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LGA Lottery: Will Big Air Hammer Small Markets?  
User currently offlineDCA-ROCguy From United States of America, joined Apr 2000, 4661 posts, RR: 31
Posted (15 years 6 months 19 hours ago) and read 2261 times:

Dear All,

Here's a good overview of the results of yesterday's LaGuardia Lottery to cut back AIR 21 slots and congestion. US and DL took it on the nose.

Watch for medium-size and small markets that depend on these two carriers for service to LGA to get hammered. Of course Delta Shuttle and US Airways Shuttle will need to continue every one of their dozens and dozens of high-margin flights to DCA, BOS, IAD, etc, and we'll need to have 20 or so flights to ATL. But five measly flights to ROC? BHM? TYS?

To paraphrase Seinfeld's Soup Nazi, "NO FLIGHTS FOR YOU!"

Yes, it's good that low-fare carriers got slots. But most of those go to major markets. Big Air needs to redistribute its remaining huge number of LGA slots to *include medium-and-small size markets.* At the cost--gasp--of just a few moneybags shuttle flights! Can Big Air show just a dram of social justice sense and political sense? Not likely.

Delta, U.S. Airways Losers in LaGuardia Lottery
December 4, 2000 6:56 pm EST

WASHINGTON (Reuters) - Delta Air Lines and US Airways saw new flights to smaller communities slashed under a lottery held Monday to cut congestion at New York's LaGuardia airport.
The commuter arms of both airlines, previously authorized to conduct more than 80 takeoffs and landings a day under a new program, wound up with only 20 slots each under the Federal Aviation Administration (FAA) lottery that spread 159 takeoff and landing slots among 13 carriers.

Delays at LaGuardia have soared since the U.S. Congress in April authorized legislation lifting some flight restrictions to promote competition and increase new service.

But the AIR-21 legislation set no ceiling on the new flights at LaGuardia, the airport now responsible for a quarter of air traffic control delays nationally, leading the FAA to temporarily curb the new flights, due to reach over 300 a day by year's end.

With little ceremony, the names of the 13 carriers were drawn from a glass bowl to determine the order in which they could take turns to choose from the available times.

Delta drew first place and US Airways was last, but it was the smaller carriers with current rights to fewer than 20 slots that walked away with a full schedule of flights, even if they didn't get the exact times they wanted.


"The only thing I didn't get was two 8.00 a.m. departures. I've got one 7.00 a.m. (and) I'm hoping I can change that," said Airtran network planning manager John Kirby after the lottery at FAA headquarters.

Under FAA rules, carriers are free to swap among themselves, but not to sell the AIR-21 slots.

The new slots become effective at the end of January and remain in effect until Sept. 15, during which time span FAA hopes it can devise a method of allocating LaGuardia's limited capacity.

Charging airlines higher fees for using the airport at peak times has been suggested, but it's not clear how that would work in a way that would still promote competition by newer carriers.

"Even if we used a congestion pricing structure, we have to accommodate the new entrants and the smaller airlines," said Robert Boyle, executive director of the Port Authority of New York and New Jersey, the agency that operates LaGuardia.

Delta, which warned in comments ahead of the lottery that it would be forced to cut service to some communities, said it would be some weeks before it could announce its new schedule.


"We're are going to look at every possible avenue to protect as much service as we can," said Delta spokesman Russ Williams after the airline lost 68 AIR-21 slots in the lottery.

US Airways, whose other LaGuardia operations had been adversely affected by the worsening delays, took the loss of 62 AIR-21 slots on the chin. "We said going into this we commend the FAA's approach. It strikes a fair and appropriate balance," said spokesman David Castelveter.

AMR. Corp.'s American Airlines was reduced to 20 of the 32 AIR-21 slots it had expected, while Continental Airlines lost just five of its 25 AIR-21 takeoffs and landings.

New entrant and smaller carriers at LaGuardia got all the slots they currently operate, AirTran -- 11, American TransAir -- 6, Legend Airlines -- 7, Midway Airlines -- 15, Midwest Express -- 8, Spirit Airlines -12, Shuttle America -14, Southeast Airways -4 and Vanguard Airlines 2.

Legend, which halted service over the weekend and filed for bankruptcy protection, was allowed to bid as it still retains an FAA operating certificate.

FAA conducted a final contingency round of the lottery to allocated Legend's slot selections, in the event it does not resume operations.

Need a new airline paint scheme? Better call Saul! (Bass that is)
17 replies: All unread, jump to last
User currently offlineLowfareair From , joined Dec 1969, posts, RR:
Reply 1, posted (15 years 6 months 16 hours ago) and read 2172 times:

Looks like Shuttle America is happy. They could put in almost hourly flights to LGA from BED if they wanted to. But I guess they might want to start flights to BUF, TTN(Not that much hope, because they are close together, although they did have ILG-TTN.), and possibly another airport that they start/resume operations to.

Midway got a ton of them, as did Spirit. It looks like the big loser here is Vanguard, who only has two.

DCA-ROCguy: If you want flights to those places, then your best bet is Shuttle America if they start flights to BUF. But you may see some larger aircraft on that route, anyways. And besides, you have jetBlue. We here in PHL don't even have WN.

User currently offlineCba From United States of America, joined Jul 2000, 4534 posts, RR: 2
Reply 2, posted (15 years 6 months 15 hours ago) and read 2155 times:

Airlines who have other NY hubs should be kept out of LGA except for flights to/from their hubs. CO has EWR, AA and DL have JFK. DL Shuttle and UAL Shuttle should stay. CO should start shuttle flights from LGA-EWR like they do from HOU-IAH. You can make the connection for no extra charges. AA and DL should do the same thing with JFK.

User currently offlineUSFlyer MSP From United States of America, joined May 2000, 2608 posts, RR: 0
Reply 3, posted (15 years 6 months 14 hours ago) and read 2151 times:

I was under the impression that that carriers only lost slots that they gained because of Air 21. The flights that operated previously such as LGA-ROC should be safe. I wouls think. Knoxville and Birmingham should be worried.

User currently offlineTWAneedsNOhelp From , joined Dec 1969, posts, RR:
Reply 4, posted (15 years 6 months 11 hours ago) and read 2134 times:

Jim, ITH is going to get slammed!!!!! Our Dash8s to LGA......GONE!!! Would love to see ITH-JFK on JetBlue though.

Cba, LGA-EWR is completely impractical sorry. As the article and Jim attempted to make clear, LGA is jam-packed and can not accept any new flights. In fact, it had to cut a ton of slots from US and DL, because their simply were too many. So your suggestion that CO add flights from LGA to EWR, no offense, is preposterous, especially when people can make the 30 40 min drive easily. The whole point of this system was to link up cities that had no service to NY (like small hamlets in upstate) to...NY. A NY-NY flight is completely worthless.

As for your first idea about CO being resigned solely to EWR and DL and AA to JFK. It has a bit more merrit, but the PANYNJ doesn't think like that. They won't punish CO because it is pumping huge amounts of revenue into Newark over at EWR. Also, PANYNJ sees a different niche for the airports. LGA is supposed to be pure O&D traffic to as many cities as possible in the northeast, midatlantic, and eastern portions of the midwest. JFK is for of course long haul, Europe, West Coast, and Africa, and EWR is supposedly a mix of all three with a rather strong connecting element to compete with IAD and ORD in getting rural service to EWR and than on to LIS, LGW, CDG, MXP, etc......

User currently offlineDCA-ROCguy From United States of America, joined Apr 2000, 4661 posts, RR: 31
Reply 5, posted (15 years 6 months 8 hours ago) and read 2132 times:

D'OH...sorry USFlyerMSP, I didn't make an important distinction. In the case of ROC, US's six daily nonstops did exist before AIR 21 and are probably not in danger. But DL reintroduced ROC-LGA service, four daily Dornier 328Jets, using AIR 21 slots. It's these flights that I think are in danger. These are part of the same DL LGA service expansion that included BHM and TYS.

But before AIR 21, US's four daily 737s and two ERJ's were IT on ROC's busiest natural single O&D route. In the 1980's Rochester routinely had fifteen or more flights a day to LGA, *all jets.* Back when Piedmont/Empire and USAir....competed.

US Airways is in political hot water over their anticompetitive supermerger with United; I doubt they'd do anything as politically stupid as cut their pre-AIR 21 flights from Upstate New York to LGA. So Russ, I'd say your Dash 8s to ITH are probably safe. But fear the wrath of Wolf if his anticompetitive monopoly dream with United is rejected by DOJ. That's when ITH would need to worry. As would ROC.

Russ, you're correct about EWR-LGA flights. Won't happen. Airspace over NYC is much more clogged than over Houston. A free air-taxi service for connecting pax isn't something on which CO, DL, or AA will spend precious LGA slots.


Need a new airline paint scheme? Better call Saul! (Bass that is)
User currently offlineAirwaysdc9 From United States of America, joined May 1999, 204 posts, RR: 2
Reply 6, posted (15 years 6 months 2 hours ago) and read 2119 times:

DCA-ROC Guy seems to think that the airlines are a big social program that exist solely to give his community low airfares to big cities....at the expense of shuttle??? the highest yielding product at both US and DL???

Come on now...these ARE businesses after all...they're in business to make money. Perhaps if you petition your representatives to re-regulate the airline Rochester can enjoy nonstop service to every major market in the country 50 times each day for $19 a seat...after all, it'll be your tax dollars at work at that point.

Until then though, I believe that the airlines are going to continue to prefer flying the high yield customers from BOS-NYC...to those $19 fares you want out of ROC.

No offense intended...basic economics. Supply and Demand.

User currently offlineDCA-ROCguy From United States of America, joined Apr 2000, 4661 posts, RR: 31
Reply 7, posted (15 years 5 months 4 weeks 1 day 17 hours ago) and read 2107 times:

No offense taken, AirwaysDC9, you make a principled and intelligent argument as usual.

Supply and demand, like all other business drivers, has its limits. Businesses do not do business in a vacuum, they do their work in living breathing communities of human beings who depend upon their products and services. Air travel is not a luxury item, it is a social good and thus the airlines' freedom to "cream," while real, is indeed limited. It is generally far better for all involved for the businesses themselves, the experts, to moderate their own conduct. However, when a market failure occurs--and one portends at LaGuardia with the loss of many AIR 21 slots--the gov't unfortunately has to intervene.

In the case of New York, it is not Rochester or Birmingham or Greensboro's fault that LGA has only two runways and is clearly the preferable business airport at the nation's largest business market. Now that the FAA has reinstated slot controls at LaGuardia, the airlines must not simply cut off all the new service to underserved markets.

They must be willing to bite off a few high-margin flights here and there, and ensure that business people in medium and small markets have a few opportunities each day to get in and out of LGA. (Of course, larger a/c with bigger business and first-class cabins can still rake in all those high-margin dollars in the big markets, so nothing may actually be lost financially speaking). Nothing extravagant, and not necessarily low-fare, just there.


Need a new airline paint scheme? Better call Saul! (Bass that is)
User currently offlineTWAneedsNOhelp From , joined Dec 1969, posts, RR:
Reply 8, posted (15 years 5 months 4 weeks 1 day 10 hours ago) and read 2082 times:

Jim, you just described....Sweden.

".....LGA has only two runways.."

Two INTERSECTING runways might I add

User currently offlineDCA-ROCguy From United States of America, joined Apr 2000, 4661 posts, RR: 31
Reply 9, posted (15 years 5 months 4 weeks 1 day 1 hour ago) and read 2072 times:

Good heavens, Russ, I didn't propose anything as radical as converting our entire aviation system to a total down-to-the-dollar-and-route regulation system (which I is what I assume you mean by "Sweden." Is it safe to say you don't mean the suburban township outside of Rochester by that name? :+) )

Government interventions in market failures are as old, and as completely a part of free-market economics, as Teddy Roosevelt. Maybe the big carriers will act responsibly and not just cut all the new service at LGA to underserved markets. But DOJ and Congress should keep a close eye all the same.


Need a new airline paint scheme? Better call Saul! (Bass that is)
User currently offlineLHMark From United States of America, joined Jan 2000, 7255 posts, RR: 42
Reply 10, posted (15 years 5 months 4 weeks 23 hours ago) and read 2063 times:

Is anything being done by the PANYNJ to improve connections between JFK, EWR, and Manhattan? The obvious solution to the LGA crunch is to make the other airports more accessible to the business crowd. I'm pretty uninformed about the rail or subway connections 'twixt JFK and downtown, so I won't speculate on a solution. Having lived in Europe for a while, however, I appreciate a convenient rail link to an outlying airport.

Logan has a cross-harbor airport ferry. Why can't JFK establish a similar link?

"Sympathy is something that shouldn't be bestowed on the Yankees. Apparently it angers them." - Bob Feller
User currently offlineJetService From United States of America, joined Feb 2000, 4798 posts, RR: 10
Reply 11, posted (15 years 5 months 4 weeks 22 hours ago) and read 2053 times:

Why couldn't the Feds help subsidize some of the flights to medium-sized markets. Maybe match local subsidies dollar for dollar. This perhaps would allow underserved airports to get some of the flights they need with gov't help; absent gov't intrusion on the airlines. I realize slots are a problem, but if locals (with fed's help) can 'show them da money', it may make some of those markets competitive for slot allocation. Whada ya think?

"Shaddap you!"
User currently offlineDCA-ROCguy From United States of America, joined Apr 2000, 4661 posts, RR: 31
Reply 12, posted (15 years 5 months 4 weeks 19 hours ago) and read 2047 times:

JetService--There was a Federal program called the Essential Air Service, that for decades subsidized flights to small cities, especially in the Midwest. For instance, EAS funded three daily flights from St. Joseph/ Benton Harbor, MI, that ran on various commuter carriers for years. I can remember seeing North Central Convair 580's in the St. Joe skies in the 1970's; they went to DTW, I think. EAS got phased out in the late '90s; I think a few communities may still have coverage. Anyone who knows more please chime in.

As a solution to LGA? Possibly; EAS existed to support air service to communities that couldn't support it profitably. I'd have to check stats at the individual carriers, but it's hard to imagine that RJ flights from most medium-size cities in the East to LGA aren't profitable. The question is the profit *margin.* Which is much smaller on an RJ to Birmingham, than on yet-another frequent-flight MD-80 to ATL.

Because profit isn't likely a problem at LGA, just the margin, outright regulation may be the answer in that very specific situation. As a Republican I'm leery of lots of regulation, but Big Air has amassed such a dreadful customer-service and community-abuse record in the'90s it may not be avoidable in some situations. Such as LGA slot distribution.

LHMark--The Port Authority is building a multibillion dollar rail link from JFK to a subway line in Queens. The PANYNJ web site has an excellent section on it, including diagrams, photo gallery, and architect's drawings. I was at JFK in June and much of the elevated-rail infrastructure in the central terminal complex was already up. It will have stops at individual terminals, various airport facilities along the Van Wyck route out, and terminate at one of the subway lines. I think it will also have LIRR access.

PANYNJ is also extending the Newark Airport Monorail from the terminal complex to the main Amtrak NY-DC line, which passes near the airport. Within a year or two, pax will be able to take Amtrak (and presumably any regional commuter rails that use that line) and pick up the *free* airport monorail, right at a new "Newark Airport" Amtrak station.

As for LaGuardia, I don't know. They sure could use on though--like the wonderful Metrorail connection we have here at DCA.


Need a new airline paint scheme? Better call Saul! (Bass that is)
User currently offlinePurdue Arrow From United States of America, joined May 1999, 1574 posts, RR: 7
Reply 13, posted (15 years 5 months 4 weeks 19 hours ago) and read 2039 times:

Regaurding Essential Air Service, I believe that a community must be at least 60 miles away from a medium sized airport to recieve EAS subsidies. For example, routes to Lafayette, IN used to have EAS subsidies when American Eagle flew here, but, when the 60 mile rule was initiated, the airlines lost their subsidies becuase we are only 58 miles from Indianapolis. Now Great Lakes and Mesaba fly here, but Great Lakes (UAExpress) will stop service on 2/14.

User currently offlineCactusA319 From United States of America, joined Jan 2000, 2918 posts, RR: 23
Reply 14, posted (15 years 5 months 4 weeks 19 hours ago) and read 2038 times:

EAS is still out there at a few markets. Marion, Ill (MWA) still gets TWE service because of it. I'm not sure if the fed would be willing to subsidize markets that a bit larger like ROC-LGA though.

User currently offlineLHMark From United States of America, joined Jan 2000, 7255 posts, RR: 42
Reply 15, posted (15 years 5 months 4 weeks 18 hours ago) and read 2032 times:

EAS wouldn't fly in this case because the problem isn't one of air service, it's a problem of convenience. EAS won't step in to make it more convenient for business travelers to land at LGA instead of EWR or JFK.

Interesting side note: It costs $19 more to fly JetBlue from ROC-JFK ($49 with two week advance purchase) than it does to take a cab to Manhattan from JFK (30 flat rate).

"Sympathy is something that shouldn't be bestowed on the Yankees. Apparently it angers them." - Bob Feller
User currently offlineDCA-ROCguy From United States of America, joined Apr 2000, 4661 posts, RR: 31
Reply 16, posted (15 years 5 months 4 weeks 17 hours ago) and read 2031 times:

Fresh off Delta's PR Wire: Comair will drop all four daily CRJ's from Manchester, NH to LaGuardia, on Dec. 31, due to The Lottery. Did MHT draw the slip of paper with the black spot? :+)

BTW, I wasn't arguing for ROC-LGA EAS subsidy. I argued that EAS wouldn't be practicable because the problem isn't one of profitability, but one of *margin.* Subsidy isn't the answer, rather regulation to ensure that small cities aren't all "shuttled" out of LGA. Besides US has six daily pre-AIR 21 ROC-US slots, and a bunch of LGA-BUF, SYR, and ALB slots. IF they have any political sense they won't drop them.


Need a new airline paint scheme? Better call Saul! (Bass that is)
User currently offlineTWAneedsNOhelp From , joined Dec 1969, posts, RR:
Reply 17, posted (15 years 5 months 4 weeks 16 hours ago) and read 2021 times:

Hi Jim,

I was just poking fun of your post where you advocate that airlines need not be so selfish, money-grubbing, enterprises and that maybe once care a little about the communities they serve rather than the the money they make...

You know, Sweden is the like "model socialist" country. Tax brackets of 110%!!! Remember tennis star Stefan Edburg, he moved out so he could keep his winnings.

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