AirTran DFW Expand

[FLB717]

WFAA.COM

AirTran (thats us) is growing from 1 gate at DFW to 4 gates in Concourse E. We are exspected to go from 6 flights a day to 24 by Jan 1, 2004 and up to 30 or more next year. With the ability to lease more gates in the future. Passenger growth is forcast to grow from 29,000 a month to 70,000 plus. Both 737 and 717 aircraft are slated to operate from DFW.

Man I love this place.

 

[crosscut]

Double check your math: from 29,000 pax to 70,000 is to almost double whereas from 6 flights to 24 flights is to quadruple our current numbers. Here is what I think: the 6 flights are round trips; the 24 flights are segments, i.e. 12 round trips, which would be more in line with doubling of the passengers. However, the 12 operations wouldn’t be enough to justify leasing 4 gates, therefore, there must be more to come. Even then our 4 little gates are nothing but a drop in this AA’s Texas super-sized bucket.

 

[FLB717]

I cant check the math, its not mine. Those are pieces from the wfaa.com/business. article. i didnt invent the news Im just repeating it. Check the website. but yes it seems off I would quess for far more pax. We try to use muliple gates up to 10 flights per gate (mdw/bwi) as states by our J. L. . That would be upto 40 flights a day. yes it is a drop in the bucket for the rest of DFW but all start some place. remember Eastern was the largets airline in the free world in the 70-80's with 4,500 pilots.

 

[General Lee]

FLB717,

Hey, I am impressed with Airtran and their hub raiding. Let's hope they avoid creating hubs in places like CVG, SLC, and LA! It is a good strategy, though.

Bye Bye--General Lee

 

[AFcitrus]

AirTran Article

Here's an interesting article on AirTran's DFW expansion.

Cheers



By Trebor Banstetter and Bryon Okada
Star-Telegram Staff Writers
THE ASSOCIATED PRESS/PETER COSGROVE
Passengers line up at the AirTran Airways counter in Orlando, Fla. The discount carrier plans an expansion at Dallas/Fort Worth Airport, meaning more bargain flights and more competition for American Airlines.

D/FW AIRPORT - Low-fare carrier AirTran Airways plans to dramatically expand its service at Dallas/Fort Worth Airport, a move that analysts said is likely to drive down fares and cause major headaches for rivals American Airlines and Delta Air Lines.

AirTran, one of the few carriers that has been consistently profitable since 9-11, will operate up to 24 flights daily from four gates at the airport by early next year, D/FW officials said Thursday. The airline now operates six flights daily from a single gate.

"This is going to be good for consumers, and bad for American Airlines," said Morton Beyer, an airline industry analyst with consulting firm Morton Beyer & Agnew in Arlington, Va. American will be forced to match AirTran's deeply discounted fares in every market where the carriers compete, he said.

"Both airlines are brutal competitors," he said. "There will be blood on the tarmac."

The expansion will be the first major attempt by a discount airline to attack American's market share at D/FW, which is the Fort Worth-based airline's largest hub. American controls about 70 percent of the airport's traffic and can charge a premium for tickets on noncompetitive routes. With its single gate, AirTran currently accounts for less than 1 percent of D/FW's traffic.

"We face this type of competition from budget carriers in markets across our network," said Tim Wagner, an American spokesman. "From that perspective, this is not new to us."

The expansion will also mean challenges for Delta, which operates a small hub at D/FW and controls about 20 percent of the airport's traffic. Delta officials did not return phone calls Thursday seeking comment.

AirTran did not disclose which cities it will add to its D/FW schedule. The airline currently flies only to its primary hub in Atlanta. AirTran announced recently that it will begin serving Orlando, Fla., and Baltimore/Washington from D/FW later this year.

"We've been very pleased with the response we've seen at D/FW over the past eight years," said Tad Hutcheson, an AirTran spokesman. "We've ordered 110 new Boeing airplanes and we're looking for profitable markets to deploy those airplanes."

Analysts said Wednesday that, with so many new flights, AirTran is likely to add several cities to its schedule.

"I think we're going to see at least six to eight new destinations" from D/FW, said Ray Neidl, an airline analyst with Blaylock & Partners, an investment banking firm in New York.

"This is David and Goliath," said Dallas Mayor Laura Miller, an airport board member. "We expect American to be competitive from Day One. It will be great for the citizens who travel."

AirTran, which is based in Orlando, is in the midst of a significant expansion that began this year. In July, the carrier announced a $6 billion contract to buy 100 new Boeing 737s and 10 new Boeing 717s.

And the airline has been adding flights, focusing largely on destinations in the West. New service has included Los Angeles, Las Vegas and Denver.

In June, AirTran served 1 million passengers in a single month for the first time.

The airline is one of a handful of carriers that remains profitable. During the first six months of 2003, AirTran earned $59 million. The six largest airlines lost $4 billion during the same period.

Like other discounters, including Dallas-based Southwest Airlines and JetBlue Airways, AirTran has a lean cost structure. During the second quarter, its operating costs totaled 8.3 cents for every available seat on every mile of the airline's network.

In contrast, American spent 10.2 cents, and Delta spent 9.7 cents.

But AirTran differs from its low-fare rivals in some ways. While Southwest operates a city-to-city schedule focusing on secondary airports like Midway Airport in Chicago and Houston Hobby Airport, AirTran has a traditional hub-and-spoke system based at Atlanta's Hartsfield Airport, the world's largest airport.

AirTran also offers a first-class cabin, a perk that many business travelers and frequent fliers enjoy.

"AirTran has a very strong business model, and the business travelers love them," said Terry Trippler, an industry analyst with travel Web site Cheapseats.com.

For consumers, the move is likely to mean a significant decrease in airfares to any city that AirTran serves, analysts say, as American and Delta are forced to match its prices.

"AirTran is going to be setting the prices" on competing routes, said Tom Parsons, chief executive of Bestfares, an Arlington-based travel service that monitors airfares. "And that's American's worst nightmare."

For years, D/FW passengers have paid significantly more to fly. According to a recent consultant's report produced for an airport bond offering, the average yield for airlines at D/FW -- the money airlines collect per passenger mile flown -- is 47 percent higher than the national average.

The higher average airfares are due to the airport's status as a hub, the shorter-than-average length of flights and American's "dominating service in many travel markets," the report stated.

As the largest carrier at D/FW, American reaps most of the benefits of the higher airfares.

Delta may be even more vulnerable to AirTran's expansion, analysts said. That airline has been replacing many of its aircraft at D/FW with smaller regional jets. Many customers may prefer to fly AirTran's full-size planes rather than Delta's smaller ones, Neidl said.

"I think it's more of a threat to Delta than it is to American," he said. "They're a weak player at D/FW right now."

Delta has been battling AirTran for years at its primary hub in Atlanta. AirTran competes with Delta on 80 percent of that carrier's domestic routes from Atlanta, Beyer said.

He estimates that Delta loses about $1 billion in revenue annually because of competition from AirTran.

"Delta challenged them almost everywhere they went, but despite that, they've survived and are thriving," he said.

Neidl predicted that the carrier might build a "mini-hub" at D/FW that would connect the East Coast with western destinations such as Los Angeles and San Francisco. AirTran has created a similar small hub in Baltimore, where it has 33 daily flights, Neidl said.

D/FW officials expect the new flights will generate $22 million to $25 million in airport revenue and contribute millions of dollars more to the North Texas economy.

Joe Lopano, the airport's executive vice president of marketing, said the expansion should stimulate more traffic at the airport, bringing in an additional 1.2 million passengers.

The airport will set aside $250,000 to make changes to gates B13 through B16 to accommodate AirTran, said Kevin Cox, D/FW's chief operating officer. The gate leases begin Jan. 7.

After its expansion, AirTran's D/FW service will be the airline's fifth-largest operation, after Atlanta, Baltimore, Orlando and Tampa.

"We love American, and they will remain No. 1 at D/FW," Miller said. But she added that "we are thrilled to increase the competition at this airport."

 

[General Lee]

I bet this will hurt Delta in DFW alittle becuase they have pulled down service to some of the cities with RJs. The article got it right when it said that passengers would rather fly on larger, roomier planes. I think I read that Airtran was going to initially fly between DFW and BOS, BWI, and MCO--right? That would put direct competition with Delta to BOS and MCO. Delta is going to have to realize that they will have to reinstate some of their larger mainline planes in the DFW base and compete. Yes, there will have to be some wage cuts probably, like I have been saying for the last couple months, in the range of 10-15% for the pilots atleast. But, it can be done.

One thing that Delta and AA has that Airtran doesn't at the DFW hub is feed. Delta does rely on a lot of RJs to feed the remaining mainline flights (They really did downsize, it is embarrassing). Hopefully Delta will compete and not retreat---and hopefully the business passengers that haven't gone over to Airtran yet will come back. Also, adding back the DFW HNL flight (some flight attendants were told that by crew planning..??)--might help with the frequent flyers in the DFW area.....But overall, we must compete, and we will. But, I do think Airtran is doing a great job.

Bye Bye--General Lee

 

[Heavy Set]

AirTran is doing a great job. I have flown on the zippy 717s several times and I always enjoyed the flights. I agree that Delta has the most to lose, especially if AirTran flies to the same or similar destinations... My feeling is that Delta NEEDS to reduce use of clausterphobic-inducing CRJs on trunk routes out of Dallas and instead use soon-to-be-ordered 100 seaters - I am hoping for the wider-cabin A318 but I bet it will be the 737-600. Most business travelers will not want to fly CRJs if they are given a choice on trunk routes for similar fares - even if loyalty points are included...

I personally think that the CRJ and ERJ range of airplanes SUCK for passengers for flight over 2 hours. I can't wait to see the EMB-170/190 and the A318 in use - comfortable and economical alternatives to the "tube effect." I am also looking forward to seeing AirTran's 737-700s with winglets - nice....

 

[IAHERJ]

Les Paul,

While I can understand why some would be led to believe that AirTran is trying to hurt Delta and AA in their decision to add some capacity at DFW, I have to disagree. DFW has been a very successful city for us. The DFW Metroplex represents one of the largest metropolitan areas in the lower 48 and geographically sits in an area of this country allowing our 717's to reach either coast nonstop. Delta operates a hub there as well as ATL but I think that is just coincidence as far as any AirTran decision goes. It's all about the money. Valuejet had a crew base in DFW years ago so the management team here at AirTran already knew the possiblilities and feasability of a DFW buildup. Like someone above said, it is only 3 new gates and like the general said, we have no feed at DFW like AA and DL have. We will compete on about 6-7 routes out of DFW by default however we operate a different kind of airline and over 70 percent of our pax out of DFW will have to be O&D while AA and DL will be drawing passangers from all over the country to feed and fill the same flights that are competing with the AirTran flights.

To make a long story short(too late), AA and DL will make out just fine at DFW. Airtran will be a distant 3rd at the airport and there is plenty of market share in the DFW area to go around. Nobody at AirTran wants to go around the country raiding hubs at others expense. We are just doing what makes sense to our bottom line and doing it at the main airports in the metropolitan areas in plain view of the public, not at secondary airports like SWA has done for decades. That's not a shot at SWA as they have obviously been very successful at what they have done. We just have a different approach. Only time will tell if this venture will be a success for this tiny little 73 airplane operation.

 

[FLB717]

Les Pauly Girl,

Bite Me! I could care less paul what you think with you "Im a Major Pilot" Dont underestimate our (those on this board) drive to see our company survive and grow with a better than tho attitude. Most of us have come from places that had to fight for every passenger. That continues today and that is what you see. We will fight to grow and keep our jobs to the best of our abilities. If you think that a large or small airline can not go out of biss them you should spend more time reading about the history of the US Airline Industry and less time talking about your military (no offense to other Mil pilots just you) days down at the VFW.

I dont believe anyone at AAI on this board said we are the be all end all next greatest best thing with wings. We just as a rule like our jobs.

 

[Heavy Set]

FLB717,

You should like your job. You are at an up and coming LCC that will be expanding and getting nice new airplanes. That is great.