Logic lacking from Wright backers
 

from the Dallas Morning News:

Logic lacking from Wright backers
by Mark Davis
12:02 AM CDT on Wednesday, June 1, 2005

Those who join me in calling for the unplugging of the Wright amendment share two beliefs.

First, an open marketplace for Southwest Airlines (and others) at Love Field would bring American Airlines fares down at D/FW International Airport, and second, AA and D/FW can withstand that competition and perhaps even benefit from it.

The factions fighting to keep the shackles of Wright on the flying public have two replies:

1) The "Southwest effect" would be so meager that the fare reductions would not be as thrilling as people say, and

2) Opening Love Field would be a seething disaster for American and D/FW, wounding the local economy for heaven knows how long.

Anyone notice that those two are contradictory?

Wright amendment proponents need to make up their minds. Love Field is either so small that it cannot spur lower fares at D/FW, or so dauntingly large that it will cripple one of the planet's largest airports and one of its biggest airlines.

This is the irrational bed Wright's advocates have made for themselves, wrapping themselves in its quilts of outdated logic and concocted fears.

Wright made sense when it passed in 1979. D/FW Airport had to have every chance to flourish; there was simply too much invested in it to subject it to the vicissitudes of the marketplace.

The success Wright helped create at D/FW is now the best argument against keeping the law. The voices at American and at D/FW invoke apocalyptic economic doom if little Love Field opens up, and most people have correctly shaken their heads in disbelief. How odd is it that those of us looking to scrap Wright have more confidence in AA and D/FW's future than their own leadership seems to have?

D/FW is one of the world's great airports. American is one of the greatest airlines in the history of aviation. 9-11 knocked them both against the ropes.

The best road to recovery for all airlines and airports comes not from stifling competition, but from additional years of safe skies and a strong economy, so that more and more people can conjure the confidence and money to fly.

The best point Wright supporters make is that Love Field should have simply shut down when D/FW opened for business.

Well, it didn't, and we don't have that magic time tunnel to take us back to relive the history that drives Wright's fan base nuts more than a generation later.

In a textbook case of the pot calling the kettle black, former AMR CEO Robert Crandall has scolded The Wall Street Journal for its pro-consumer stance that Wright should be overturned, arguing in a recent letter that Southwest has enjoyed "a unique monopoly position" at Love Field.

American can fly from Love anytime it wishes. Meanwhile, those Southwest fliers are really getting gouged, aren't they? You can see them grimace as year after year they make Southwest the rarest of all corporate species – a profitable airline.

If you want to see monopoly pricing, examine American's fares to various cities from D/FW, and then compare them with the cost of the trip from any other Texas city where Southwest is a direct competitor.

This proud, massive airline and a very proud, massive airport are following understandable instincts: They are fighting for their bottom line. But the scare tactics must stop and Wright must go. It is ridiculous to dwell on bad blood and what-ifs from the era of disco and bell-bottoms.

After D/FW and AA shake off an initial sting, lower fares will create more demand for flights to and from the Dallas-Fort Worth area. As the vast majority of our area's growth extends north and west, D/FW will remain the favored airport by a vast majority of fliers.

Reps. Sam Johnson and Jeb Hensarling have boldly introduced the Right to Fly Act, which would repeal Wright immediately. There is no excuse for any Texas member of Congress – especially not the Republicans, who are duty-bound to support free markets and consumer liberty – to stand in its way.

Davis Rebuttal
 

SWAjet,

Mark Davis is a morning DJ for WBAP here in Dallas. He will debate our former CEO, Bob Crandall, this morning between 9 and 12. If you want to follow the debate, you can go to the following link to hear it live.

http://www.wbap.com/

Here is my letter to Mr. Davis,

Mr. Davis

I usually agree with most of your views, but on the Love Field debate we are on opposite ends of the spectrum. Make no mistake about it, Southwest is trying to fly out of Love for one simple reason – they want to drive a dagger into the heart of American Airlines.

Mr. Davis, do you know that Southwest has most of their fuel hedged for the next two years in the $24-$26 price range while American is paying the going price in the high $50’s. The $24 -$26 fuel hedges run out in a couple of years. Mr. Kelly knows he has a limited window of opportunity with a major price advantage, hence the move now to open up Love Field.

You also seem to think DFW and American “will just be fine” if Southwest wins. Mr. Davis, surely you know the precarious financial footing that American has been operating on since 9/11. Our employees have taken severe paycuts on the magnitude of 23%-40% to help keep our company out of bankruptcy. Many, many jobs in the metroplex have been lost at our airline. Our management has made great strides to cost our costs, yet due to the high fuel costs we are just barely keeping our heads above water. I hope you realize that our airline can not even afford to put pillows on the planes anymore. We are just now starting to see the fruits of our labor.

Meanwhile, DFW has taken on billions in new debt building both a drastically needed new international terminal and airport train the last few years. Now you and other misguided congressional leaders want to let Southwest have their cake and eat it too. You want to help one of the few strong airlines and body slam American just as we are just getting back on our feet.

Wise leaders sought to prevent this type of airport turf battle by drawing up the Wright agreement years ago, but Southwest has constantly tried to jump through legal loopholes to keep their monopoly going in North Dallas.

The sad fact of this matter is that if Southwest wins, either American loses many of their best customers in North Dallas, who will choose the shorter commute to Love Field, or American will have to split their operations (which will cause an enormous rise in operating costs) to compete with Southwest over at Love.

What is lost in this argument is that Southwest is free to come right over to DFW and fly anywhere in the US. There are plenty of open gates. Yet, it chooses to stay at Love. Now ask yourself, why doesn’t Southwest want to move to DFW?

Yes, we all love cheap tickets, but is the support for Love field worth putting American into bankruptcy or having double the airline traffic at Love? Will this be better for the metroplex? Ticket prices are already hovering near a 15 year low. American, its employees, and the DFW Airport Board have made enormous investments and upgrades to DFW airport and the local community based on keeping the Wright Amendment intact. Now you want to pull the carpet from under our feet. This is a case where one company wins all the marbles while the other one gets screwed. How fair is that?

Like I said, I enjoy your show, but your support for Southwest will have severe repercussions for American and its employees. Unfortunately the fallout will be felt around the Metroplex. I hope you reconsider your stance.

AA767AV8TOR

YGTBSM. All this from the the airline that reconfigured it's F100's to 56 seats to "compete" with Legend Air. As soon as AA drove the dagger in the heart of Legend, it packed up and went back to DFW. And now YOU are crying foul?

Inaccurate. We have significant hedging out through 2009. Additionally, we are continuing to acquire further hedging as the marked warrants. They don't "run out". Therefore your thinly laced theory that we are doomed without the end of the WA because of no more fuel hedging is not supported by fact. Or reason.

Here is a summary of the arguments:

AMR employees understandably don't want their airline to suffer from the competition SWA would bring to many lucrative AA DFW-? routes. So they're willing to make any argument EXCEPT that customers would largely benefit by the reduced fares and greater choice of flights/carriers. (any argument that AA would go under is absurd).

SWA employees want to be able to fly anywhere they want to, and a federal law banning them from certain city pairs flies just isn't right in 2005.

There ya have it.

Flea

AA is going to lose on this where it matters most which is the court of public opinion. The sooner they realize this the quicker they can lessen the damage.
AA had fuel hedges but they were cashed in to fortify the management pension plans. That isn't the AA employee's fault, but neither is it SWA's fault. AA has the cost advantage of lower wages. AA is a great airline with a great global network. If they can't compete in Texas on a level playing field then they might as well shut down now because they will never compete anywhere.
Their own doctored study showed airfares falling 50%, they just left that part out. The people of Texas aren't stupid, only a lot of the legislators and officials at DFW.
The best thing AA can do is drop this stupid facade and simply compete on their strengths like they do in Miami and Chicago. When that happens traffic will increase for everyone just as it has everywhere else the "Southwest effect" has taken hold. Delta and USAirways have already proven that raping the public is not in the best long term interest.

Not trying to sound like a skipping CD but,
AS I HAVE SAID BEFORE AND WILL SAY AGAIN....IF SWA WANTS TO FLY LONG HAUL COME ON OVER TO DFW AND SET UP SHOP.
ASK ANY DELTA EMPLOYEE, THERE IS PLENTY OF AVAILABLE GATES AND ROOM TO OPERATE.
I know it and so does EVERYONE else SWA and ONLY SWA wants to kick out the Wright FOR THEIR BENEFIT.

I just want to vomit on your cockpit floor when I hear all the business about

"This is what the customers want"

BULL**** This is what SWA wants.



I have a final soultion for this matter.
Repeal the Wright law CLOSE LOVE FIELD. to ALL AIRLINE TRAFFIC
and have EVERYBODY operate from DFW.
No more bickering one airport fits all, everybody moves the speed of the slowest airplane.
Try that shoe on SWA!

The door will be open (and always has been) open for ALL INTERESTED airlines
to operate out of DFW.
SWA has no interest in"adding competition" to the north Texas market,
They just want to skate the existing law whine and cry and make a quick buck.

My offer is this:
If SWA TRULY WANTS to offer all of USA flying from north texas,
Do what EVERY OTHER AIRLINE DID 30 years ago.
MOVE TO DFW.
I say this :
"PUT UP OR SHUT UP"
GET OFF YOUR CHECKBOOK AND COME PLAY WITH THE BIG BOYS

And you wonder why you're loosing money.

Like I posted to you in another thread; We won't move to DFW for the same reasons we left DEN, SFO, and IAH. WAY too much pain (reference your post above) for the buck.

True on both counts. We want this because this is what the customers want. It makes good business sense.

Yes, you are correct. This is supposed to be a capitalist society.

Next.

Let me ask you again (from another thread); we pack up and move to DFW. We are now saddled by the same exorbitant leases and flow delays that you are. Now what? Feel better? You seem to advocate the best course of action if someone has fallen over a cliff is to not change course, but to jump over with them. :rolleyes:

I post this once more as proof;

The bottom line is MONEY.
It is FAR CHEAPER to attempt a change in the law than compete head to head
as in SWA DFW to ORD equals 159.00 dollars
AA DFW to ORD equals 159.00 dollars

I would surely get on your bandwagon if it made MY COMPANY millions of dollars.

As I have stated before SWA is NO DUMMY.
They know that they have it good right where they have it (Love )

I just can't stand the BS and out and out LIES that come from the "Free Love"
camp.

You an I both know that SWA/DFW is stupid.
Your proposal to free up Love field ONLY benefits SWA.
I don't care how much shoe polish you rub on it.

Here is my take on the whole deal.

SWA wants to open up Love for THEIR BENEFIT not the customers or North Texas.
They want to operate UNOPPOSED in their sandbox.
I say CLOSE LOVE.
AND EVERYBODY MOVE TO DFW.
That way no more squabbling.
I know damn good and well that SWA WILL NOT go for that. AND SO DO YOU.

If SWA said what they REALLY MEAN then I could possibly understand your point.

The "FREE LOVE" camp needs a ad like this:

Tired of getting dicked by AA?
Well come on over to our Lovely field, Friendly TSA, smiling employees, and maybe even star in our own television show! We will jet you off to exotic locations like DEN and LAS or maybe even LAX! And when the smoke clears from this Wright Amendment snafu we will raise prices to the same as you had it at DFW. So Come-on over it will be fun-fun-fun.

Open up Love field benefits 1 company.
Leaving the Wright Amendment alone benefits ALL companies :)

The Wright amendment is going away. Public opinion is running in the high eighties for doing away with it. Even corrupt politicians with lined pockets will bow to those numbers. It is even worse now with the debaucle of the bogus study which conveniently left out the part about the dramatically lower fares for the people of the area that has become the laughing stock of even the national press.

AA went to Love long enough to pummel Legend Air, (once Cecil had chided them enough into being able to handle the slam dunk arrival). ORD and MDW do fine. MIA and FLL do fine. IAH and HOU do fine. LAX and BUR, ONT, SNA do fine. SFO and OAK do fine. They all have their respective niches and loyal customers. Playing the bawlbaby over DFW is just making AA and the DFW administration look moronic to the public.

The time for debate is over. The momentum for change is too strong. AA needs to face reality and learn to compete or surrender, because next time if it isn't SWA it will be Jetblue, Airtran, Frontier, whoever.

For a nation that prides itself on free market principles, the Wright amendment is an absolute travesty. Such blatently heavy handed regulation of open and free commerce is unprecedented even during the glory days of the Soviet Union and Aeroflot.

Ironically, it is AA who is to blame for this whole issue coming to a head now anyway. SWA didn't care when their focus was on short haul. It was Crandall's leadership is getting taxes and fees imposed by the segment rather than percentage of ticket price that forced SWA into the long haul market in the first place. That strategy was aimed directly at hurting SWA and it has now come back to bite its mamAA on the hiney.

You sound like Al Sharpton, or Jessie Jackson
It just ain't fair!
That makes me Laugh Out Loud.

Lets talk about something worth talking about like...
 

Hooter's Air

Does anybody know anything about this small flying company (club)? Is there a better job out there?

Just wondering if anyone could open up this meca of potential?

Great rebuttal. You just reinforced the title of this thread.

AA,

Read what Widow wrote one more time;

Widow,

Your entire post was beautifully stated. :D

But I especially liked this:

Just face it guys.
SWA wants to rule the world.
I thought the title of "Sky Nazies"
was already taken?

SWA wants to rule the world. So does AA, UA,and Delta. Protectionist regulations are wrong and outdated in a free society.

If Wright Dies
 

I just wonder if this Wright amendment is indeed changed, since it solely benefits SWA at the expense of American Airlines, as a comprise, SWA has to give up have half the gate space at Love.

SWA may very well end up with a ton of competition at Love, plus long, long waits for takeoff. Say good-bye to your monopoly at Love. RLC said on the Mark Davis show yesterday, that if American is able to secure half the gates at Love, all of this is no problem.

You don’t think this could happen – Watch!!

SWA fuel hedging program have been very successful. In fact, it’s the primary reason the company is still one of few profitable airlines. What happens with your future hedges depends on where the price of gas goes. I realize SWA has other fuel hedges in place, but your low fuel hedges start to run out in a couple of years.

No doubt Kelly is trying to put the squeeze on American, but it could backfire in a big way.

AA767AV8TOR

AA loses in that game. AA already came into Love just long enough to screw Legend and then high tailed it out of there. (but not before a whole bunch of go-arounds). On the other hand, SWA could get a pot so sweet out of the DFW folks worried about their darkened corridors to bring lock stock and barrell to DFW and run 300 or so flights a day at $20 a pop and enjoy a (short) war of attrition and end up king of that hill. Who knows? That could actually be their plan from the get go. From my experience the employees of AA don't really care much for their own company but the employees of SWA love theirs like family. I rode on AA in February and there was a AA mechanic riding two rows behind me. After a cursory cabin service, the FA of our section and the mechanic compared notes on all the things they could do to harm the company if they lost their pensions or were forced to take another pay cut. Many passengers heard most or all of the conversation and several commented on it.
It is a shame because I happen to think that American Airlines is one of the best legacy carriers and could actually have the brightest future. That why it is unfortunate to see how stupid and silly they look to Bobby and Suzy Cowboyfan over this Wright issue.
Nevertheless, on the issue of the Wright amendment, my bet is on Love and Luv.

Widow’s Son,

I wouldn’t count out AA so quickly. Yes, AA is a wounded animal. And yes, wounded animals can fight pretty hard when threatened. You talk so much about the loving culture at SWA, but don’t forget that the F/A’s were ready to walk last year until Herb stepped in at the last moment.

I can’t really disagree with you regarding the cultures between SWA and AA or any legacy carrier for that matter. The employees at the legacies have had to suffer on so many different levels that SWA has managed to avoid so far – terrorist attacks, paycuts, downsizing, loss of perks and now the pensions. It’s no wonder there is a bunch of poor attitudes.

You are right though about AA being the “best of the worse.” It’s the reason why Kelly is going after AA before we fully recover. It is just a good business decision for them.

I think you are taking this whole thing way too personally, not as an individual, but as an AA employee.

I don't think SWA is "going after" anyone. They are just trying to do what is in their own best interest and what is fair. In the process they could very well end up helping AA by stimulating traffic at both airports and forcing AA to abandon the legacy operating models that no longer work.

SWA has always been the type to focus on building itself up rather than tearing others down. No airline in industry has more of a history of "going after" competitors than AA. Read books such as "Hard Landing" and learn of all kinds of nasty even illegal tactics employed over the years, or just ask any former Braniff employee. SWA doesn't operate that way. It was AA's throwing SWA out of Sabre a few years back that forced SWA to pioneer alternative ticket distribution models that have swept the industry and it was the Crandall led coalition that changed fees and taxes to being segment based that forced SWA into long haul. Both have been hidden blessings for SWA just like opening Love could end up being a hidden blessing for AA. When someone gives SWA a lemon, they have an amazing knack for turning it into lemonade. Other carriers would do well to learn the same.

SWA not going after anyone! Don’t kid yourself. I guess going into Phili and Pittsburg was just coincidence. Under Kelly, SWA has gotten very aggressive, almost morphing into the old Crandall mode.

What is fair is for SWA to go to DFW. The leaders of Dallas and Fort Worth did not want competing airports. That was the whole idea behind building DFW.

Here is a quote from AA VP of Marketing this morning:

Fort Worth-based American said Southwest competes successfully against all carriers.
"Southwest is neither small nor weak, nor are they the underdog that they like to play," said Dan Garton, American's executive vice president of marketing. "When they decided to 'take us on' in San Jose and Nashville, they did just fine. When they decided to take on entrenched carriers in Los Angeles, Baltimore and Orlando, they did just fine. And presumably, they feel pretty good about their chances of succeeding against 'fortress hubs' in Philadelphia and Pittsburgh."
Given Southwest's success, Mr. Garton said, "it is hard to imagine what they are afraid of at D/FW, except that – given a choice – they would prefer to grow their monopoly at Love to the challenges of the level playing field at D/FW."
As for any operational issues about D/FW's size and scale, Mr. Cox described them as "red herrings." These factors include:
•Taxi times. Planes take an average 29 minutes to get between gates and runways at D/FW. That won't work well with Southwest's model, in which planes spend as little time as possible on the ground.
But Southwest operates at airports where some of the average taxi times are even longer than at D/FW. Data from February to March showed that Southwest planes had longer taxi-out times (going from the gate to the runway) at Philadelphia and Fort Lauderdale, Fla., than what American saw with its planes at D/FW.
However, the same data showed American's planes at D/FW had about double the average taxi-in time than most of Southwest's airports during February and March.
•Costs. It will cost about $6.33 to fly a passenger from D/FW once its new terminal is open. That's among the lowest fees for a major airport. Southwest pays less to fly from Love Field, though the airline didn't have a precise figure Wednesday.
The greater cost for Southwest would be in splitting its operations between two airports, which would not only involve a lot of new infrastructure but considerable confusion for its customers.
Southwest estimates that it's invested tens of millions of dollars in Love Field that it prefers not to walk away from.
Still, D/FW officials say they're convinced that Southwest would succeed at D/FW and should fly there in the interest of doing what's best for North Texas.
"A company's business model should not dictate public policy," Mr. Cox said.

The extension to the Wright amendment allows Southwest to fly to Mississippi, Kansas, and Alabama, and guess what? They haven't even touched that new route authority. Hmmmm.

If the amendment is appealed I see the following shakeout. American moves in to match Southwest's new longhauls, providing a better passenger experience and stimulating traffic in that market.

Swa wont stop till they rule the world.
Ask any "other carrier" about the preferential treatment that SWA enjoys.
I can not tell you how many times I have had to turn 30 degrees to "make way"
for SWA.
Just the other day in STL we were told to hold short for crossing traffic.
waiting to join the taxiway,
3 and 1 half minutes later SWA comes by . looked just short of "airspeed alive" to me.
This kind of treatment is Bull $@&%
You guys are the primadonna of the airline world,
SWA can do no wrong just ask anybody.

Personally I think its Bull %#(^ that SWA pays for parties for all the center controllers.
That is exploiting the Government.
There should be rules against that.

SWA is just another airline , but now that they have the attention they need they are AGAIN trying to exploit the government (see repeal Wright Amendment)

Agreed...but until it is illegal you may want to start sending a case of Wild Turkey to center controllers. After all - you only have to walk accross the street from the AA "schoolhouse" to deliver it.

Wild Turkey is Herb's choice.
Not sure what the ATC likes.
probably cold beer and hot FA's
Neither we have here at the Goliath Air.

We all just need to laugh a little here
Look at Herb, that guy is always smiling and happy.

Great Point...all over the industry - pilots are fighting the same race to the bottom from our respective managements. The last thing we need to do is beat up on each other, after all we're doing the same job just wearing a different uniform.

The ability to laugh goes a long way.