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Old Posted May 24, 2012, 9:50 AM
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SnyderBock SnyderBock is offline
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It's interesting, the United non-stop to Tokyo flight was announce only weeks after the new deal was struck to reduce United Airlines annual lease of ~$150 million by $22 million, if United increased flights at DEN by 4.5% between now and 2016. Whats even more interesting, is United did this without negotiating the same economic benefits that were being offered to ANA.

It's almost as though United wanted to be the one offering the service, not ANA (it's star alliance partner) and all United wanted before offering it, was reduced lease costs.

The executives at United indicated they wanted DEN to remain a a primary hub, but they just needed the costs to go down. Those extra costs are primarily related to the automated baggage system that United insisted on being installed when the airport was constructed, which ultimately failed to perform up to standards.

Since then, automated baggage system have evolved (thanks to next generation systems being used in Asia). DIA is in a 1st phase of expansion (adding the South Terminal expansion) but which will also expand the concourses and construct a new 2nd generation automated baggage system before 2020, in the 2nd phase of expansions.

I think United will prove to be more committed to Denver than even Houston. DEN was United's 2nd largest hub, prior to the merger with Continental and they definitely have more incentive to expand there now.

It's probably not a coincidence that this Tokyo service was announced just weeks after this restructured, incentives laced deal, was announced.
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