American Slashes Domestic, United Cuts International, and Southwest Shuffles

Yesterday, American announced the details of its fall flight cuts and the big surprise to me is how deep New York/LaGuardia flying is going to be cut. Meanwhile, United announced it was pulling out of two fairly large cities, Ft Lauderdale and West Palm Beach, as well as from several international routes. On the flip side, Southwest said it will drop a couple routes but add several as well, mostly in Denver and Florida. Let’s get to it.

American
Let’s start with American since that was much bigger in scope. It appears that Miami comes off unscathed while Dallas/Ft Worth will see 5% of flights go and Chicago/O’Hare will lose more than 12%. That looks good in comparison to St Louis (down 27%) and astoundingly, New York/LaGuardia which will be down 33% from 126 departures a day to only 84.

None of those shock me except for the LaGuardia pulldown. American Cuts Flights at LaGuardiaFor the longest time, airlines have clamped down on congested airport fortresses like LaGuardia and Washington/National, and have not been willing to let slots and gates go. LaGuardia has always been one of those places that you just assumed wouldn’t see massive cuts from the incumbent carriers, because no matter how bad things got, the value of those slots would always be worth it when things got better . . . or at least that WAS conventional wisdom.

This cut tells me that American has decided that nothing is sacred, and that’s a good thing. They can’t continue to lose money on bad flights in the short term just because they might be better in the long run. This is time to make some serious survival decisions and they’re doing it.

Of course, they’re not going to do it quietly. They’ve now petitioned the government to reduce slots at LaGuardia by 20% in the name of improving operations. Yeah, right. In other words, we want to pull down flights but we don’t want to allow anyone to take our place. Hmm, 42 daily flight openings would make a nice little operation for Southwest, huh?

A quick note about the rest of the cuts. Overall, American will mostly be cutting frequencies, but a few cities will see American disappear completely. We already knew about Oakland, Samana (Dominican Republic) and London/Stansted, but now Barranquilla (Colombia), Albany, Providence, Harrisburg, and San Luis Obispo go as well. San Luis Obispo also loses its maintenance base. I’m guessing that may have been where they maintained the now disappearing Saab 340 fleet, which would make sense.

United
Now let’s look at our other route cutter. First, United will pull out of Ft Lauderdale and West Palm Beach. These aren’t small cities, and it’s really amazing that United’s presence has eroded to the point where the airline ends up dropping places like this. United gave up on Florida a few years ago when it became virtually all-Ted. All the decent money around these areas would have fled to other carriers, if it was even at United in the first place. Besides, United could get you to Dulles, but Florida is a New York kind of market. Oh well, I guess they’ll just have to codeshare with US Airways and Continental now.

The bigger cuts for the airline are coming internationally. The recently launched Denver – London/Heathrow and LAX – Frankfurt flights are gone, so is San Francisco to Taipei and Nagoya. There will be some other schedule shifts as well as United prepares to ditch 6 747-400s and to start Dulles – Moscow and Dubai flights. I think the international pain is just beginning.

Southwest
Lastly, (man this post is long), let’s look at Southwest’s announcement today about its fall schedule. Nothing too crazy or surprising here. I mean, they’re beefing up Florida, as any airline would do once summer is over (uh, except United I guess). Oh, and the Denver onslaught continues. Southwest moves into yet another Frontier market – Denver to Orange County – as well as one that isn’t competitive – Denver to Tulsa. Oh, and eleven of the existing Denver markets get increased frequency, including 3 new flights to Chicago/Midway alone. Wow. I guess they had to do something to replace a lot of the long haul frequencies from Midway that are being cut back. And two routes will go away entirely – Oakland to Tucson and Kansas City to Sacramento.

If you’d like to see more detail, here’s the PDF with all of Southwest’s fall schedule changes.

(Original LaGuardia Tower Image from 10cuidados on Flickr)

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19 Comments on "American Slashes Domestic, United Cuts International, and Southwest Shuffles"

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Court
Guest
American went on a phone blitz over the past several weeks to find anyone who’d be willing to lease those LGA slots. I can tell you things got desperate considering the operators they were contacting. My question is whether this will affect the New York slot auction issue and how. As for Southwest in Denver, I can’t help but think they’re doing anything they can to finish off that pesky little airline with animals on their tails. The popular apacolyptic theorists seem to think that United might find itself in that unmentionable Chapter between 6 and 8 relatively soon. If… Read more »
Justin
Guest

It is a big chop for LaGuardia but the thing to know about that airport, however, is that AMR skews heavily to Eagle in those slots. And the flights are to some marginal markets.

A
Guest

“United might find itself in that unmentionable Chapter between 6 and 8 relatively soon.”

I’m not guessing which airline gets there first, but I do think that before the end of the year one of the legacy carriers gets liquidated. A lot of problems would’ve been solved already had United been forced into chapter 7 instead of reorganizing in chpt. 11 a few years back – ditto that for Delta and Northwest.

Court
Guest

CF,

I’ve noticed that about the Southwest-as-the-Aggressor nay-sayers. For me, it’s obvious Southwest has picked Denver as it’s greatest opportunity for growth (That’s the optimists’ way of saying Southwest has picked Denver as the most probable buffet for a vulture). Any bets there’s a picture of the rockies in Southwest’s strategy department?

Xnuiem
Member

I would assume the DEN-TUL move is aimed at hurting Frontier. Right now, Frontier is the only non-stop discount (other than Sun Country *shudder*) out of DFW/DAL to DEN. AA flies it, but SWA has to make a stop, usually at ABQ, however now, those of us loyal to SWA out of DAL will be able to go to DEN on a bit more direct and shorter layover (if we even change planes) route via TUL.

james
Guest

Didn’t see it mentioned in the article but Frontier cut routes and jobs today too:

http://www.rockymountainnews.com/news/2008/jun/25/bankrupt-frontier-cuts-planes-capacity/

Not that I’m happy. I don’t think I’ve ever made a “Frontier is doing great” comment but I’ve certainly touted their good service and product. Hopefully they’ll weather the storm and remain on an even field with Southwest. One good thing about having a sole hub is their recognition and base is high and supportive here – but I doubt cutting flights will ring well with customers who already have tickets and have to choose other times/dates to fly.

james..

Allen
Guest

I wouldn’t say Frontier is doing great. But IIRC on the routes where it goes head to head with SWA it was doing alright. I mean, if Frontier was being that hurt on those routes wouldn’t they cut back or drop the route? They can’t really afford those losses at this point.

I think it’s reasonable to say SWA’s presence isn’t helping Frontier’s situation. I haven’t seen any specific to convince that SWA is hurting Frontier more than UAL in Denver though.

Ellis
Guest
One of the things I can’t get my head around is why United are cutting the international fleet and international services when it seems that the only way for US carriers to make good yields is on international routes. In so many ways, UA used to have a good international network advantage over the other US carriers – at least until Delta found out that there’s money in international. Still, compared to many other airlines around the world, UA has an inferior cabin product (granted, its getting better in J class). Maybe it’s a sign that the problems are much… Read more »
Allen
Guest
Do you really think SWA’s moves in Denver is what on investors minds when it comes to Frontier? They’re not more worried about fuel prices? Labor issues? Frontier finding strong non-Denver based routes it’s capable of making money on? UAL deciding to getting into a pissing match on prices with Frontier? Sure, they’re a factor but in the grand scheme of things I wouldn’t say they’re hurting Frontier in Denver any more than they are UAL. I wouldn’t describe the difference between Frontier and SWA in Denver as “very few”, either. IIRC even with this Frontier still servers twice as… Read more »
Court
Guest
Allen, I think Frontier investors are extremely worried about Southwest. High fuel costs are one thing, but Southwest is preventing Frontier from being able to raise prices to accommodate for them. It all comes back to competition and supply and demand. Fuel costs are being blamed for so much in this industry, but it’s not the main reason for the industry’s problems. Commoditization and over-capacity are the real culprits that aren’t allowing the carriers to adjust ticket prices to the rise in fuel prices. One of three things will happen to snap back the industry to rationalization. Either a large… Read more »
David SF eastbay
Member
I said to people a long time ago that the government needs to go back to setting prices. That will be the only way service comes back into the airline business as when fares were set by the government the airline only had service to set them apart. I think the airlines are cutting routes more for the reason of getting rid of employees and no or low profit routes and using fuel prices as the reason. So many routes are flown just because the other “guy” flys it. They all seem to think they must to what everyone else… Read more »
The Traveling Optimist
Guest
The Traveling Optimist
Titanic Trail of Tears: Europe – ZRH, GVA, ATH, HAM, TXL, GLA, FCO S.Amer – SCL, BOG, PTY, GIG, ASU, MVD, CNF Asia – DEL, MNL, GUM, SPN, and HKG – JFK/LAX/DEL/NRT S.Pac – BNE, AKL Each one, in my mind, represents major opportunities lost or mishandled at the hands of United management. Each of these cities continues even today to be served by at least one US carrier except BNE and CNF. So how do the other carriers make these markets work where the Friendly Skies failed? Other US carriers are not without their own high visibility market failures… Read more »
Bobber
Guest

Hi Cranky,

Any idea when the LHR-DEN gets cut? We’re taking that route at the end of July on the way to OAK (cheaper than SFO). I was never convinced there was a need for more direct flights to DEN from LHR (I think BA has one, unless that is out of LGW). I’m due to make an LHR-GIG trip in November as well, hoping to do so on UA, but is that a likely candidate for the chop as well now?

Bobber

p.s. Hope your head has cleared now!

Kartik Krishnaiyer
Member
United pulling out of West Palm Beach is not a big deal. Closing an unprofitable and seasonal station. One flight a day I believe they maintained during the summer. Plus the landing fees at PBI are very high for a low yielding station. Fort Lauderdale on the other hand, is somewhat shocking. Southwest smells blood in the water @ FLL and I find it little coincidence that all of the new routes announced by WN either touch FLL where UA has quit entirely or DEN, where obviously UA is downsizing. Fort Lauderdale is less seasonal than West Palm Beach and… Read more »
dan
Member
It will be sad to see AA leave PVD as they were one of the original carriers there – but it’s only 3x ERJ. The extra nonstop to FLL is nice. Anyways moving on to David’s comment: “I said to people a long time ago that the government needs to go back to setting prices. That will be the only way service comes back into the airline business as when fares were set by the government the airline only had service to set them apart.” I think that regulation is the worst thing that can happen to the industry right… Read more »
Jennifer
Guest
I just flew from Dallas to Orange County/John Wayne and back on American, and the experience was actually rather pleasant, for a change. Howsomever, I’m seriously worried about American’s ability to stay solvent. Our flight back was half empty; I had three seats to myself. Granted, this was a Monday evening, but it was a Monday evening after a holiday weekend, and it was a 5pm flight – peak flying time. Gee, maybe if they just RAISED PRICES ACROSS THE BOARD instead of annoying fliers with petty fees, they might send out full planes? I dunno, but between that and… Read more »
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