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"Southwest Could Triple Daily Departures From DIA if FAA Approves"

Wednesday, April 26, 2006

Southwest Could Triple Daily Departures From DIA if FAA Approves
The Denver (CO) Rocky Mountain News

Southwest Airlines is preparing to as much as triple its daily departures
from Denver International Airport, reflecting the carrier's intentions to
grow rapidly in its newest market.

The low-cost airline appears close to receiving final Federal Aviation
Administration approval on a proposal to fly as many as 60 daily nonstop
departures from Denver. Southwest, which launched service at DIA in January,
currently offers 20 daily flights from the airport.

Southwest's proposal signals that the company is bullish on its potential in
Denver, said company spokeswoman Melanie Jones.

"This is a response to the success we're seeing there, and it's in
anticipation of growth so when the time is right we have this step in
place," Jones said, adding that the carrier has not announced specific plans
for any new service.

Dallas-based Southwest last year received federal approval to start service
at DIA and was told it would have to go through the process again if it
planned to add more than 40 flights.

Airlines that want to start service or significantly increase flights at a
given airport must meet certain environmental regulations. The FAA has
issued a recommendation approving Southwest's latest proposal, saying the
new flights conform with the regulations. The agency is now accepting public
comment on the issue.

Southwest has said all along that it sees significant potential in Denver,
and industry experts have been expecting Southwest to expand here sooner
rather than later.

Last week, for instance, a Bear Stearns analyst downgraded shares of
Denver-based Frontier Airlines, saying the carrier will face increased
competition from Southwest.

"We believe expansion plans in Denver are aggressive and that Southwest
capacity will more than triple in the next two years," analyst David Strine
wrote in a research note to clients.

Experts say Southwest could boost flights from DIA to current destinations
but also will look to add service to new cities such as Oakland, Calif.;
Houston; Orlando, Fla.; and Nashville, Tenn.

Southwest is expanding rapidly nationwide as other airlines become more
competitive. The carrier will add 33 planes to its fleet this year and has
140 planes scheduled for delivery between 2007 and 2012. Much of that growth
likely will come at the expense of other carriers, said Evergreen-based
aviation consultant Mike Boyd.

Still, he said, Southwest faces a tough battle in Denver. Both United and
Frontier, the city's largest carriers, are fighting aggressively for
passengers and are well-known in Denver. Boyd also argues that, price being
equal, those two carriers offer a better product than Southwest.

"The last time I checked, Southwest was not included on the tablets Moses
brought down from Mount Sinai," Boyd said. "So there's no guarantee they
will be successful."

Consumers could be the biggest winners in any Southwest expansion. The
carrier already has helped push down fares at DIA since its arrival less
than four months ago. During the first week of April, for instance, fares at
DIA were down 18 percent from a year earlier, even as ticket prices
nationally were on the upswing.

And, as the competition heats up, both United and Frontier are boosting
their service ahead of the summer busy season.

The airport is "very pleased with Southwest's indication that it is looking
at increasing its schedule," said DIA manager Turner West. "Increased
competition is always good for the traveling public."

Southwest currently has three gates on the C concourse at DIA and will gain
one more in June. It typically operates about 10 flights a day at each gate
it leases, meaning it would need more if it expands in Denver.

West said DIA will make "every effort" to work with Southwest on securing
additional gates.

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