The Future of Airline Network Structures on the North Atlantic

The Future of Airline
Network Structures on the
North Atlantic
Frances Kremarik
University of Westminster
April 2015
A dissertation submitted to the University of Westminster
in partial fulfillment of the requirements of the degree of Masters of Science,
Air Transport Planning and Management
© Frances Kremarik 2015

i
ABSTRACT
Aviation passenger traffic on the North Atlantic between Europe and North America
is an established market: it has never been, however, a static one. The market has
evolved since its inception, and continues to do so. Changes in regulations, bilateral
agreements, airline consolidation, the rise of global alliances, and technological
developments have all contributed to create a dynamic market.
The majority of traffic on the market is provided by network carriers on scheduled
services. The success of these carriers was initially predicated on the presence of a
strong domestic network feeding a main hub airport, or airport hubs, for service
between the two continents. Routes were strictly controlled through bilateral
agreements, and despite interline agreements, there was little active co-operation
between carriers. Each airline was reliant upon its own hub and spoke system to
provide air service on the North Atlantic.
With the advent of the EU/U.S. Open Skies Agreement in 2008, numerous airline
mergers (especially in North America), the growth of joint-ventures and airline
alliances, as well as technological advances, the structure of the North Atlantic market
has changed. Through an examination of flight offerings from July 2000, July 2007, and
July 2014, and secondary data sources it is evident that carriers are adjusting their
route networks.
Whilst some network airlines are consolidating their operations on hub to hub routes,
other airlines are expanding to provide routes from their hub to secondary airports:
there is no evidence to indicate that airlines will expand to include non-hub to non-
hub service.
The strategy employed by each airline, however, is strongly influenced by their joint-
venture arrangements and alliance affiliation. The network synergies resulting from
this co-operation are essential to many airlines, and will continue to be the key factor
in future network development strategies.
Word Count: 20,779

ii
ACKNOWLEDGEMENTS
I would first of all like to thank my advisor, Dr. Nigel Dennis. His support and direction
were instrumental in the completion of this dissertation.
I would also like to thank my classmates: Arjun Arayakandy, Vivian Chales, Wellington
Chingwaro, Sydney Kruapech, Douglas McKay, Jimmy Musoni and Krzysztof Piecuch.
Thank you for the memories.
To the people who I have worked with on the International Travel Survey in Statistics
Canada: Lotfi Chahdi, Michel Campbell, Pauline Carr, Élaine Fournier, Jocelyn Lapierre,
Sylvain Perron, and most certainly Sylvain de Repentigny. Your constant support and
encouragement have made me strive to succeed. And I would be remiss without
mentioning Richard Vincent. Your insightful thoughts and suggestions two years ago
over a cup of coffee have led me to the course that I now find myself on.
My thanks to Chuck McNiven who has spent countless hours reading and editing my
various efforts during my master’s program, including this dissertation.
My eternal gratitude to Fr. Radoslav Lojan, Ph.D. Your friendship and constant belief
in my ability to succeed helped me pursue my graduate studies aspirations and have
been instrumental to my success. And to James Scheer, your support and friendship
has helped keep me grounded and keep things in perspective.
And last, and certainly not least, my thanks to my mother, Mrs. Matilda Kremarik.
Without your love and understanding, I would not have been able to face the
challenges that I have encountered these past few years. Dakujem.

iii
TABLE OF CONTENTS
Abstract i
Acknowledgements ii
List of Tables v
List of Figures vi
List of Appendices viii
Glossary of Abbreviations ix
Chapter 1 – Introduction 1
1.1 Airline Industry Consolidation 1
1.1.1 North American Airlines 1
1.1.2 European Airlines 3
1.2 Airline Alliances 4
1.3 Non-Alliance Partnerships 5
Chapter 2 – Literature Review 6
2.1 Network Structures 6
2.2 Deregulation 7
2.3 Technological Advances 8
2.4 Airport Constraints 9
Chapter 3 – Methodology 11
Chapter 4 – Analysis of North Atlantic Network Routes 14
4.1 U.S. Airlines 14
4.1.1 American Airlines / US Airways 14
4.1.2 Delta Airlines / Northwest Airlines 16
4.1.3 United Airlines / Continental Airlines 18
4.1.4 Other U.S. Airlines 20
4.2 UK Airlines 21
4.2.1 British Airways 21
4.2.2 Virgin Atlantic Airlines 23
4.2.3 British Midland 24
4.2.4 Other UK Airlines 24

iv
4.3 Canadian Airlines 25
4.3.1 Air Canada 25
4.3.2 Air Transat 27
4.3.3 Other Canadian Airlines 28
4.4 Other Airlines 29
4.4.1 Fifth Freedom Carriers 29
4.4.2 Other European Airlines 29
4.5 Connectivity 30
4.5.1 Route Network Strategies 30
4.5.2 Current Developments 33
Chapter 5 – Factors Influencing Future Network Development 35
5.1 Airline Alliances 35
5.2 Airport Expansion and Connectivity 36
5.3 Demand on the North Atlantic 38
London-New York 40
London-Chicago 42
London-Los Angeles 44
London-Washington 45
London-Boston 47
London-Miami 48
London-Toronto 49
London-Atlanta 50
London-Philadelphia 50
Market Assessment 51
5.3.1 Trans-Atlantic Economics 52
5.4 Passenger Demographics 56
5.5 Technological Development 60
5.6 Long-haul Low Cost Carriers and Leisure Carriers 62
5.7 Overall Assessment 63
Chapter 6 – Conclusion 64
Appendices 66
Bibliography 83

v
LIST OF TABLES
Table 1 – American Airlines (US Airways) Flights, U.S.-UK, 2000-2014 15
Table 2 – Delta Airlines (Northwest Airlines) Flights, U.S.-UK, 2000-2014 17
Table 3 – United Airlines (Continental Airlines) Flights, U.S.-UK, 2000-2014 18
Table 4 – British Airways Flights, Canada/U.S.-UK, 2000-2014 22
Table 5 – Virgin Atlantic Flights, Canada/U.S.-UK, 2000-2014 23
Table 6 – Air Canada Flights, Canada-UK, 2000-2014 26
Table 7 – Air Transat Flights, Canada-UK, 2000-2014 27

vi
LIST OF FIGURES
Figure 1 –Seat Capacity on Selected Routes on the North Atlantic, 2000 and 2012
38
Figure 2 –Revenue Passengers on Selected Routes on the North Atlantic, 2000 and
2012 39
Figure 3 – Market Share on London-New York Route, 2000 40
Figure 7 – Market Share on London-Chicago Route, 2000 43
Figure 8 – Market Share on London-Chicago Route, 2012 43
Figure 9 – Market Share on London-Los Angeles Route, 2000 44
Figure 10 – Market Share on London-Los Angeles Route, 2012 45
Figure 11 – Market Share on London-Washington Route, 2000 46
Figure 12 – Market Share on London-Washington Route, 2012 46
Figure 13 – Market Share on London-Boston Route, 2000 47
Figure 14 – Market Share on London-Boston Route, 2012 48
Figure 15 – Market Share on London-Miami Route, 2000 48
Figure 16 – Market Share on London-Miami Route, 2012 49
Figure 17 – Price of Jet Fuel (U.S. Dollars), 2000 to 2013 54
Figure 18 – Exchange Rates Vis a Vis the U.S. Dollar, 2000 to 2014 55

vii
LIST OF FIGURES (continued)
Figure 19 – Overall Travel from the UK to North America, 2000 to 2013 56
Figure 20 –Travel from the UK to North America by Trip Purpose, 2000 to 2013
57
Figure 21 – Overall Travel from North America to the UK, 2000 to 2013 57
Figure 22 –Travel from North America to the UK by Trip Purpose, 2000 to 2013
58
Figure 23 – Exchange Rate for the Pound Sterling, 2000 to 2013 59

viii
LIST OF APPENDICES
Appendix 1 – Airline Alliance Membership 66
Appendix 2 – Email interview with Mr. Marc Mapleston
President of Lift Airline Planning (Ottawa, Canada). 68
Appendix 3 – Email interview with Mr. Laurie Price
Former Director of Aviation Strategy, Mott MacDonald. 70
Appendix 4 – Email interview with Mr. Kenneth Stevens
Former Director, Airport Affairs, at the Alaska Air Group. 72
Appendix 5 – London-New York Route Data 74
Appendix 6 – London-Chicago Route Data 75
Appendix 7 – London-Los Angeles Route Data 76
Appendix 8 – London-Washington Route Data 77
Appendix 9 – London-Boston Route Data 78
Appendix 10 – London-Miami Route Data 79
Appendix 11 – London-Toronto Route Data 80
Appendix 12 – London-Atlanta Route Data 81
Appendix 13 – London-Philadelphia Route Data 82

ix
GLOSSARY OF ABBREVIATIONS
Airlines
AA – American Airlines
AC – Air Canada
AF – Air France
BA – British Airways
BD – British Midland International, also known as bmi
CO – Continental Airways
DL – Delta
DY – Norwegian Airlines
IAG – International Consolidated Airlines Group
IB – Iberian Airlines
KLM – KLM Royal Dutch Airlines
LH – Lufthansa Airlines
LOT – LOT Polish Airlines
NW – Northwest Airlines
TS – Air Transat
TWA – Trans World Airlines
UA – United Airlines
US – US Airways
VS – Virgin Atlantic Airlines

x
Airports
AMS – Amsterdam Schiphol Airport
ARN – Stockholm International Airport
ATL – Atlanta Hartsfield International Airport
AUS – Austin International Airport
BFS – Belfast International Airport
BHX – Birmingham International Airport
BOS – Boston Logan Airport
BWI – Baltimore International Airport
CDG – Paris Charles de Gaulle International Airport
CLT – Charlotte International Airport
CPH – Copenhagen International Airport
CWL – Cardiff International Airport
DEN – Denver International Airport
DFW – Dallas-Fort Worth International Airport
DTW – Detroit-Wayne County International Airport
EDI – Edinburgh International Airport
EWR – Newark Liberty Airport
FLL – Fort Lauderdale International Airport
GLA – Glasgow International Airport
IAD – Washington Dulles International Airport
IAH – Houston Bush International Airport
JFK – New York John F. Kennedy International Airport
KEF - Reykjavik Keflavik Airport
LAS - Las Vegas McCarran International Airport
LAX – Los Angeles International Airport
LGW – London Gatwick International Airport
LHR – London Heathrow International Airport
MAN - Manchester International Airport
MCO – Orlando International Airport
MIA – Miami International Airport
NCL – Newcastle International Airport
OAK – Oakland International Airport

xi
ORD – Chicago O’Hare International Airport
OSL – Oslo International Airport
PHL – Philadelphia Liberty International Airport
PHX – Phoenix International Airport
RDU – Raleigh-Durham International Airport
SFO – San Francisco International Airport
TPA – Tampa International Airport
WAW – Warsaw International Airport
YEG – Edmonton International Airport
YHZ – Halifax Stanfield International Airport
YOW – Ottawa MacDonald-Cartier International Airport
YMX – Montreal Mirabel International Airport
YUL – Montreal Trudeau (formerly Dorval) International Airport
YVR – Vancouver International Airport
YYC – Calgary International Airport
YYT – St. John’s International Airport
YYZ – Toronto Pearson International Airport
ZRH – Zurich International Airport
Other
ATC – Air Traffic Control
CAA – Civil Aviation Authority (UK)
EU – European Union
FAA – Federal Aviation Authority (U.S.)
ICAO – International Civil Aviation Organization
MCT – Minimum Connect Times
ONS – Office for National Statistics (UK)
SARS – Severe Acute Respiratory Syndrome
UK – United Kingdom
U.S. – United States
U.S. CBP - U.S. Customs and Border Protection
U.S. DOT – United States Department of Transportation
VFR – Visiting Friends and Relatives

1
CHAPTER 1 - INTRODUCTION
Air travel across the Atlantic Ocean is the oldest intercontinental market. Numerous
airlines have plied the routes over the decades, providing service to literally millions
of people. Whilst the early years of aviation were dominated by national carriers and
heavy regulation, the last few decades have seen technological advances,
deregulation, and the rise of alliances, as well as financial challenges and terrorism
threats. The resultant upheaval left previously dominant airlines bankrupt, and an
industry that is redefining itself to retain its profitability amongst fierce competition.
Traffic on the North Atlantic1 has always been dominated by large scheduled carriers,
as is the case today. It is a mature market that accounts for 22%2 of intercontinental
traffic. It is however dynamic, as not only the carriers operating these routes have
changed over the years, but also some of the routes themselves.
The focus of this study is to examine the flight routes on the North Atlantic market
from 2000 to 2014, and to postulate future developments. This study seeks to identify
the key factors on both the North Atlantic and the wider aviation industry that are
likely to influence future changes, and concludes with possible strategies for
development in the future.
1.1 Airline Industry Restructuring
The airline industry has undergone substantial transformation since 2000: mergers
and bankruptcies have transformed the industry on both sides of the Atlantic.
Although the industry has never been static, the situation was exacerbated by the
attacks of September 11, 2001 and the subsequent decline in travel.
1.1.1 North American Airlines
At the start of the century, there were two major Canadian carriers (Air Canada and
Canadian Airlines) and six major U.S. carriers (American Airlines, Continental Airlines,
Delta Airlines, Northwest Airlines, United Airlines, and US Airways). By the end of
2014, only four of these eight carriers remained: Air Canada, American Airlines, Delta
Airlines, and United Airlines.
The United States market had already undergone a period of change after the Airline
Deregulation Act was enacted in 1978. By 2000, the iconic Pan American Airlines had
already gone bankrupt; Trans World Airlines, another former dominant trans-Atlantic
carrier was in financial difficulty, and was acquired by American Airlines in March
2001.
1
For the purposes of this study, Canada and the United States are defined as North America, and Europe
is defined as continental Europe including both Moscow, Russia and Istanbul, Turkey.
2
According to 2011 ICAO data, traffic between North America and Europe accounted for 21.7% of all
passenger revenue traffic between global regions.

2
The events of September 11, 2001 not only devastated the U.S. travel market, but it
helped undermine the financial viability of the entire U.S. airline industry. These
factors combined with rising oil prices contributed to a number of Chapter 11 filings.3
Of the six major U.S. trans-Atlantic air carriers, only Continental Airlines did not file for
bankruptcy since 2000. The financial impacts to the industry however made
consolidation necessary for survival.
The first of the major mergers in the U.S. industry was between Delta Airlines and
Northwest Airlines when the two merged operations under the Delta name on
October 30, 2008.
The next merger was that of United Airlines and Continental Airlines in 2010 with the
United Airlines name being retained but the Continental Airlines livery being used;
operations were fully integrated by March 2012.
In November 2013, US Airways amalgamated with American Airlines, the last of the
three major mergers.
These mergers resulted in the consolidation and integration of operating networks.
Whilst some hubs continued and even grew in importance, there was also some hub-
shifting as others were relegated to secondary or even non-hub status4. Routes were
re-aligned to match the new networks, and occasionally resulted in changing
frequencies and linkages (Bilotkach et al, 2013).
Despite being geographically larger, the smaller Canadian population has resulted in
fewer ‘national’ carriers. Even so, consolidation occurred when Air Canada acquired
its rival, Canadian Airlines in April 20005. Although there were issues integrating into
a new network, there was no hub shifting as seen in the U.S.
Due to the nature of the Canadian market6, Air Canada’s Canadian competitors on the
trans-Atlantic are charter and tour package operators (leisure carriers7). Air Transat, a
Montreal based operator offering tour packages and low-cost flights survived heavy
financial losses in the post-9/11 period to maintain services (Deveau, 2012; Cousineau,
2013).
3
In the United States, a company may file for protection from its creditors under Chapter 11. Chapter
11 allows companies to restructure its contracts with other entities as well as with its own employees.
4
The de-hubbing of Cleveland by United Airlines and the downgrading of operations by Delta Airlines
in Cincinnati are two examples of this practice.
5
Although the actual acquisition took place in December 1999, operations were not integrated until
April 2000 and CP flight codes were still in use until the end of 2000.
6
The Canadian holiday market is noted by its seasonality with ‘sun’ destinations in the southern U.S.
and Caribbean being in high demand during the winter months and trans-Atlantic destinations in high
demand during the summer months.
7
Leisure carriers are noted by their seasonal network operations and lack of connecting flights.

3
Other carriers have not been as fortunate. Although a leisure carrier, Canada 3000 was
the second largest airline in Canada and a notable trans-Atlantic operator when it
ceased operations less than two months after the September 11 attacks (Besant,
2002).
Zoom was another leisure carrier that operated trans-Atlantic flights from June 2003
until August 2008. The carrier had flight bases in both Canada and the UK when it
ceased operations (Newswire, 2008; Reuters, 2008).
With the seasonal nature of the Canadian market, Air Canada started low-cost
operations geared toward holiday destinations under the ‘Rouge’ brand in July 2013.
These flights operate on trans-Atlantic routes during the seasonal summer period.
1.1.2 European Airlines
The European market has also undergone some changes since the beginning of the
century. As in North America, the events of September 11, 2001 exacerbated the
financial difficulties of some airlines. Both Swissair and Sabena8 were forced to cease
operations and declare bankruptcy, as were other airlines that were part of the
Swissair group, within months of the attacks (Doganis, 2010).
In October 2003, Air France and KLM merged to form the largest airline on the
continent (Economist, 2003). Despite the amalgamation, both airlines continue to
operate under their own banner and operate a multi-hub system based on Charles de
Gaulle Airport in Paris (AF) and Schiphol Airport in Amsterdam (KLM) (Burghouwt,
2014).
Lufthansa Airlines pursued an acquisition strategy in the years following the KLM-Air
France joining, acquiring Swiss in March 2005. Lufthansa then obtained controlling
interest in three more airlines: Brussels Airlines (2008), British Midland (2008), and
Austrian Airlines (2009). All of the airlines maintained their own operations and livery.
British Airways also expanded in the post-9/11 years, merging with Iberia, the Spanish
flag carrier in 20109. The IAG Group expanded again with the acquisition of British
Midland from Lufthansa10. Although all three airlines continued their passenger
operations under their own respective brands, BA and IB cargo operations were
consolidated under IAG Cargo (Air Cargo News, 2012).
8
At the time of its collapse, Swissair owned 49.5% of Sabena (BBC News, 2001).
9
IAG, the ownership management group, was founded as a result of the BA-Iberian merger to oversee
the operations of both airlines. However, BA remains the dominant airline within the group, just as
Lufthansa is the dominant airline in the Lufthansa group.
10
Lufthansa had acquired total control of BD in November 2009. IAG also acquired Vueling, a Spanish
low cost carrier in 2012; Vueling however operates only within Europe and does not have any trans-
Atlantic flights.

4
1.2 Airline Alliances
Airline alliances were founded with the intent to expand the connectivity of its
member airlines, and have allowed airlines to market themselves having a global reach
through their codeshare agreements (Hanlon, 2007). Although there have been, and
continues to be, interline agreements between many airlines, the agreements were
not co-operative ventures; and legal restrictions often limit the ability to merge or to
form joint-venture partnerships. Membership in an alliance also allows passengers to
accumulate frequent flyer miles when flying other alliance carriers, thus reinforcing
the draw of the alliance; an important consideration as business travellers are heavily
influenced by their mileage accumulation programs when selecting flights (Hanlon,
2007). Airlines also benefit from increased passenger traffic and some reductions in
costs (Iatrou and Alamdari, 2005).
There are currently three global airline alliances: Star Alliance, OneWorld, and
SkyTeam. The Star Alliance was the first to form in May 1997, with Air Canada,
Lufthansa, SAS Airlines, Thai Airways, and United Airlines being the founding members
(Star Alliance, 2013). OneWorld was founded the following year with American
Airlines, British Airways, Canadian Airlines11, Cathay Pacific and Qantas as its original
members (OneWorld, 2014). SkyTeam was then founded by Aeromexico, Air France,
Delta, and Korean Airlines in 2000 (SkyTeam, 2014).
Each alliance was founded with an American, Asian and European member airline,
thus underlining its global nature. Since their respective inceptions, the linkages
between many of the member airlines have grown, aided by technological advances
allowing for greater ease in transferring passengers between airlines. Airport terminal
re-organizations12 have lowered MCT and enabled greater connections and improved
efficiencies. Joint-ventures have also been approved, notably that of AC-LH-UA in the
Star Alliance and that of AF-KLM-DL in SkyTeam.
The alliances are not static, and there have been numerous additions and changes
within the alliances (see Appendix 1). These have been aided by consolidations within
the industry, but also reflect changing competition and airline goals. Alliances also do
not limit their members from participating in agreements with non-aligned carriers
like Etihad or Emirates, nor does it remove competition between its own members.
The alliances were however formed to expand linkages between its own members,
and as such there are relatively few codeshare arrangements between airlines from
different alliances.
11
Canadian Airlines withdrew from the alliance in June 2000 following its acquisition by Air Canada.
12
The re-organization of Terminal 1 at Toronto’s Pearson Airport and London’s Heathrow Terminal 2
for Star Alliance carriers are just two examples.

5
Alliances have, however, influenced airport selection and caused route re-alignments
to complement alliance partners (Dennis, 2005), and Flores-Fillol (2009) posited that
alliances would concentrate services at hub airports. This is supported by Button
(2009) with his ‘dog-bone’ network structure with service being operated by alliance
partners between their respective hubs with regional routes being provided by the
alliance partner at either end.
1.3 Non-Alliance Partnerships
Partnerships outside of the alliance structure are also present on the North Atlantic.
A notable non-alliance airline, Virgin Atlantic, has participated in codeshare
agreements with U.S. based airlines in recent years.
In 1997, Virgin Atlantic began codeshare flights with Continental Airlines on several
routes on the North Atlantic13 (Virgin Atlantic, 2011). This was an active partnership
based on a block space arrangement until its dissolution in February 2012 (Dennis,
2005).
Virgin Atlantic then began a partnership with Delta Airlines in June 2013 which became
a metal-neutral joint venture in January 2014; the joint-venture remains separate
from Delta joint-venture with AF-KLM (Virgin Atlantic, 2015; Russell, 2013).
The second largest Canadian carrier, WestJet14, has also entered into partnerships
whilst not joining an alliance. Over the last five years, the airline has entered into a
number of codeshare agreements, including KLM (2011), British Airways (2012), and
Air France (2013) (KLM, 2011; CBC, 2012; Air France, 2013).
13
In July 2000, VS and CO had codeshare flights from LHR to EWR, IAD, JFK, and LAX as well as flights
from LGW to BOS, EWR, MIA, and MCO (OAG, 2000).
14
WestJet Airlines was founded in 1996. It operates domestic and transborder flights, and provides
seasonal service to Central American and Caribbean destinations. During the summer of 2014, it
operated its first trans-Atlantic service, a one-stop direct flight from Toronto to Dublin via St. John’s.

6
CHAPTER 2 – LITERATURE REVIEW
2.1 Network Structures
Many of the airlines operating services on the North Atlantic began as flag carriers of
their respective countries.15 These airlines were often created to provide air service
on domestic routes within their respective countries, and then gradually expanded
their networks to provide services to other countries.16
The majority of airlines with services on the North Atlantic are ‘network carriers’ who
have developed and operated their networks on a hub and spoke system, with the
hub acting as a transfer point for passengers to connect to other flights leaving the
hub17.
The network carriers in North America have numerous hubs within their networks, a
reflection of the larger geographic size of their respective countries (Reynolds-
Feighan, 2010). Although not as common, some European carriers also operate multi-
hub systems in their networks (Dennis, 2007; Burghouwt, 2014). Most hubs, however,
utilise waves for their network operations although some operate as ‘continuous
hubs’18.
Although the hub and spoke system optimises air network efficiencies, it is not always
convenient for passengers, many of whom would normally prefer point to point
service. Some airlines complement their hub to hub inter-continental routes with
point to point services that exclude a hub at one end (Oum and Zhang, 2001). Fageda
and Flores-Fillol (2012) also determined that on services within Europe, airlines would
benefit from avoiding hubs and providing point to point service on thinner routes
especially on low-cost subsidiaries. This was also noted by Düdden (2006) who found
that in the presence of low density economics, high costs of feeding the hub, and a
high preference for direct flights, airlines would be more inclined to offer point to
point services. Düdden also noted that airlines with highly developed hub and spoke
networks, especially those with multi-hub networks, would not be as likely to offer
services that bypass their major hub as would smaller airlines19.
15
This is the case in Canada and Europe but not in the United States. Despite regulations requiring that
United States airlines be controlled by American interests (majority ownership), all of the airlines began
as private corporations.
16
The issue of flying rights through bilateral agreements will be discussed below in Section 2.2
Deregulation – Open Skies.
17
For a more detailed discussion on hub and spoke networks, please see Doganis, 2010.
18
Heathrow Airport is an example of a ‘continuous hub’ airport with its continuous flow of flights rather
than waves. American Airlines experimented with this principle after 2002 but returned to utilising
waves at its hubs in 2014 (Schlangenstein, 2014).
19
Düdden cited Swiss as one of his examples which was using both Geneva and Zurich for long-haul
services at the time at the time of his article; since his article, Swiss no longer operates long-haul
services from Geneva.

7
The development of air travel helped spur larger and more extensive hub networks.
Larger aircraft were required to be able to fly the distances required, and more
passengers were needed to fill the plane and make the route financially viable.
Although there would be passengers flying the route on a point to point basis, most
routes were nonetheless dependent upon sufficient feeder traffic to be viable.
Most initial trans-Atlantic routes flew from one hub to another – albeit the hub of
another airline. Prior to 2000, however, there was a growing trend toward hub to non-
hub linkages on long-haul routes (Swan, 2002; O’Connor, 2003). This trend was
suspended after Sept. 11, 2001 following the resultant downturn in travel and was
also noted by Dennis (2005). A more recent study by Bel and Fageda (2010) indicates
that inter-continental flights are once again trending toward dispersion rather than
toward consolidation.
Most trans-Atlantic airlines however, are dependent upon feeder traffic and rely upon
strong domestic networks to generate sufficient passenger numbers to make long-
haul20 routes feasible. Whilst Pan-Am Airlines was the largest international U.S. carrier
in 1978, de-regulation in the United States undermined its status by allowing other
carriers to compete on international routes. The airline struggled to develop its
inadequate domestic network to feed its long-haul routes: a situation which
contributed to the airline’s demise in 1991 (Sipika and Smith, 1993).
2.2 Deregulation
The onset of international air travel first underwent standardized regulation under the
terms of the Chicago Convention in 1944 which not only helped found ICAO, but also
provided the basis for international bilateral air service agreements (Button, 2009).
These bilateral agreements between countries often stipulated the frequency of
service to be offered, the destinations which would have the service, and the carrier
designated to operate the service. Whilst some countries allowed liberal access to
their airports, other countries were more conservative and restricted access to only a
few airports.
Although the US was successful in negotiating ‘open sky’21 agreements with several
EU countries during the 1990s and early 2000s, the UK was not one of them. Airline
operations between the U.S. and the UK were still regulated by the Bermuda II treaty
(which replaced the less restrictive Bermuda I Treaty of 1946), limiting access to
20
Although trans-continental flights in North America may exceed 5 hours, this paper does not consider
them to be long-haul. All North Atlantic routes, however, are deemed to be long-haul, regardless of
length.
21
Open sky agreements allow for unlimited market access, permit codeshare flights, and do not require
that carriers be designated to operate services. Unless specified, however, cabotage is not permitted
(Button, 2009).

8
Heathrow to two carriers from each country22 and limiting which U.S. cities could have
air links to the UK (Button, 2009). The agreement also limited which destinations could
be served by which airlines (U.S. or British) and imposed other conditions pertaining
to flights from London and which U.S. cities could be used as gateway cities and who
could provide those services. The treaty did, however, protect pre-existing 5th
freedom23 rights of carriage like those held by Air India and Kuwait Airways on services
to JFK (U.S. Department of State).
These restrictions were lifted when the United States and European Union signed an
open skies agreement which came into effect in March 2008.
Although Canada does not have an open skies agreement with the EU, it did
successfully obtain an open sky treaty with the United Kingdom which was
implemented on September 1, 2006 (Transport Canada, 2006).
The initial impacts of the EU-U.S. open skies agreement saw U.S. airlines rush to
acquire slots at Heathrow Airport in the initial deregulation period. Whilst some of
these actions resulted in new routes, most of the airlines transferred their operations
from Gatwick and consolidated their services at Heathrow Airport (Humphreys and
Morrell, 2009).
2.3 Technological Advances
The range and capacity of aircraft being manufactured has changed over the last
fifteen years and has had a dramatic influence on the industry (Doganis, 2010).
Previously, large aircraft were necessary for the trans-Atlantic journey in order to
ensure that there was sufficient fuel capacity to make the trip. The size of the plane
thus meant that there had to be large numbers of passengers on the aircraft to make
the trip financially viable. As such, most routes were operated between major cities,
often hubs, on the respective continents.
In 2000, common aircraft on the North Atlantic included the A300, A330, B747, B767,
as well as the MacDonnell-Douglas MD-11 and various Lockheed Tri-Star aircraft.
Many of the aircraft used had range restrictions of 10,000 km, although some did have
maximum ranges nearing 12,000 km.
The airline industry, however, operates on thin economic margins, and with the
largest cost component (except labour) being fuel, airline manufacturers began to
22
At the time of the U.S. EU Open Skies agreement, only AA, BA, UA and VS could provide services to
the U.S. from Heathrow Airport. AA and UA acquired their rights from TWA and Pan-Am respectively,
and had them ratified in the Heathrow Agreement of 1991 (Hanlon, 2007).
23
5th
freedom rights refer to the ability for an airline to provide air service from their own country to
another country, and then to continue that flight onward to a 3rd
country. Most airlines have 3rd
and 4th
freedom rights (the right to fly from their home country to another, and from another country to their
home country). 6th
freedom rights involve a stopover in the home country and is often considered to
be a combination of 3rd
and 4th
freedom rights.

9
improve their aircraft with more fuel-efficient engines and with lightweight materials,
thus reducing the amount of fuel required to make long-haul journeys. The two largest
long-haul aircraft manufacturers, Airbus and Boeing, have introduced different types
of aircraft over the last ten years.
The A380 by Airbus began service in 2007. The aircraft can carry 525 passengers in a
three-cabin configuration and over 800 passengers in a single-cabin layout. It has a
range of 15,700 km, and is the manufacturer’s response to optimising slots at
congested airports and maximising service between the ‘megacities’ of the world
(Airbus, 2014)24.
The B787 or Dreamliner by Boeing began commercial service in 2011. There are two
different versions of the plane currently operating (-8 and -9), with passenger
capacities of 242 and 280 respectively, and their flight range is 14,500 km for the B787-
8 and over 15,300 km for the B787-9. The plane is built using composite materials thus
reducing its weight and improving its fuel efficiency (Boeing, 2014).
Both aircraft were utilised on trans-Atlantic routes in July 2014 with the Dreamliner
being used by Air Canada, British Airways, LOT Airlines, Norwegian Airlines, and United
Airlines25; the A380 was used by Air France, British Airways, and Lufthansa.26
2.4 Airport Constraints
With the growth of air travel came more routes and greater congestion at airports.
The regulation and control of ‘slots’27 became a necessity at some airports mainly due
to ATC constraints and to a lesser extent, to reduce terminal capacity issues.
Although it remains a relatively minor issue in both the United States and in Canada,
airport congestion has been an issue in Europe for some time. In 2012, the EU had 159
Level 3, or Fully Coordinated Airports, a designation given when demand exceeds
airport capacity.28
24
Although Airbus is also in process of introducing the A350, the A-330neo and A-321neo, as they were
not in service during the summer of 2014, they are beyond the scope of this study.
25
July operations by carrier: AC: YYZ-LHR, YYZ-ZRH; BA: LHR-AUS, LHR-EWR, LHR-PHL, LHR-YYZ; LOT:
WAW-ORD, WAW-JFK, WAW-YYZ; DY: CPH-FLL, LGW-FLL, LGW-LAX, LGW-JFK, OSL-FLL, OSL-LAX, OSL-
JFK, OSL-OAK, OSL-MCO, ARN-FLL, ARN –LAX, ARN –JFK, ARN –OAK; UA: IAH-LHR (Routes Online,
2014c).
26
July operations by carrier: AF: CDG-LAX, CDG-JFK, CDG-SFO, CDG-IAD; BA: LHR-LAX; LH: FRA-IAH, FRA-
MIA, FRA-JFK, FRA-SFO (Routes Online, 2014b).
27
A ‘slot’ is defined as a 15-minute window for an arriving plane, and is paired with a 15-minute slot for
departures.
28
For a further discussion and explanation of airport slots, please see Graham, 2013.

10
This is an especially contentious issue in the UK where the Davies Commission (headed
by Sir Howard Davies) is at present tasked with determining the best site for future
runway expansion in the country, currently identified as being in the south-east. At
present, Gatwick is the busiest single runway airport in the world and Heathrow is
operating at near capacity. Whilst many airlines would like to have routes to and from
London, the lack of available slots restricts both possible network expansion and
London’s connectivity growth. Research by Gudmundsson et al (2014) found that
congestion factors at Heathrow led to spillover to Gatwick and Manchester Airports,
and to a lesser extent Birmingham Airport: an interesting situation when one
considers that U.S. airlines transferred all of their operations from Gatwick to
Heathrow when the opportunity became available.
Another consideration is the growing practice of avoiding congestion issues at London
Heathrow and using European hubs instead to transfer to regional airports in the UK
(Hanlon, 2007). This was supported by Evans and Schafer (2014) who posited that
airlines would select alternatives to congested airports if possible. Congestion factors
were also seen as influencing future routes, as noted in the case of Delta and its route
selection at JFK (Bilotkach et al, 2013). This is perhaps more viable in the United States
where airlines have multiple hubs from which to base their operations than in the
European context where most airlines have only one hub.
However, if there are no slots to acquire, it is reasonable to hypothesise that if an
airline still wishes to expand, it would have to do so at other locations where slots are
available.

11
CHAPTER 3 - METHODOLOGY
The focus of this study is to examine the flight routes on the North Atlantic market and
to postulate future developments. As the entire trans-Atlantic is too broad in scope to
examine in its entirety in this paper, the focus will be on services between
Canada/United States and the United Kingdom, the largest segment on the trans-
Atlantic market (Hanlon, 2007).
For the purposes of this study, the term ‘North Atlantic’ specifically refers to the UK to
Canada/U.S. market and the term ‘trans-Atlantic’ refers to all traffic between Europe
and North America; North America was defined as being Canada and the United
States.
Future trends are often based on recent developments and changes, and as such,
flight schedules from 2000 onwards were presented and analysed in order to, in part,
determine possible future trends. These schedules were then examined from a market
share perspective on nine North Atlantic routes to provide route specific trends as well
as an overall market analysis. Both technological changes and the growing impact of
airline alliances have influenced airlines, and these were also examined within the
context of changing North Atlantic networks. Economic factors from both an industry
and passenger perspective were then analysed to provide context for possible future
developments of the North Atlantic.
In order to provide an overview of the flight changes on the North Atlantic (Chapter
4), the study focuses on three time periods: July 2000, July 2007, and July 2014. For
the period of July 11-17 in each year, data were obtained from the respective OAG
Flight Guides to compile flight schedules between UK airports and North American
airports. OAG Flight Guides were also used to obtain data for other years, and unless
otherwise specified, are the source for all flight schedule information.
Although numerous flights operate as codeshares, each flight was assigned to the
operating carrier regardless of the various airlines codes associated with the flight.
The origin and destination of each flight was deemed to be the last point from within
the UK and the first point of entry in either the U.S. or Canada. As such, a flight from
Cardiff to Birmingham to Toronto to Calgary will have been designated as having
Birmingham as its origin, not Cardiff, with the destination being Toronto, not Calgary.
It should be noted that although the text will often state that a flight was from one
city to another, it should be understood that a return service was always paired with
the initial flight.
As with the identification of codeshares to the operating carrier, this was done in order
to avoid any possible duplication or double-counting of services. It also allowed for a
more solid foundation of comparison as airline partnerships and alliance membership
was somewhat fluid during these time periods.

12
Each airline’s operations were then examined over the three time periods. This
provided the basis for analysing the changes in routes flown. With three major
mergers taking place amongst the U.S. airlines in the period between 2007 and 2014,
the initial route networks of each of the 6 airlines were examined within the context
of its post-merger entity. This was necessary as route adoption from the acquired
airline and occasional hub-shifting occurred in the ‘new’ airline after amalgamation.
UK airports were defined as either London airports or regional airports. London
airports consist of: Gatwick, Heathrow, Luton, Stansted, and London City airports. All
other airports were deemed to be regional airports.
As July was being examined, the flights identified include seasonal service as well as
year-round operations; this is especially true of leisure carriers whose operations are
highly seasonal. Although the study focuses on the three time periods noted above, in
order to provide further background on the dynamic nature of the market, other
airlines (and their flights) that operated between these time periods were identified
as well, though their networks were not examined in depth.
Data regarding aircraft specific information were primarily obtained from the
respective manufacturer’s website. This was also complemented by secondary
sources when comparing aircraft from different manufacturers.
The future development of airline alliances was considered to be a key element in
determining future network development on the North Atlantic. As such, three
experts in the aviation field, Mr. Marc Mapleston (Canada), Mr. Laurie Price (UK), and
Mr. Kenneth Stevens (U.S.) were contacted and sent a number of questions
concerning alliances and their impact on the North Atlantic. Their opinions are
referenced in Chapter 5 with their email responses included in the appendices.
Chapter 5 also includes information on passenger revenue traffic, seat availability
(capacity), and the passenger occupancy factor (referred to as the load factor in this
study) on various routes and the overall air travel on the North Atlantic, all compiled
using ICAO data accessed through the Flight Global website. As only partial data were
available for 2013 (neither all carriers nor full year reporting), its use in comparison to
previous years was minimal; as a result, annual data from 2000, 2004, 2008, and 2012
were examined. These years were selected to provide greater context and to highlight
the trends evident on the North Atlantic. ICAO data also does not include data from
all airlines, and a notable omission in regards to this study is that of Air Transat and
their impact on the Canadian market.
It was not possible to obtain comprehensive revenue data solely for the North Atlantic,
and as a result, revenue for the entire Atlantic market was presented instead in
Chapter 5. Data were obtained from Air Canada annual financial reports, and annual
10-K filings by U.S. airlines were examined. The U.S., however defines ‘Atlantic’ to
include not only flights to Europe but also to Africa, the Middle East and India; Air
Canada has only one flight outside of Europe. Although the vast majority of U.S.
airlines flights on the Atlantic are to Europe, this data limitation must be remembered

13
when examining the revenue data. Both BA and Virgin Atlantic publish their revenues
by point of sale but not by origin-destination, and were therefore not included.
Chapter 5 presents travel figures between the UK and Canada and the United States;
data were compiled from the (UK) Office of National Statistics publications as the UK
was the common travel link. Data were compiled to compare total travel as well as
trip purpose data from 2000 to 2013 (data for 2014 were not published at the time of
this study). The ONS use nationality as the basis for their travel data, which would
exclude non-citizen residents from the trip data. Although data from Statistics Canada
and the U.S. Department of Transportation could differ, a data confrontation analysis
is beyond the scope of this study.

14
CHAPTER 4 – ANALYSIS OF NORTH ATLANTIC NETWORK ROUTES
4.1 U.S. Airlines
There are at present three U.S. airlines operating services on the North Atlantic:
American Airlines, Delta Airlines, and United Airlines. Each airline has merged with
another carrier which also operated services on the North Atlantic: US Airways,
Northwest Airlines, and Continental Airlines respectively.
In examining the route networks of U.S. carriers, the pre-merger networks of July 2000
and July 2007 were considered separately before analysing the post-merger structures
in July 2014 as hub-shifting in the new amalgamated airlines undoubtedly influenced
the routes being flown. In addition, alliances and joint-ventures may have also
changed, thus influencing flight patterns and codeshare arrangements.
4.1.1 American Airlines / US Airways
American Airlines had secured access to London Heathrow following its acquisition of
TWA’s London routes in 1991. The airline did not, however, limit itself to LHR and also
operated routes from Gatwick Airport to the United States.
AA operated 15 daily flights from LHR to the U.S. in July 2000, with the majority being
to their hubs in JFK and ORD; there were also 3 daily routes to LGW from Dallas and
Raleigh (see Table 1).
Although JFK was a major gateway airport for the airline, its only service to the UK was
to London Heathrow. Instead, American Airlines used Chicago as a hub for its North
Atlantic services operating routes not only to LHR, but also daily service to
Birmingham, Glasgow, and Manchester (see Table 1).
In July 2007, the airline had consolidated its operations on both the American and
British sides of the North Atlantic. American Airlines no longer provided service to
either Birmingham or Glasgow, although it did add a daily service from Manchester to
Boston to complement its existing daily flight to Chicago (see Table 1).
The airline also consolidated its New York routes at JFK, ceasing North Atlantic flights
out of Newark and reallocated some of its routes to London Heathrow.
In contrast, US Airways had limited its U.S. operations to its two main eastern hubs,
Charlotte and Philadelphia (see Table 1). The airline operated a single daily flight on
the North Atlantic from CLT in July 2000 and July 2007 to London Gatwick. US Airways
also offered 3 daily flights from Philadelphia to the UK in July 2000, and reallocated its
flights to expand to a third destination, Glasgow, in 2007.
US Airways also operated direct flights from Pittsburgh to London Gatwick, but this
route only operated from 2002 to 2004.

15
Table 1 – American Airlines (US Airways) Flights, U.S.-UK, 2000-2014
American Airlines (US Airways) service U.S.-UK
Daily Flights to the UK
2000 2007 2014
BOS LHR 2 2
BOS MAN 1
ORD LHR 4 5 4
ORD MAN 1 1 1
ORD BHX 1
ORD GLA 1
LAX LHR 1 2 1
MIA LHR 1 2 1
JFK LHR 6 5* 3
JFK MAN 1
EWR LHR 1
DFW LGW 2 2
DFW LHR 3
RDU LGW 1 1
RDU LHR 1
CLT LGW 1 1
CLT LHR 1
CLT MAN 1
PHL LGW 2 1
PHL LHR 1
PHL MAN 1 1 1
PHL GLA 1 1
PHL EDI 1
Total flights 25 25 21
* This included a 6/week service
Sources: OAG, 2000; OAG, 2007; OAG 2014
In July 2014, AA no longer offered any services from Gatwick Airport; services to the
UK were also no longer being offered by the airline from Boston.
Although ORD, LAX, and MIA, also saw 1 fewer daily flight to LHR (returning to July
2000 levels), a daily service was added on the DFW-LHR route.
AA reduced its service on the LHR-JFK route to 3 daily flights, although it should be
remembered that the airline has a joint-venture agreement and codeshare
arrangement with BA (which has increased its service from 6 to 9 daily flights)29.
29
Most flights operated by AA on the North Atlantic are codeshares not only with BA, but with Finnair
and Iberia as well.

16
The former US hubs of Charlotte and Philadelphia had been incorporated into AA’s
North Atlantic network following their merger in 2013, and increased their service to
regional airports. CLT maintained its daily service to LHR and had added a second daily
service to Manchester in July 2014. PHL also maintained its previous links to the UK
and added a fourth city to its offerings with a daily service to Edinburgh. Although the
merger had been completed, neither the systems nor the networks had been fully
integrated and the airline continued to operate 8 hubs (Nicas, 2014).
Although airports may be de-hubbed and the role of each airport within the new
network may yet be redefined, it appears that Philadelphia has replaced Chicago’s
predominance as the primary hub for flights to the UK. This is in part due to American
Airlines incorporating all of US Airways’ routes as Philadelphia serves more secondary
airports, and despite its proximity to New York, has a different catchment area than
that of JFK (CAPA, 2013). Although both Philadelphia and Chicago had poor on-time
annual performances in 2014 (20th and 24th respectively out of 29 airports), Chicago
has the reputation of an airport to avoid with over 40% of flights being delayed during
the winter (U.S. DOT, 2015a; Gulliver, 2014).
In July 2000, of the 21 daily flights being operated on the North Atlantic by AA, 3 were
to non-London airports. In July 2014, the airline still operated 21 daily flights on the
North Atlantic market, with 6 being to regional airports.
Whilst the airline had increased its proportion of UK flights to non-London
destinations, AA still only flew to 3 regional airports. The only change being that in July
2014 the airline flew to Edinburgh, Glasgow, and Manchester whereas in 2000, AA
provided service to Birmingham instead of Edinburgh.
4.1.2 Delta Airlines / Northwest Airlines
Delta Airlines is the smallest of the ‘big three’ U.S. carriers on the UK-U.S. portion of
the North Atlantic market, a status it has held throughout the scope of this study.
Although the integration of Northwest Airlines did add more routes to its network, the
acquisition did not improve its relative position to its competitors.
The airline had six daily flights between the U.S. and the UK in July 2000 with 4 of its
6 daily flights from its hub in Atlanta (see Table 2). It is interesting to note that Delta
did not have any New York to London flights as part of its route network in July 2000.
This was rectified in July 2007 as Delta operated twice daily service between JFK and
LGW in addition to its MAN service (6 days/week).
Service from ATL to LGW decreased from 3 to 2 daily flights, although the airline did
add a daily service from Atlanta to Edinburgh.

17
Table 2 – Delta Airlines (Northwest Airlines) Flights, U.S.-UK, 2000-2014
Delta Airlines (Northwest) service U.S.-UK
Daily Flights
2000 2007 2014
ATL LGW 3 2
ATL LHR 3
ATL MAN 1 1 1
ATL EDI 1
BOS LHR 1
CVG LGW 1 1
JFK LGW 2
JFK LHR 3
JFK MAN 1 1*
SEA LHR 1
DTW LGW 2 1
DTW LHR 2
MSP LGW 1 1
MSP LHR 1
Total Flights 9 10 12
* This was a 6/week service
NW operated daily service between MSP and LGW and twice daily service between
DTW and LGW in July 2000. These routes remained in operation in July 2007, although
service between DTW and LGW was reduced to 1 flight per day (see Table 2).
In 2008, Northwest offered a direct flight between Seattle and LHR, though the service
was only in operation for 1 year. At the same time, Delta discontinued its EDI-ATL
service and replaced it with EDI-JFK; a service which only operated for 2 years.
Delta began to integrate Northwest Airlines into their network in 2008, and the
subsequent merger consolidated operations on both sides of the North Atlantic.
Following the Open Skies agreement, Delta transferred their operations from LGW to
LHR, and in July 2014, with the exception of a daily flight between Atlanta and
Manchester, all of the airline’s flights were to Heathrow Airport.
By July 2014, Cincinnati’s importance in the new post-merger airline had decreased
with the addition of MSP and DTW, and no longer provided air service to the UK
(Wetterich, 2014). Service between London and New York increased to 3 daily flights
(and 3/week service on another flight) using the JFK-LHR route whilst the DTW-LHR
route increased from 1 to 2 daily flights. Delta also added daily flights to LHR from both
Boston and Seattle (see Table 2).
Delta began a joint-venture with SkyTeam partners Air France-KLM in April 2008; a
venture which was expanded into a metal-neutral arrangement in 2009 (KLM, 2013).

18
This has resulted in numerous codeshares, and the strengthening of service to DTW,
a major connecting point for Air France-KLM30.
The airline also entered into a separate partnership with Virgin Atlantic in June 2013
which became a metal-neutral joint venture in January 2014.
Although Delta’s partnership with VS has expanded the destinations it can offer to its
passengers, Delta’s presence in the UK is still limited to London and Manchester.
4.1.3 United Airlines / Continental Airlines
In July 2000, United Airlines operated services between 7 U.S. cities (BOS, ORD, LAX,
JFK, EWR, SFO and IAD) and the UK. Unlike other airlines, all of UA’s services to the UK
were focused on LHR (see Table 3). UA had acquired Pan-American’s London routes in
November 1990, and had maintained its focus on Heathrow Airport.
Table 3 – United Airlines (Continental Airlines) Flights, U.S.-UK, 2000-2014
United Airlines (Continental Airlines) service U.S.-UK
Daily Flights
2000 2007 2014
BOS LHR 1
ORD LHR 4* 3 3
ORD EDI 1
LAX LHR 2 1 1
JFK LHR 3
EWR LHR 1
SFO LHR 2 2 2
IAD LHR 3 4 4**
IAD MAN 1
CLE LGW 1 1
IAH LGW 2 2
IAH LHR 3
EWR LGW 2 3
EWR LHR 5
EWR BHX 1 1 1
EWR GLA 1 2** 1
EWR MAN 1 2 1
EWR BFS 1 1
EWR EDI 0 2 2
EWR BRS 0 1
** This included a 4/week service
30
Prior to its joint-venture agreement with Delta, Air France-KLM had a joint-venture agreement with
Northwest Airlines whose major hubs were DTW and MSP (KLM, 2013).

19
These routes were however, a challenge to the airline as it did not have a hub presence
in either New York area international airport (JFK or EWR) or in Boston.
By July 2007, UA had ceased operations on all three of these routes, almost totally
accounting for the airline’s one-third reduction in overall service on the North Atlantic.
The airline also re-allocated some of its services although all of UA’s routes from the
United States continued to fly to LHR31.
During July from 2008 to 2010, UA also offered direct service between its major mid-
West hub, Denver and London Heathrow.
In contrast, Continental was limited by the Bermuda II agreement and as such,
operated all of its London services from Gatwick Airport.
In July 2000, CO operated 5 daily flights to LGW from Cleveland, Houston and Newark,
all hub airports in the CO network. Although the service from EWR to LGW was
operated as part of its codeshare/block space arrangement with Virgin Atlantic,
Continental also operated a number of flights outside of this arrangement to UK
regional airports (see Table 3).
In July 2007, Continental not only maintained its flights from Cleveland and Houston
to Gatwick, but expanded its UK service from EWR.
Although not Continental’s principal hub on U.S. domestic operations, Newark’s
geographic location made the airport an excellent choice for the airline’s North
Atlantic routes. When the airline expanded its UK network and included more regional
routes, it did so from Newark.
Neither airline competed with the other on North Atlantic routes as UA focused its UK
operations at LHR, whilst CO based its London operations at LGW and provided more
regional service from its EWR hub; in July 2007 less than half of all Continental’s flights
to the UK were to London Gatwick (see Table 3). When the airlines merged in 2010,
there was no duplication in services that needed to be eliminated.
In July 2014, both airlines had fully integrated their operations and restructured their
North Atlantic offerings. Following the U.S.-UK Open Skies agreement, all of
Continental’s previous Gatwick operations were moved to LHR. The integration of the
UA-CO networks saw the de-hubbing of Cleveland, and the entrenchment of Newark
as the airline’s principal North Atlantic hub. This had been an issue for UA as the airline
was without a New York area hub prior to the merger. The merger also resulted in the
termination of the codeshare/block space arrangement between Continental and
Virgin, and the transference of Continental from SkyTeam to the Star Alliance.
31
In July 2007, there was an ORD-MAN flight with a UA codeshare. However the flight was operated by
British Midland, not United Airlines.

20
United Airlines integrated Continental’s North Atlantic services into its route network,
and in July 2014 had numerous flights into London as well as to five regional airports
(BFS, BHX, EDI, GLA, and MAN). Its multi-hub network in the United States allowed the
carrier to expand its UK services from Newark, Chicago, Houston, and Washington.
4.1.4 Other U.S. Airlines
Although by 2014 there were three dominant U.S. airlines operating flights on the
North Atlantic, other U.S. airlines have also operated routes.
TWA, a former dominant player on the North Atlantic, ceased operations in 2000.
During July 2000, it was reduced to 1 daily flight between St. Louis and Gatwick Airport,
and shortly thereafter the airline was taken over by American Airlines.
In 2005, two other U.S. airlines began operations, EOS and MaxJet32. Both air carriers
eschewed economy class in favour of all-business class cabins, although EOS’s offering
was closer to a first class product (Air Travel Genius, n.d.).
MaxJet based its UK operations at London’s Stansted Airport, and operated 6
flights/week to JFK in July 2007. During the same month it also operated 4 flights/week
to Washington and another 3 flights/week to Las Vegas. Despite plans to expand and
high load factors, the airline ceased operations in late December 2007 (Lowe, 2008).
EOS was also based at London’s Stansted Airport, and operated 15 flights/week to JFK
in July 2007. The airline however, was unsustainable and filed for bankruptcy
protection in April 2008, just four months after rival MaxJet ceased operations (Bland,
2008).
Although U.S.-based leisure airlines are not a significant factor on the North Atlantic,
there have been carriers that have operated flights. During the time period examined,
Sun Country operated flights between London and Minneapolis-St. Paul (with a
technical stop in Gander) in both 2010 and 2011. In 2010, the airline operated flights
1/week to London Stansted; in 2011 the airline had shifted operations to London
Gatwick and increased its frequency to 2/week (Routes Online, 2010).
32
A third all-business class airline, Silverjet (UK), began operations in 2007 and is discussed later in
Chapter 4.2.3.

21
4.2 UK Airlines
Unlike the U.S. airline industry, the UK market has had a relatively stable structure
with British Airways and Virgin Atlantic being the primary players from 2000 to
present. In addition, British Midland also operated some North Atlantic flights prior to
its acquisition in 2010, as did some other UK airlines.
4.2.1 British Airways
In July 2000, BA had 24 flight routes from the UK to Canada and the U.S with almost
all from either Gatwick or Heathrow. The only exception was a daily flight from
Manchester to JFK.
The airline had 43 daily flights between UK and North America, with 31 being operated
from Heathrow Airport33.
Nearly half of BA’s North Atlantic flights were to the U.S. northeast. BA also operated
5 daily flights to the west coast and 4 daily flights to Canada (see Table 4).
By July 2007, British Airways was transferring services from Gatwick Airport and was
consolidating its position at Heathrow Airport; only 5 of the 11 routes offered from
Gatwick Airport to the U.S. in July 2000 remained at the airport. The airline also
cancelled LGW-CLT whilst adding daily services from LHR to both Calgary and Seattle.
BA expanded its routes into the Midwest and Pacific Coast areas with the addition of
daily flights to Chicago and Houston (in addition to Calgary and Seattle) whilst reducing
its flights to Atlanta, JFK, and Washington.
By July 2014, British Airways had consolidated its North Atlantic operations to the
London area as the Manchester-JFK route was no longer in operation. In addition,
Gatwick Airport had been relegated to predominantly leisure oriented flights
(Orlando, Tampa and a new route to Las Vegas) and only had about 3 daily flights (see
Table 4).
BA’s route network from Heathrow Airport expanded in July 2014. Whilst the airline
had ceased operations to Detroit, it added routes to Austin, Las Vegas, and San Diego.
British Airways also operated a direct service34 primarily directed towards business
passengers between London City Airport and JFK in July 2014 (see Table 4).
33
This does not include 3/week service between LGW and TPA.
34
BA operates a direct flight, BA 1, from JFK to LCY, but requires a fuel-stop in Shannon, Ireland on its
westbound service. This paper considers the UK to be the last point prior to entering the U.S., not
Ireland. BA 1 had been the flight number assigned to Concorde flights between JFK-LHR in July 2000.

22
Table 4 – British Airways Flights, Canada/U.S.-UK, 2000-2014
British Airways North Atlantic Service
Daily Flights to the UK
2000 2007 2014
ATL LGW 2 1
ATL LHR 1
AUS LHR 1
BWI LGW 1
BWI LHR 1 1
BOS LHR 3 3 4
YYC LHR 1 1
CLT LGW 1
ORD LHR 2 3 2
DFW LGW 1 1
DFW LHR 1
DEN LGW 1
DEN LHR 1 1
DTW LHR 1 1
IAH LGW 1 2
IAH LHR 2
LAS LHR 1
LAX LHR 3 3 2
MIA LGW 1
MIA LHR 1 2 2
YUL LHR 1 2* 1
JFK MAN 1 1
JFK LGW 1
JFK LHR 7 7* 9
JFK LCY 1**
EWR LHR 2 2 2
MCO LGW 1 1 2*
PHL LHR 2 2 2
PHX LGW 1
PHX LHR 1* 1
SAN LHR 1
SFO LHR 2 2 2
SEA LHR 1 1 1
TPA LGW 1** 1
YYZ LHR 2 2 2
YVR LHR 1 1 2**
IAD LHR 4 3 2

23
Although BA no longer operates the MAN-JFK flight, the route continues to have
service provided by American Airlines. Just as a number of flights operated on the
North Atlantic by BA included codeshares with its alliance partners, BA has a
codeshare number on the route.
These arrangements are especially important when considering its joint-venture
arrangement with American Airlines and the increased connectivity and options
British Airways has in offering flights to destinations to the U.S.
4.2.2 Virgin Atlantic Airlines
Virgin Atlantic operated flights to 10 U.S. destinations from London in July 2000.
Although the airline had permission to operate flights from Heathrow Airport, the
airline also operated flights from Gatwick Airport. The majority of VS flights to the U.S.
were operated with a Continental codeshare, a result of its block space arrangement.
This arrangement was still in place in 2007 as VS (like BA) transferred flights from LGW
to LHR, notably to Boston, Miami, and Newark, leaving only its sun destinations of Las
Vegas and Orlando at Gatwick Airport. The airline also started air service from
Manchester, but the only destination served was Orlando (see Table 5).
Table 5 – Virgin Atlantic Flights, Canada/U.S.-UK, 2000-2014
Virgin Atlantic Airlines service U.S.-UK
Daily Flights
2000 2007 2014
BOS LGW 1
BOS LHR 1 1
ORD LHR 1 1 1
LAS LGW 1 1
LAX LHR 2 2 2
MIA LGW 1
MIA LHR 1 1
EWR LGW 2
EWR LHR 3* 2
JFK LHR 3 4 3
MCO LGW 2 2 2
MCO MAN 1
SFO LHR 1 1 1
YVR LHR 1**
IAD LHR 1 2 1

24
Services to EWR and JFK accounted for over ⅓ of Virgin Atlantic’s operations on the
North Atlantic in July 2000; services to LAS and MCO accounted for just over ⅕ of their
services (see Table 5).
This emphasis on New York and sun destinations increased in July 2014 as they
accounted for 31% and 20% respectively of the VS network on the North Atlantic.
In July 2014, Virgin Atlantic had expanded its network to include Vancouver with
5/week service. The airline also added a second flight to SFO with 5/week service.
Combined with its service to Los Angeles, this accounted for 25% of the airline’s
operations on the North Atlantic.
The combined areas of New York, Pacific coast, and sun destinations, have consistently
accounted for over ¾ of Virgin Atlantic’s North Atlantic network over all three time
periods examined.
It should be noted that Virgin Atlantic’s agreement with Continental ended in 2012
and was replaced by a metal-neutral arrangement with Delta Airlines in 2014. As such,
all VS flights from London had a Delta codeshare in July 2014.
4.2.3 British Midland
Although British Midland was a major domestic carrier within the UK, it had limited
offerings on the North Atlantic.
In the summer of 2001, the airline began direct service from Manchester to both
Chicago and Washington. In July 2005, BD also added 2 flights/week from Manchester
to Las Vegas.
In early 2006, however, the MAN-IAD flight was discontinued. British Midland
continued to operate the other two flights during July 2008, but ceased operations on
both routes in early 2009, thus ending the airline’s North Atlantic services.
4.2.4 Other UK Airlines
Following the trend of U.S. based airlines EOS and MaxJet, Silverjet began operations
in January 2007. The airline had its own dedicated terminal at Luton Airport, and in
July 2007 operated 13 flights/week to JFK Airport (Air Travel Genius, n.d.). It was not,
however, able to sustain its operations, even with aggressive pricing to gain market
share, and ceased operations in May 2008 (MaxJet Archives, 2013; Lowe, 2008).
Flyglobespan was a Scottish-based airline that in 2007 expanded to start flights on the
North Atlantic; the majority of its offerings were to Canada and used Hamilton Airport
as its eastern Canadian base with flights to 8 regional UK airports (Express Voyage,
2007). The airline also offered flights to other Canadian cities as well as New York and
Boston from Liverpool and Glasgow respectively. Flyglobespan however encountered

25
challenges later that year when its ETOPS35 licence was suspended, a move which
undoubtedly increased its operating costs and contributed to the airline reducing its
North Atlantic offerings (UK Airport News, 2007; CAPA, 2008). Flyglobespan ceased all
operations in December 2009 (BBC News, 2009).
Go One Airways offered flights between LGW-YYZ in July 2002. In July 2007, UK-based
Astraeus Airlines also operated flights between Gatwick Airport and St. John’s, though
that service only lasted that summer (Mullaley, 2007).
Thomas Cook has also operated flights to both Canada and the United States. In July
2014, the company offered flights from Manchester to Las Vegas, and Orlando, as well
as a flight from Glasgow to Orlando36. Previously, the company also offered flights to
a number of Canadian destinations. Many of these flights were operated by Air
Transat, and appear under an Air Transat code, though they may also have been listed
with a Thomas Cook code as well.
4.3 Canadian Airlines
The Canadian market has had continuous operation on the North Atlantic from 2000
to 2014 by two airlines: Air Canada and Air Transat. This is in itself unusual in that Air
Transat is not a network carrier but a leisure carrier.
4.3.1 Air Canada
In July 2000, Air Canada operated daily flights to 7 Canadian destinations from
London’s Heathrow Airport; Air Canada did not operate flights from Gatwick Airport.
In addition, the airline flew to both Glasgow and Manchester from its Toronto hub.
By July 2007, AC increased its service to full daily flights from LHR to both St. John’s
and Halifax, and expanded its network to include a daily flight between LHR and
Edmonton. It also added another daily flight between YUL and LHR (see Table 6).
Meanwhile, AC had ceased flights to Glasgow by July 2006, and reduced its service
between LHR and Vancouver. Despite Air Canada’s removal of service to Glasgow, the
airline had increased its connectivity to regional airports in the UK through its BD
codeshares (which were present on all of its flights to the UK).
35
The ETOPS (Extended Range Twin Operations) licence allows flight over large expanses of water with
two engines. Aircraft without ETOPS clearance are forced to take a flight path that never takes them
more than an hour away from the nearest airport in case of engine problems (UK Airport News, 2007).
36
These flights were operated by Condor Flugdienst.

26
Table 6 – Air Canada Flights, Canada-UK, 2000-2014
Air Canada service Canada-UK
Daily Flights
2000 2007 2014
YYT LHR 1* 1 1
YHZ LHR 1* 1 1
YUL LHR 1 2 1
YOW LHR 1 1 1
YYZ LHR 5 5 5**
YYZ MAN 1 1 1***
YYZ GLA 1
YYZ EDI 1**
YYC LHR 2 2 1
YEG LHR 1 1
YVR LHR 3 2 1
* AC 3079 was a daily flight between YHZ-LHR that stopped in YYT 4 times/week
*** This included a 4/week service
In July 2014, service between Toronto Pearson and Manchester was reinstated,37
albeit on Air Canada Rouge and not on mainline service.38 The new service offered
flights 5 times/week. Likewise, Rouge began service 5 times/week between YYZ and
Edinburgh. Air Canada had not previously operated services to Edinburgh.
Air Canada continued its reduction in service between LHR and YVR to 1 daily flight.
The airline also reduced its service between LHR and both Calgary and Montreal to 1
daily flight each in July 2014, down from 2 daily flights in 2007.
Although Air Canada reduced the number of flights between Canada and the UK from
2000 to 2014, it actually expanded its route network. In 2000, 6 cities in Canada had
direct service to the UK; in July 2014, this had increased to 8 cities.
37
Flights between Toronto and Manchester had ceased in September 2007.
38
Air Canada Rouge began operations as a low-cost wholly owned subsidiary of Air Canada in the spring
of 2014. The airline is geared toward leisure and VFR passengers, and its aircraft offer economy and
premium economy seating, but no business class service. The term ‘mainline’ is often used to refer to
Air Canada service as opposed to service on Rouge.

27
4.3.2 Air Transat
Air Transat is Canada’s largest leisure carrier on the North Atlantic, and has flown a
number of routes between Canada and the UK. Although the carrier has a ‘Canadian’
designation and has cabotage rights, it does not fly point to point services within
Canada except as part of its routes (1-stop direct) to foreign destinations.
In July 2000, the majority of Air Transat flights (17) were flown from Toronto, with
Calgary being the only other airport to offer non-London flights (see Table 7).
In July 2007, the airline expanded its operations to double its service to the UK to 53
flights each week. Non-stop service was withdrawn from Cardiff39 and Newcastle,
whilst adding twice a week service to Belfast. Service from Canada to both Manchester
and Gatwick Airport more than doubled when compared to July 2000. Although the
airline now offered service from 7 different Canadian cities40.
Table 7 – Air Transat Flights, Canada-UK, 2000-2014
Air Transat service Canada-UK
Flights per Week
2000 2007 2014
YHZ LGW 2 1
YMX LGW 2
YUL LGW 3 1
YUL MAN 1
YOW LGW 1 1
YYZ LGW 6 13 10
YYZ MAN 3 8 6
YYZ GLA 4 5 5
YYZ BFS 2
YYZ BHX 2 2 2
YYZ CWL 1
YYZ EDI 1 1
YYZ NCL 1
YYC LGW 2 3 3
YYC MAN 1 2 2
YYC GLA 1 1 1
YEG LGW 1 1 1
YVR LGW 1 5 5
YVR MAN 2 2
YVR GLA 1 1
Sources: OAG, 2000; OAG, 2007: OAG, 2014.
39
Air Transat continued to offer service between YYZ and CWL but as a 1-stop flight via BHX.
40
Air Transat transferred operations from Mirabel Airport to Trudeau Airport in 2004.

28
The economic crisis of 2008 precipitated heavy financial losses and the air carrier
withdrew from its strategy of expanding its market share to stabilising its financial
situation (Deveau, 2012). Service was withdrawn from both Belfast and Edinburgh as
was the flight between Montreal and Manchester, leaving the city with only 1
flight/week to LGW.41 Service to both BHX and GLA however remained constant
compared to July 2007.
Despite the airline’s consolidation strategy during this time period, from 2008 to 2010,
Air Transat briefly expanded its operations in London with the introduction of
weekend flights between Pearson and Heathrow Airports.
The airline also continued to reduce its reliance upon Toronto as its principal base of
operations for flights to the UK: in July 2000, 65% of flights to the UK were from YYZ
whilst in 2014 the proportion was 56%. More than half of all Air Transat flights from
Canada to the UK, however, were still to Gatwick Airport in July 2014 (54%), up from
46% in July 2000.
4.3.3 Other Canadian Airlines
In July 2000, Canada 3000 operated flights in the North Atlantic market, using Glasgow
Airport as their UK hub as opposed to London Gatwick. Although 4 of their 14 weekly
flights were between Toronto and Gatwick Airport, all of the airline’s other flights to
the UK were to Glasgow42. The airline continued flights before ceasing operations a
month and a half later after the events of September 11.
Zoom Airlines operated North Atlantic flights in July 2007 with 25 flights/week
between Canada and the UK. Ten of these flights were to LGW43, with the remaining
flights being to GLA, MAN, and BFS. The airline also offered flights from the UK to New
York and other U.S. destinations in 2006. The airline however, ceased all operations in
August 2008.
41
Whilst Air Transat uses Toronto as its main airport for UK operations, Montreal is used as its principal
airport for operations to France.
42
Canada 3000 had flights to Glasgow from Halifax, Montreal, Ottawa, Toronto, Calgary, Edmonton,
and Vancouver.
43
Zoom operated flights to London Gatwick from Halifax, Montreal, Ottawa, Toronto, Winnipeg,
Calgary, Edmonton, and Vancouver.

29
4.4 Other Airlines
4.4.1 Fifth Freedom Carriers
Although most network carriers on the North Atlantic are based in Canada, the U.S.
and the UK, there are others that are based elsewhere. These carriers have fifth
freedom rights that had been granted through previous bilateral agreements between
their respective countries. Some have maintained continuous service whilst others
have discontinued operations on their routes.
Both Kuwait Airways and Air New Zealand have operated routes from Heathrow
Airport to JFK and LAX respectively in July 2000, July 2007, and July 2014.
Pakistan Airlines also operated flights between Manchester and New York JFK
throughout all three time periods. The level of service varied, although they never
provided more than 5 flights/week. The airline also had 2 flights/week from MAN to
ORD in July 2007 and operated flights from Manchester to Houston in 2005 and 2006.
Air India operated daily flights between Heathrow Airport and JFK in both July 2000
and 2007; in July 2014, service was reduced to 3 flights/week. Air India also operated
3 flights/week between LHR and Chicago in both July 2000 and July 2007, and 5
flights/week between Birmingham and Toronto in July 2007.
Both Olympic Airlines and Gulf Air operated routes between MAN and BOS, and LHR
and LAX respectively in July 2000. In addition, Air France (codeshared by Delta)
operated a daily service between London and Los Angeles in 2008.
These carriers provide service from their home countries to the UK and to points
beyond (and vice versa), and as such carry little point to point service on the North
Atlantic.
4.4.2 Other European Airlines
In July 2014, two other European-based carriers operated on the North Atlantic.
Europe Airpost is based in France whilst Norwegian Air is incorporated in Ireland. The
former offered point to point service whilst Norwegian Air is developing a base for
network operations at Gatwick Airport.
Europe Airpost operated 1 flight/week between Halifax and Glasgow, with continuing
service to Paris CDG (Routes Online, 2014a).
Norwegian Air meanwhile based its operations at London Gatwick with flights to Fort
Lauderdale, Los Angeles, and New York (JFK).

30
4.5 Connectivity
4.5.1 Route Network Strategies
Before 2008, the Bermuda II Treaty controlled air traffic between U.S. and the UK,
restricting which airlines could operate out of Heathrow Airport and on which routes;
likewise, restrictions limited the U.S. airports to which UK airlines could operate
services44. Once the U.S.-UK Open Skies Agreement was enacted, these restrictions
were rescinded and airlines were able to choose from which airports they would
operate services. For U.S. airlines flying to London, the choice was simple: Heathrow
Airport. Every U.S. airline moved their operations from Gatwick Airport, and in July
2014, not a single U.S. airline operated routes to the U.S. from Gatwick.
All of the network airlines operating on the North Atlantic use Heathrow Airport as the
focal point for their UK operations. The ‘second’ city in the UK is Manchester with a
49.7% market share of all North Atlantic flights to regional airports; all of the network
carriers (except BA) operate flights from the airport.
The third choice is in Scotland, currently Edinburgh as opposed to Glasgow. Whilst
virtually all North Atlantic flights to Scotland landed at Glasgow in July 2000, in July
2014 the trend had shifted as the majority of North Atlantic flights to Scotland were
to Edinburgh (56%). This was in part due to the increased presence of Star Alliance
carriers UA and AC, perhaps drawn by LH’s 2 daily flights between EDI and FRA. The
proportion of flights to Scotland has steadily increased from 2000 to 2014.
Although the number of North Atlantic flights to regional airports has increased from
10.6% (July 2000) to 14.5% (July 2014), the flights amongst the regional airports has
actually become more consolidated: the proportion of flights to MAN, GLA, and EDI
rose from 83.0% to 89.7% during the same time period. Despite its proximity to
London, BHX has seen a steady reduction in North Atlantic service. Although it was the
third largest regional airport in 2000, the airport has since been left with one daily
service to Newark (UA), and two weekly flights to Toronto (TS).
In July 2007, however, there were a number of non-network airlines operating on the
North Atlantic, many of whom operated from regional airports: the result was that
20.0% of all flights to the UK were to regional airports. It was during this time period
that North Atlantic flights operated from Bristol, Doncaster, Exeter, and Liverpool,
airports that had not previously nor since had long-haul service.
The demise of these airlines reduced direct North Atlantic service to every regional
airport in the UK except Edinburgh.
On the other side of the Atlantic, U.S. airlines have a tendency to concentrate their
operations through their own individual hubs.
44
For the details regarding permitted flight routings, please refer to U.S. Department of State (n.d.),
Article 3, and Sections 5, 6, and 7.

31
All airlines, however, have different network strategies on the North Atlantic and are
influenced by their joint ventures and alliance membership.
Although in 2014 Delta Airlines was the largest airline in the entire trans-Atlantic
market in terms of seat availability, it also had the smallest route offerings on the
North Atlantic (Routes Online, 2015b; OAG, 2014). In July 2014, the airline operated
just over 12 daily flights from the U.S. to the UK with 6 routes into LHR and 1 route to
MAN. Although Delta has a joint venture agreement with Virgin Atlantic, Virgin’s
regional carrier, Little Red, had limited regional connections from Heathrow Airport
with flights only to Aberdeen, Edinburgh, and Manchester; service which will cease in
2015 (BBC News, 2014).
Delta’s association with Air France-KLM is the basis for providing service to regional
airports in the UK. Instead of using LHR, Delta uses Amsterdam Schiphol Airport
through its SkyTeam alliance partner KLM, as a hub for providing regional connections
to the UK. In July 2014, Delta was able to offer codeshare connections from
Amsterdam to 11 regional airports through its partnership with KLM. Although most
flights are routed through AMS, Delta also utilises its Air France partnership to provide
connections to 7 regional airports via CDG45.
The route network of OneWorld members and joint-venture partners American
Airlines and British Airways in July 2014 emphasised the importance of Heathrow
Airport. AA focused its North Atlantic service on routes to LHR, although each of its
eastern hubs (CLT, ORD, JFK, and PHL) also had a daily flight to MAN. Philadelphia
provided daily service to not only LHR and MAN, but also to GLA and EDI in July 2014.
British Airways operated all of its North Atlantic routes from London airports in July
2014. BA operated the majority of its routes from LHR with Gatwick Airport operating
less than 10% of all BA flights, and all to sun destinations (LAS, MCO, and TPA); London
City Airport also operated a 5/week flight to New York JFK Airport.
Despite being a UK carrier with cabotage rights, BA has relatively few regional routes
from LHR (GLA, EDI, and MAN). Both BA and AA focus their North Atlantic operations
at Heathrow Airport, and only AA operates flights between the U.S. and non-London
airports.
United Airlines operated 25 daily flights from 6 U.S. cities to the UK in July 2014, the
most daily flights of the U.S. airlines. Although most of the flights were to LHR, a
number were to regional cities. From its eastern hub airport at Newark, UA operated
5 daily flights to LHR and another 6 daily flights to 5 different regional cities (BFS, BHX,
EDI, GLA, and MAN). Its Washington and Chicago hubs also had daily flights to
Manchester and Edinburgh respectively.
45
Air France has a codeshare agreement with Flybe who operates flights from CDG to: Aberdeen,
Birmingham, Edinburgh, Exeter, Manchester, and Newcastle. AF also has a codeshare agreement with
Cityjet who provides service from CDG to Cardiff.

32
Air Canada operated 7 daily flights to Heathrow Airport from 7 different Canadian
cities in July 201446. In addition, the airline had 4 daily flights and a 5/week service to
LHR from its principal hub airport in Toronto as part of the airline’s mainline service.
Air Canada Rouge also operated two 5/week routes from Toronto to Edinburgh and
Manchester in July 2014, the airline’s only non-London destinations.
Both AC and UA had greater regional connectivity through its Star Alliance partner
British Midland. When BD was sold by the Lufthansa Group to IAG and formally exited
the alliance in April 2012, these codeshare options were no longer available. Although
British Midland was not a major network airline globally, it was a major domestic
airline and its exit did impact the alliance’s presence and connectivity in the UK (CAPA,
2012).
In addition to providing service to regional airports from their respective primary hubs,
both airlines are in a joint venture agreement with Lufthansa, and have utilised the
airline’s German connections, especially through Frankfurt, to connect to UK
destinations. LH had flights to BHX, EDI, and MAN from its Frankfurt hub in July 2010;
in July 2014 LH had expanded its UK offerings to include both Aberdeen and Bristol.
Over the same period, LH added service from Düsseldorf and Munich to Glasgow and
Bristol respectively whilst ceasing operations from Düsseldorf to Newcastle.
The route networks of airlines on the North Atlantic in July 2014 outlines the
importance of joint ventures and alliance partners in their flight offerings.
Each of the North American airlines are dominant in their own hubs, especially
through their extensive domestic connections47. Their strength is reflected in the
route network of alliance partner airlines aligning their route networks to take
advantage of the connectivity offered at their partner’s hub airport.
The hub system in the UK is not as demarcated, with British Airways being the
dominant presence at its main hub Heathrow. Virgin Atlantic also uses Heathrow
Airport as its main base, but as it is divesting itself of its feeder routes through its
dissolution of Little Red, it does not truly operate as a ‘hub’ airport.
Delta Airlines has codeshare flights with joint venture partner Virgin Atlantic, and
virtually their entire network into the UK is focused on London Heathrow. In order to
provide connectivity to other UK cities, however, Delta normally routes passengers to
Amsterdam where they are then able to connect onto flights with SkyTeam partner
KLM. In essence, Delta’s ‘UK’ hub is actually Amsterdam Schiphol.
46
The Canadian airports were YYT, YHZ, YUL, YOW, YEG, YYC, and YVR.
47
Chicago O’Hare is the only hub airport that has 2 dominant North Atlantic operating airlines as both
AA and UA use the airport as a Midwest hub in their operations.

33
Although American Airlines and joint venture partner British Airways have services
from a number of U.S. cities to the UK, both carriers have focused their UK services at
London Heathrow. BA’s reliance upon Heathrow Airport, and the slots necessary to
maintain and expand their route network from the airport, has been speculated to be
a strong reason for their acquisition of British Midland (Gulliver, 2012). Slots are also
a likely motivation in their current attempts to purchase Irish airline Aer Lingus; a
move that would allow for better North Atlantic connections and the removal of
competition for partner AA on routes from Dublin to Boston and Chicago (Pogatchnik,
2015). It is interesting to note that although BA is the UK partner in the joint venture
between the two airlines, American Airlines provides more routes from outside of
London to the U.S., albeit mostly from Manchester.
The current United Airlines route network is an amalgamation of its previously held
London routes and the incorporation of Continental routes from its Houston and
Newark hubs. UA has continued to use EWR as its main hub for North Atlantic flights,
and uses it as an anchor on a number of flights to UK regional airports; however,
virtually all flights to the UK from outside of Newark are to LHR.
By the end of 2007, Air Canada had consolidated all of its North Atlantic routes at
Heathrow Airport. At the time, AC was able to provide flights to 6 other UK airports
from LHR through its codeshares with British Midland: by 2012, this was no longer the
case. The airline has developed a strategy which connects non-hub Canadian cites to
LHR, and has since 2013 introduced flights from its main hub in Toronto to regional
airports (Edinburgh and Manchester) in the UK through its subsidiary Rouge.
Bereft of their former Star Alliance partner bmi, both airlines are also able to use their
joint venture arrangements with Lufthansa to use German airports, especially
Frankfurt, as transfer points for connecting service to UK airports. In addition to their
own networks, both AC and UA can utilise their codeshare arrangements with
Lufthansa on the airline’s flights to UK regional airports.
Both United Airlines and Air Canada were impacted British Midland’s departure from
the Star Alliance. Whilst both are pursuing route expansion into regional airports as
their current strategy, their network could be expanded and complemented through
the acquisition of Irish airline Aer Lingus with its extensive UK routes and strong
Heathrow presence.
4.5.2 Current Developments
The route networks of individual airlines will continue to change in the future, just as
they have done so in the past, and the strategies employed by the air carriers will be
influenced by many factors. The North Atlantic is a dynamic market that is influenced
by numerous factors as airlines continuously adjust their operations to maintain
profitability – whilst their competitors do the same.
Virgin Atlantic is withdrawing from its only Canadian destination (Vancouver) in 2015
to expand its network in the United States to Detroit, as well as add flights to Atlanta,

34
Los Angeles, and New York (CTV News, 2014): the flights to Atlanta and Detroit (two
of Delta’s major hubs), strengthen the network alignment between Virgin and Delta.
Its new re-alignment strategy focuses upon its partnership with Delta, and nearly ¾ of
all of its international flights are now on the North Atlantic compared to less than 60%
just 2 years ago (CAPA, 2015a).
Delta Airlines on its part is continuing to concentrate its flights at Heathrow Airport
with the introduction of a daily service in April 2015 between Philadelphia and
Heathrow Airport - a route that became available as part of the conditions for
permitting the AA-US merger (Routes Online, 2014e; European Commission, 2013).
United Airlines is continuing to expand its network in the UK from its Newark hub with
seasonal service to Newcastle starting in May 2015 (Shields Gazette, 2014).
Although it is expanding its service to Europe with flights to Amsterdam and the
introduction of a Montreal-Venice flight, Air Canada is realigning its UK network by
shifting flights from its Edmonton-Heathrow route to its Calgary-Heathrow service.
The Edmonton route will be reduced to 3/week whilst AC will introduce a second flight
operating 4/week from Calgary (Air Canada, 2014; Routes Online, 2015f).
American Airlines is expanding its list of destinations from JFK with the introduction of
seasonal service to both Birmingham and Edinburgh in 2015. In addition, the airline is
introducing a second daily flight between PHL and LHR, as well as between LHR and
LAX (Routes Online, 2014d; Routes Online, 2014e).
Unlike other network carriers, British Airways has not indicated any changes to its
current network on the North Atlantic (British Airways, 2015).
For the first time in almost 15 years there will be 2 Canadian network carriers
operating services on the North Atlantic as Westjet will enter the UK market with a
one-stop direct flight from Toronto to Glasgow via Halifax. The flight will operate as a
seasonal service between May and October in 2015 (CBC, 2014).
In contrast, Europe Airpost, which offered 1/week seasonal service from Halifax to
Paris via Glasgow in 2014, has withdrawn from the Halifax-Glasgow portion of its flight
and adjusted its route to stop to Dublin instead in 2015 (Routes Online, 2015d).
The lure of the London-New York market has attracted another airline, France-based
La Compagnie, who will begin flights from Luton to Newark in May 2015. The service
will start with 3/week service, increasing to 6/week service by July (Routes Online,
2015e).

35
CHAPTER 5 – FACTORS INFLUENCING FUTURE NETWORK DEVELOPMENT
The previous chapter focused on the traffic patterns on the North Atlantic since 2000.
It is not possible, however, to examine these changing patterns in isolation; without
presenting the trends within the context of the entire trans-Atlantic market would be
to omit some of the most important factors influencing route networks including
airline alliances, airport connectivity, and technological change amongst others.
In terms of capacity48, the top three airlines on the trans-Atlantic are Delta, British
Airways, and United Airlines with market shares ranging from 11.5% to 11.7% in 2014;
each one a member of a different airline alliance (Routes Online, 2015b).
5.1 Airline Alliances
Airline alliances have expanded considerably in both membership and global
connectivity. There are at present three global alliances which in July 2014 had an
overall membership of 59 airlines (see Appendix 1).
Alliances have improved connectivity over the last 14 years. In 2000, there were
relatively few codeshares in operation on the North Atlantic; by 2014, it was a rarity
to find a flight that did not have at least one codeshare, and most flights had multiple
codeshares. This has provided a platform to move passengers from more cities to
more cities and enhanced connectivity not only on the North Atlantic, but on the
entire trans-Atlantic market, enabling people to connect in Europe to other
destinations on the continent or to destinations in Africa or Asia (Stevens; Mapleston).
It is debatable whether alliances have helped or hindered competition on the North
Atlantic; Stevens believes that competition has improved whereas Price holds the
opposite view. Mapleston feels that although initially they improved competition (and
choice for passengers), the growth of joint-ventures has since limited competition.
The co-operation between alliance members has been complemented by the approval
of joint-ventures. This is especially important on the trans-Atlantic with the presence
of the A++ joint-venture (Air Canada, Lufthansa and United Airlines), the Delta-KLM-
Air France joint-venture, and the recently approved joint-venture between American
Airlines and British Airways; all three from different alliances. This has allowed for
greater integration of flight schedules, and a more seamless transfer of passengers.
Alliances can be considered to be surrogates for ownership and possibly as an interim
step toward mergers and acquisitions (Price).
Despite consolidation in the industry, many airlines are still governed by ownership
rules, thus limiting and occasionally excluding the opportunity for cross-border
mergers with other airlines (Mapleston); further mergers may be difficult unless these
rules are relaxed.
48
Capacity here is defined as total seat availability, occupied or otherwise.

36
The greater integration between alliance members has strengthened the relative
position of the alliances and entrenched their market share on the North Atlantic
(Mapleston). It has also limited the ability of non-aligned carriers to successfully enter
the market (Price).
The history of alliances, however, indicates that they are anything but stable; a
number of airlines have withdrawn from alliances or even switched alliances. The
recent spate of consolidations in the U.S. however have left three major airlines, each
in a different alliance, which should stabilise alliances in the foreseeable future
(Stevens), whilst Price believes that alliances will dissolve and be replaced by
international airline groupings within the next ten years. Mapleston postulates that a
fourth airline alliance could emerge in the future, one whose core members are based
in the Middle East.
It is difficult to determine the future of alliances, but the presence of a fourth airline
alliance would undoubtedly affect the North Atlantic market, especially if the ‘new’
core hubs were to be located outside of Europe.
5.2 Airport Expansion and Connectivity
Airlines operating on the trans-Atlantic rely upon their hubs for providing connectivity
to other destinations: it is the focal point of their route networks. Although congestion
is not an issue for most airports in North America49, it is an issue for many European
airports. As such, airports that are limited in their growth would find their ability to
expand restricted whilst those without such limitations are able to provide airlines
options to expand their flight offerings.
At present, Heathrow Airport, and to a lesser extent Gatwick Airport, are at the centre
of the airport expansion debate in the United Kingdom. The Davies Report is scheduled
to present its findings and recommendations in the spring of 2015 – after the UK
general election. The political sensitivity surrounding airport expansion is extreme,
and has contributed to the inability to make a decision - or expand runway capacity –
for nearly 50 years.
The current publicity campaign by Heathrow Airport emphasises the importance of
connectivity and its economic impacts for the country. That it is the preferred airport
of international airlines, especially U.S. carriers, was evident following the U.S.-UK
Open Skies Agreement. The airport, however, continues to operate at near capacity,
and even a recommendation by the Davies Commission will not alleviate the situation
until a new runway is completed – at least 10 years in the future.
49
At present, only Washington Reagan (DCA) is a slot-controlled airport in the U.S. Although not
officially slot controlled, the U.S. DOT has implemented various measures to relieve congestion at New
York’s JFK, LaGuardia, and Newark airports (U.S. DOT, 2015b). Chicago’s O’Hare Airport was slot-
controlled until 2008 (FAA, 2008). Billy Bishop Airport is the only slot-constrained airport in Canada
(Newswire, 2014).

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