The moment that North Texas travelers have been waiting for has finally arrived.
Starting today, nonstop flights to Denver, Baltimore, Las Vegas, Los Angeles, New York and Chicago will be taking off from Dallas Love Field as the Wright Amendment restrictions are lifted.
For consumers, industry analysts say, there will be more choices, particularly for business travelers, since there will be more daily flights to cities like Washington, D.C., and San Francisco. And there may be some fare sales as airlines try to fill up seats on these new flights.
“You’re basically going to have to spur demand and the only way to spur demand in something like this is to drop prices,” said FareCompare.com founder Rick Seaney. “You have to get people to go who wouldn’t go if the price isn’t right.”
For 34 years, the Wright Amendment restricted where airlines could fly out of Love Field to a handful of states unless the airline was using planes with less than 56 seats. A compromise between local leaders and approved by Congress ends those restrictions while limiting the airport to 20 gates and prohibiting international flights.
But the impact won’t be as great for North Texas fliers as some might have hoped when the compromise was reached in 2006.
The airline industry has fewer competitors, with several airlines merging, including American and US Airways, and Southwest Airlines and AirTran Airways. Oil prices spiked in 2008 and have remained around $100 a barrel. As a result, average fares at both Dallas/Fort Worth Airport and Love Field have increased in the past few years.
“The real beneficiaries of the Wright Amendment going away are people who live closer to Love Field than to DFW,” said Bud Weinstein, an economist at Southern Methodist University. “It’s also a real plus for downtown Dallas because you now have an airport 10 minutes from downtown.”
Consumers have already seen some low fares from Southwest and Virgin America on their new flights out of Love Field, but do not expect carriers to discount the flights forever, said University of North Texas lecturer Steve Joiner.
“The fares on a particular entry into a new market don’t last that long,” Joiner said. “You’ll see fares stay reasonable but they will be higher than they have been in the past.”
When through ticketing was introduced in 2006 — allowing Southwest to sell tickets on flights that left Love Field, stopped in a Wright-approved state like New Mexico, and then continued on to Los Angeles — the Dallas-based carrier had to convince Tarrant County residents to drive past DFW to fly out of Love Field.
Southwest Chief Executive Gary Kelly said internal company research shows that some already do, as the airline increased its one-stop flight offerings. Through ticketing generates $250 million to $300 million annually for Southwest.
“We have millions of customers right here in Dallas, and this is an opportunity for us to say, we’re bringing you more product,” Kelly said.
Southwest added seven nonstops today and will add another eight nonstop routes Nov. 2. San Francisco and Oakland will be added to the nonstop list in January. Virgin America, which moved its operations from DFW to Love Field today, launched four new nonstops from Love Field.
Simply having a second airport to choose from offers consumers more competition to choose from, said Airfarewatchdog.com founder George Hobica. But he added that lifting the Wright Amendment restrictions will likely only affect fares on a handful of routes.
“It’s probably better for Southwest than it is for consumers because Southwest can now fly to where they think they can make the most money,” Hobica said.
Analysts say Southwest will maintain its monopoly on Love, operating over 90 percent of the capacity out of Dallas, while American remains the largest carrier at DFW, with over 85 percent of the traffic.
In a newsletter sent to employees last week, American said it is “well-positioned to withstand the challenge from Southwest and other airlines at Love Field.”
“We are going to be in a competition for our customers when the Wright Amendment goes away. I think it’s a competition that we’re going to win,” American president Scott Kirby said.
American plans to win by flying more often to top business travel destinations each week. For example, American has 116 flights a week to Chicago while Southwest only has 40.
There is one market where American acknowledges that Southwest still has the advantage and that’s Houston. Southwest flies to Houston 138 times a week compared with American’s 101 flights.
“Unless Southwest can increase their frequencies, American has a huge advantage,” Seaney said. “All they have to do is drop the price at the time that Southwest leaves.”