Southwest Continues Cutting Atlanta, Delta Must Be Thrilled

Delta, Southwest
ATL Changes AirTran 2011 vs AirTran and Southwest 2013

Remember when Southwest announced it was taking over AirTran and people immediately thought Delta was in trouble in Atlanta? Hah. Yeah, right. I’d say the opposite is true. Delta must absolutely love Southwest for how much it has cut back Atlanta so far.

Southwest didn’t complete its purchase of AirTran until May 2011, and the first joint schedule wasn’t released until travel for September of that year. For that reason, I decided to take the summer 2011 schedule in Atlanta, before the changes, and compare it to the recently-released summer 2013 schedule. I looked at a Wednesday in the middle of July and the results are quite clear. Southwest has put a serious dent in AirTran’s Atlanta schedule.

Southwest and AirTran combined in 2013 will operate 12 percent fewer departures than AirTran alone did in 2011. (Southwest didn’t start serving Atlanta until well after.) AirTran had 211 Wednesday departures back then, but the combined airline will have 185 next summer.

Probably more staggering is the number of cities that have lost service completely. In fact, the combined airline has cut the number of nonstop destinations from Atlanta by 20 percent. Southwest/AirTran will serve only 45 destinations next summer while AirTran served 56 back in 2011. And those 45 destinations include 4 new Southwest ones. That means Southwest has ditched 15 AirTran destinations. (The most recent, Wichita, was just announced recently.) Take a look at the carnage via this Great Circle Mapper map.

ATL Changes AirTran 2011 vs AirTran and Southwest 2013

The red lines go to the 15 cities that had nonstop service on AirTran in 2011 but will be losing it by next summer. The blue lines are the four airports that weren’t in the schedule in 2011 but will be next summer.

So has Southwest grown anywhere? Sure. It did add new service to Austin and Louisville. It also added 4 new flights to Baltimore along with 2 new flights to Vegas, Chicago/Midway, and Memphis. There was also 1 additional flight each to Akron/Canton, Ft Lauderdale, Houston/Hobby, Pittsburgh, Richmond, St Louis, and Tampa. In other words, most of the growth has been to Southwest strongholds. And that’s not a surprise. (I don’t count Norfolk as growth since it basically replaced 4 Newport News flights with 3 in Norfolk. And Aruba was an AirTran destination that just wasn’t served on Wednesdays back then.)

We also have to think about seat count growth. As those 717s are replaced by 737s, each flight will end up having more seats onboard. So there is growth in existing markets just by changing aircraft types. But there are a lot of markets left with nothing.

As you can imagine, Delta has to be enjoying this. It serves 13 of the 15 cities that AirTran/Southwest ditched, so it has to love what’s happening on those routes. (The other two are Atlantic City and Branson.) At the same time, Delta is going from competing with an airline that has First Class and seat assignments to one that doesn’t. It’s also facing a Southwest/AirTran that will have higher costs than what AirTran had on its own. That means fares have to be higher for Southwest to make money.

Yes, it’s mostly a good news story for Delta. Southwest is slowly turning Atlanta into a very different kind of city in its network compared to what it was in the AirTran network. Here’s the breakdown of daily departures by airport, for those who are curious. (The 2011 numbers came from masFlight, but I used Southwest/AirTran schedules for 2013 data.)

July 17, 2013   July 13, 2011   Pct Change
  AirTran Southwest Total Seats   AirTran Seats   Flights Seats
ACY   2 234   -100% -100%
AUA 1 1 145     N/A N/A
AUS 2 2 274     N/A N/A
BDA   1 145   -100% -100%
BKG   2 234   -100% -100%
BMI   2 234   -100% -100%
BOS 5 5 641   6 702   -17% -9%
BUF 3 3 351   3 351   0% 0%
BWI 6 5 11 1,483   6 730   83% 103%
CAK 5 5 613   4 468   25% 31%
CLT   2 234   -100% -100%
CMH 2 2 234   2 234   0% 0%
CUN 2 2 290   2 290   0% 0%
DAY 3 3 351   4 468   -25% -25%
DCA 6 6 730   6 786   0% -7%
DEN 2 2 4 576   4 580   0% -1%
DFW   7 903   -100% -100%
DTW 4 4 468   4 552   0% -15%
EYW   1 145   -100% -100%
FLL 8 8 992   7 903   14% 10%
FNT   4 524   -100% -100%
HOU 5 3 8 1,030   7 903   14% 14%
HPN   3 351   -100% -100%
IAD   4 468   -100% -100%
ICT   3 351   -100% -100%
IND 4 4 468   2 262   100% 79%
JAX 4 4 468   4 496   0% -6%
LAS 2 3 5 719   3 435   67% 65%
LAX 3 1 4 578   5 725   -20% -20%
LGA 6 6 786   9 1,109   -33% -29%
MBJ 1 1 145   1 145   0% 0%
MCI 4 4 468   4 468   0% 0%
MCO 9 9 1,053   10 1,282   -10% -18%
MDW 6 4 10 1,262   8 936   25% 35%
MEM 5 5 585   3 351   67% 67%
MKE 5 5 613   5 613   0% 0%
MSP 4 4 496   6 702   -33% -29%
MSY 4 4 496   4 468   0% 6%
NAS 1 1 145   1 145   0% 0%
ORF 3 3 417     N/A N/A
PBI 2 2 234   2 234   0% 0%
PHF   4 468   -100% -100%
PHL 5 5 613   5 585   0% 5%
PHX 2 2 286   2 290   0% -1%
PIT 4 4 496   3 351   33% 41%
PNS 3 3 351   3 351   0% 0%
PUJ 1 1 145   1 145   0% 0%
PWM   2 234   -100% -100%
RDU 3 3 351   3 351   0% 0%
RIC 4 4 468   3 351   33% 33%
ROC   2 234   -100% -100%
RSW 4 4 468   4 468   0% 0%
SAT 4 4 552   4 468   0% 18%
SDF 3 3 417     N/A N/A
SEA 1 1 143   3 435   -67% -67%
SFO 2 1 3 433   4 580   -25% -25%
SJU 2 2 290   3 435   -33% -33%
SRQ   2 234   -100% -100%
STL 4 4 468   3 351   33% 33%
TPA 8 8 964   7 903   14% 7%
Total Departures 156 30 186 23,556   211 26,395   -11.8% -10.8%
Destinations     45     56     -19.6%

[Edit 11/27 @ 238p PT to add changes in seats to the table]

Get Cranky in Your Inbox!

The airline industry moves fast. Sign up and get every Cranky post in your inbox for free.

68 comments on “Southwest Continues Cutting Atlanta, Delta Must Be Thrilled

  1. Airtran seems to be going from a standalone Atlanta-centric operator to being instead merged into the Southwest system – just as one would expect from any corporate acquisition. Furthermore, smaller 717s are being replaced with larger 737s.
    Yes, some of the thinner destinations are being cut, but capacity is being added both in terms of frequency and also number of seats per flight on other routes.

    If you compare instead number of seats in/out of ATL available for sale or maybe available-seat-kilometres on these 2 dates, then how big do the cuts seem ?

    1. David – I just updated the table above to show seat count changes as well. My numbers likely vary a bit from Tim’s for two reasons. First, I did 2011 to 2013 whereas Tim pulled 2012 to 2013. Also, he is pulling weekly counts and I’m just looking at Wednesday. But the numbers are very similar.

      Interesting to note that there were very few markets that had a big difference between seat and flight changes. Here are the ones with double digit differences:

      Baltimore – Flights increased by 83% but seats increased by 103% thanks to a lot more Southwest 737s bringing the average seat count up over so many previous AirTran 717s.

      Detroit – Flights stayed flat but seats dropped by 15% as AirTran replaced 737s with 717s.

      Indianapolis – Flights doubled but seats only went up 79% because the one 737 was replaced and it’s all 717 now.

      Midway – Flights went up 25% but seats went up 35% thanks to bigger Southwest 737s.

      San Antonio – Flights were flat but seats were up 18% as the all-717 operation saw 3 737s come in to join 1 717.

      Other than that, the changes in seats aren’t much different. Of course, these will all change as Southwest moves things from AirTran over to Southwest and eliminates all 717s.

    1. J – Right, but this is an Atlanta post and the point is that in that same announcement, Southwest dropped Atlanta to Wichita.

      1. ICT is an interesting smaller market. State and local goverment has handed out millions to Airtran and Frontier over about a 10 year span to try and lower fares there (over $6 million last year). Frontier has come and left twice and Airtran was just replaced by Southwest. Airtran leaving ICT helps Delta a lot and east coast fares out of that market will go up. ICT really needs to pursue another carrier if they want to continue this subsidy strategy to lower fares (JetBlue or Spirit?) Factor in a new $100+ million terminal in 2015 largely subsidized by federal money and you could devote a whole post to the ins and outs of ICT.

  2. So they are cutting ATL to DFW/CLT/IAD mega hubs cities for DL/AA/US/UA so that’s not to surprising, and we already know about WN and DFW. If you look at the other cities they don’t seem like major markets where one might be shocked at the loss of service.

    What’s wrong with getting rid of minor markets that must not be performing well and not going head to head in a couple of others with major players.

    Beef up your strengths seems a wise move.

    1. David SF – I’m not suggesting this is a bad idea for Southwest. Southwest has higher costs and it’s getting rid of smaller airplanes, so it has no real option but to eliminate service to smaller cities. But that is great news for Delta and probably makes it worth questioning if the AirTran acquisition really made sense. I suppose we’ll find out in a few years.

  3. ATL was AirTran’s hub. Southwest is a point-to-point airline, they don’t really have hubs per se. So they have reduced their presence in ATL to those markets that have significant point-to-point traffic.

    I don’t know if this is necessarily good for Delta. There is now no competition on minor routes, but more competition on the busy ones.

    1. The minor routes at ATL are very important to feed DL’s massive international operation.

      I’m not worried about most of these cities, because while they may not be served from ATL, for the most part they’re covered in the combined WN system.

      ROC/PWM/ORF are better served through BWI. ICT as mentioned before is getting new service. I’m surprised that HPN is being cut, although is this due to the exit of 717’s?

      IAD no one cares about from a domestic standpoint outside of United.
      BKG has other service to HOU and MDW.

      Overall its consistent with WN’s plan to make ATL O&D. AirTran had no choice as ATL was basically its only hub. Its cheaper and easier for WN to route connections via BWI/HOU/BNA and even MDW as needed.

      1. I keep hearing WN wants to focus on the “local” ATL passenger, rather than the FL hub. How exactly are they going to focus on one of the most overserved local passengers in the US industry, other than on price?

        1. AirTran moved a lot of people from ATL to Orlando (DisneyWorld) and Fort Lauderdale (CruiseShips) now Southwest gets them. Orlando is huge market for Southwest (their planes are always filled) I just think Southwest wants to be the airline of Florida.

    2. Jim – Don’t be fooled by Southwest saying it’s point to point. Take a look at Midway, for example, where I believe half the traffic is connecting. They set up their networks differently than a traditional hub and spoke carrier, but they definitely operate hubs.

      As for Delta, where are they getting more competition? Baltimore? Chicago? Those aren’t markets where Delta will be crying. They’re in a much better place right now.

      Sanjeev – I asked about White Plains when they killed it. I think there were a couple issues from ground handling only being handled by the airport and no ability to get more slots.

      1. Very true…BWI is my home airport, and while not officially labeled as a hub, in reality it operates like one for SWA.

        I think a legitimate question is “what is SWA’s real strategy?” The airline of Herb Kelleher that turned the industry on its head has morphed into a higher fare, run of the mill airline, in my opinion.

        1. I think Southwest wants to be the only airline in the middle. They want to fly pleasure-vacation travelers (some business) to domestic and some international resort destinations for a moderate fare. They don’t want to be the ultra low cost carrier that nickle and dimes you to death or the large legacy carrier that only wants business travelers. The Kohls of the airline industry.

          BTW… I like BWI now that Southwest has made it a hub. It’s a really nice airport.

  4. The problem with Southwest switching ATL from a hub to a local focus is that without first class cabins, assigned seating, airport lounges, etc., they don’t really have much to offer Atlanta business travelers, which is where the money is made. They’ll be stuck competing for the deep discounting leisure travelers. Given Southwest’s cost issues, it would surprise me if this is a plan for success in Atlanta.

    1. They’re going after a different business market in addition to leisure. Not every business traveler has expense accounts, corporate contracts with airlines, etc.

  5. This does bring up the question, strategically does/did this merger make sense? Given how mediocrely WN has executed the merger, I’m leaning heavily toward no.. But I could be wrong.

    What exactly has WN gained out of all of this? Some 737s? Lots of employees?

    If I were to make a bet on this, I’d say the story here was WN pigheadedness thinking that their way was the right one and FL’s practices be damned. Perhaps WN could’ve made a first class cabin work on some flights? Why can DL make the 717 work but WN can’t? This more and more looks like WN just purchased Airtran to get a competitor out of the way and pickup some 737s..

    1. The 717 question is an easy one. Look at the crew rates that DL will pay on the 717 vs. what WN would be paying on the 717.

    2. Nick – That really is the big question in my mind. I don’t think we’ll know for a few more years if the merger made sense or not, but early indications are that Southwest isn’t getting much.

      It can buy as many 737s as it wants on its own – doesn’t need a merger. It also could have gotten its IT act together a decade ago and started flying internationally on its own. It doesn’t need to buy an airline for that.

      While it did eliminate a formidable competitor, that vacuum will be filled by someone else. Southwest’s costs are too high and other can swoop in to fill in as an ultra low cost carrier. Spirit, Allegiant, and Frontier have all grown into these opportunities and will continue to do so.

      I’m just not sure that it got very much here.

      1. I’m not sure that they’d be able to get as many 737s as they wanted as quickly as they wanted. Boeing has actually said no to Southwest, which resulted in them buying Ford Europe’s 737 which flew around in an odd configuration for a while.

      2. Don’t forget JetBlue in that list. They are increasingly demonstrating that they are not afraid to take on Southwest.

    3. WN not only eliminated a competitor, it took a profitable airline and reduced it to ashes, treating AirTran’s employees like second class citizens–taking away seniority, and not treating them like “family” (on a personal level) which is supposedly WN’s claim to fame.

      1. You give some and you get some. Would you rather have kept your seniority and at the same time kept your AirTran pay rates. That would have been fair.

  6. WN has been overflying ATL for years so much of this comes as no surprise. Using Florida as an example, WN has so many nonstop/direct flights to their current cities there is no need to funnel pax through ATL as FL did. The alternatives are already in place.

    If you look back, the FL integration, while much MUCH slower is reminiscent of Morris Air. Some smaller stations were cut, others were tied to existing WN stations and the SLC “hub” was pared down a bit. Now with the WN DEN build up, the operations at SLC have been pared down even further as DEN serves SLC’s old function on a greater scale.

    Finally, ATL for WN is simply not as important from a network perspective as it is/was for FL. If you look at the network now, there are MORE destinations available to/from ATL, just not nonstop.

    1. ChuckMO – Yeah, let’s look at Morris. What did Southwest get out of that? Not much. Sure it picked up a couple of cities in the Pac Northwest but it has never gained much of a toehold in that area anyway. It certainly could have just started flying to those cities on its own. Even Salt Lake was never that big for Southwest. Of course, Morris was a tiny acquisition and easy to integrate so it couldn’t have done that much harm in the scheme of things.

      As for Atlanta, Southwest may have more destinations via connections, but when you’re competition is Delta flying nonstop, you’re going to get killed on all but the ultra price sensitive traveler. But Southwest also didn’t need AirTran to reach those cities. It could have just started flying to Atlanta and connected it into the network on its own.

      1. Morris was an easy way to fill in a service area WN had yet to exploit. I would note that after the initial Morris cities were cut, the remainders are still part of the WN network though several intra-Northwest routings have been cut, but that’s part of larger WN tendency to eliminate marginal short haul flying that is taking place throughout the system.

        I also believe that there’s more to the FL acquisition than just ATL. International, some slots at DCA and LGA and several new markets not served by WN. But FL is proving to be a far more costly solution for WN than I believe WN bargained for. It will be interesting to compare the resulting downsizing of ATL vs. SLC on a percentage basis when the dust settles. ATL is surrounded by strong WN stations as is SLC now (post DEN build up).

  7. Here?s my guess?
    Southwest wanted Frontier and didn?t get it. So they buy AirTran. This eliminates another low-cost competitor, gets them access to Atlanta, and the addition of landing slots in the NYC and Wash DC.
    Plus doesn?t AirTran have a lot of flights out of Atlanta to say Orlando? So now Southwest does.
    And if Southwest owns AirTran? AirTran money is now Southwest money. I?m sure Southwest will turn Atlanta into another one of their ?Hubs.?

    Also still guessing here? But I think Southwest is worried about Spirit nipping at their heals. Spirit is slowing moving into Southwest markets. So to counter, Southwest buys AirTran and moves into Spirits
    ?Spring Break-Pleasure? international routes.

    Southwest is adding international gates to Houston Hobby (thank you Houston City Council) and with the huge updating of Dallas Love Field I?m sure they will go international too, once the Wright amendment restrictions end in 2014 and they ?talk? to the Dallas City Council. Texas loves it Southwest! I?m a Texan if you haven?t guest.

    **Side note**
    Southwest really isn?t a business traveler carrier even though they want to be.
    Southwest didn?t need Frontier after all? Look at Denver, they practically own it.
    Southwest may say they don?t have ?Hubs? but have you been to?

    1. Tom – A couple of thoughts…. Southwest didn’t need to buy AirTran to enter its markets. If it thinks its business model is far superior (as it does), then just enter the market and win that way. Instead, by buying AirTran, you bring a lot of baggage with you. AirTran money is Southwest money, but Southwest costs are now AirTran costs so much of the network becomes unprofitable.

      As for Spirit, buying AirTran doesn’t help but rather hurts Southwest. AirTran had costs low enough that it could have competed with Spirit. Now with Southwest costs, it creates even greater opportunity for Spirit to move in and take traffic.

    2. Just one quick note… The compromise that finally resulted in the repeal of the Wright Amendment, I believe, still prohibits Southwest from flying internationally out of Dallas Love Field even once most other restrictions are lifted in 2014.

  8. It’s an interesting analysis, but I know y’all realize that seat counts and frequencies are just part of the equation…

    It’s quite possible WN is managing to offset the loss of what are a bunch of second and third tier locations. Perhaps even more than offsetting if they’re able to move more people east-west and in/out of the WN non-hubs than what the FL hub was able to accomplish…

    1. Eric – Sure, that’s what has to happen for Southwest to do anything with this. But we really won’t be able to measure that for a long time – at least not until they actually integrate the airlines or at least begin codesharing.

      1. On a side note, when are they going to start code sharing? It was supposed to be in 4th quarter 2011 and then 1st quarter of 2012 and here we are at the end of 2012. They have had code shares before. Why is it so difficult with Airtran? I understand the problem with international flights, but it seems they could at least be code sharing the domestic routes.

        1. BarryATL – I seem to recall that they were talking about early 2013 now, but they have lost credibility with so many delays.

  9. Excellent analysis Brett!! IMHO…I dont know how much DL is smiling because the ATL transition is pretty much a zero sum game. I am willing to bet that the city pairs being axed from ATL are sectors that were top heavy on connecting traffic. That fare mix of say 80% cx/20% o&d (using random assumption numbers) dosent work with WN’s cost structure. SDF/ORF/AUS offer strong O/D and have been held captive by DL for years. Naturally there will be connectivity over ATL based on the scope of the operation…but the connectivity will not be the backbone of the sectors. This is in keeping with previously announced abandonment of cx heavy short segments like IND-MDW, LGA-BWI,FLL-MCO,etc.

  10. Most seem to think that the SW objective was to fly local O&D from ATL. Im thinking that the other half of the trip is probably more the case in that SW is listening to its huge customer base who wanted to fly to ATL. Picking up some brain power experience in international helps, a few airplanes, etc. was frosting on the cake.

  11. Was buying an existing airline the only way Southwest could of gotten into ATL? Plus can’t they just gut AirTran and keep the gates they aquired?

    1. Not at the scale that they are at once the shake out of the merger is complete. They might have gotten a few gates but then would have had to compete with both delta and airtran while waiting for someone to downsize. If you look at most SW hubs they roughly run 150-220 flights a day and that puts them right where they need to be today and more with the gates they aquire from airtran in ATL….about the same scale as denver but it took less than 5 years to do it.

  12. Don’t say SW isn’t a hub airline. Just consider BWI, MDW, HOU, DAL, and PHX. All are basically hubs. OK, maybe not on the order of DL in ATL or AA in DFW, but they have around 150 to over 200 flights each and handle the change of one SW airplane to another SW airplane. I thought SW would set up a similar “hub” in ATL. Nope, they sold the 717s to DL, which will use them instead of RJs in ATL and DTW, and they kept the 737-700s which they’ll just add to their other old and new 737s. I think that they really didn’t want to merge with profitable AirTran and build a bigger airline, but rather they wanted to get rid of a pesky and profitable competitor. SW shouldn’t feel too smug about their plans, because Atlanta has always been a two hub airport and soon another airline will come along like Valujet did in the early 90’s and build another hub in Atlanta.

      1. Atlanta is gate challenged. Even with the new international terminal, that did not add a lot of capacity in the great scheme of things. There is the possibility that some of Southwest/Airtran’s gates may become available. Airtran was using a lot of the “common use” gates on Concourse D and E. Those gates belong to the airport and can be used for other airlines if Airtran does not really need the gates for their current level of traffic. But, I don’t think there is enough gate space to start a significant operation in Atlanta.

        1. Quite a few of AirTrans gates don’t fit anything over a 717. They will all have to be realigned and reprinted causing some gates to be pulled from service due to inadequate space to fit an airplane.

          1. The 717 is about as long as an 800. SO wingspan is the issue- to say after the re-striping they end up with 18 gates. Ive seen various SW operations operate anywhere from 8 to 13 turns a day per gate. So taking the 10 a day average your looking at 180 flights with an upside of 230 flights in a pinch…..its all about gates and how fast you can turn them.

  13. I’m in the camp that believes WN didn’t need anything but the gates at ATL. Look at what they did with TZ…bought them, told everyone they’d continue operating the airline, then slowly took it apart & shut it down. Main objective there appeared to be real estate at MDW (gates).

    1. AirTran has/had 19 gates at ATL on Terminal C – South. They operated a fleet of B717s and B737-700s. They operated over 200 flights a day from these 19 gates. SW could easily use those gates to operate a HOU or PHX sized hub from those same 19 gates. Instead, they have decided to operate a minor operation out of ATL. I don’t believe ATL’s management will allow SW to operate all those gates without offering 200 or so daily flights out of ATL and neither will management give them to DL. ATL’s management has always had a policy of giving DL a lot of gates, but they will hold onto those Terminal C-South gates for now. ATL’s management had no means to prevent SW’s takeover of AirTran, but they can stop them from allowing SW to hold onto 19 gates when its number of daily flights is no more than 50.

      1. 737’s don’t fit at the AirTran 717 designated gates. Southwest will lose gates when the safety zones are reprinted to fit 737-800’s.

      2. The Concourse C gates are not in question. Airtran/Southwest has a long term lease on those gates. The issue will be the Concourse D and Concourse E gates that Airtran/Southwest uses. Most of the gates on D and E are not under a standard lease. They are under a shared agreement. In that agreement if the airline is not fully utilizing it’s gates, the airport can take them back.

        As an added note, Airtran has never done 200+ flights a day out of the 19 gates on C concourse. When Airtran hit that level of traffic there were additional gates on D and E. The E gates are usually only international, but have been used for domestic when needed. Airtran now has a dedicated international gate on Concourse T.

  14. Since WN (apparently) is concentrating on local traffic to/from ATL, this has strong potential to hit DL where it hurts. Southwest walkup fares are typically lower than legacy carriers’ walkup fares, at least in part because Southwest has a lower cost structure than the legacies, and can price accordingly. Hub profitability depends on local traffic at yields higher than those for connecting traffic. If Southwest succeeds in attracting any reasonable component of local ATL traffic, it could impact the hub’s profitability on a significant scale. DL will match, but they don’t have the cost structure; this dagger is aimed at DL’s ATL heart. Re the cancellation of DFW-ATL, it won’t be that long before this is replaced with DAL-ATL, where DL is nicely preparing the market for WN’s eventual entry. For a trip departing today, DL is charging $433 one-way; Southwest charges $336 for a one-way ATL-DEN trip departing today; ATL-DEN is about 500 miles further…go figure.

    1. Last I checked DL’s and WN’s costs were similar. WN’s costs long ago caught up with legacy carrier’s costs, and AFAIK now is one of the highest… CF is that still the case?

      1. Not quite. In the last quarter, Southwest had unit costs of 12.77 cents on an average stage length of 694 miles. Delta had unit costs of 13.83 cents, and I can’t seem to find the stage length in their 10-Q. That being said, I would imagine it’s longer than Southwest’s. And with a longer stage length, your unit costs will be lower.

        So Southwest still has an advantage but it’s less than it used to be.

        1. True, but DL has a better yield than WN.

          WN’s yield was 14.89 cents per RPM, whereas DL’s was 16.15 cents per RPM. This is 2.12 and 2.32 cents respectively above their unit costs. so DL has a small advantage there…

          Although much of that for DL might be coming from their international operations versus the domestic operations. Yet another reason why WN’s management might not be earning all their pay given how slow they are going into the intl market..

          1. Nick – Sure, Delta commands higher fares and does a much better job of generating revenue than Southwest. If you’re talking costs, then Delta does not have an advantage. But if you’re talking about overall profitability, it’s no contest, at least not lately.

          2. I was working through George’s comment. I have a bit of a knee jerk reaction when people trot out Southwest’s costs, because they’re no longer anywhere near as low as they were, nor is the differential as great.

            It does make sense that Southwest may end up eating into DL’s walkup fares, although I’m curious how much wiggle room Delta has to match those.

  15. Delta is years “behind the 8 ball” in business lost to SW as Delta, in almost all cases over the years, just abandoned cities that SW est. service in because Delta did NOT know how to compete with this model! They tried, but too late with their green aircraft, etc.! SW has never gone BANCRUPT!

    1. It amazes me how quickly the SW cheerleaders come out. DL has been running an excellent operation as of late and is doing the running other carriers out of markets, not the other way around.

  16. Gary Kelly has been saying all along since the announcement of the merger that ATL will be scaled back, so this route analysis is kinda just showing the results and not really enlightening.

    Why use ATL as a hub at all? Other than being a decent funnel to the Carribean and Mexico.. is Soutwest gonna make money connecting people to Florida? They’re better off just flying them nonstop. Look at the geography folks, there’s not a lot of cross country connections to use ATL for to the east and south. Thats the difference between ATL, compared to almost every other Southwest “hub”.

    Also known is that Southwest has not grown their fleet and capacity for nearly two years. Right now they’re busy with transitioning 717’s to Delta. Which brings up another point – why help your competitor become more efficient.. unless you aren’t really worried about them affecting your business?

    So I think the “pullback” is somewhat temporary, and that Southwest will come out swinging with more service in 2013 when they plan to increase overall capacity. There are a number of Southwest cities that Airtran doesn’t serve, but will likely see planes to/from Atlanta. Salt Lake City and Hartford for example, among others.

    Kelly had also said Southwest will increase frequencies to Atlanta from currently served Airtran cities. For example, Delta has 6 flights daily to Dayton, whereas Airtran has 3, in Columbus, Delta has 8 to Airtran’s 2. By simply adding more flights and lowering fares, they can muscle into Delta’s business when they’re ready to.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Cranky Flier