"Monopoly at Midway?"

Sunday, March 13, 2005

Monopoly at Midway? 
Southwest Airlines has won the fight for dominance at the airport. What does
this mean for consumers? 
By Guy Tridgell
The Chicago (IL) Daily Southtown


Patrick May will be keeping close tabs on Midway Airport the next few
months.

May, an Oak Lawn native, runs a Southwest Side business that manufactures
components for steel drums. The job requires him to leave town, sometimes
several times a month. 

For the past few years, May has looked to Midway more and more to meet his
travel needs. 

The competition between ATA Airlines and Southwest Airlines worked to his
advantage. 

While the two airlines battled it out for the distinction as the No. 1
carrier at Midway, businessmen such as May were the victors, cheap flights
were their spoils. 

They often found deals purchasing a ticket just a couple of days before the
flight. 

"If you are a once a year traveler who takes the kids to Florida, you can
afford to shop around," May said after returning on a Southwest flight from
Oakland last week. "Businesses like myself are taking a close look at the
cost of these flights. It is no longer, 'Oh, it is just travel.'"

John Szabocsik, a Chicago businessman who designs medical equipment, is
worried because he wants to see more competition as a way to tamp down
flight costs. 

Losing airlines, or existing airlines cutting back service, does not help. 

"I want to see more airlines," Szabocsik said before boarding an ATA flight.
"Let's get some more airlines in here."

The reason for the anxiety? 

The battle for Midway dominance is over, and there is a clear winner. 

Last month, Southwest assumed control of six of the 14 gates once occupied
by ATA.

The deal was struck after ATA declared bankruptcy in 2004, after several
years of rapid growth in Chicago. The airline, based in Indianapolis, will
continue to do business from its eight remaining gates.

But the shakeout left no doubt about who is the top tenant at the Southwest
Side airport. 

Southwest Airlines will occupy 25 gates.

The remaining 18 gates will be occupied by 11 commercial airlines and one
cargo carrier.

Another carrier, Ted, a United Airlines offshoot discounter, joins the mix
next month.

Southwest will occupy 25 gates, nearly 60 percent of the capacity at the
airport, when the dust finally settles.

The prominent role of Southwest is causing some concern among Midway
regulars, worried they will be forced to pay to pay higher fares with the
competition gone. 

The "M" word - monopoly - is getting mentioned. 

But analysts and city aviation officials said customers are not getting a
bad deal. 

"If you were to pick an airline to have a monopoly, it would be Southwest,"
said DePaul University economics professor and transportation expert Joe
Schwieterman. "They built their reputation on low fares."

Southwest executives said they will stay true to their reputation. 

The Dallas airline started with seven flights when it opened for business at
Midway two decades ago. 

Southwest was known then for offering the lowest fares though an unusual
menu of direct, point-to-point service, eschewing the traditional
hub-and-spoke model of most airlines. 

Not much has changed since.

Not much will change in the future, said Patty Kryscha, district marketing
manager for Southwest.

"It's not in our DNA," Kryscha said. "I don't see us ratcheting up fares.
That would drive a lot of our customers away."

The Chicago Department of Aviation, which runs Midway, is unconcerned about
what the tumult at the airport might mean to fares. 

"There are plenty of airlines to go around," a department spokesman said. 

Schwieterman predicted Midway customers forced to look to Southwest for
flights will see differences in more subtle ways. 

The leather seats and roomier cabins in ATA planes will not be found on
Southwest.

And the experience of boarding flights with Southwest, which does not assign
passengers specific seats, is more hectic. 

"It is a shame that the competition is going away," Schwieterman said. "But
this hardly constitutes a major problem." 

Frequent fliers will be monitoring. 

Felix Serrano, a Florida businessman, felt the effects last week on a return
flight home. 

The departure of ATA means he can no longer fly into the St. Petersburg
airport. He must fly into the Tampa Bay airport instead. 

The inconvenience adds an extra 30 minutes to the drive back to his house. 

"I really hate that," Serrano said.


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