18.5.05

Watching Closely In Memphis

It makes sense that Memphomaniacs would be quite interested in the ongoing saga. One of us knows several from that great city who regularly drive to Little Rock so that they can fly Southwest. The Memphis airport is a Northwest Airlines hub and has a stranglehold there. Its frustrating for Memphians especially when their airport is located a mere 12 miles from the Wright boundary.

Memphis Business Journal

From the May 13, 2005 print edition

Southwest fights for right to fly
Amos Maki

A legal battle between two airlines in the heart of Texas could have major implications for Mid-South travelers.

Southwest Airlines, the nation's most popular and profitable discount airline, is waging a public relations and lobbying blitz on Capitol Hill to repeal a 26-year-old law that restricts flights on full-size jets from Dallas' Love Field to destinations in Texas, Louisiana, Arkansas, Oklahoma and New Mexico. In 1997, the law was amended to add Mississippi, Kansas and Alabama. Southwest is based in Dallas, where American Airlines has a monopoly on Dallas/Fort Worth International Airport and is fighting to keep the law in place.

Southwest officials say repealing the federal law would remove one hurdle from serving Memphis. Other barriers remain, however, including the lack of flyers who use Memphis as a destination or point of origin and Northwest Airlines' domination of the local market.

"If we made an announcement tomorrow that we're coming to Memphis, it's against the law to have traffic from Dallas to Memphis," says Ed Stewart, spokesman for Southwest Airlines.
Southwest officials say establishing service from Dallas to Memphis would improve Memphis' chance of getting service from Southwest because they could use Dallas as a destination or connecting city to establish traffic in Memphis. From Memphis, Southwest could serve Chicago's Midway Airport.


Dallas and Chicago are huge destination points for Memphis area travelers. According to data from 2003, Chicago ranked second as an origin and destination point for Memphis International Airport, while Dallas ranked fifth.

Larry Cox, president and CEO of the Memphis and Shelby County Airport Authority, has courted Southwest for two decades. He is confident Southwest will one day enter the Memphis market, but he isn't so sure repealing the Wright Amendment would automatically bring the discount carrier to town.

"We've been trying to get Southwest here for a long time, but they have not made any commitment to me that the repeal of the Wright Amendment would get them in," Cox says. "It would probably help Nashville to our detriment."

Southwest is able to serve Nashville, but none of its flights are direct from Dallas. Nashville is Southwest's 10th busiest airport in terms of daily departures, with 85 daily non-stops to 27 cities with connections available to 27 other cities. The airline operates 10 gates and employs 394 people in that city.

For years, Memphis travelers have been making trips to Nashville and Little Rock, Ark. -- where Southwest offers 14 daily non-stop departures to seven cities -- to take advantage of the airline's discount prices.

Robert Dow, a controller with Acoustic and Specialties, Inc., a commercial interior contractor in Memphis, lived in Dallas for eight years and was accustomed to having price-competitive travel options. Now, he says he would rather drive to Arkansas to catch a flight.

"Northwest has a stranglehold on Memphis-based air travel," he says. "Memphis, not just Dallas, is hurt by the Wright Amendment. Why else would so many people, myself included, rather drive two hours to Little Rock and fly Southwest Airlines than to pay the exorbitantly high ticket prices commanded by Northwest?"

Southwest has heard the cries from Memphis.

"I know the pain people in Memphis probably feel and it's no small pain," Stewart says.

Northwest is the dominant carrier in Memphis. The Eagan, Minn.-based airline and affiliates Mesaba and Pinnacle Airlines operated 224 of the 283 daily flights from Memphis International in March 2005. The airline offers nearly 90 destinations from Memphis.


Southwest officials acknowledge the challenge Northwest would pose if they entered the local market.

"They play hardball," Stewart says. "You better be ready to get in the ring with a heavyweight. When you go to a fortress hub, you better expect big, silver bullets to be coming your way."
Northwest, the nation's fourth-largest carrier, has no official position on the Wright Amendment and says it isn't afraid of the possible competition from Southwest. In Memphis, Northwest has some low-fare competition from Air Tran and America West and the airline competes directly against Southwest in Detroit.


"Northwest competes with those carriers on the basis of price, service, frequency and breadth of destinations," says Thomas Becher, spokesman for Northwest. "We believe that Northwest's product offers Memphis area travelers a superior experience in many ways, including international service."

The Wright Amendment was enacted to protect Dallas-Fort Worth airport and, Southwest would say, the airlines it serves, from competition. For many years Southwest was neutral on the law. Those days, however, are long gone and Southwest has no intention of backing down now.

"We've lived with this misery for 26 years and as long as it takes, this fight will go on," Stewart says.

CONTACT staff writer Amos Maki at 259-1764 or at amaki@bizjournals.com

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