Airlines typically follow two types of business models: the Point to Point and the Hub-and-Spoke.

Point to Point Model:

This model is based on flights that are provided to and from a city. Unit costs are lower in this model as aircraft are utilized more often because they do not have to wait for connecting flights, thus reducing fixed costs, which accounts for a large percentage of operating costs. Costs are spread out over many hours of flying, thereby driving down the unit cost. Low fare airlines like Southwest and Jetblue are examples of airlines following the point to point system. See figure below.

Hub and Spoke Model:

This model is used by most of the major airlines including American, United, US Airways, Delta, Continental, and Northwest. The Hub and Spoke system allows the airlines to maximize passenger enplanements on each flight by offering connections to both domestic and international destinations. This more complicated route system provides customers with a much larger number of route option, which in turn maximizes revenue opportunities. The downside to this is the increase in aircraft wait time and lower aircraft utilization time, which increases the airlines' unit cost. See figure below.

TOP SIX MAJOR AIRLINES HUB AIRPORT

Airline	Airport Code	Airport Name
American Airlines	DFW	Dallas/Fort Worth International Airport
Continental Air Lines	EWR	New York/Newark Liberty International Airport
Delta Air Lines	ATL	Hartsfield Atlanta International Airport
Northwest Airlines	MSP	Minneapolis-St. Paul International Airport
United Airlines	ORD	Chicago O'Hare International Airport
US Airways	PHL	Philadelphia International Airport