh). Denver is now down to number eight on the list.
It should go without saying that the primary reason that the rust belt region is so underserved is that most of these cities have economies without a heavy international focus. Despite large populations, cities with weaker economies are not as likely to generate the business revenue needed to support a route, especially one serviced by the high premium seat density aircraft favored by the ME3 carriers. Another important piece to the puzzle is cargo, which is also driven by business.
Perhaps the best measure of a city’s economic health is its GDP and GDP growth. The U.S. Department of Commerce publishes an annual list of metropolitan area GDPs. Trimming this list to cities unserved by the ME3, we get the following list:
Yay, my hometown made it back into the top five (and we’re number two for economy growth)!
One final statistic that I think is an important consideration is ethnic demographics. A significant portion of the ME3’s passenger load is visiting friends and relatives (VFR). Much of this traffic, from the United States at least, is to Asian countries. Although VFR passengers are more likely to drive up passenger counts in the economy cabins as opposed to the more profitable premium seats, they are definitely a piece to the larger puzzle. The following list ranks the top 10 candidate airports by Asian population within 100-miles, based on the 2010 census.
So pulling all the statistics together, I developed an overall ranking of cities based on the above criteria. I present the top 10:
We’ll review each of these cities in depth in a moment, but first, let’s briefly consider the equipment that might be used to service a new route. As these markets all represent the smaller U.S. markets, it is unlikely that any of these cities would demand the capacity of an A380, which is operated by all three airlines. Even a 777-300ER would be a stretch, as the capacity doesn’t seem justified. The nonstop distances are significant, ranging from 7000 to 8500 miles; this somewhat limits the equipment that could be used on such a route. These long-haul distances to smaller markets do seem perfect candidates for both the 787 and A350. Qatar and Etihad collectively have 100 787s and 105 A350s in operation or on order.
Emirates is a bit of a different story, however. As the airline’s business model revolves around larger widebodies, Emirates does not have any orders for either the 787 or the A350 (although they had an A350 order that they cancelled a while back). Many of these routes could potentially be operated by Emirates’ 777-200ERs, though it would likely take the range of a 777-200LR to operate the longer routes. Emirates collectively owns 16 of these aircraft and has been actively pulling them off some routes (DFW, LAX, SEA, ORD), replacing them with larger A380s and 777-300ERs. In addition, Emirates currently has 150 Boeing 777X jets on order that could be used to service such routes after their entry into service – currently scheduled for 2020.
City-by-City Rundown of ME3 Service Potential
Detroit, MI (DTW). My Odds – 3:4
I’m surprised that none of the middle east carriers are flying to Detroit yet, although Royal Jordanian does fly there. It seems like a no-brainer. It’s true that the economy of Detroit has been in bad shape in recent years, and DTW isn’t exactly a thriving airport, but I can’t believe that the seat of U.S. automaking doesn’t have direct service to the middle east. When I was in India a few years ago, I was surprised how common the Ford brand is – U.S. automakers are doing big business there. The Detroit area also has a huge Muslim population. In addition, Detroit’s economy is in the midst of a modest recovery. Finally, Detroit is driving distance to many of the rust belt cities further down on this list. Of all the criteria I considered, Detroit checks all of the boxes. I’d put better-than-even odds that DTW sees a new route in the next year or so.
Minneapolis / Saint Paul, MN (MSP). My Odds – 1:2
Although Denver edged out Minneapolis in my list, I think MSP airport probably has a slightly higher likelihood of getting an ME3 route. Its large, diverse population and strong GDP makes MSP seem just ripe for the picking. I’d put even odds that we see service into MSP in the near future. Look out Delta – your hubs are my two highest candidate cities.
Denver, CO (DEN). My Odds – 1:3
I’m obviously (not) impartial here, but I think Denver has a good shot at getting a new route. With a diverse oil and tech-driven economy, one of the busiest airports in the country, lots of tourism-fueled Origin and Destination traffic, and no competing major international airports within nearly 1000 miles, I believe a new route would perform well.
Phoenix, AZ (PHX). My Odds – 1:4
Phoenix ranks as the third biggest economy, and second largest population center unserved by the ME3. Although it doesn’t have the booming economy or busy airport that Denver does, I believe it would be a viable option for an ME3 carrier.
Charlotte, NC (CLT). My Odds – 1:8
Although a smaller market in and of itself, Charlotte has lots regional traffic which drives a busy airport. With the region’s fast-growing economy, I could see some interest from the ME3. I’d be really surprised, however, if that happened before one of the cities higher up on this list.
Cleveland, OH (CLE). My Odds – 1:8
Does Cleveland rock? It ranked at the very top for cities with a large unserved ME3 population. While CLE airport itself isn’t exactly a booming place these days, its strategic location within the underserved rust belt region might just warrant a new route. Detroit’s only a few hours down the road however, and I expect it would have much higher appeal to a middle east carrier than Cleveland. If for some reason, political or otherwise, Detroit does not get a new ME3 route, CLE would jump much higher on this list.
Las Vegas, NV (LAS). My Odds – 1:10
The reason that Las Vegas ended up so high on the list is its gaming and tourism industry, which drives high Origin and Destination passenger numbers. Does the draw of high stakes gaming and high-end hospitality warrant a new route from the Middle East? I would be surprised if it did, but it is worth noting that Las Vegas has a number of successful international routes from Europe, Central America, and even a Korean Air flight from Seoul.
Portland, OR (PDX). My Odds – 1:15
Portland is a relatively small market, but has a strong GDP with solid growth and lots of Origin and Destination traffic. However, Seattle – and its twice-daily Emirates service – is only a few hours up the road. I doubt PDX will see much interest from the ME3, but you never know.
San Diego, CA (SAN). My Odds – 1:20
San Diego is tough. Although it ranked higher up in my overall analysis, there are some serious factors working against it. It’s only a few hours down the road from LAX and its A380-heavy service. At around 8,500 mi, it’s also the most far-flung of any US destination, out-ranging most of the smaller aircraft that might be practical to service such a route. Pulling off a route into San Diego would be tough without a fifth freedom right to do so.
Pittsburgh, Pa (PIT). My Odds – 1:20
There was a lot of discussion earlier this year about Pittsburgh potentially getting a Qatar Airways route. Although I don’t really see the demand for it, considering the other candidates on this list, it does sit within a few hundred miles of a huge population that does not otherwise have access to an ME3 route. I’d put it as a distant third contender for a rust belt route behind Detroit and Cleveland. Stranger things have happened.
When examining number of orders on the books by all three Middle Eastern airlines, it’s clear they all have their eye on expansion. I expect, in time, many of the above cities will have direct service into Doha, Dubai, or Abu Dhabi.
Although this analysis covers many of the economic and demographic factors behind new route selection, there’s a big piece missing – politics. International, national, local, codeshare, and union politics all play a big role in where an airline chooses to fly. It takes backing at all levels to make a route work – without broad-based support, a new route will never get off the ground. I think the rust belt region is definitely next in line for a new route, but politics could decide whether it goes to Detroit, Cleveland, or Pittsburgh.