Who Will Win?

[funguy2]

First, in answer to the poll question:

If I had to make a prediction: I think the judge will favor the Southwest transaction, as it is the most $$ for the least assets. However, given that the lessors have shown willingness to move aircraft out of ATA (per what America West has said), I don't think there will be much left to ATA, that they will not need the other 8 gates... I think AirTran will grudingly accept less gates (some subset of the leftover 8 gats) for a little bit less cash, as they have to do something with all those airplanes in 2005, plus DAL's expansion in ATL (thanks to the pull down of DFW). I think even if Southwest expands at MDW, that there is some room for AirTran, similar to BWI. AirTran will likely fly MDW-LGA/BOS/DCA, Florida, and maybe LAX/DFW as a more point-to-point network than ATA's current "hub" structure.

That is my prediction, as things stand now...

Second, as a comment on the "AirTran is an awful place to work" folks:

I thought AirTran had relatively good labor relations. As I recall, AirTran did not have any furloughs post-9/11, and they have been able to work things out with their unions, particularly the pilots, when they volunteered post-9/11 concessions (to prevent furloughs) allowed JetConnect (RJ service subcontracted to Air Wisconsin) and allowed the wet-lease programs (with Miami Air and most notably Ryan Int'l). This does not seem to be indicative of labor battle atmosphere.

I have heard that management can be a little over-zealous in the "frugality" department sometimes, but I guess thats part of what makes an LCC low cost.

 

[JS]

I hope Southwest doesn't win the bid. That would be pretty sad for the city of Chicago to lose LCC service to New York, Boston, and Washington, DC.

I'm sure hourly flights to OMA would be great for people headed to Omaha, but there are actual cities that Southwest simply refuses to serve that ATA now serves and that AirTran would be happy to take over.

 

[KCFlyer]

I hope Southwest doesn't win the bid. That would be pretty sad for the city of Chicago to lose LCC service to New York, Boston, and Washington, DC.

I'm sure hourly flights to OMA would be great for people headed to Omaha, but there are actual cities that Southwest simply refuses to serve that ATA now serves and that AirTran would be happy to take over.

[post="228733"][/post]​

Omaha...no. But they WOULD like to serve Chicago to Dallas...but the federal protection of a city that cannot support two airports prevents that for the time being. You gotta wonder what Texans....who are known for their pride....would feel knowing that their civic leaders are only acting in the citizens best interest by limiting the secondaryt airport since their metropolitan area isn't metropolitan enough to support two unrestricted airports.

 

[SWAFA30]

I hope Southwest doesn't win the bid. That would be pretty sad for the city of Chicago to lose LCC service to New York, Boston, and Washington, DC.

I'm sure hourly flights to OMA would be great for people headed to Omaha, but there are actual cities that Southwest simply refuses to serve that ATA now serves and that AirTran would be happy to take over.

[post="228733"][/post]​

WN only wants 6 gates and there are what...14 or 15 up for grabs? That leaves 8 or 9 gates for jetBlue, AirTran, or any other LCC to provide service to "actual" cities such as New York, Boston, and Washington...with virtually no competition since WN "refuses" to serve these markets. WN gets along just fine with FL in BWI, there's no reason to think the same thing couldn't happen in MDW.

 

[jimntx]

Well, but if SWA does not fly to NY, BOS, or DC and AirTran doesn't fly to Omaha, where is the vaunted competition everyone is crying about? Sounds to me more like a deal to divvy up the territory. Doesn't sound like a situation that would encourage lower fares.

And, SW may be asking for "only 6 gates", but that is in addition to the 20+ (I believe) that they already control at MDW. If another post I saw is correct it would give SW control of something like 75% of the gates at MDW. If this is wrong, somebody post for me the total number of gates at MDW and the number that SWA would control with the addition of the "only 6" gates.

 

[SWAFA30]

Well, but if SWA does not fly to NY, BOS, or DC and AirTran doesn't fly to Omaha, where is the vaunted competition everyone is crying about? Sounds to me more like a deal to divvy up the territory. Doesn't sound like a situation that would encourage lower fares.

Do either of the carriers in question have a history of raising fares and gouging customers in markets where there is little or no competition? I'm not being facetious, I'm genuinely curious.

And, SW may be asking for "only 6 gates", but that is in addition to the 20+ (I believe) that they already control at MDW. If another post I saw is correct it would give SW control of something like 75% of the gates at MDW. If this is wrong, somebody post for me the total number of gates at MDW and the number that SWA would control with the addition of the "only 6" gates.

[post="228765"][/post]​

A quick glance at the Chicago DOA website and Southwest.com show that SWA currently has rights to
19 of 43 gates at MDW. If I'm doing the math correctly, that means SWA currently holds 44 percent of the gates at MDW and an additional 6 gates would raise the percentage to 58%. The numbers are based on looking at terminal maps on a website and counting on my fingers, I'll poke around the net and see if I can find anything more concrete but I think the numbers are pretty close.

 

[swflyer]

And, SW may be asking for "only 6 gates", but that is in addition to the 20+ (I believe) that they already control at MDW. If another post I saw is correct it would give SW control of something like 75% of the gates at MDW. If this is wrong, somebody post for me the total number of gates at MDW and the number that SWA would control with the addition of the "only 6" gates.

[post="228765"][/post]​

According to this site, Fly Chicago, there are 45 gates at MDW.

Southwest currently controls 19, bidding on 6.

19 + 6 = 25 '/. 45 x 100 = 55.5%

Thanks for playing!! <_<

 

[JS]

Omaha...no. But they WOULD like to serve Chicago to Dallas...but the federal protection of a city that cannot support two airports prevents that for the time being. You gotta wonder what Texans....who are known for their pride....would feel knowing that their civic leaders are only acting in the citizens best interest by limiting the secondaryt airport since their metropolitan area isn't metropolitan enough to support two unrestricted airports.

[post="228740"][/post]​

Oops -- I forgot about that! New York, Boston, Washington DC and Dallas would lose LCC service because of Southwest's REFUSAL to serve NYC, BOS, WAS and DFW.

This isn't 1975, where the CAB could force WN to fly to JFK in exchange for an additional frequency to OMA. If WN doesn't want to fly to JFK or DFW, they don't have to. However, when it comes to passing out these newly available gates, I hope that avoiding loss of affordable air service is a consideration.

 

[SWAFA30]

Oops -- I forgot about that! New York, Boston, Washington DC and Dallas would lose LCC service because of Southwest's REFUSAL to serve NYC, BOS, WAS and DFW.

Looking at the markets in question, I'd say it's not so much a refusal as a decision to offer service to the vicinty of each market via secondary or (thirdary[is that a word?] in the case of ISP)airports and at the same time do what makes economic sense for SWA. They'll get you where you wanna go, they just drop you off at the corner instead of taking you all the way to the front door. As for Dallas...there's a whole other thread devoted to that trainwreck.

This isn't 1975, where the CAB could force WN to fly to JFK in exchange for an additional frequency to OMA. If WN doesn't want to fly to JFK or DFW, they don't have to. However, when it comes to passing out these newly available gates, I hope that avoiding loss of affordable air service is a consideration.

[post="228818"][/post]​

Under SWA's proposal, ATA keeps some(over half) of their gates at MDW. Assuming they choose to remain a going concern in Chi-town that would leave them free to use the proposed codeshare to pick up inbound transfers from OMA off SWA and carry them to NYC, BOS, WAS, and yes even DFW. If SWA were to get their way and grow from 19 to 25 gates, that would still leave 18 gates for any carrier(s) to provide low-fare service to anyplace they choose. Even OMA.

I'm surprised Sir Richard Branson's VirginUSA hasn't thrown their hat into the ring...I mean really...how often do this many gates in such a key market come up for grabs? Now that woulda been interesting.

 

[JS]

Looking at the markets in question, I'd say it's not so much a refusal as a decision to offer service to the vicinty of each market via secondary or (thirdary[is that a word?] in the case of ISP)airports and at the same time do what makes economic sense for SWA. They'll get you where you wanna go, they just drop you off at the corner instead of taking you all the way to the front door. As for Dallas...there's a whole other thread devoted to that trainwreck.

Yes, that would be tertiary.

That "corner" is an awfully long distance. It would be like taking a city bus from Love Field to the city hall in Arlington, Texas rather than a taxi. Google "city bus Arlington Texas" and you will get my drift.

 

[SWAFA30]

Yes, that would be tertiary.

That "corner" is an awfully long distance. It would be like taking a city bus from Love Field to the city hall in Arlington, Texas rather than a taxi. Google "city bus Arlington Texas" and you will get my drift.

[post="228829"][/post]​

Judging by the explosive growth in BWI, PVD, MHT, and even ISP(4 brand new gates with more on the way) it would seem that for more than a few customers, the corner is close enough if the price is right.

Tertiary huh? Doesn't exactly roll off the tongue but I'll gladly add it to my vocabulary. Thanks!

 

[JS]

Sure, if you're actually going to Providence or Manchester or Baltimore or Long Island, those airports are fine. But they're awful if you're going to downtown.

 

[SWAFA30]

Sure, if you're actually going to Providence or Manchester or Baltimore or Long Island, those airports are fine. But they're awful if you're going to downtown.

[post="228843"][/post]​

So, then how are we to explain the amount of traffic that these markets generate for SWA?

 

[jimntx]

Under SWA's proposal, ATA keeps some(over half) of their gates at MDW. Assuming they choose to remain a going concern in Chi-town that would leave them free to use the proposed codeshare to pick up inbound transfers from OMA off SWA and carry them to NYC, BOS, WAS, and yes even DFW. If SWA were to get their way and grow from 19 to 25 gates, that would still leave 18 gates for any carrier(s) to provide low-fare service to anyplace they choose. Even OMA.

BTW, it's pronounced tur-shee-airy with the emphasis on the air.
Do you honestly think that ATA is going to remain in the scheduled air service business? Particularly, in the light of the fact that the a/c lessor has already found a placement for ATA's a/c. The reason AWA withdrew from the bidding for MDW is that they had planned to take over the leases on ATAs 737s, but they are not available.

I'm surprised Sir Richard Branson's VirginUSA hasn't thrown their hat into the ring...I mean really...how often do this many gates in such a key market come up for grabs? Now that woulda been interesting.

[post="228825"][/post]​

VirginUSA exists only on paper, and not really even there. Branson can't make a move until he either (1) finds a U.S. investor to put up the money and hold the majority of the stock or (2) get the law changed that forbids foreign majority ownership of a U.S. based airline.

The reason SWA is willing to "codeshare" with ATA is because SWA management knows that very soon there is going to be nothing to codeshare with. ATA will be gone and SWA will have control of MDW. It's a VERY smart move on SWA's part, but the courts and the city of Chicago may not go along with the plan.

 

[JS]

So, then how are we to explain the amount of traffic that these markets generate for SWA?

[post="228844"][/post]​

Like I just said -- people going to Providence, Manchester, Baltimore, or Long Island.