"New Southwest flights beat American by 26%"

Friday, December 2, 2005

New Southwest flights beat American by 26%
By Tim McLaughlin
The St. Louis (MO) Post-Dispatch


Southwest Airlines on Thursday introduced four new flights between St. Louis
and Dallas Love Field, offering fares 26 percent lower than American
Airlines, which until now had a monopoly on that route.

Southwest, the king of low-cost carriers, will start service to Lambert
Field and Kansas City International Airport from Dallas on Dec. 13. The
carrier will offer four daily nonstop flights to each city.

One-way fares will be $79 with 14-day advance purchase, Southwest said.
Unrestricted, walk-up fares will be $129 each way.

In 2004, Dallas ranked as the fifth-most-frequent destination for St. Louis
airline travelers, according to Lambert Field data. DFW received 3.4 percent
of the passengers originating at Lambert. Chicago was the top market with
7.3 percent.

In June, a study by Southwest consultant Campbell-Hill Aviation Group Inc.
estimated the airline's entry into the Dallas-Lambert Field market would
provide an incremental economic impact of $95.2 million to St. Louis.

Southwest's entry on the Dallas-Missouri routes is a blow to American, which
considers St. Louis and Kansas City two of its leading monopoly cities.
President George W. Bush opened up the two cities for Love Field flights on
Wednesday when he signed into law a 2006 transportation bill that exempted
Missouri from federal restrictions.

The 1979 Wright Amendment previously restricted flights between Love Field
and Missouri on big jets, partly to protect up-and-coming Dallas/Fort Worth
International Airport from nearby Love. Sen. Christopher "Kit" Bond, R-Mo.,
authored the amendment that excludes Missouri from Wright Amendment
restrictions that prevent nonstop flying from Love to most U.S. cities.

Missouri now joins Texas and seven other states with unrestricted flying
from Love.

"Missouri has been punished far too long by the resulting high-fare
monopoly," Southwest Chairman Herb Kelleher said in a statement.

American currently operates 14 daily nonstop flights between DFW and
Lambert. But the airline says it will offer some flights from Love. No
schedule has been announced.

In testimony last month before a Senate transportation committee, Gerard
Arpey, chairman of AMR Corp., American's parent, said if Love Field had been
allowed to operate without restrictions, the massive investment in DFW would
have been jeopardized. He also cited a study by ECLAT Consulting Group that
said total repeal of the Wright Amendment would trigger a net loss of 185
daily flights from DFW, shaking the economy of north Texas. Southwest said
its cheap fares will spur passenger traffic at Love and DFW.

On Thursday afternoon, you could book a Dec. 13 round-trip flight between
St. Louis and Love Field for a base fare of $146.98 on Southwest's Web site.
In contrast, American's online site offered a round-trip flight between St.
Louis and DFW for a base fare of $198, or 26 percent more than on Southwest.
Neither fare includes taxes and other fees, and the flights return Dec. 14.

Airline analyst Roger King of CreditSights Inc. estimates American's annual
revenue on flights between Dallas and St. Louis will drop to $84 million
from $141 million. Meanwhile, Southwest would pick up $45 million a year in
revenue.


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