Editorial: When it comes to Chicago’s vital O’Hare airport, United and American airlines hold the cards

In public, cities and airlines talk like partners. But when it comes to spiffy new airports, their stakeholder interests mostly are in opposition.

Cities, which usually own the airport, want prestigious gateways and “world-class” architecture. They want jobs from construction contracts going to favored parties. They want to fill the concourse with restaurants and retail, pushing the gates away as far as they can so that captive passengers spend sales tax-generating money on “local” eateries and the like, even though those places are mostly licensing agreements with the huge international concessionaires that rake in the biggest bucks. And, of course, they want the airlines to pay for all those fountains and sculptures, the indoor trees, the soundscapes and the fake parks.

And what do the airlines themselves want? Their needs are far, far simpler.

They want low costs per emplaned passenger, or CPE, an industry standard measurement of how much it costs airlines to use an airport. And they want efficient operations — the ability to move passengers, especially connecting passengers, off and onto planes that can leave and arrive on time.

And the passengers themselves? A bit of both, certainly, but their interests are more closely aligned with the airlines’ interests.

Most people don’t care about fountains. They want convenient, nonstop flights, ideally lots of them, and low fares. So when the Chicago Sun-Times reported this week that United and American airlines were balking at the ever-mounting cost of O’Hare’s so-called Global Gateway program, even though they had signed on to the idea during the Rahm Emanuel administration, we were far from surprised.

In fact, American had long been talking to us about their unease with the plan, especially since we’d already noted that the huge carrier appeared to be quietly dropping flights in Chicago and moving them to Charlotte and Phoenix.

When they met with us during the summer, they came armed with data. In 2022, the CPE at Charlotte was $4.13. In Phoenix, $5.36. Dallas/Fort Worth: $12.19. And at ORD? It was $25.98, even before the big Global Gateway push. At New York’s rebuilt LaGuardia Airport (where the dancing fountains play “New York, New York”), it was $25.91 and rising. At JFK, it was a whopping $32.61.

Those numbers explain why American does not have hubs in New York, despite its size, and also why Charlotte, a city only one-third the size of Chicago, has an incredible seven times the number of American Airlines flights than its actual inhabitants can support. That’s because most everyone in CLT is connecting, and people don’t mind much where they connect as long as, you guessed it, the fares are low and flights ample and convenient.

CLT is not the fanciest airport in the world, but it’s cheap and American rewards it with flights. DFW costs a bit more at $12.19, but it’s a huge metro area with good weather to boot. And that’s still less than half of what American pays at O’Hare. Even before any Global Gateway reinvention.

The simple reality here is that Chicago has to compete on cost. Otherwise, airlines will just move their flights to competing cities, many of which have real systemic advantages over Chicago, with its high labor costs, onerous new potential requirements in terms of leave and tipped wages, and tough winters.

Ribbon-cutting politicians and those who try to please them usually fail to understand these realities, which explains, along with mergers, why airports like St. Louis (once a massive TWA hub) and Pittsburgh (once a massive U.S. Airways hub with an entire mall in the airport) suddenly found themselves with acres of empty restaurants and failing retail.

Airlines also can move their headquarters. The airline bloggers we follow, many of whom have excellent sources, have been speculating for months that Chicago’s hometown airline, United, plans to move its headquarters, perhaps to Denver (2022 CPE, $10.48). United consistently has denied any such plan, but anyone who thinks this is not a potential negotiating tactic at this high-stakes moment is a fool.

And let’s be crystal clear: Mayor Brandon Johnson has to keep United headquartered in Chicagoland. That’s a lot more important than any architectural plan. Losing a corporate citizen of that magnitude, and with that history, would be a disaster.

So what to do now? Rather than play some kind of hardball saying that the airlines already had signed on to the plan, Johnson’s aviation team should figure out a way to cut airlines’ costs.

We have our issues with the decision to make Terminal 5 (now the home of Delta and Southwest) as much a domestic terminal as an international one, but that ship has sailed. What’s in play is what happens in Terminals 1, 2 and 3.

Right now, there are no customs or immigration facilities in those terminals, which means United and American have to pay to tow their empty planes from Terminal 5, where all international flights arrive, to Terminals 1 and 3 respectively, so as to ease the journey of connecting passengers. The airlines hate doing that, and international arrivers at O’Hare mostly have to schlep on the train to connect, a lousy chore when you’re tired. So it makes perfect sense to build new international facilities in what was Terminal 2. The airlines are happy to pay for that because they see the benefit, as well as the updated space for lounges for their premium passengers.

But they’re much less happy to pay for what they call an “underground city,” a massively expensive subterranean world that’s part of an original plan that also builds new gates the airlines do not now think they need. They should know. They’d prefer a simpler, faster tunnel, like the existing Terminal 1 at ORD for United, or what American now has at JFK.

Chicago’s O’Hare, one of the very few dual hubs in the world, is clearly at a crucial nexus. We’d love to see an airport of which we all can be proud, but we maintain that it cannot be some kind of unrealistic vanity project for the city, nor a politicized trophy. We think the great architect Jeanne Gang and others can scale back some of the expense of their aging plans, reflecting these new financial realities, and still design for us an impressive dual-hub airport. An airport that could be further expanded in line with the demands of its customers. Not its operator.

When Chicagoans and suburbanites fly out of O’Hare, they care most about reasonable fares, efficient operations, frequent departures and a wide choice of nonstop domestic and international destinations. They do not want to pay the price for diminished competition, and they sure as heck don’t want to have to connect through Charlotte or Denver.

But if Chicago gets on its high horse here about past commitments, that’s a clear and present danger. The city has far less leverage than it seems to think.

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