We’ve heard rumblings about the death of outdated perimeter rules at both Washington/National and New York/LaGuardia for years. But could it actually happen in New York? It seems that there are talks about the perimeter rule going away at LaGuardia, and that would be great news… for some airlines. Others may not be so happy. And different cities will have mixed emotions as well.
Let’s start by going over what the perimeter rule involves today. The rule says that, with just a couple exceptions, flight to LaGuardia cannot originate from more than 1,500 miles away. Flights from LaGuardia can’t go to a destination beyond 1,500 miles away either. That line draws out like this (the original map is from Great Circle Mapper, which is a fantastic tool.)
Though the distance has changed at times in the past, you can see exactly why it ended up where it did today. Dallas and Houston both magically squeak in just under the limit. Amazing how they also squeak under the 1,250 mile from Washington/National too, isn’t it? That’s a powerful Texas lobby.
You can see that Denver, despite being more than 1,500 miles away from LaGuardia, got itself grandfathered in as perfectly acceptable. Go figure. The only other exception? This rule doesn’t apply on Saturdays at all. Airlines have tried nonstops beyond the perimeter on Saturdays but most of them fail.
It’s the Port Authority that says it’s reviewing whether to eliminate the rule. But as is always the case with the Port Authority, if it happens, I’m sure it’ll take decades to get done.
Let’s say that in 2080, the Port Authority finally decides it’s time to eliminate the rule. What does that mean for everyone involved? Well, if it’s in 2080, I have no clue. But let’s pretend there’s a miracle and the Port Authority acts in the near future. That would mean we’d see more long haul travel at LaGuardia and smaller cities might lose service. Here’s how the winners and losers break down.
American and Delta Win
Both American and Delta have large slot holdings at both LaGuardia and JFK. So why would they be winners? Because for the vast majority of high dollar business travelers, LaGuardia is the preferred airport. You can imagine that both Delta and American would instantly start flying from LaGuardia to many of the cities in red on my map above. In particular, LA and San Francisco would be huge for them. Sure, that would require replacing existing service, but these guys probably have more service in some markets than they need today. It wouldn’t be hard to move things around.
While other airlines have slot holdings at LaGuardia too, they would have to cut much more essential service in order to serve these new markets. And if they did, they still wouldn’t likely be able to match the frequency of American and Delta. The flights from JFK would instantly become less important. Sure, JFK would still be needed for international service, but for west coast service, LaGuardia would become as important as it is today for travel within the eastern half of the country.
JetBlue, United, and Virgin America Lose
For those same reasons stated above, JetBlue, United, and Virgin America would be the losers.
For United, it’s more than that. United has spent years developing Newark as the only true global hub in New York. That wouldn’t change since LaGuardia would never be able to handle long haul travel. (I say never assuming there’s no chance they’ll both add a customs facility and extend a runway a lot.) But all those people who go to and from the West Coast on United via Newark will no longer have to compare to JFK travel times and convenience. When compared to LaGuardia, Newark becomes less attractive to a ton of people in Manhattan.
For JetBlue and Virgin America, it’s really mostly about the lack of slots. Today, they can compete on transcon markets with everyone else out of JFK. But if the competition starts frequent flights from LaGuardia and you can’t make the move, you’re going to take a hit.
There aren’t just airlines that win and lose in this game, however. There are also airports.
Big West Coast Cities Win
Of course, it’s the big west coast cities that will come out well here. Travelers will no longer have to choose from JFK or Newark. They’ll have the option to go to LaGuardia. Those who are going into Manhattan will prefer LaGuardia nearly every time.
JFK service will still exist, especially thanks to international connections, but at a reduced rate, I’d assume.
Small East Coast Cities Lose
Those small cities that have service to LaGuardia today should be the most concerned. Think Bangor, Dayton, Greensboro, Norfolk, etc. You get it. It all comes down to simple math. Do Delta and American think they can make more money flying a 757 to LA or a CRJ to Bangor? The answer won’t always be the same. Some of these shorter-haul small cities probably do quite well. But there’s no question some small city frequencies will have to be sacrificed in order to serve the big markets.
Some small cities might see less service. Some might lose LaGuardia service all together. Who knows, maybe a couple will end up getting JFK service instead. But things would certainly change.
In the end, a lot more people will benefit than will get hurt if this were to happen. Let’s see if the Port Authority can actually take action.
