With the New Terminal Opening in San Diego, Alaska and Southwest Prepare for Battle

You know that I love watching the drama between United and American in Chicago, but get ready for a new favorite battle: San Diego. Both Alaska and Southwest appear ready to fight as the new terminal prepares to open. Alaska fired its most recent shot by adding three new routes and increasing frequencies on others.

San Diego is a good market. And, importantly, it’s a constrained one. Yes, it has a single runway, but it also has only one and a half terminals. I say “half” because if you’ve ever been on Southwest flying out of Terminal 1, you know it is barely functional. It is old, and it is woefully undersized. It is very hard to run an operation out of that place.

But at the end of this summer, the new Terminal 1 opens. Not only is it modern with properly-sized holdrooms and all that, but the initial phase will open with 19 gates compared to the 14 in operation today. Once the old Terminal 1 is knocked down, another 11 gates will be built on that footprint to open by 2028. There are also taxiway improvements coming to help increase the flow of aircraft around the small footprint of the airfield. And this means the time has come for airline to step up if they want to be in a good position.

Historically, San Diego has been Southwest’s turf. (Ok, if we go far enough back, it was PSA’s turf, but that’s a little further than I was looking to go in this post.) Southwest is the king of intra-California and has been for decades. That’s why it’s no surprise that for the 12 months ending July 2025, the airline will have 60 percent of its seats in San Diego on flights of less than 500 miles.

That’s not all Southwest does, of course. Here’s the July route map for Southwest.

^{Southwest San Diego Map via Cirium}

As usual, Southwest does a lot on the midcons. It also extends further east to its hubs in Baltimore, Orlando, and even Tampa. But this is a very Southwest way of serving the city. (Note that it is down to only Honolulu in the islands during peak summer.)

Alaska, meanwhile, has been sneaky, working its way around Southwest’s key markets. Here’s Alaska’s July map, including Hawaiian:

^{Alaska/Hawaiian San Diego Map via Cirium}

Alaska has only 24 percent of its seats in markets of less than 500 miles. Sure it has the usual markets where it competes with Southwest, but it also has Fresno, Monterrey, San Luis Obispo, Santa Rosa… you get the point.

Then it has skipped almost entirely over the middle of the country and focused on the Pacific Northwest at its home base as well as the east coast. Yes, there’s that Florida overlap, but Alaska is largely serving the big cities in the east that matter. But what about the middle? That’s what its partnership with American is for. People can fly American to Phoenix, Chicago, or DFW and connect all over from there.

This strategy has kept San Diego as a place where both airlines can coexist. It certainly helps that the legacy carriers have ignored the market. Here’s a look at San Diego seat share over time:

^{Map via Cirium}

Since 2004, the Big 3 and their joint venture partners have grown seats in San Diego by a mere 2.2 percent to just shy of 6 million seats combined in 2024. Southwest, however, has grown 25 percent, topping 5 million on its own. And Alaska has grown an incredible 259 percent (off an admittedly smaller base) to reach more than 2.8 million seats. The rest of the growth has come from ultra low cost operators which all together account for 1.3 million seats.

So, Southwest has about a third of the market while Alaska is around 18 percent, but Alaska has big plans for San Diego. It’s tired of the old Virgin America network and keeps pulling back on longer-haul flying both Los Angeles and San Francisco. (Just last week it canceled Washington/Dulles from both airports as well as SFO – Chicago/O’Hare and Los Angeles – Nassau.) In California, Alaska seems largely focused on making San Diego its own now.

The airline added three new routes this week, and they are all notable.

• Chicago/O’Hare 3x daily starting Oct 4
• Denver 3x daily starting Oct 4
• Phoenix 3x daily starting Aug 20

It is also jacking up frequencies in important markets starting October 26:

• Las Vegas from 4x to 6x daily
• Sacramento from 4x to 6x daily
• Salt Lake City from 1x to 3x daily
• San Jose (CA) from 4x to 6x daily

This is no small expansion, and it shows how much progress has been made in becoming competitive. It has now easily surpassed Southwest on the number of destinations from San Diego.

Destinations Served from San Diego by Month (including merger partners)

^{Data via Cirium}

But it’s not just about serving more destinations. It’s about serving the right ones and with the right service pattern.

Chicago is significant in that Alaska already has partner American flying the route. But it’s important for Alaska to fly it so it can control capacity and fares and have better connectivity off its own flight to American’s beyond options. Just note, however, that this comes as Alaska pulls out of the San Francisco – Chicago route. It hasn’t flown there from LA in awhile. San Diego is different. It matters more to Alaska right now.

Phoenix is another American hub that Alaska wants to feed, but this is a much tougher market. You have American with 5x daily, Southwest with 9x daily, and even Frontier with 11x weekly. This is a very busy market, but it’s also a key destination for San Diego with more than 1,000 daily passengers each way (PDEW), so Alaska wants to be there.

And then there’s Denver which is actually the largest market from San Diego that Alaska doesn’t serve with more than 1,200 PDEW. So, now it will.

If you exclude Oakland, Alaska will now serve all of the top 13 markets from San Diego. Of the top 21 airports, Alaska will only not serve Oakland, DFW, and Minneapolis/St Paul.

Southwest, meanwhile, doesn’t serve Seattle, New York City, Boston, or MSP. It has secondary airports in some markets as well, like Washington, DC. Alaska is making a play that with its partnership with American, it can better serve the people of San Diego. Southwest will absolutely not go down with a fight, so get ready to rumble.

Congratuations to the people of San Diego, things are about to get fun.