US carrier Virgin America has opened reservations for flights from Dallas Love Field after being selected by the US Department of Justice (DOJ) for the two gates that are being divested by American Airlines as part of the settlement agreement resolving American Airlines’ merger with US Airways.
As part of the merger settlement, DOJ required the divestiture of gates at several domestic airports to facilitate entry and expansion by low-cost airlines, where consumer competition could be negatively impacted by the unprecedented consolidation this latest merger represents. Southwest and Delta Air Lines’ bids for the gates were rejected by DOJ, given that Southwest would be consolidating its own monopoly and that Delta is not a low-fare airline and would not add the required level of service, according to literature from Virgin America.
The US carrier says its new flights from Dallas will “provide vigorous competition” in a market where at present one carrier (Southwest Airlines) controls 80 per cent of the gates at Love Field (16 of 20 gates). It says the “centralised location” of Love Field “makes it a more convenient choice for Dallas-based and Dallas-destined business travellers”.
Under its revised Dallas schedule, Virgin America will move its existing links to Dallas/Fort Worth International from Los Angeles and San Francisco to the downtown airport from October 13, 2014 and will add multiple daily links with Chicago, New York, Washington DC. The airline will launch of four times daily links between Dallas Love Field and Washington Ronald Reagan National and New York LaGuardia and airports from October 13, 2014 and October 28, 2014, respectively, and twice daily flights to Chicago O’Hare from early 2015, while it plans to increase capacity on its existing Dallas flights to Los Angeles and San Francisco from three to four daily from 2015.
"Dallas is a global center of industry and it deserves more business-friendly flight options from the airport most convenient to downtown," said David Cush, president and chief executive officer, Virgin America. "The opportunity to expand our service at Love allows us to not only spur more fare competition, but also provide travelers with a different kind of flight option — one that allows them to stay connected, comfortable and productive on long-haul flights to major business destinations."
Earlier this year, Virgin America invested in divestiture assets being sold as part of the merger settlement, including 12 airport slots at New York LaGuardia (six slot pairs) and eight slots at Washington National (four slot pairs), both airports where legacy carriers have historically dominated operations and where consumers have previously suffered from lack of service competition and higher fares as a consequence. With the planned divestiture of Love Field gates, Virgin America says it would be able to offer Dallas customers “a competing network of flights to large business markets” from Love Field”.
Virgin America's proposed service from Dallas Love Field cannot begin until October 2014, after the expiration of the Wright Amendment, which has restricted flights at Love Field since 1979. Since coming into force, non-stop flights out of Love Field have been limited to only a handful of states. Local politicians said the restrictions were put in place to maintain a financially healthy DFW Airport. But in 2004, Southwest began a public campaign to change those restrictions and after several months of negotiations a compromise was agreed and approved by Congress in 2006.
Southwest Airlines had also pitched for these two American Airlines gates having already announced plans to offer new non-stop services to 15 domestic destinations from Dallas Love Field. The carrier will initially add five new routes from October 2014, followed by ten additional destinations from early November 2014, increasing its network from Love Field to 31 non-stop destinations.
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