Troubling airline developments
Las Vegas tourism industry could be hurt by merger of carriers, grounding of 787
Two big national aviation stories could affect Las Vegas tourism in the months and years ahead.
One is a potential merger between American Airlines and US Airways. The other is the grounding of the Boeing 787 Dreamliner.
All the buzz points to a merger announcement soon from American Airlines and US Airways. Unlike US Airways’ sloppy merger with America West Airlines in 2005, the major unions for both airlines have been in front of the deal and support it.
The big question that remains is which management group would run the new company. It appears that US Airways Chairman and CEO Doug Parker has the inside track, although some prefer American CEO Tom Horton. Horton has positioned American to expand by 20 percent when the airline emerges from Chapter 11 bankruptcy protection. Parker, on the other hand, is one of the strongest advocates for capacity restraint — and that’s where Las Vegas comes into play.
The city’s resort community has been its strongest when airlines expand capacity with new flights and larger aircraft. But Parker makes the case that if airlines were to do that, planes would have more empty seats and airlines would lose profits.
It’s easy to understand Parker’s philosophy, but the real-world effects of capacity restraint on a community can be devastating.
US Airways, under Parker’s control, radically decreased its presence at McCarran International Airport, and hundreds of flights — and jobs — were lost. But the industry became healthier.
One can imagine what Parker would have in store for Las Vegas if he heads the new American-US Airways airline.
American operates an average of 26 flights a day to Dallas, Los Angeles, Chicago, New York and Miami. US Airways runs an average of 18 flights a day to Phoenix; Philadelphia; Charlotte, N.C.; and Washington, D.C.
There could be fewer flights, or no difference at all, but don’t count on the new airline to be a part of an international expansion for Las Vegas, particularly with US Airways’ Phoenix hub so close.
Las Vegas’ hopes to have Boeing 787 Dreamliners carry international passengers here also may be dashed.
When they first went into service in late 2011, 787s received glowing reviews. Manufactured with lightweight materials, they were more fuel efficient than other planes and more comfortable for passengers on long trips.
Bigger than 757s and smaller than 747s or 777s, they are perfectly suited for intercontinental trips.
But only one airline that flies 787s — United — operates at McCarran, and that company is unlikely to use them on international routes to Las Vegas.
More likely candidates would be Japan Airlines, All Nippon Airways or Air India. It wouldn’t shock me if the air service development team fielded by McCarran and the Las Vegas Convention and Visitors Authority already has talked with those companies. And 52 more airlines have them on order.
But the 787 has been grounded since Jan. 16 as engineers work to resolve issues with its electrical system and lithium-ion batteries. If the problems drag on, they could damage consumer confidence — and put a dent in Las Vegas’ long-term hope to use the plane to bring overseas customers here.