I’m sure some of you were hoping to come and read about Alaska and Virgin America getting together. Though it’s just been announced in the last hour, I’m not in the habit of trying to break the news. I’m going to review and have a post about it tomorrow. Until then, it’s time to turn my gaze away from the airline industry at large and instead peer into my backyard. Earlier this year, highly slot-restricted Long Beach Airport announced that it would be adding 9 daily slot pairs for big commercial jets on top of the 41 that exist today. Now we know how those slots are going to be used, and there are some mild surprises here.
Let’s start with the newcomer in the market, Southwest. Southwest surprised everyone by putting its hat in the ring to get all 9 of the new slots, its first foray into Long Beach. In the end, it picked up four. Some figured that wouldn’t be enough to make it worth Southwest’s while, but with the ability to outsource ground-handling at small stations like this along with the big splash Southwest made upon applying, I couldn’t imagine the airline not seeing this through.
At an event last week that drew the mayor and other local dignitaries on to the Queen Mary, Southwest finally announced where it would fly. All four slots will be used for flights to Oakland. This shocked a lot of people, but to me it was only a mild surprise. My previous thinking was that we might see 3 daily flights to Oakland and 1 to Vegas in order to handle eastbound connections.
It seemed clear that with so few slots, Southwest was first and foremost going to focus on the intra-California market that the airline serves so well. Think about it this way. Southwest has tremendous amounts of service in both LA and Orange County. That’s why I never figured Southwest would be interested in Long Beach at all.
But what Southwest saw was an opportunity to get a slight edge. For the people in the relatively small catchment area that prefer Long Beach, Southwest hopes they’ll choose the airline when they need to head up north. If that helps lock them in to Rapid Rewards or gets them to like the airline’s service, then when people need to go to LA or Orange County to fly elsewhere, they’ll be more likely to choose Southwest. Or so the theory goes.
And as for Oakland vs other Bay Area airports, this is obvious. Snoop Dogg is a huge Raiders fan, so…. Seriously though, that’s where Southwest is strongest up there by far. While I would have liked to see San Jose, that just doesn’t fit into the network well enough.
What surprised me was that they didn’t send one airplane to Vegas to be able to connect people to places elsewhere in the Southwest network. But from an operational perspective, it doesn’t sound like that’s a popular idea. Having just one flight that’s heavy on connections means that if flights are late, then they feel more obligated to hold the Long Beach flight. There just aren’t any other options. So for now, Southwest really can’t get people who want to fly east from Long Beach.
On the other side of the coin, JetBlue picked up three additional slots. JetBlue has been in Long Beach for 15 years, but as of late, it’s been under-utilizing its slots. It’s allowed to do that, but that’s why it was surprising that JetBlue wanted more. Of course, that was an anti-competitive move to prevent others from coming in.
I was really surprised when JetBlue announced it was actually going to use these slots and not squat on them. For the first time in awhile, JetBlue is adding a new destination. There will be one daily flight from Long Beach to Reno. The airline is also adding an additional daily flight to Vegas, San Francisco, and… Oakland.
For the record, JetBlue announced its flights first, so this wasn’t a reactive move in response to Southwest. But there was probably some expectation at the time that Southwest would be in this market. And now we’ll have 8 daily roundtrips between the two airlines. I look forward to cheap flights to Oakland for some time.
Since JetBlue has been underutilizing its slots, it could have started these flights without any new slots at all. So why now? I’ll assume it’s a mix of a couple things. First, JetBlue knows there a political game here. There’s already a lot of noise about how JetBlue is squatting on slots, and it’s giving the anti-airport crowd ammunition. So this will help diffuse that issue to some extent. Second, I imagine the Bay Area additions help with competitive positioning vs Southwest.
Lastly, there’s Delta. Delta won 2 slots, and though some had dreamed of seeing new service, that’s not happening. Most days, Delta flies 2 CRJ-900s to Salt Lake and 2 CRJ-700s. Later this summer, it will upgauge all flights to CRJ-900s. It couldn’t have done that before, because the CRJ-700 is considered a commuter and uses slots from a different pool. The CRJ-900 weighs too much for that. Now with 2 more big jet slots, Delta can finally upgauge to the CRJ-900 on all flights and standardize.
That, by the way, leaves the 25 commuter slots in Long Beach as entirely unused. Anyone wanna start an airline?
Now it’s time for the fun part. We get to see if this service works for anyone. I wouldn’t be surprised to see JetBlue cut back on some frequencies over time. But by then, the move will have served its purpose from a public relations standpoint anyway. And Southwest? Well, with 8 flights a day in that market between two airlines, it should be ugly. We’ll see if Southwest’s strength in both the Bay Area and the LA Basin mean that it can succeed.