Troubling airline developments

Las Vegas tourism industry could be hurt by merger of carriers, grounding of 787

Richard N. Velotta

Richard N. Velotta

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.

Tags: Business, Opinion
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  1. The lack of action taken by the leadership at McCarran to keep US Airlines night flights and the comments following that stated that the flights were only connections anyway - were just bunk. You can see the downturn in the economy of the airport during this single stretch. Nothing to motivate US Air to keep the flights, unlike now where incentives are being provided to airlines who add flights. If this was only done back in 2008, where would this town and the airport be right now?
    Fact is that Douglas Parker getting his hands on American is a horrible move for Las Vegas. He has shown no love towards Las Vegas and you can only hope that this takeover is denied. It was not so long ago when Harry Reid jumped in to help approve US Air / America West getting more slots at Reagan National. Part of the deal - Las Vegas needed a non stop flight to Reagan on that airline. Those flights were at 11 PM at night and full all of the time. When no one was looking, US Air cancelled these flights. Only bringing them back a year later - where they still are full. The Hotels will all tell you how they want more non stop flights from East Coast and Midwest Cities were average spend per passenger is much higher than any new LA to Vegas route. Killing off the night flights - which were usually cheaper flights now has made Vegas a dead airport for inbound passengers after 11 PM. Jobs lost, empty gates - all while McCarran was adding more gates and wanting to charge more for these new gates. American will cut flights and Las Vegas will again feel the impact. All of those business travelers who used US Air clubs - they lost Las Vegas in 2008 as well. Where was the leadership at McCarran during a time where every guest was needed to fill rooms and now how tough is it to get any new flights back? It makes Las Vegas out to be just like Reno - paying for flights to be added and yet they had them all for years.

    New leadership is needed. Allegiant needs to be moved over to A & B gates. Something needs to be done to get long haul flights on major domestic carriers back. Mesa Arizona now has taken an Executive Airport, turned it into a major airport with Spirit, Frontier and Allegiant bringing 1 million passengers into Mesa. All while the main airport is down - 1 million at Sky Harbor. Someone was thinking down there. We need to get some thinkers over at the airport, as these European flights lead to trips to Zion and Grand Canyon as much as they do to any casino. Instead of making passengers have to spend more time at McCarran due to forcing flights into the D Gates, time to use the A Gates and keep people working at McCarran. Yet - these same people watched 200 flights be taken away by US Air in 2008 without them doing anything to keep these flights with incentives. Now they are providing incentives and it is too late.

    Put the McCarran leaders on a Dreamliner to somewhere else. As they are part of the reason why Vegas has not recovered.