The Miami Herald on our FLL plans...
AIRLINES
US Airways maps Broward strategy
BY DOUGLAS HANKS III
dhanks@herald.com
US Airways says it will depend on Broward County's growing immigrant population to fill seats on the 10 new daily flights the airline announced Monday between Fort Lauderdale and Latin America and the Caribbean.
The troubled airline's plan for a major expansion at Fort Lauderdale-Hollywood International Airport was driven in part by the growing number of local passengers interested in flying to places like Panama City, San Salvador and Santo Domingo, county officials and airline executives said.
The new plan comes as US Airways struggles to ward off a second bankruptcy and survive in an industry reshaped by low-cost carriers, higher fuel costs, and the continuing fallout from the Sept. 11, 2001, terrorist attacks.
Talks between US Airways pilots and management broke down Monday, a troubling sign for an airline desperate to cut labor costs. The company has warned it may seek bankruptcy protection for the second time in two years.
The five new U.S. routes announced for Fort Lauderdale (Boston, Newark, Orlando, Tampa and Key West) would come at the expense of Pittsburgh, the erstwhile US Airways hub downsized as part of a cost-cutting strategy. The airline's trumpeting of cheap new Fort Lauderdale fares fits in with plans to compete with JetBlue and the other discount carriers that have made Fort Lauderdale-Hollywood one of the fastest-growing airports in the country.
Analysts portrayed the Fort Lauderdale expansion plans as the latest effort by US Airways to craft a survival strategy and generate confidence in its long-term direction.
US Airways executives embraced the new flights as recognizing a broader change in South Florida as more people with Latin American and Caribbean roots move north from their traditional stronghold in Miami-Dade County.
''The reality is, most of the traffic today [to that region] flies in and out of Miami,'' said B. Ben Baldanza, senior vice president of marketing at US Airways. Miami International Airport accounts for 1,232 flights to Latin America and the Caribbean each week, compared to about 400 from Fort Lauderdale.
Baldanza said ''demographic shifts'' made Fort Lauderdale an attractive gateway for people flying between the United States and the Caribbean Basin to visit friends and family. US Airways will continue flying passengers from the Northeast bound for Caribbean vacations through hubs in Charlotte, N.C., and Philadelphia, a spokeswoman said.
Though passengers will be routed through Fort Lauderdale on their way to the new Latin American destinations, US Airways does not plan on bestowing the ''hub'' title on Fort Lauderdale, which instead will become a ``focus city.''
''The difference between a focus city and a hub is the emphasis on the local market,'' said Amy Kudwa, manager of public relations for US Airways.
Barring expansion by competitors, the US Airways plans would vault it from Fort Lauderdale-Hollywood's fifth-largest carrier to the No. 1 slot at the airport. Domestic flights would increase from 19 a day to 48 when the first phase of the plan launches in February, with another 10 international routes added per day, according to airport and airline figures.
In all, about two million extra passengers would come through the Fort Lauderdale airport each year, increasing the yearly total of 20 million by about 10 percent and requiring more screeners, Customs inspectors and other staff, said Tom R. Jargiello, director of aviation for Broward County.
He said those requests have been made to the federal agencies responsible for those duties. The Broward County Commission must approve US Airways' request to lease all or part of five additional gates to handle the new flights; the county expects another $5 million in fees and rent from the airline each year.
Baldanza said a bankruptcy filing by US Airways would not alter its Fort Lauderdale expansion, though some analysts are questioning whether the airline can avoid liquidation.
A bid for South Florida's Latin America and Caribbean travelers would play into US Airways' low-fare game plan.
The so-called friends-and-family niche for international travel is notoriously price sensitive, offering slim profit margins and demanding bargain fares, said Stuart Klaskin, an aviation consultant and partner in KKC Aviation Consulting in Coral Gables.
But with JetBlue, Spirit and the other discount carriers expanding into the Caribbean and Latin America, analysts saw the US Airways plan as a move to get ahead of its low-fare competition before they again batter the airline in another market.
''They are looking for places where JetBlue is not beating them up,'' said William Alderman, president of Alderman and Co., an investment banking firm specializing in airline deals and based in South Norwalk, Conn. ``Give it time.''
Analysts also saw the US Airways move as embracing optimism at a time of acute worry about US Airways' future.
''I see this as a signal to the naysayers among us out there -- like me -- that they're still vibrant, still competitive, still looking for long-term strategies,'' Klaskin said.
