This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

A Black Eye for Cleveland?

NEW YORK (TheStreet) -- On Feb. 1, United Airlines (UAL - Get Report) announced that it will demote Cleveland from a United hub to a mere spoke.

As United CEO Jeff Smisek wrote in his announcement, "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. We simply cannot continue to bear these losses."

But is it also a major loss for the city of Cleveland? It could hurt the arts. What if it squeezes the middle class?

Cleveland has endured a long list of indignities: a precipitous decline in population, the closure of much of its heavy industry, the infamous fire on the Cuyahoga River. Both the city and its former baseball and football stadium have been nicknamed "the Mistake on the Lake." LeBron James broke its heart with "the Decision" to start playing for Miami's basketball team. Its most popular tourist talking point is its "Hastily Made Tourism Video."

And now, it is no longer a United hub.

Must Read: BlackRock International Growth and Income Trust Breaks Below 200-Day Moving Average - Notable for BGY

Clevelanders saw this day coming when United and Continental merged in 2010. Cleveland was the Continental Midwest hub, and Chicago was the United hub. It doesn't come as a shock that Chicago won out.

The Plain Dealer described the change as "a psychological blow to Cleveland, a city whose tough attitude masks an often-shaky self-image."

More than that, it will eliminate nearly 500 jobs: 430 airport operations jobs and 40 catering jobs, by Smisek's count.

Cleveland is the latest in a list of Midwestern cities that have seen their airline hub status eliminated. In an interview, TheStreet's Ted Reed ticked off a list of former hubs in the region: Dayton, Indianapolis, Pittsburgh, Columbus, St. Louis. Now Cleveland. The airline industry has contracted substantially over the past couple of decades, Reed said. All of these smaller city hubs have shuttered, and Charlotte is one of the only smaller hubs standing.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
UAL $56.81 0.00%
AAPL $122.77 0.00%
FB $94.20 0.03%
GOOG $627.26 0.00%
TSLA $253.39 0.15%

Markets

Chart of I:DJI
DOW 17,440.59 -127.94 -0.73%
S&P 500 2,067.64 -12.01 -0.58%
NASDAQ 5,039.7760 -48.8540 -0.96%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs