After last week’s announcement that WOW Air will “pause” its Miami service, it got us worrying about a few things – the first being a spike in airfares to and from MIA.
Secondly, if WOW can’t make South Florida work as a low-cost leisure destination from Europe, then what route can they make work?
The low-cost carrier from Iceland flies to several U.S. cities: San Francisco, Los Angeles, Dallas, St. Louis, Chicago, Detroit, Cleveland, Pittsburgh, Cincinnati, Boston, New York and Washington. Up until now we’ve seen only growth from WOW Air.
The U.S. needs more domestic and international air service, not less.
Over the past several years, airline mergers have left about 1,000 domestic routes without service, most of them between smaller cities, according to an analysis by Massachusetts Institute of Technology.
The good news is that there are new homegrown startups filling some of the voids among these smaller airports throughout the Midwest and Northeast, reports CNNMoney.
These new airlines include:
- OneJet will operate more than 300 flights a week to and from Pittsburgh.
- JetSuite has been expanding to connect LA and the Bay Area from lesser used airports with refurbished, inexpensive 30-seat regional jets.
- FlyOtto, which FlyersRights has reported on, is reaching airports that don’t have commercial service at all.
- World Airways may be reborn to take on the big U.S. carriers on international flights, using Boeing 787s. Behind the plan is Ed Wegel, who briefly resurrected Eastern Air Lines.
Some underserved cities that need more commercial air service:
- Branson, Mo. – gets thousands of visitors each year at a local theme park
- Central Illinois Airport – can serve many communities between STL and ORD.
- Columbia, Mo. – home of the state’s major public university.
- Evansville, Ind. – the location of a major food manufacturer and university; can serve communities in nearby states.
- Fort Smith, Ark. – accessible to a significant population in western Arkansas and eastern Oklahoma.
- Greensboro, N.C. – a major population center with nearby universities.
- Lake Charles, La. – near several chemical manufacturing companies in south central Louisiana.
- Lincoln, Neb. – site of the state’s capitol, largest university and second largest population.
- Rochester, Minn. – home of the Mayo Clinic, which serves more than a million U.S. and international patients a year.
- Rockford, Ill. – the center of a major population area in northern Illinois.
- Salisbury, Md. – would serve many communities on Maryland’s Eastern Shore.
- Shreveport, La. – the location of an important university and manufacturing facilities.
- Springfield, Mo. – could serve Branson, Mo., and is the location of a federal medical prison and university.
Cities with no commercial air service at all:
- Baraboo-Wisconsin Dells, Wis. – would serve major manufacturing facilities in northeast Wisconsin as well as thousands of vacationers.
- Enid, Okla. – the location of a significant college and would serve north central Oklahoma.
- Fond du Lac, Wis. – would serve central Wisconsin and several major manufacturing facilities in west central Wisconsin.
- Topeka, Kan. – the capital of Kansas.
- Terre Haute, Ind. – the location of several major manufacturing companies in west central Indiana.
- Yellowstone National Park – One of the biggest tourist attractions in the United States, Yellowstone lacks a nearby commercial airport. Best options are Salt Lake City or Billings, Mont., which are both around five hours away. You can fly into Jackson, Wyo., for a very high price. Increasing flights to a place like Bozeman, Mont., or Idaho Falls, Idaho, especially in the summer months could be very profitable.
The Inspector General of the Department of Transportation in January launched an audit to examine the impact of airline consolidation on air service to small and medium cities.
The U.S. is a huge market, with deteriorating customer service standards, owing to lack of competition.
Could foreign-owned airlines revive competition in U.S. skies, and do something good for passengers like allowing non-U.S. airlines to operate domestic flights?
The biggest four carriers in America now control 80 percent of the market, the Economist points out, compared with just 48 percent a decade ago. Warren Buffett, a man who knows an oligopoly when he sees one, bought nearly $10 billion worth of airline stock in 2016.
What makes the airline industry different from the auto industry? Competition. Ford or GM would also have done much better without companies like Honda and Toyota coming into the U.S. market back in the 1970s. Of course, the automobiles we get now are much better because of competition.
How the airlines became abusive cartels
As we approach the one-year anniversary of United Airlines violently dragging off a passenger, Dr. Dao, there hasn’t been much reform in the system that rewards flyers for voluntarily giving up seats – even though Although some airlines have authorized payments of nearly $11,000 to entice passengers to give up seats on overbooked flights.
But no refinement of voluntary market remedies will fix the deeper issues in the airline industry, as air travel is far from a free market.
U.S. regulators should remove the cap on foreign ownership, take slots away from incumbent airlines and boost the use of secondary airports to aid new airline entrants.If that doesn’t yield dividends, regulators should consider breaking up the big airlines. Allowing competition to wither was a huge mistake.
One silver lining is that Representative Dave Brat (R-Va.), has introduced H.R. 5000 which would repeal restrictions that hinder investment in U.S. airlines.
Paul Hudson, President of FlyersRights.org said, “Reforming or repealing laws and policies that prohibit foreign competition, inhibit new domestic airlines startups and expansion is essential to improving air travel for the 99% of Americans and businesses that depend on commercial air travel for long distance transportation. We look forward to Free to Fly’s introduction and enactment in the next year.”
SOURCE: Paul Hudson, President
