Wednesday, November 11, 2009

A Duel in Dallas

Something may be happening in the Dallas air market that I'm curious how many people have truly considered or are aware of. Specifically, in 2014 the long debated and sometimes hated Wright Amendment restricting flights at Love Field in central Dallas will be lifted. Or will it?
Proponents for and against the Amendment have locked horns for over thirty years over the measure, despite easing of restrictions in 1997 and, most recently, 2005. I am not here to recreate old arguments but rather to ask a simple question:

Which of the airlines at DFW would readily return to Love Field given the opportunity?

Here is where the Wright Amendment, though "completely" lifted in 2014 will in fact live on. The agreement reduces the maximum gates at Love Field from 32 to only 20, 12 of which are controlled by Southwest Airlines. With eight gates left, who can really do much of anything at the airport that will offer serious competition? Short of starting a new airline and quickly ramping up to fill those eight gates, no one. See Muse Air. Given the level of service they provide at DFW today, however, airlines like United, USAirways, Continental and Air Tran really only need two gates each to run their operation, three at the most.

The main issue to decide is which of the two airports is cheaper to operate from. Woe to DFW if they have been charging premiums all this time! The DFW nonstop advantage will be gone but if Love Field thinks it can GET a premium for only eight gates it has to remember that the smaller airlines have been at DFW and their customers are used to DFW. Without a cost advantage those carriers would have no reason to leave the centrally located DFW.

No international service would be allowed at Love Field but that would be a wash to the smaller airlines in the market. United and Lufthansa are not exchanging much at Dallas and neither is KLM to Northwest or Delta. They handle their business at Chicago and Atlanta, respectively. If anyone benefits from this it is a bone thrown to American.

So it seems to me that the Wright Amendment may no longer be in force as a living piece of legislation after 2014 but the last will and testament didn't do as much as it could have done to foster growth at the smaller airport. The gates are restricted, the service is domestic only and the largest operator there certainly plans to move quickly to lock the airport in its favor. The one window of opportunity remain the eight unused gates if someone at DFW is willing to pull up stakes and move across town.

Love Field will never look like or be as diversified as it was in its heyday but it is entirely possible to see some major US carriers flying over downtown again for the first time in over 30 years.

Gotta go!

No comments:

Post a Comment