WASHINGTON (AP) — United Airlines said Saturday it will drop
its money-losing hub in Cleveland, slashing its daily flights and
eliminating 470 jobs.
The company’s CEO Jeff Smisek announced in a
letter to employees that the airline will no longer use Cleveland to
connect fliers coming from other airports around the country. As a
result, United’s daily departures from the city will fall from 199
currently to 72 by June.
"Our hub in Cleveland hasn’t been
profitable for over a decade, and has generated tens of millions of
dollars of annual losses in recent years," Smisek states. "We simply
cannot continue to bear these losses."
United said in November
that it aims to cut $2 billion in annual costs in the coming year by
shifting flights, making workers more productive, and improving its
maintenance procedures.
Similar cutbacks have affected many other
small hubs in cities such as Memphis, Cincinnati and Salt Lake City amid
a wave of airline mergers over the last five years.
Because it’s
hard to fill a plane between, say, Indianapolis and Paris, airlines use
hubs like Cleveland to gather passengers and connect them to the flights
they want. People who live in a hub city get a wider selection of
destinations because their airport has more flights than it would if it
was limited to the flights supported by local traffic.
Cleveland
was a hub for Continental when it merged with United in 2010 to form
United Continental Holdings Inc. Ever since the merger, people in the
industry have assumed it was in danger of losing its hub status, because
the airline now has United’s Midwestern hub in Chicago.
"Ever
since the merger everyone knew this was a risk, which is why economic
development officials for the city, the region and the state have
discussed options with United for keeping its presence in Cleveland,"
Ohio Gov. John Kasich said. "This is a disappointing decision and one we
disagree with, but a point that United stressed is that demand for air
travel from Cleveland remains strong and that they’re maintaining
virtually all of their flights to and from major markets."
In
June, Delta Air Lines Inc. announced it would be closing its Memphis
hub, which it had inherited in its 2008 acquisition of Northwest
Airlines. Delta already has a huge hub operation in Atlanta.
Copyright 2014 The Associated Press. All rights
reserved. This material may not be published, broadcast, rewritten or
redistributed.