The airline and airport news seems to be moving in the right direction for low-cost, point-to-point carriers. The country’s largest legacy carriers are retrenching in their hubs and the largest airports, abandoning middle America to low-cost carriers.
Recently, Delta and US Airways swapped slots between New York La Guardia and Washington Regan. Continental and AirTran swapped slots that resulted in AirTran leaving Newark and Continental adding to its dominance.
Finally, just this week American Airlines announced that they are beefing up thier Chicago operation by more than 13 percent going from 430 departures to almost 500. At the same time operations at Miami, Dallas, LAX and JFK are being increased while airports such as St. Louis and Raliegh-Durham were demoted.
So, what is happening here? The major airlines are retrenching back to their main business hubs and leaving the rest of America to the point-to-point carriers. Southwest, though it has made inroads into the business travel market, will no doubt see a silver lining to American leaving St. Louis (above) and Raleigh-Durham. AirTran and JetBlue will benefit from American Airlines’ cutback at Raleigh-Durham as well.
The flying public will benefit from the departure of the legacy carriers with more and more low fares and possibly a battle between the low-cost carriers for market share. However, frequent fliers for the legacy carriers who have been loyal because of upgrades and other perks will find themselves having to chose between some of the low-cost carriers. They, initially, will not be happy.
However, I predict that once they get used to the better service and better prices from the non-legacy carriers and once the low-cost carriers flesh out their point-to-point schedules, the major airlines will have a hard time returning.
With enough service at the major hubs to keep prices down and to remain a thorn in the side of the legacy carriers, low-cost carriers can maintain good load factors and significant business traffic at the major airports. Plus, they will begin adding more passengers and new routes as major carriers retreat to their fortresses and the main business hubs.
If I were a low-cost-carrier CEO, I would be licking my chops.
Charlie Leocha is the President of Travelers United. He has been working in Washington, DC, for the past 14 years with Congress, the Department of Transportation, and industry stakeholders on travel issues. He was the first consumer representative to the Advisory Committee for Aviation Consumer Protections appointed by the Secretary of Transportation from 2012 through 2018.
