Fri, Mar 06, 2009
Employee Asks If WN Debut At Logan Will Mean US Reductions
When Southwest Airlines expands into a new market, the economics
of the business change. When the low-cost carrier initiated new
service into Las Vegas and Pittsburgh, US Airways cut service. Now
that airlines are already dropping flights to battle declining
passenger traffic, will Southwest's debut at Boston's Logan
International Airport this fall drive US Airways from that market,
too?
The Boston Globe reports one US Airways employee actually
summoned the nerve to raise that issue in the question-and-answer
section of a corporate newsletter sent to employees. US Airways
director of scheduling Glenn Martin provided the company's
response.
"It is sometimes true that when Southwest enters a market, the
economics change and flights that were profitable for US could
become unprofitable," Martin replied. "However, the opposite has
also occurred, and there have been times when Southwest entered
into markets that US was serving and later pulled out completely,
such as service to Hartford, Connecticut."
Regarding Logan, he added, "at this point, there are no plans to
reduce the flight schedule."
US Airways has about 15 percent of the market at Logan
International. Airport officials predict lower fares, but no
service cuts by other airlines in response to Southwest's
arrival.
US Airways CEO Doug Parker has also noted that the airline has
cut its fleet almost to the minimum size allowed by its union
contract with pilots... so the airline can't cut capacity much
further if the economy continues its current flat spin.
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