Canceled Southwest routes
• Boise-Salt Lake City
• Kansas City-Seattle/Tacoma
• Manchester-Las Vegas
Southwest Airlines will cut 100 of its nearly 3,200 daily flights at the end of the year, including many from cities such as Philadelphia, Pittsburgh and Boise, Idaho, as the low-cost carrier grapples with the higher fuel costs and still-sluggish economy that have vexed full-service carriers.
The airline, which will add back 120 flights in February, is permanently eliminating service from Philadelphia to Jacksonville, Fla.; Pittsburgh; Providence, R.I.; and Manchester, N.H. It also cut Boise service to Seattle; Salt Lake City; and Reno, Nev.
Southwest, which added flights for routes such as Baltimore to Boston and Orlando, said the route changes were part of its effort to integrate service with AirTran. Southwest acquired AirTran in May for $3.2 billion in cash, stock and debt in an effort to establish itself at major airports where it was not previously, including Atlanta and Washington Reagan National.
"The schedule coordination is a first effort by both airlines to maximize operations and prepare for full integration," Southwest said.
Still, the route cuts might be a broader sign that the financial headwinds that have struck full-service carriers such as American Airlines and United Continental are taking its toll on Southwest, whose first-quarter earnings plunged 55% from a year earlier on a combination of rising fuel prices and increased costs stemming from bad weather.
With airline shares hit by a combination of a slower-than-expected economic recovery, high fuel prices and the prospect of more transportation-security costs being transferred to them from a cash-strapped U.S. government, Southwest's stock was trading at a 52-week low last week.
"Guess what management has at their disposal to turn this around? Pull back capacity," said Vaughn Cordle, chief analyst at Washington investment adviser AirlineForecasts. "They're going to start weaning the routes that are the least profitable."
As for specific routes, Philadelphia can be especially problematic because of the combination of the airport's layout and weather patterns, which can wreak havoc on an airline known for its short-hop routes and quick turnarounds, according to Darryl Jenkins, chairman at Virginia-based consultant American Aviation Institute.
"Philly's probably a little more difficult an airport to work out of than they're used to," said Jenkins, adding that Southwest's online performance has been on the decline. "Philly loses an enormous amount of capacity in bad weather."
With Southwest cutting routes, at least for the short term, some of its competitors stand to benefit, according to Scott Hamilton, an aviation analyst with Leeham Cos. Specifically, Alaska Airlines is likely to gain passengers from Southwest's withdrawal from the Boise routes, while US Airways will likely further strengthen its position with Philadelphia travelers after Southwest cuts routes there, Hamilton said.