The Washington Post reports that a deal has been reached that extends the United presence at Washington Dulles to at least 2025. While this isn’t quite a surprise, it does quell some perennial questions about how the Dulles hub fits into United’s network. The United presence at Washington Dulles as a hub extends back to May 1986.
If there’s one thing that I’ve noticed, it is Virginia Governor Terry McAuliffe’s focus on Dulles. A few years ago, I had the pleasure of attending an inaugural landing for Air China, where Governor McAuliffe highlighted his focus, to create international partnerships. Washington Dulles is his greatest pathway to that end. In fact, McAuliffe is quoted noting:
The extension of the United lease solidifies Dulles as Virginia’s gateway to the country and the world and a critical piece of our efforts to build a new Virginia economy.
Reaching a Deal to extend the United Presence at Washington Dulles
A big part of the deal, was $25 million in 2017 and 2018 to focus on lowering the costs for airlines operating out of Dulles. The funding was contingent on a longer term lease agreement–the previous United lease, signed in 2015, only extended to 2018. The Metropolitan Washington Airports Authority (MWAA), both Washington Dulles and Reagan National, so it looks like Reagan National may be getting the short end of the stick here.
What else does the deal included?
Looking at the briefing slides for the agreement amendment, the deal includes $446 Million in a new Dulles Capital Construction Program (CCP), which will include:
- $182 Million for Terminal building upgrades, including:
- Utility upgrades for Concourse C/D
- Capacity enhancements to the International Arrivals facility
- Baggage handling improvements
- Existing aircraft gate upgrades to accommodate additional international service, including A380 modification
- Construction of four additional domestic gates
- $145 Million for Airfield Pavement
- $51 Million for Passenger Conveyance Systems
- $22 Million for Airport-Wide Utility Systems
- $20 Million for Roads
- $26 Million for “Other”
Perhaps the most interesting in this aspect, are the points about terminal upgrades including the A380 Modifications. Interesting, because United doesn’t have A380’s, so this is clearly more aligned with the strategic extension of international routes, or at least additional capacity. At present, Air France, British Airways, and Emirates fly the A380 to Washington Dulles,
What is missing from the deal
United primarily flights from Concourse C/D, which was originally planned as a temporary facility. The temporary facility was built in 1985! While it is great to see that there will be utility upgrades, the C/D concourses are woeful as compared to Dulles’ gorgeous A and B terminals. I would have hoped that United would have pushed for better facilities for the hub, however, I suspect that United is more focused on keeping costs low, despite aging temporary concourse.
Overall, this is good news. It helps to maintain the United presence, given how Star Alliance heavy the international traffic is to Dulles. Furthermore, extending the lease to 2025 should help both sides–United and Dulles–in planning mutually beneficial investments.