Chicago mayor Rahm Emanuel unveiled an $8.5 billion,
eight-year plan to expand and renovate O'Hare Airport, but the proposal could
be jeopardized by opposition from American Airlines, O'Hare's second-largest
tenant.
The plan calls for a 25% expansion in O'Hare's current gate
capacity of 184 and a 60% increase in O'Hare's terminal square footage.
Terminal 2 would be mostly demolished and replaced by a new international
terminal, to be called the O'Hare Global Terminal.
The airport's three other terminals -- 1,3 and 5 -- would
also be improved. Terminal 5, which serves international traffic, would be
upgraded and expanded. Terminals 1 and 3 would be renovated.
Emanuel and the Chicago Department of Aviation are pursuing
the expansion plan as they renegotiate lease agreements with hub tenants United
and American, which expire in May. Those and other carriers have been in talks
with the city for the past 18 months. Emanuel proposes to finance the first
half of the project through the issuance of $4 billion in bonds that would be
backed by airport revenue, including parking and concession revenue, but also
landing fees, terminal rent and other fees paid by airlines.
In a press release put out by the mayor's office Wednesday,
United, Delta, Alaska and Spirit executives all voiced support for a newly
negotiated lease deal and for the redevelopment of O'Hare.
"The improvements in our new agreement will help ensure
we provide a superior travel experience for the more than 36 million United
customers who fly through O'Hare each year," said United CEO Oscar Munoz.
United handled 32% of passenger traffic at O'Hare in the 12
most recent months for which Bureau of Transportation Statistics are available.
The figure doesn't include United Express regional flights, which are operated
by contracted carriers.
American, which competes fiercely with United in Chicago,
handling 27% of traffic at O'Hare, (not counting regional American Eagle
flights) said that it won't sign the agreement despite its enthusiasm for the
expansion project because of a "secret provision" added at the last
minute to award five additional gates to United.
"Today, Chicago is extraordinarily well positioned with
three carriers operating hubs and competing aggressively against each other,"
American spokeswoman Leslie Scott said, referencing itself, United and
Southwest, which has its largest base at Chicago Midway. "However, the
United gate deal would undermine competition, allowing the largest airline at O'Hare
to expand its size advantage for years into the future. Thus, the United gate
deal creates a clear winner, United, and clear losers: namely, competition,
Chicago travelers and American Airlines."
American said it would sign the lease if that provision is
removed, or if the city of Chicago would accelerate construction of three
already planned gates and award those to American.
"To date, the city has dismissed that approach without
explanation," the carrier said.
In an email to Travel Weekly, United spokesman Frank
Benanati called American's statement, "disingenuous," and said that
the arrangement for United to get five extra gates is due to an arrangement
that will result in American opening five new O'Hare gates later this year.
"American has been aware of our agreement for over a
year and has worked to block the implementation at every opportunity,"
Benanati said.
Emanuel's office didn't immediately respond to a request for
comment.
Along with the terminal expansions, the city promised the O'Hare
project would modernize airport facilities with use of advanced technologies.
Three new baggage systems would be introduced. State-of-the-art security
screening would be added and the airport would be designed to facilitate
biometric self-service check-ins.
In addition, the plan would facilitate more ease of movement
for connecting passengers and provide more gate capacity from the airfield
side, allowing the airport to more efficiently handle larger aircraft, the
mayor's office said.
O'Hare is currently the nation's third-busiest airport
behind Atlanta and Los Angeles, having serviced 79.8 million fliers last year.
Forecasts call for the airport to service nearly 100 million passengers by
2026, the planned completion year of the proposed redevelopment.