Tuesday, December 13, 2005
American unveils flight schedule for Love Field Airline plans 16 daily trips to Missouri, two Texas citiesIn addition to launching service to compete with Southwest's new routes to St. Louis and Kansas City, American also added regional jet service to Austin and San Antonio from Love.
The 16 new daily flights set up a head-to-head duel between the Dallas-Fort Worth area's two hometown airlines – American, the world's largest carrier, and Southwest, the nation's leading discounter.
But while passengers will benefit from lower fares at both carriers between North Texas and Missouri, American's return to Love also stokes the fires in a battle over the future of the region's two leading airports.
American will begin flying from Love on March 2. To find planes for the new service, American is raiding its largest hub, Dallas/Fort Worth International Airport.
"It's bad for American Airlines, it's bad for our people and it's bad for the people who live around Love Field," said Dan Garton, executive vice president for marketing at Fort Worth-based American.
"But we've said all along that this is absolutely essential for us to do to remain competitive."
This winter, instead of the 788 daily departures at D/FW that American had planned, the carrier expects to have about 775 flights after reshuffling its schedule.
By April, the number of D/FW departures will fall even further as American removes some flights to Missouri while adding seasonal service to other cities.
American is eliminating nonstop service to six cities from D/FW, including Long Beach, Calif., and is reducing the number of flights to seven others, such as Cincinnati.
The eliminated flights are among the weakest in the American system.
While American has some planes in storage that it could tap for the Love service, Mr. Garton said, it doesn't have the resources to increase staff levels.
American's announcement came the same morning that Southwest flew its first passengers from Love Field to St. Louis and Kansas City.
Last month, Missouri became the ninth state that can be served from Love under the Wright amendment.
Southwest began a campaign 13 months ago to lift Wright. D/FW and American both oppose any changes to the law.
Southwest spokesman Ed Stewart said the new American flights wouldn't change its goal of achieving full repeal of the Wright law.
"They're just another competitor," Mr. Stewart said. As for the flight reductions at D/FW, Mr. Stewart said it "just seemed like they were repositioning their aircraft the way they always do."
For American, the new flights represent part of a struggle for geographic supremacy in the Dallas area.
About half of American's best customers – its frequent fliers who fly nearly exclusively on its silver planes – live closer to Love Field than to D/FW.
American would have acted sooner but had already pre-sold tickets on its winter flight schedule. Also, the airline has to prepare its gate areas at Love and start marketing the service.
The San Antonio and Austin flights will be on 50-seat regional jets operated by American Eagle, and are intended to provide some connecting passengers to American's flights.
Mr. Garton said he doesn't know whether the flights will lose money for American, but he reiterated that the carrier believes it's a less costly path than merely matching Southwest's fares from D/FW.
"This is not something we look forward to doing," Mr. Garton said, noting that the aircraft American will use for the Missouri flights, the MD Super 80, will be the loudest commercial aircraft flying at Love.
"We are not driving this – we are responding to them," he said.
American's flights from Love will be priced similarly to those from D/FW. The carrier will match Southwest fares but control the number of cheaper tickets available.
That will mean that Southwest will, at times, have lower-priced flights than American.
Most observers predict that American will lose plenty of money on the Love flights.
"It's a real dilemma for American," said Ray Neidl, airline analyst for Calyon Securities in New York. "I feel their pain."
American might be looking to make a bold statement with the move about the consequences of full repeal of the Wright law to the region, he said.
American might be willing to lose money in the short term if it can stop what Mr. Garton called "being nibbled to death by a duck," meaning more individual states winning exemption from the Wright law, Mr. Neidl said.
The new Love flights and reductions at D/FW are not material to American's earnings, he said. "It's a pinprick at this point, but it's a pain for them."
Wall Street seemed indifferent to the news, trading up the shares of American parent AMR Corp. 18 cents to $19.47. Shares of Southwest fell 10 cents to $16.21.
Reaction to American's flight schedule fell along well-worn lines.
D/FW officials said their worst fears had been realized.
"It is a very unfortunate reality that North Texas is losing key flights and destinations at a time when our region was looking forward to domestic and international growth," Kevin Cox, D/FW chief operating officer, said in a prepared statement.
An incentive package from D/FW remains on the table for Southwest, Mr. Cox said. Southwest has said it isn't interested.
The Love Field Citizens Action Committee said the new American flights "fly right through the middle of the master plan" document that limits growth at Love, spokeswoman Pat White said.
The North Dallas Chamber of Commerce disagreed, saying the master plan that it agreed to along with the residents group has a 250 departure-per-day limit that isn't close to being violated.
"These are a small percentage of the total increase that was forecasted," said Steve Taylor, president of the chamber. "The master plan is not at issue here."
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