Study Finds Opening Love Field to Long-Haul flying would have Serious Conserquences

[FlyBoeingJets]

And SWA is the very cradle of civility amongst airline competitors...just ask Muze.

Chase,

Thanks for the biased recap post. I love how SWA writes stuff that makes it sound like they are the only company who has had to fight to stay in business. I do like that the article openly owns up to the niche SWA sought to preserve at Love. The article fails to highlight the degree to which this was a back alley bait and switch by Herb and Lady Bird and the fact that the only real legal action taken, was to REMOVE Braniff who was matching your routes at Love. Without exception, every Braniff guy I fly with maintains that they were told every airline tenant at Love was going to move to DFW. When SWA did not go Braniff (and everyone) was pi$$ed! Braniff stayed to try to compete with you but were forced out by court order. So the wellspring from which your airline spawned was not so much a lovely little niche but rather a legal ambush.

Where is the equity in a repeal of the WA? Your airline has been enabled by the positive aspects of the agreement to the extent that it is very likely the main reason the airline is what it is today. Now, your airline is ready to come out from behind those protections and rather than open up operations at DFW, you want a REVERSAL on the agreement! Again, where is the equity in this? Equity treatment for the airlines that went to DFW, to the people who built DFW, to the North Texas economy? Low airfares to a very small number of cities is not going to cut it. Equity too in the form of some type of "soft landing" for AA. AA is relatively strong in the face of all the non-market, geopolitical churn of the last four years. All of which, I might add, has been a windfall to your airline. Which highlights something interesting: What is the real issue here? Is some of the non-market, geopolitical churn negatively affecting the mighty and precious SWA? Do you need to start flying longer distances from Love because people might start to drive and forego the frustrations of air travel? Well, if that is at all true, I say: you made your bed--sleep in it! Or move to DFW.

The soft landing (equity treatment) due to AA should pattern the sort of gracious gift given to SWA in the form of Love Field. Just as SWA was given an advantage to start operations, AA should be allowed to continue operations. Afterall, SWA only wants this brand of competition now, at this time, because AA is hurting. SWA has always shirked the sort of heads up competition that could really help North Texas travelers.

Flopgut,

I very much appreciate the lesson and wish SWA didn't have a hand in their demise. I was hazy on how Braniff was pushed out. Herb was, and is, an amazing lawyer in a crazy industry. SWA has, indeed, been blessed at key moments. It amazes me how a handful of events or decisions can decide the fate of an airline.

I've been trying to see the future of this industry for awhile and it still looks opaque to me. I thought USAir and UAL were goners and now they look to dominate once again. NWA and DAL appear to be on the brink of shrinking by 20%, but I am probably underestimating them too.

I have friends overestimating SWA as I underestimate other carriers. Some say SWA will be flying international. I think SWA will remain successful, but I doubt the international expansion.

This industry is incredibly interesting (read terrifying). I wonder how it will unfold over the next 2-5 years.

Regards,

FBJ

 

[Flopgut]

Flopgut, you really dont like SWA do you? You also ramble on a lot. The airline industry is a business. SWA is in the business to make money. You file for BR protection, we try to change outdated laws. We might win, we might lose only time will tell.

I have said it before, I'll say it again. I hope SWA folks have great careers, make plenty of money, retire comfortably and never have to worry about their future. But repealing the WA is just too much! Is it so wrong that some amount of public policy dictate how the pursuit for air commerce be conducted? The evolution of Love field into SWA's protected enclave trounced the careers and lives of lots of people. I can't believe how completely the modern SWA pilot can ignore the fact that Love Field was once home to other airlines, other pilots! Do you doubt that their careers were as important to them? Did they not have families counting on them? If you are having trouble imagining that let me channel a little of their perspective for you--SCREW YOU SWA! Live with the WA or go to DFW.

 

[OffHot]

Now Flopgut, do you honestly believe that we don't have former Braniff, Midway, Eastern, etc pilots working for us. That they don't talk to us about the old days. Not sure how the WA and Braniff going out of business go together, but if you can connect the lines then fine. So do you believe that AA was justified in attacking, sorry agressivley competing against, Legend to the point that Legend went Chapter 7. What about their families. Was Dallas even a hub for AA before DFW was open or for that matter weren't they based in Chicago or New York before becoming Ft Worths home town airline? I'm not sure. If it wasn't then maybe AA put all those people on the streets. It don't believe they did, I believe the better financed and better managed airline survived. If I worked for AA I would want the WA to stay, it reduces my compition and allows me to have hire fares, which of course is needed to fly out of DFW. SWA would rather avoid the head to head compition, which no one will win--not even the mighty AA (side note I personally like AA, great airline to fly on). Laws change, that's why we send those people to Washington. The airline industry has changed over the past 30 years, DAL might have been our spring board to success, it is not our cash cow today. We make way more money at MDW, oh wait they have two airports and AA has a hub there, but it works. The primary problem in Dallas and Ft Worth is that we have two airport authority's not one like Chicago. Dallas has the advantage being involved in both. Every airline is seeking to increase productivity and decrease cost in an effort to drive up revenues, SWA is no different. I'll take fighting the WA over BR any day. And like you I wish no one ill will in this business, things change daily.

 

[SWAnnabee]

If DFW is such a great airport to fly out of....why don't the powers that be let all the other airlines that are beating on their door, have those empty 24 gates?

If that DFW board is holding on to those 24 empty gates just for SWA, and turning down all the other airlines who want them....they are not doing a good job of managing their assets.

Tejas

Thats one of the better, and more unbiased from either side, points I've seen in a while.

 

[SWA/FO]

:beer: And my point is: SWA is not canceling anybody's pension.

I did not say your retirement money was not yours.... I only stated that all the money in my retirement fund is mine. I find this funny that I would have to explain this to you in this day and age... If you need some examples of compaines that have recently canceled their employees pensions...just let me know and I'll point them out to ya.

 

[Flopgut]

Now Flopgut, do you honestly believe that we don't have former Braniff, Midway, Eastern, etc pilots working for us. That they don't talk to us about the old days. Not sure how the WA and Braniff going out of business go together, but if you can connect the lines then fine. So do you believe that AA was justified in attacking, sorry agressivley competing against, Legend to the point that Legend went Chapter 7. What about their families. Was Dallas even a hub for AA before DFW was open or for that matter weren't they based in Chicago or New York before becoming Ft Worths home town airline? I'm not sure. If it wasn't then maybe AA put all those people on the streets. It don't believe they did, I believe the better financed and better managed airline survived. If I worked for AA I would want the WA to stay, it reduces my compition and allows me to have hire fares, which of course is needed to fly out of DFW. SWA would rather avoid the head to head compition, which no one will win--not even the mighty AA (side note I personally like AA, great airline to fly on). Laws change, that's why we send those people to Washington. The airline industry has changed over the past 30 years, DAL might have been our spring board to success, it is not our cash cow today. We make way more money at MDW, oh wait they have two airports and AA has a hub there, but it works. The primary problem in Dallas and Ft Worth is that we have two airport authority's not one like Chicago. Dallas has the advantage being involved in both. Every airline is seeking to increase productivity and decrease cost in an effort to drive up revenues, SWA is no different. I'll take fighting the WA over BR any day. And like you I wish no one ill will in this business, things change daily.

I'm sure SWA has only hired the most compliant and defeated ones from former airlines. Specifically, I wonder what your old Braniff types truly think...would they want to work for what Braniff might be today or SWA?

Legend was an experiment that really had no steam. They patterned what SWA had done from Love so completely that AA had to act they way they did. SWA had shown too well what could happen. Arguably, they would have done better from DFW, you know, hide out on the battlefield. Nevertheless, if what they had was truely well thought out and executed they would still be around. I think the market worked in that example. Its not like they didn't know AA was going to do what they did and no party was exiled from the playing field.

The deal is this: All anyone wants to see is SWA stick to the deal. Or if they don't want to do that, go to DFW. It is really that simple. No one is trying to put SWA out of business on this. Everyone knows you have the dough and this is no hardship. Figuratively speaking, the WA should be viewed exactly the same as what the City of Austin did to Mueller. Just as surely as the runways are decomissioned, the WA stands. Look, this is an opportunity for SWA to deal with some adversity and get a little stronger. Something that your outfit hasn't had to do too much of. Go to DFW, spiff up the terminal, paint an airplane in a novelty scheme with the airport diagram on the tail, or whatever. The economies of this business are not always going to be so out of whack. Your brand is going to have to learn to function in a world where costs are more in line. Going to DFW would go a long way toward acquiring that discipline.

 

[enigma]

Legend was an experiment that really had no steam.

I've got to call BS on this one. Legend was well financed and well managed. The market did NOT determine their fate, the court battles they were force to fight used up all of their cash and AA's obviously predatory competition was too much. If AA were still flying fifty six seat MD80's out of Love, I might be on your side, but they aren't. To my logic, the very fact that AA flew aircraft capable of seating 172 pax out of Love, and then stopped as soon as Legend went out proves to me that AA isn't interested in fairness and equity.

enigma

 

[race#53]

Here is AA's MOA;

1. American is the second largest airline in the United States, offering service throughout the country. In 1998, American operated over 850 aircraft, earning more than $1.7 billion in operating profit on passenger ticket sales exceeding $15 billion. American concentrates its operations at "hub" airports at which it offers multiple daily flights to and from dozens of other cities.

2. American operates its largest and most profitable hub at DFW, which is the third largest airport in the United States serving over 55 million passengers annually. American is by far the dominant carrier at DFW, offering over 700 flights daily to more than 100 destinations. In 1998, American's service to and from DFW accounted for nearly $2 billion in annual revenues.

3. American has monopoly power in many of its routes from DFW. For many of the destinations it serves from DFW, American is the only nonstop carrier; it seldom competes with more than one other nonstop carrier on any route. Because it faces so little competition, American can and does charge fares on DFW routes that are significantly higher than the fares it charges on other routes where its faces more competition.

4. These high fares make entry into DFW routes attractive to start-up airlines with relatively low costs (known in the industry as "low cost carriers" or "LCCs"). When an LCC enters a route, it offers fares that are substantially lower than the fares the incumbent hub carrier has been charging, attracting not only consumers who have been paying the higher fares, but also consumers who previously could not afford to fly.

5. Beginning in 1993, American became concerned that LCCs would begin to offer service on DFW routes at fares lower than it had been charging and, once established, would expand low-fare competition to more DFW routes. American adopted a strategy to prevent LCCs from developing a toehold at DFW: if an LCC began to offer service on a DFW route, American would add capacity and lower fares on the route until the LCC was driven out of the market.

6. American realized its strategy would be costly in the short run but concluded that short-term losses were good "investments" if they forced an LCC out of the DFW markets it was serving, thwarted future expansion by the LCC into additional DFW routes, or deterred entry into DFW routes by other LCCs. As the chairman and CEO of American put it in 1996, "f you are not going to get them [LCCs] out then no point to diminish profit." American pursued its strategy, however, because it knew that once LCCs were driven out of DFW routes, it could reduce its service and raise its fares, thereby recouping its short-term losses through future supracompetitive fares.

7. American successfully used its strategy against Vanguard Airlines, Sun Jet International, and Western Pacific, each of which attempted to challenge American on certain DFW routes. In each instance, American added flights and reduced fares, losing money as a result. While consumers benefited temporarily from the capacity increases and fare decreases, in each instance, the LCC was driven out of some or all of the DFW routes it was serving; in each instance, American substantially raised fares after the LCC exited; in most instances, American reduced its service after the LCC exited; and in every instance, American solidified its power to charge high fares on DFW routes well into the future.

 

[Skyrunner]

Proud title of the amendment!!!!!!!

After a 34-year career in Congress, Jim Wright, D-Texas, resigned as speaker of the House in 1989 after the House Ethics Committee found he had violated House rules in 69 instances. The charges included $145,000 worth of "gifts" Wright had received from a Fort Worth, Texas, developer. The committee also found that Wright used the bulk sale of an anthology of his speeches to get around the limits on how much House members could accept as speaking fees. Wright was the first speaker ever forced out under an ethical cloud.

What else has he done that we will never know about?

Adios,

CB

 

[FlyBoeingJets]

The deal is this: All anyone wants to see is SWA stick to the deal. Or if they don't want to do that, go to DFW. It is really that simple. No one is trying to put SWA out of business on this. Everyone knows you have the dough and this is no hardship... Look, this is an opportunity for SWA to deal with some adversity and get a little stronger....Your brand is going to have to learn to function in a world where costs are more in line. Going to DFW would go a long way toward acquiring that discipline.

I respectfully disagree. When the DFW planners tried to move SWA to DFW Herb fought it and won. Apparently some judge thought is was fair to let SWA stay at Love when the airport planners thought otherwise.

Now, with populations rising, a byzantine style airport is still trying to force SWA to move there. SWA never wanted to fly out of DFW and was created on the assumption they would not have to. To force SWA to move to DFW is a Soviet era plan to control the ecomomy. The only deal worth honoring was the money developers wanted in exchange for the risk of working on the project and the continued success of said project. They got paid and the airport has been hugely successful. Now the population can handle 2 airports. AA and DFW will continue to thrive. If everyone flies out of DFW the delays and headaches will get terrible in a year or two.

Oh yes, SWA will have to deal with costs coming in line. AA will improve its profit with increasing numbers of international flights. SWA will be unable to tap into this lucrative resource and will have to be content with the razor thin margins on domestic flights.

A deal is a deal??

Is there no accounting for change?? I wonder if ATT said, "Hey we need to keep our monopoly on phone service. After all, a deal is a deal."

And that darn cell phone and internet telephony. Don't they know proper phone service should only come over our wires. A deal is a deal.