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BEFORE THE

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

__________________________________________

)

Application of )

)

SOUTHWEST AIRLINES CO. )

)

For exemptions from 14 C.F.R. Part 93, Subparts ) Docket DOT-OST-2012-0029

K and S, pursuant to 49 U.S.C. § 41718(g)(2) )

(BEYOND-PERIMETER SLOT EXEMPTIONS) )

)

For service between Ronald Reagan )

Washington National Airport (DCA) and )

Austin-Bergstrom International Airport (AUS) )

__________________________________________ )

COMMENTS OF THE

SOUTHWEST AIRLINES PILOTS’ ASSOCIATION

Communications with respect to this document should be addressed to:

Therese Merrick

General Counsel

Southwest Airlines Pilots’ Association

1450 Empire Central, Suite 737

Dallas, TX 75247

(214) 722-4212

tmerrick@swapa.org
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I. INTRODUCTION

Southwest Airlines Pilots’ Association (“SWAPA”) is the exclusive bargaining representative 

for more than 6,000 Southwest Airlines pilots. Due to the Spring 2011 Southwest Airlines Co. 

(“Southwest”) acquisition of AirTran Airways, Inc. (“AirTran”) and a recent seniority integration 

plan negotiated between Southwest, AirTran, SWAPA, and the Airline Pilots Association 

(“ALPA”) (the current bargaining representative of AirTran pilots), by 2015 SWAPA will also 

represent AirTran’s nearly 1,700 pilots. Once all AirTran pilots have transitioned over to 

Southwest, SWAPA will be the sole bargaining representative for nearly 8,000 pilots at the 

nation’s largest domestic carrier. 

Having reviewed all of the applications for the eight slot exemptions currently available, 

SWAPA strongly supports the application of Southwest Airlines for the slot exemptions to serve 

passengers between Ronald Reagan Washington National Airport (“DCA”) and Austin Bergstrom 

Airport (“AUS"), with continuing single- plane service to San Diego International Airport 

(“SAN”).

II. ANALYSIS OF CRITERIA FOR NEW DCA SLOT EXEMPTIONS

Pursuant to the FAA Modernization and Reform Act of 2012 and Order 2012-2-21, the 

Department of Transportation (“DOT” or “Department”) has invited applications from new 

entrant and limited incumbent carriers for eight new slot exemptions between DCA and 

airports beyond the 1,250 mile DCA perimeter. The exemptions will be awarded based on an 

applicant’s ability to: 

(A) Provide air transportation with domestic network benefits beyond the 1,250 mile 

perimeter;

(B) Increase competition in multiple markets;
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(C) Not reduce travel options for communities served by small hub airports and medium 

hub airports within the 1,250 mile perimeter;

(D) Not result in meaningfully increased travel delays;

(E) Enhance options for nonstop travel to and from the beyond-perimeter airports that will 

be served;

(F) Have a positive impact on the overall level of competition in the markets that will be 

served; or

(G) Produce public benefits, including lower fares, higher capacity, and a variety of service 

options.

Having conducted an independent analysis of the criteria, SWAPA asserts that if Southwest is 

awarded two of the available beyond-perimeter slots, all seven of the Department criteria will 

be met and the flying public will benefit from new DCA – AUS non-stop service.

A. Southwest will provide air transportation with domestic network benefits beyond the 

1,250 mile perimeter.

Austin-Bergstrom is 1,315 miles from DCA, and therefore qualifies as “beyond the 

perimeter”. If awarded the slot exemptions, Southwest’s service between DCA and AUS will be 

the only non-stop service between the Nation’s Capital and Texas’s capital. The continued, 

single-plane service to SAN, also beyond perimeter, will provide single plane service to 

passengers between DCA and SAN and expand connecting service to passengers. Southwest will 

also have the future ability to adjust respective flight times in Oakland (“OAK”), Las Vegas

(“LAS”), San Jose (“SJC”), Los Angeles (“LAX”), El Paso (“ELP”), Lubbock (“LBB”), and Harlingen

(“HRL”) to allow additional connections from AUS.

B. Southwest will increase competition in multiple markets.

Currently, there is no nonstop service between DCA and AUS available making this a prime 
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market for new service and increased competition. Amongst the contending markets lacking

nonstop DCA service, AUS demands the highest fare and serves the second most O&D 

passengers. (Exhibits 2 and 3) 

Similarly, service between DCA and SAN is deficient. Nonstop service between DCA and SAN 

will be available for the first time in the summer of 2012 through US Airways. Southwest’s 

ability to bring one-stop, same plane service to DCA – SAN passengers will provide greater 

options and competition thanks to the “Southwest Effect”1. This will be accomplished without 

having to dedicate another slot to SAN service. Southwest’s service will also result in low fare 

competition in Dallas (“DAL”) and Houston (“HOU”), two of the largest domestic markets.

Southwest has a commanding cost advantage at this stage length, and this cost advantage will 

translate into lower fares than any other applicant can offer. (Exhibit 5)

C. Southwest will not reduce travel options for communities served by small and 

medium hub airports within the perimeter.

The new service proposed by Southwest is a net additive for Southwest; therefore no 

within-perimeter airport will lose service to support the proposed beyond-perimeter service.

Additionally, the service will add low fare connecting opportunities to DAL and HOU, which

currently lack nonstop DCA service.

D. Southwest’s use of the exemptions will not result in increased travel delays.

Southwest’s new service will not meaningfully increase travel delays at any of the airports 

involved. Furthermore, as noted in Southwest’s application, Southwest is the industry leader in 

 

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The “Southwest Effect” was coined in 1993 by the U.S. DOT to describe the considerable boost in air travel that 

invariably resulted from Southwest’s entry into new markets. Market stimulation results from Southwest’s 

competitive, low-cost service, particularly in markets where so-called “Legacy” airlines previously enjoyed 

monopoly or near-monopoly status on certain routes.
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on-time performance. (See Southwest Application)

E. Southwest will enhance options for nonstop travel to and from the beyond-perimeter 

airports that will be served.

If awarded the two slots requested in its application, Southwest will offer the only nonstop 

service between DCA and AUS, Texas’s state capital. As previously stated, amongst DCA markets 

currently lacking nonstop service, AUS has the highest fares and second most O&D passengers.

(Exhibits 2 and 3)

F. Southwest’s use of the exemptions will have a positive impact on the overall level of 

competition in the markets that will be served.

Southwest will offer the only nonstop service between DCA and AUS, and equally 

important, will offer competitive continuing service to DAL, HOU, and SAN. In the near future,

this may extend to OAK, LAS, SJC, LAX, ELP, LBB, and HRL based upon adjustments to the 

Southwest schedule.

Southwest will stimulate traffic and lower fares by a wide margin over its competitors as 

exemplified in Southwest’s forecast. (See Southwest Application) Southwest maintains the

lowest unit costs, and this will translate into the largest gap for stimulation. (Exhibit 5)

Southwest will effectively compete with new US Airways service between DCA and SAN without 

using a second slot for the same beyond-perimeter city. Slots are scarce and therefore should 

be distributed in a manner that benefits the most airports and passengers.

G. Southwest’s use of the exemptions will result in public benefits, including lower fares, 

higher capacity, and a variety of service options.

Based on all applications submitted to the DOT, Southwest will be operating the largest 

aircraft in terms of seating configuration. (Exhibit 1) Southwest has the greatest potential to 

lower fares because of its well established low unit costs. (Exhibit 5) Southwest has applied for 
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these slot exemptions to serve the market with the highest fares and one of the largest 

passenger bases lacking nonstop service to DCA. This will lead to the greatest potential for 

stimulation.

III. COMPARISON OF VARIOUS AIRLINE APPLICATIONS FOR AVAILABLE EXEMPTIONS

 

A. JetBlue’s Proposed Service to San Juan and AUS

If JetBlue is awarded the DCA slot exemptions, it intends to serve San Juan Luis Munoz 

International Airport (“SJU”) and AUS. JetBlue lacks both the history and presence that

Southwest has maintained in AUS for 35 years. (Exhibit 4) JetBlue has limited local brand loyalty

in AUS. For example, Southwest has a greater share of passengers who start their journey in 

AUS versus its share of total O&D passengers. (Exhibit 4) Furthermore, the SJU – DCA market 

has a smaller passenger base than AUS – DCA and already offers lower fares than AUS – DCA. 

(Exhibits 2 and 3) Finally, JetBlue plans to use a small E190 (a regional jet) to serve the AUS –

DCA market, an aircraft with nearly 50% less capacity than Southwest’s B737-800. (Exhibit 1)

This would be a poor use of the scarce DCA slot exemptions.

B. Sun Country’s Proposed Service to LAS

Currently, Sun Country has a very limited presence at LAS. Nonstop service between DCA 

and LAS is already available on US Airways. Each application for the available beyond-perimeter 

slot exemptions presents benefit beyond the immediate markets served, with the exception of 

Sun Country’s application. Sun Country’s proposal to service the DCA – LAS market would only 

benefit those two cities and not a single market beyond. Sun Country proposes flying a smaller, 

higher cost aircraft on a route that will limit stimulation potential. (Exhibits 1 and 5) This is 

simply not a viable option for the Department if it wishes to meet the seven criteria it has set 
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forth.

C. Virgin America’s Proposed Service to SFO

It would be counter-productive for the Department to award three of these scarce beyondperimeter slot exemptions to a single city pair. United has already converted one slot 

exemption to serve the DCA – SFO market. Virgin America now requests two exemptions to 

serve the same city pair. Virgin America proposes to serve this market with the second smallest 

aircraft of all applications for the available slot exemptions. (Exhibit 1)

When interest expense is included in ownership cost, Virgin America barely qualifies as a 

low cost carrier. SWAPA questions whether Virgin America will be able to stimulate the market 

significantly without losing money. While Virgin America has stimulated domestic markets, it 

has done so at a great financial expense. (Exhibit 5)

D. Frontier’s Proposed Service to Colorado Springs and SAN

Frontier has no long-term plan for DCA or Colorado Springs (“COS”) service. COS is a recent 

and unproven focus city for Frontier. The COS market is the smallest of all markets applicants

seek to serve. (Exhibit 2) Furthermore, COS is less than two hours from Denver (“DEN”). Highly

competitive nonstop service between DCA and DEN is already available on both Frontier and 

United. SWAPA does not believe Frontier will stimulate the same volume of new passengers as 

other proposals; instead it will simply recapture passenger traffic that is driving to DEN today.

Frontier offers many of the same connecting opportunities over DEN that it is proposing over 

COS. Given DEN’s proximity, this will not improve travel time or routing efficiency in these 

markets.

E. Alaska’s Proposed Service to Portland and SAN
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Alaska cannot match Southwest’s cost advantage, and therefore an award of slot 

exemptions to Alaska will not generate the “Southwest Effect” low fares that Southwest has 

become famous for over the last 40 years. (Exhibit 5) If awarded two of the available slot 

exemptions, Southwest will offer low fare, single-plane service between DCA and SAN, and will 

effectively compete with US Airways’ non-stop service to SAN. Alaska cannot produce the same 

public benefit.

F. Air Canada’s Proposed Service to Vancouver

Limited slot resources should first be used to benefit the American public and American 

airline employees. SWAPA does not discount that Air Canada’s proposal will improve travel for

some US passengers, but a majority of the benefits will go to Canadian and other foreign 

customers beyond Vancouver. Without full transparency, SWAPA’s analysis shows that DCA to 

Vancouver (“YVR”) is the second smallest market proposed from any applicant. Air Canada is 

also proposing to fly the route with a small plane and lacks the history of stimulation required 

to grow the market. Small planes in small markets cannot begin to benefit the flying public as 

compared to Southwest’s proposed service. (Exhibit 2)

IV. CONCLUSION

As a representative for Southwest employees, SWAPA is acutely aware of Southwest’s 

lack of access to major airports such as DCA and LGA where grandfathered rights--in some cases 

dating back before deregulation--dictate all the places where the largest U.S. domestic carrier is 

prohibited from providing its legendary low-fare service. The rare availability of DCA beyondperimeter slot exemptions provides the Department with a compelling opportunity to enable 

Southwest to expand its limited DCA service with a new low-fare, large aircraft, nonstop flight 
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to AUS, a market currently without nonstop service. By awarding two of the available DCA slot 

exemptions to Southwest, utilization of a scarce resource can be maximized to produce the 

greatest public benefits.

For the reasons stated above, SWAPA fully supports the Southwest application and 

urges the Department to award two of the eight available DCA slot exemptions to Southwest 

Airlines so that it may begin non-stop service between Austin-Bergstrom International Airport

and Washington National Airport with continuing single-plane service to San Diego.

Respectfully submitted,

_______________________

Therese Merrick
CERTIFICATE OF SERVICE

I hereby certify that on March 27, 2012, a copy of the foregoing was served via e-mail on 

the following persons:

anita.mosner@hklaw.com (Air Canada)

megan.lawrence@alaskaair.com (Alaska Airlines)

msinick@ssd.com (Alaska Airlines)

robert.cohn@hoganlovells.com (Frontier Airlines)

patrick.rizzi@hoganlovells.com (Frontier Airlines

robert.land@jetblue.com (JetBlue Airways)

jhill@dowlohnes.com (JetBlue Airways)

perkmann@dowlohnes.com (JetBlue Airways)

leslie.abbott@wnco.com (Southwest Airlines)

bob.kneisley@wnco.com (Southwest Airlines)

John.Fredericksen@suncountry.com (Sun Country Airlines)

barbara.russell@virginamerica.com (Virgin America)

john.varley@virginamerica.com (Virgin America) 

jegillick@zsrlaw.com (Virgin America)

jimsmith@ci.austin.tx.us (Austin Airport)

john.potter@mwaa.com (Washington National Airport)

susan.kurland@dot.gov (DOT)

todd.homan@dot.gov (DOT)

brian.ctr.meehan@faa.gov (FAA)

info@airlineinfo.com

___________________

Therese Merrick
Exhibit #1: Southwest Offers Most Seats Per 

Slot Pair

127,750

122,640

114,610

109,500

94,170

87,600 86,870

73,000

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

Southwest

737-800

Frontier A320 Alaska 737-800 JetBlue A320 Sun Country

737-700

Air Canada

A319

Virgin A319 JetBlue E190

Seats Offered Per Slot Pair

Based on one daily round trip flight and seating configurations stated in filings. 
Exhibit #2: AUS is the 2nd Largest DCA Market 

Amongst Proposals Without Nonstop Service

Based on DOT Origin & Destination Survey YE2011Q3. YVR data is from Airconomy TotalDemand reconciled against T100 YE 2011-10-02. 

181K

163K

137K

100K

91K

56K

35K 33K

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

LAS SFO SAN PDX AUS SJU YVR COS

N/S BEGINS 

May 15th

N/S BEGINS

June 8th

CURRENT N/S
Exhibit #3: AUS Passengers Suffer from the 

Highest Fare and Fare Per Coupon Mile At 

DCA Amongst Proposed Markets

Based on DOT Origin & Destination Survey YE2011Q3. Excludes est. taxes and fees , zero fare passengers, and 999 reporting errors. 

$258 $254 $247 $242 $234 $229

$207

$0.00

$50.00

$100.00

$150.00

$200.00

$250.00

$300.00

AUS PDX SAN COS LAS SFO SJU

Average Net Fare ($)

18.09¢

15.01¢

10.65¢ 10.60¢ 10.27¢ 9.94¢

8.80¢

0.00¢

2.00¢

4.00¢

6.00¢

8.00¢

10.00¢

12.00¢

14.00¢

16.00¢

18.00¢

20.00¢

AUS COS LAS SJU SAN PDX SFO

Average Coupon Yield (¢)
Exhibit #4: Southwest has a Longer History, 

Greater Market Presence, and Greater Brand 

Preference at AUS vs. jetBlue

Based on OAG historic schedule data starting in 1982 and Innovata LLC schedule files. 2012 is through June 30th.

0

10

20

30

40

50

60

0

2

4

6

8

10

12

14

16

18

20

1982198319841985198619871988198919901991199219931994199519961997199819992000200120022003200420052006200720082009201020112012

WN Destinations

B6 Destinations

WN Daily Departures

B6 Daily Departures

1.16%

(0.21%)

-0.40%

-0.20%

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

1.40%

Southwest JetBlue

Based on US DOT Origin & Destination Survey YE2011Q3.

Southwest & jetBlue share of true originating AUS O&D passengers vs. 

share of all AUS O&D passengers.
Exhibit #5: Southwest’s Significant Cost 

Advantage Translates into Ability to Offer 

Lower Fares

0.00¢ 2.00¢ 4.00¢ 6.00¢ 8.00¢ 10.00¢ 12.00¢ 14.00¢ 16.00¢

VX A319

SY 737-700

B6 E190

B6 A320

AS 737-800

F9 A320

Est. WN 737-800

Unit Cost Comparison @ 1,315(sm) miles

Based on 2011Q3 Form 41 data stage length adjusted by cost category/driver. Segment cost includes direct, indirect, and ownership(including interest expense). 

Fuel is assumed to be $3.35 per gallon and load factor was assumed to 80%. Frontier costs have been adjusted for certain reporting discrepancies. Seating 

configuration was assumed to be same as proposal.