http://blog.chron.com/houstonpolitics/2012/05/southwest-and-united-slug-it-out-at-council/
People*****said it repeatedly today, that*****this isn’t a war between Southwest Airlines and United Airlines.
Of course it is.
The two corporate combatants testified before Council on Tuesday in what is likely to be the only time they directly meet on the battlefield before Council makes what one member called “a legacy decision” on whether to grant Southwest’s request to build a $100 million expansion of Hobby with five new gates and a Customs facility. Southwest plans to fly from Hobby to Mexico and the Caribbean starting in 2015.
The two airlines presented competing claims that Hobby expansion will help or hurt the Houston economy, mostly an in-person rehash of what they had already propagated through consultants’ studies.
But Southwest CEO Gary Kelly went further than he had in previous remarks on just how much of a commitment his company is willing to make.
“If we can reach an agreement with you, I’ll pay for the $100 million project,” Kelly said.
“We have built, we wrote the checks to build facilities in at least one other city,” Kelly said later in the hearing. “We are putting capital, $100***** million, on the table.” But later, when asked by a reporter if he meant that Southwest was willing to take the money from its profits or instead intended to use money from a $1.50-per-ticket increase in the Hobby passenger charge that’s passed to the Federal Aviation Administration, he said, “It’s all the same.”
Kelly alone testified for Southwest. He refused a bathroom break through the four and a half hours of testimony, then took questions from the media and posed for pictures with whooping, cheering employees in the lobby outside Council chambers.
United hired a crack team of consultants*****– a former high-ranking FAA official, Houston’s best-known economist and a nationally renowned aviation consultant from MIT– *****to tell*****Council not to be taken in by promises of lower fares, thousands of new jobs and an alleged obligation to make Hobby international facilities available to Southwest. They said Houston stands to lose 3,700 jobs if the deal goes through.
The testimony repeated the pattern of the two companies’ campaigns so far. Kelly made the simple assertion that competition is good and did not see the need for a company study to document the benefits to Houston of Hobby expansion. United’s experts picked apart a city-commissioned study that projects 10,000 new jobs. Barton Smith, professor emeritus of economics for the University of Houston and a United consultant, called the study “an embarrassment.”
Kirk Shaffer, former associate director for airports at the FAA during the Bush administration and an attorney, told Council not to take any stock in a legal opinion delivered by City Attorney David Feldman that Houston was obligated to consider Southwest’s pitch.