Let’s start with a brief history. If you’ve never been to the Bradley Terminal at the western end of the horseshoe of terminals at LAX, you know that once you get past security, the concourse are very small with limited seating and almost non-existent amenities. It really is a poor experience, and I think few would argue that something new was needed. LA World Airports (LAWA) spent over $700 million fixing up the pre-security area (ticket counters, etc), but the concourse needed to go, so they came up with a plan to knock down the existing concourse and build an all new one immediately behind it.

When I wrote about this in 2008, it was expected to open with 14 gates beginning this month. The entire project was around $2 billion, which included a new taxiway, fire station, etc. The price hasn’t changed much (the terminal will now be $1.7 billion on its own without the other improvements) but one more gate was added (plus 3 existing gates that are staying for a total of 18) and it has slipped a year. The first phase will open in March 2013.

For those who prefer visuals, take a look at this 2:49 video walkthrough of the project. Then stick around for the explanation.

Travelers will enter as they do today, into the main ticketing area. But instead of going either to the left or to the right to get into one of the two security lines, there will be a new central security area that feeds into the new concourse. Once you go through security, you’ll come out into the Great Hall.

This is where all the big shops, restaurants, and lounges will be. They kept talking about it being a town square, or something like that. To the north, there will be a short concourse with a larger one to the south. You can see this area under the shorter ceilings.

Travelers will all board through the same gate entrance, but some will walk immediately upstairs to board on the upper deck if on an A380 while other stay downstairs. That might be a bottleneck. Arriving passengers will get off the airplane and then promptly go UPstairs. There will be a glassed-in sterile corridor that goes above the departure gates for arriving passengers. They’ll walk to the middle of the terminal where they’ll have to then go all the way back down to the basement for customs. It’s a lot of up and down.

When it first opens, the 10 gates on the west side of the building will be operational. The east gates will have to wait until they demolish the old concourse, which they will do one side at a time so that they can keep enough gates operating.

On the very northern end, three gates from the old concourse will actually remain and will be attached via a walkway at that end. Why? Because the LAX master plan has a line north of which no building will occur. That’s for future plans to separate the runways further for safety purposes. Even though new construction can’t occur, old construction is grandfathered in. So they’re keeping those three gates, as awkward as it might seem.

Eventually, there will also be connectors between the Bradley Terminal to Terminals 3 and 4 behind security to make for better connections. If they could only open up that Terminal 4-5 connector, the entire airport would be connected behind security except for Terminals 1 and 2.

Photo courtesy of LAWA

So is it worth the $1.7 billion (part of a larger $4 billion+ renovation at the airport)? No. I mean, the new terminal was needed, but did they really need to spend so much money on this crazy roof? I’m sure they could have gotten something just as light and airy but without looking like a copy of Mexico City’s Terminal 1 for a lot less.

The airport CEO, Gina Marie Lindsey, keeps hammering on how this takes no money from the LA general fund so it costs taxpayers nothing. Yeah, right. That money ends up coming from higher operating costs. According to Gina Marie, the cost per enplanement at the airport will rise from $12 today to “only” $17 somewhere around 2016. I’d be amazed if that held true considering the $4 billion being spent, but even if it does, that $5 per head will be problematic, especially for domestic flights.

Gina Marie was quick to say that they were working to spread the cost of these projects around the entire airport. That means that Southwest, sitting alone in Terminal 1, will still have to pay for some of this even though it gets none of the benefit. Oh, I’m sorry, airport officials kept dismissing my questioning along those lines with “everyone benefits from a better airport.” I’d like to see what the airlines say about that.

While international carriers will grin and bear it, the domestic guys, especially those flying shorter haul flights, could see real pressure on some flights. I don’t dispute that much of this work needed to be done; I just wish there was more concern about cost control in order to keep as many flights viable as possible.

But hey, what’s done is done at this point. We’ll see how things look next March when the concourse opens for business.

[See more of my photos on Flickr]

Air travel tax refund procedure still fuzzy – CNN Out of the Office
It was a double CNN week as the editors decide to move forward next week’s post on tax refunds to go this week instead.

Fliers won’t get air travel tax refund – CNN Out of the Office
And it became a triple week, when I had to update this after Congress made the taxes retroactive and decided the no refunds would be given.

Ontario officials concerned over continued dropoffs of passengers, flights at ONT – Inland Valley Daily Bulletin
I was asked to comment on the continuing decline of traffic at Ontario airport. Really not the most accurate quotes, so let me clarify. Southwest isn’t cutting two more routes from Ontario in January – it’s reducing frequency on two more routes (Phoenix and Vegas). I also have no idea what that AirTran quote even means.

LAN-TAM Merger: U.S. Carriers Sweat The Fate of Alliance Partners – BNET Headwinds
LAN and TAM are merging, and everyone wants to know which alliance the combination will choose. Could it be both?

how to keep your flight attendant from jumping off the plane – Antibride
Admittedly a fluffy story, but it’s a light-hearted look at how to treat a flight attendant onboard (with some serious points).

JetBlue’s All-You-Can-Jet Turns Back to Twitter to Fill Seats – BNET Headwinds
It’s baaaackk. JetBlue’s All You Can Jet has returned and the airline is relying on Twitter to get the word out.

Flight Attendant Demands May Block Southwest’s Push Toward Bigger Planes – BNET Headwinds
I thought Southwest’s announcement about getting a larger plane was odd, but I then I started looking at the labor angle.

How to Fix LAX By Bringing Alliance Partners Together< - BNET Headwinds
I admit it’s a reach, but LAX won’t be able to spend much money and this could be a big improvement for the customer.

JetBlue and American: Why Frequent-Flier Sharing Makes Sense – BNET
JetBlue and American have gotten one step closer to each other by starting frequent flier earning on select flights.

Delta Earnings: Outlook Weak Despite Strong Industry Premium Traffic Trends – BNET
Lots of conflicting information out this week. Huge profits but weaker outlook = confusion.

LA World Airports Smartly Reconsiders Regionalization Strategy – BNET
Interesting words from the LA airport folks – they’re thinking twice about the regionalization strategy now that traffic is so far down at LAX itself. Good.

Continental and Wired: How Not to Do a Promotional Partnership – BNET
Continental has teamed up with Wired to do a pretty awful job of promotion.

Think a Lot of People are Using Wifi In the Air? Think Again – BNET
Runway Girl Mary Kirby caught on to some numbers that AirCell mentioned regarding onboard wifi usage. They’re pretty low.

Hey Los Angeles: Customers Pay for Airports Improvements Regardless of How They’re Structured – BNET
The LA City Council just voted to support an increase in the Passenger Facility Charge. That comes straight out of your pocket, and it’s not a great idea.

US Airways Adds Cash for the Next Couple Winters, Defers Airplanes – BNET
Yes, US Airways has done it again. They’ve played with the cash gods and walked away with more in their pocket. This time it’s mostly expense reduction via aircraft delays.

Labor Issues Thwart Southwest’s Efforts to Buy Frontier – BNET
Southwest lost its chance to buy Frontier thanks to labor issues. It shouldn’t be a surprise, but it still is.

LAX Rent Increase Ruled Not Discriminatory, But Fight Continues – BNET
LAX tried to increase its rent for those airline not under long term lease, and they just won the first round of the battle. But there’s more to come.

In Search of the Elusive Power Port – NileGuide
I wrote this guest post for NileGuide about which airlines have power outlets and where you can find them. It ain’t easy.

Air Traffic Controller Union, FAA Agree on Labor Deal – BNET
It’s taken years, but the new administration has finally started working with the air traffic controllers. They have a tentative agreement.

June Premium Traffic Drops “Only” 21.3 Percent – BNET
It’s premium traffic monitor time again, and it’s ugly . . . again. But things are getting a bit less bad.

Delta’s Partnership with Virgin Blue Causes Pain for United in Australia – BNET
Virgin Blue is walking away from its United codeshare down under.

Volaris is now flying a single daily trip from LAX to Toluca (outside Mexico City) and another one to Guadalajara. They’ll be starting flights to those cities from Oakland as well, and at the press conference yesterday, Volaris Managing Director and CEO Enrique Beltranena (bottom left in the picture, though I’ll certainly understand if you’re distracted by those flight attendants) announced that they had just received approval to fly from Oakland to Tijuana as well. He also said that he expects Volaris to be flying to more than 10 cities in the US in the next two and a half years. So this is no small plan.

How the heck are they planning on being the first successful low cost carrier flying between the US and Mexico? A huge part of the plan is the Southwest codeshare that was announced earlier. In fact, it’s such a large part of the plan that Kyle O’Neil, Southwest’s Director of Alliances (the tall, white dude in the middle of the picture) was there at the podium today for the event.

Of course, the question on my mind was whether or not the codeshare was still proceeding as planned, especially considering that the WestJet deal had been delayed. So, I asked them to elaborate on details. Kyle said that Southwest was still planning to launch the codeshare in 2010, but he couldn’t announce a date. Original plans were for the codeshare to go on sale in early 2010, so this looks like there might be a little slippage in my mind. But Kyle reiterated that they were very committed to the partnership, something that was evident by his mere presence at the event.

For Volaris, I imagine the codeshare can’t start soon enough. They are coming off a disastrous traffic plunge in Mexico following the swine flu outbreak that began in April. Enrique admitted that Volaris has been suffering, but he said that he believes Volaris was the only airline in Mexico to be breakeven over the last six months. (Warning: He answered that question in Spanish, so I’m trusting that my Spanish skills haven’t failed me.)

In the end, Enrique presented a very nice plaque (at left) to LAX commemorating the start of their service. He said that they’ve presented this to each city they fly as a symbol that they intend to be there for a long time. I like the symbolism.

So Volaris is pushing ahead, and LAX is a huge part of their commitment to making flying in the US work. They will be flying out of Terminal 2 here at LAX (convenient since Northwest flights all moved to Delta’s terminal yesterday), and while it’s not going to provide connections behind security to Southwest, it will at least be right next door.

What might you expect to see onboard? If you’re looking for legroom, you won’t find much. I’m told their A319s are equipped with 144 seats while the A320s have 172. For comparison, JetBlue’s spacious configuration has only 150 seats on an A320, but I think Volaris’ configuration makes sense for the airline. They do have leather seats and overhead TV screens, so the product is still quite nice. (You can see a photo of the inside of their aircraft on airliners.net.)

Perhaps the most interesting thing offered by Volaris is unique in this industry. As Enrique said (to many laughs), “We guarantee on-time performance or your money back so I hope your airport delivers.” That’s right. If your flight is late by more than 30 minutes, you get your money back, regardless of the reason for the delay. As a marketing campaign, I love this idea. It will certainly stand out and it’s a huge differentiator. On the other hand, remember why Domino’s dropped their 30 minute guarantee? They had drivers getting in accidents because they were rushing to beat the deadline. I really hope we don’t see any pressure on pilots to beat the deadline here. That makes me a little nervous.

Overall, it was a good event at LAX. Enrique seems like a very smart man, and he’s already built an airline that not only has to be the frontrunner of the low cost carriers in Mexico, but is also a great place to work. In fact, the biggest smile I saw from him all day was the one he let out when he was introduced as leading an airline that has been recognized as one of the top places to work in Mexico.

Would I try them if I were heading down to Mexico? Absolutely. And the low fares that they’re trying to bring into the market should help them stimulate additional traffic, assuming the burdensome taxes don’t overwhelm their efforts. I tend to think this can work, but this is not exactly the ideal time to be trying it. Still, they pushing ahead at full speed.

So what’s next for Volaris? Well, there was some pressure from LA officials for the airline to start service to Ontario as well (which is operated by the same folks that run LAX), but Enrique responded that “there is nothing more we would like to do than start service to Ontario. So if we are able to, and you are able to reduce the cost of the airport . . . .” Ah, smart man. Keep an eye on these guys, and if you have the chance to fly them, let me know your impressions.

Allegiant is a very simple operation. They will be basing two aircraft here at LAX and those planes will usually each do a morning roundtrip to some far flung destination followed by a second roundtrip in the afternoon every day of the week. That’s right. They’ll serve twelve destinations from LAX with only two airplanes, but that’s normal for these guys.

Allegiant doesn’t try for business traffic. They just want to bring leisure travelers to a destination, and in this case that destination is Southern California. It’s cheap (some flights for as low as $39 each way), but you have to fly on their terms. Make sure you pay attention to all the extra fees – almost nobody escapes without paying more – but it’s still a really good deal overall. Each destination will be served only two or three times per week. Here’s the rollout schedule:

Starting:
May 1 – Grand Junction (Colorado) on Monday/Friday
May 1 – Medford (Oregon) on Monday/Friday
May 2 – Bellingham (Washington – near the Canadian border) on Monday/Wednesday/Saturday
May 2 – Missoula (Montana) on Wednesday/Saturday
May 3 – Monterey (California) on Tuesday/Thursday/Sunday
May 3 – Springfield/Branson (Missouri) on Thursday/Sunday
May 22 – Billings (Montana) on Tuesday/Friday
May 23 – Fargo (North Dakota) on Tuesday/Saturday
May 23 – Sioux Falls (South Dakota) on Wednesday/Saturday
May 23 – Wichita (Kansas) on Wednesday/Saturday
May 24 – Des Moines (Iowa) on Thursday/Sunday
May 24 – McAllen (Texas) on Thursday/Sunday

It will be very interesting to see how United/American/Alaska react to direct competition on routes they fly nonstop. Scratch that – there really isn’t much competition here, but will it be perceived that way? Those United and American flights from Monterey to LAX are there mostly to feed other flights and not for local traffic. This thrice weekly flight on Allegiant really won’t take much traffic from the existing airlines but rather stimulate new traffic. It’s a little different in Medford where Horizon gets local traffic, but it still won’t be much competition with only two flights a week. Of course, Alaska (Horizon’s parent) has shown that it is all for strong reactions when threatened lately (right, Virgin America?), so there’s no guarantee they will ignore this either.

Another interesting thing is what you find when you pick through the schedules to look for holes. When a plane goes to Monterey on Tuesday, Thursday, and Sunday, it looked like it was sitting on the ground for more than four hours. A little more digging shows that Allegiant is squeezing in a roundtrip down to San Diego from Monterey before it comes back to LAX again. Same thing goes for flights to Grand Junction, but from there the plane is just going back to Vegas, probably so they can swap aircraft through the system.

Also, one of the airplanes has a gaping hole on Monday, Tuesday, Wednesday, and Friday afternoons. The plane arrives back at LAX at 140p on Monday, 235p on Tuesday, 355p on Wednesday, and 135p on Friday and does nothing else for the rest of the day. Something tells me they could launch another route or two in the not-too-distant future. There’s no reason for that plane to sit idle.

One more thing. If you’re trying to put the schedules together yourselves, you may have a little trouble until you realize that the Wednesday and Saturday flights to Bellingham are actually flown by an airplane based in Bellingham and not one of the LAX planes. That’s how they can squeeze out an extra morning flight on those days.

Allegiant will use Terminal 6 at LAX, and they won’t need a ton of space. In fact, the flights are scattered so that this entire thing can be operated from only one gate. So, welcome to LAX, Allegiant. We look forward to seeing you bring many pasty white Midwesterners here to spend money and help us out of our budget hole.

• Bellingham (Washington)
• Billings (Montana)
• Des Moines (Iowa)
• Fargo (North Dakota)
• Grand Junction (Colorado)
• McAllen (Texas)
• Medford (Oregon)
• Missoula (Montana)
• Monterey (California)
• Sioux Falls (South Dakota)
• Springfield (Missouri)
• Wichita (Kansas)

My initial thought was that it would be San Diego, but that was proven wrong when the airport manager in Sioux Falls let it slip that it would be to the LA area. At that point, I figured Allegiant would try the currently empty San Bernardino Airport since those guys would likely pay Allegiant to fly there. But recently, I learned that LAX would actually be the chosen airport.

This surprises me, and not for the reasons you might think. Allegiant has shown that it isn’t afraid of flying to larger airports. Obviously Las Vegas is one, but they’ve also recently ventured on to routes like Bellingham to Oakland and San Diego. As long as there’s a smaller airport on one end, it shouldn’t be an issue.

What does surprise me is that flying out of LAX means they’ll be entering routes that already have nonstop service. Monterey is served by United and American and Medford is served by Horizon. Allegiant historically has not liked to go head to head with other airlines, so this is an interesting move, assuming it proves to be true.

There’s no question that bringing people from small towns to LA a couple times a week could be a lucrative business, and I think there’s a very good chance that Allegiant can be successful with this move. Their unique model has shown that it can work with a handful of tweaks to it, and I don’t see why this tweak won’t be successful. I will, however, be closely watching those towns with competing nonstop service to see if the incumbent airlines feel the need to respond or not. That will probably make or break those routes.