BEFORE THE

OFFICE OF THE SECRETARY

DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

_____________________________________ )

2012 CHICAGO

- CANCUN COMBINATION ) Docket DOT

- OST

- 2012

- 0001

SERVICE PROCEEDING )

_____________________________________ )

RESPONSE OF AIRTRAN AIRWAYS, INC.

TO COMMENTS OF FRONTIER AIRLINES

Communications with respect to this document should be sent to:

Bob Jordan Robert W. Kneisley

President Associate General Counsel

AIRTRAN AIRWAYS, INC. Leslie C. Abbott

9955 AirTran Boulevard Senior Attorney

Orlando, FL 32827 SOUTHWEST AIRLINES CO.

1901 L Street, N.W., Suite 640

Washington, D.C. 20036

bob.kneisley@wnco.com

(202) 263

- 6284

April 2, 20122 BEFORE THE

OFFICE OF THE SECRETARY

DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

_____________________________________ )

2012 CHICAGO

- CANCUN COMBINATION ) Docket DOT

- OST

- 2012

- 0001

SERVICE PROCEEDING )

_____________________________________ )

RESPONSE OF AIRTRAN AIRWAYS, INC.

TO COMMENTS OF FRONTIER AIRLINES

On March 16, 2012, the Department issued Order to Show Cause 2012

- 3

- 10

tentatively awarding exemption authority to AirTran Airways, Inc. (“AirTran”) to provide

scheduled service of persons, property and mail between Chicago, Illinois and Cancun,

Mexico. O n March 26, Frontier Airlines, Inc. (“Frontier”) filed Comments in response to

the Show Cause Order which stated in part that Frontier “does not formally object” to

the Department’s selection of AirTran.

Normally, a statement by the losing party in a con tested route proceeding that it

does not object to the Department’s selection of the other party would end the matter,

with no need for response. However, in this instance, Frontier took the extraordinary

step of using its supposed “non

- objection” as a pl atform for gratuitous criticism of

AirTran/Southwest as well as mischaracterization of the Department’s decision. Not

only do these statements come with poor grace from the losing party, they have no

basis in fact and should be disregarded.

For example, Frontier claims that the Department determined “not to give any

credit to illusory network benefits” from the integration of AirTran and Southwest’s

operations (Frontier Comments at 1

- 2). This completely mischaracterizes the3

Department’s decision. As Or der 2012

- 3

- 10 made clear, the Department found

AirTran’s proposal to be so superior to Frontier’s in terms of “capacity, service and

market structure benefits” that it warranted the award of authority “even without the

benefit of Southwest’s network” (Orde r 2012

- 3

- 10 at 5). Similarly, Frontier’s claim that it

has lower fares than Southwest in Denver markets where the two carriers compete

head

- to

- head (Frontier Comments at 2) is belied by recent statements of its own parent

company to the Securities and Exc hange Commission:

“ Southwest pricing [in Denver] has caused downward pressure on Frontier

yields and any future Southwest exposure may place further downward

pressure on our revenue .”

Republic Airways Holdings, Inc. Form 10

- K, March 15, 2012, p. 18. Again

, Frontier’s

claim is not only irrelevant but baseless

.

As Frontier knows, the a l l e g a t i o n s in its Comments will have no effect in the

instant case, so it is unlikely that Frontier made them for that purpose. Instead, the real

goal of Frontier’s gratuitous charges appears to be an attempt t o influence other

pending Department proceedings in which both Frontier and Southwest are competing

applicants. 1 This is clear from Frontier’s exhortation to the Department that it “should

use the award of limited

- authority rights” in the future in a manner that would benefit

Frontier ( Id

.).

Southwest submits that Frontier’s attempt to use this proceeding to t ry to gain an

advantage in other , unrelated Department proceedings is improper and should be

disregarded. The only relevant part of Frontier’s Comments is that Frontier does not

object to the Department’s Show Cause Order awarding AirTran authority to pro vide

1 Frontier and Southwest are competing applicants in two pending proceedings for the award of DCA slot

exemption s , Docket OST

- 2000

- 7182 (inside perimeter) and Docket OST

- 2012

- 0029 (outside perimeter).4

scheduled service between Chicago (Midway) and Cancun. That being the case, we

urge the Department to promptly issue a final order so that AirTran can begin service in

this important air travel market. The Department’s decision was based on a

compr ehensive record demonstrating that AirTran will provide enormous public and

competitive benefits, and has been enthusiastically received by the City of Chicago (see

attached press release).

Respectfully submitted

,

____________________ Rober t W. Kneisley

April 2, 20125 C ERTIFICATE OF SERVIC E

I hereby certify that on April 2, 2012, a copy of the foregoing was served via e

mail on the following persons:

robert.cohn@hoganlovells.com (Frontier Airlines)

patrick.rizzi@hoganlovells.com (Frontier Airlines

susan.kurland@dot.gov

paul.gretch@dot.gov

brian.hedberg@dot.gov

brett.kruger@dot.gov

todd.homan@dot.gov

esta.rosenberg@dot.gov

john.allen@faa.gov

ursk@dos.gov

Rosemarie S. Andolino

Commissioner

City of Chicago Department of Aviation

rosemarie.sandolino@cityofchicago.org

Erin O’Donnell

Managing Deputy Commissioner

City of Chicago Department of Aviation, Midway Airport

Erin@cityofchicago.org

__________________________ Leslie C. Abbott