The long-anticipated Southwest entry into the New York market is set for June 28, as the carrier announced schedules and fares for its entry into LaGuardia with nonstops to Baltimore-Washington and Chicago Midway.
Industry mavens said the king of the low-cost carriers is certain to reshape service and pricing, but the congestion at LaGuardia is bound to take its toll on the airline, too. New York's routine delays are certain to disrupt the airline's traditional 30-minute gate turnaround times.
"For years, customers have asked for Southwest service into New York City, and we are now connecting two of our largest markets with the nation's largest city," said Gary Kelly, Southwest chairman, president and CEO.
The Dallas-based airline will offer five daily nonstops to Midway and three to BWI, with introductory Web-only rates (through April 20) of $89 and $49, respectively.
The carrier also plans to launch service at Boston's Logan Airport in the fall.
Southwest has avoided direct competition in congested areas such as Boston and New York, though it has entered the region with service to MacArthur Airport in Islip, N.Y., plus points in New England such as Manchester, N.H.
"For years we've tried to entice them," said William DeCota, director of aviation for the Port Authority of New York and New Jersey, which owns and operates LaGuardia. The hold-up, he said, has always been the impact that LaGuardia delays would have on the Southwest operational model.
But DeCota said, "They're coming in with an understanding there is this constraint. There's no escaping it. There's a 30% chance you're going to be delayed by 15 minutes or more. But they're figured out a way to escape a ripple effect through the rest of their network."
Southwest got its toehold at LaGuardia by acquiring seven pairs of slots from its bankrupt code-share partner ATA Airlines for $7.5 million.
It then did some bartering to get more slots and cut down on some potential congestion delays. The original slots were all during peak periods. The airline traded them in for eight slot pairs spread throughout the day.
Bob Jordan, an executive vice president of Southwest, said there was quite a bit of "horse trading" involved.
In the Nuts About Southwest blog, Bill Owen, a lead planner in Southwest's schedule planning department said, "We're able to add an eighth flight by scheduling our first [Chicago] departure in before slot controls start [prior to 7 a.m.] and putting the last arrival after slot controls stop [after 9:59 p.m.].
"So even though we're new to this whole slot-controlled thing, we're already working to maximize our presence at LaGuardia."
Southwest spokeswoman Whitney Eichinger said, "We secured 14 slots from the ATA deal, one slot from the FAA, and one flight lands after 10 p.m., so it is not under the slot rule."
Addressing DeCota's comments on delay difficulties, Eichinger said, "What you see with our schedule is many customers will change planes in either Chicago or Baltimore to continue on their trips. So if you have a connecting flight, it most likely will not be on the same aircraft. For the schedule that means that if we incur delays in New York City, it will not affect our system down the line as much as it would if folks in Baltimore and Chicago were waiting on that specific aircraft to continue their trip."
Going into LaGuardia is a big, perhaps even necessary move for Southwest, said Kevin Mitchell, chairman of the Business Travel Coalition, as the airline continues to try to land more corporate travel programs. And the new Midway and Baltimore service at the airport will be a "great move" for consumers, he added.
"This will have the likely effect of disciplining pricing in scores of LaGuardia nonstop and connect markets," Mitchell said.
Darin Lee, principal at consulting firm LECG, said, "In my view, Chicago was fairly predictable, and a prudent choice for Southwest's foray into LaGuardia. After Miami/Fort Lauderdale, Chicago is the largest origin-and-destination market from New York City, and it commands a much higher average fare than South Florida because of its strong business mix."
Southwest, Lee said, also already has good coverage of Florida from Islip.
"Given the appeal of LaGuardia to time-sensitive business travelers, Chicago makes a lot of sense," Lee said. "BWI is perhaps a bit riskier, because of the strong competition from [Amtrak's] Acela and the fact that JetBlue also serves the city-pair. But I suspect that Southwest couldn't resist the high yields."