BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

WASHINGTON, D.C. 

Application of 

SOUTHWEST AIRLINES CO. 

for an exemption pursuant to 49 U.S.C. § 40109 

to engage in foreign scheduled air transportation 

of persons, property and mail between Houston 

Hobby Airport and Cancun, Mexico City, Puerto 

Vallarta, and San Jose del Cabo, Mexico 

(HOU-CUN) 

(HOU-MEX) 

(HOU-PVR) 

(HOU-SJD) 

Docket DOT-OST-2014-0222 

 

Application of 

SOUTHWEST AIRLINES CO. 

for an exemption pursuant to 49 U.S.C. § 40109 

to engage in scheduled foreign air transportation 

of persons, property and mail between the United 

States and Belize 

Docket DOT-OST-2014-0223 

ANSWER OF THE CITY OF HOUSTON 

Communications with respect to this document should be sent to:

Mario C. Diaz 

Director 

Ian Wadsworth 

Chief Commercial Officer 

Department of Aviation 

CITY OF HOUSTON 

16930 John F. Kennedy Blvd. 

Houston, TX 77032 

(281) 233-3000 

(281) 233-1859 (fax) 

Rachel B. Trinder 

ZUCKERT, SCOUTT & 

RASENBERGER, L.L.P. 

888 Seventeenth Street, N.W. 

Washington, D.C. 20006-3309 

(202) 973-7927 

(202) 342-0683 (fax) 

rbtrinder@zsrlaw.com

For the City of Houston 

Dated: December 29, 2014 
BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

WASHINGTON, D.C. 

Application of 

SOUTHWEST AIRLINES CO. 

for an exemption pursuant to 49 U.S.C. § 40109 

to engage in foreign scheduled air transportation 

of persons, property and mail between Houston 

Hobby Airport and Cancun, Mexico City, Puerto 

Vallarta, and San Jose del Cabo, Mexico 

(HOU-CUN) 

(HOU-MEX) 

(HOU-PVR) 

(HOU-SJD) 

Docket DOT-OST-2014-0222 

 

Application of 

SOUTHWEST AIRLINES CO. 

for an exemption pursuant to 49 U.S.C. § 40109 

to engage in scheduled foreign air transportation 

of persons, property and mail between the United 

States and Belize 

Docket DOT-OST-2014-0223 

ANSWER OF THE CITY OF HOUSTON 

The City of Houston (“Houston” or the “City”) respectfully submits this answer to 

the applications filed on December 11, 2014 by Southwest Airlines Co. (“Southwest”) for 

the bilateral designations and other authority necessary to operate scheduled foreign air 

transportation between Houston’s William P. Hobby Airport (“Hobby” or “HOU”), on the 

one hand, and Cancun, Mexico City, Puerto Vallarta, and San Jose del Cabo, Mexico, 

on the other hand – commencing in October 2015, with sales of the flights to begin in 
Answer of the City of Houston 

Page 2 

2 

the first quarter of 2015 – as well as for the authority necessary to operate scheduled 

foreign air transportation between Hobby and Belize City.1

Houston’s air service to Mexico is a key component of the vibrant economic and 

cultural relationship between them. Houston is already the nation’s largest air 

transportation gateway to Mexico, and its international air traffic overall is growing at a 

record pace. Since the year 2000 Houston’s international passenger count has 

increased by an impressive 60%, and as of the end of October 2014 its year-to-date 

international traffic was up 10% over the same period in 2013. 

This remarkable air traffic growth reflects Houston’s role as one of the key 

engines of the U.S. economy. If the greater Houston Metropolitan Statistical Area 

(“MSA”) were a State, it would rank eighteenth in population, ahead of Missouri and 

Maryland.2 Indeed, with a gross product of $533 billion in 2013, the region has a GDP 

that exceeds that of all but 21 foreign countries. 

A significant component in Houston’s ever-growing international traffic is the 

region’s strong position as a leading location for major companies that have a global 

presence. The Houston region is home to the headquarters of 26 of the 2014 Fortune 

 

1 Because the U.S.-U.K. “Bermuda 2” agreement, which is applicable to this service, provides for 

unlimited U.S. carrier services between the U.S. and Belize, Houston believes that grant of the Belize 

authority requested by Southwest in docket DOT-OST-2014-0223 should not be controversial. 

Nevertheless, Houston wishes to confirm its strong support for Southwest’s HOU-BZE application, as well 

as for the carrier’s recent announcement that it will operate HOU-SJO services starting in October 2015 

pursuant to its existing U.S.-Costa Rica authority in docket DOT-OST-2014-0162. Both Belize City and 

San Jose are important destinations for leisure and business passengers from Houston and the south 

central U.S., and Southwest will introduce important new competition into both of those markets. 

2 See “2014 Houston Facts”, http://www.houston.org/economy/#HoustonFactsPublication (June 2014). 
Answer of the City of Houston 

Page 3 

3 

500 companies and 28 of the 2014 Forbes Global 2000 companies,3 and the Houston 

metroplex is the leading job creator among U.S. cities.4 This remarkable economic 

strength provides ongoing new opportunities for carriers, passengers and shippers, and 

ever-growing potential for additional air services to meet the community’s increasing 

needs. These needs are especially vital – and growing – where Mexico is concerned. 

Indeed, more than 600,000 members of the greater Houston community – comprising 

over 44% of Houston’s foreign-born population – were born in Mexico. As a result, 

Houston is very fortunate that multiple U.S. and Mexican carriers already are serving or 

wish to serve Mexico markets from Houston. Notably, United today serves 26 

destinations in Mexico from its hub at Houston’s George Bush Intercontinental Airport 

(“IAH”) – a transborder network unmatched by any other U.S. carrier. 

In light of the growing demand for additional Houston-Mexico air services, 

Houston is extremely pleased that the U.S. and Mexico recently initialed an important 

update to their bilateral air services agreement; the City hopes that the procedures 

necessary for the agreement’s implementation will be completed as soon as possible. 

In particular, the new provisions allowing for unlimited designations in transborder citypair markets for third- and fourth-freedom passenger services will finally enable U.S.-

Mexico services to expand commensurate with market needs. 

 

3 Additionally (based on data provided by the Greater Houston Partnership), more than 1,200 Houston 

companies currently do business with Mexico; 44 have subsidiaries in Mexico; and numerous Mexican 

companies have subsidiaries in Houston. 

4 See, e.g., “18 Facts That Make Houston The Best City In America”, http://www. 

businessinsider.com/houston-best-city-in-america-2014-6 (July 1, 2014) (noting that among the twenty 

most populous U.S. metropolitan statistical areas, Houston has – by far – achieved the highest 

percentage of jobs recovered since the end of the economic downturn). 
Answer of the City of Houston 

Page 4 

4 

This development will be especially critical for Houston and Hobby; extensive 

new international facilities are under construction at Hobby, and are on schedule for an 

October 2015 opening. These facilities, financed in significant part through a 

partnership with Southwest, will enable not only new international services from 

Southwest but also from other U.S. and foreign carriers, with services to Mexico as the 

key component. These services not only will significantly expand Houston’s overall 

access to Mexico, but also will provide important competition to existing and future 

Mexico services from IAH, and are anticipated to expand the opportunities for all 

carriers. A City study on the impact of opening Hobby to international services 

concluded that once the services are fully developed they will generate 1.3 million new 

passengers (primarily in Houston-Mexico markets) – including not just new traffic at 

HOU but also stimulated net growth at IAH; additional benefits will include significant 

overall fare savings for local and connecting passengers using IAH and HOU as 

gateways to Mexico. Furthermore, Hobby’s new role as an international gateway is 

expected to create 14,000 new jobs and have a total economic impact of $1.2 billion in 

the greater Houston area. 

As the Department knows, while the U.S. and Mexico anticipate implementation 

of the new bilateral in early 2016, that is not soon enough to ensure open access to all 

markets by the time the new Hobby international facilities open in 2015, and as 

Southwest has indicated in its application, it needs to begin marketing the new services 

very soon. In two of the four city-pair markets in which Southwest seeks designations – 

Houston-Cancun and Houston-Puerto Vallarta – there currently are unallocated 

designations available for services by a U.S. carrier. But in the other two markets – 
Answer of the City of Houston 

Page 5 

5 

Houston-Mexico City and Houston-San Jose del Cabo – all the available designations 

have been allocated, including in each market two that are held by United and a 

regional affiliate, one of which Southwest seeks in each city-pair. 

Houston greatly values all of the services provided by carriers at both HOU and 

IAH, and has no desire to lose of any of its existing services, even during the interim 

period prior to implementation of the new agreement. Both United and Southwest are 

important partners with the City. Both have made substantial commitments to and 

generate extensive air transportation benefits for the City, and major expansion and 

development projects are underway at both IAH and HOU to accommodate the carriers’ 

current and future growth. But at the same time, the City’s interest and obligation is to 

promote additional air services and competition, and in seeing that new entrant carriers 

desirous of providing Mexico services from Houston can obtain the authority that they 

need. Houston hopes that the Department will explore all opportunities available to 

approve and secure additional rights from Mexico so that all carriers wishing to serve 

these markets are able to obtain the authority they need on a timely basis. As 

Southwest has indicated, it needs to receive the authority as soon as possible so that it 

can begin selling flights by the first quarter of 2015, given the Hobby international 

facilities’ opening date and the October 2015 start date for Southwest’s services. 

Houston asks the Department to ensure that whatever action is taken, it is concluded 

consistent with that timeframe. 

Accordingly, Houston asks the Department to take the steps necessary to ensure 

that Southwest receives the authority it seeks and on the timeframe it seeks, with 
Answer of the City of Houston 

Page 6 

6 

respect to both the Houston-Mexico markets at issue in docket DOT-OST-2014-0222 

and the Houston-Belize authority requested in docket DOT-OST-2014-0223. 

Respectfully submitted, 

________________________________ 

Rachel B. Trinder 

ZUCKERT, SCOUTT & 

RASENBERGER, L.L.P. 

888 Seventeenth Street, N.W. 

Washington, D.C. 20006-3309 

(202) 973-7927 

(202) 342-0683 (fax) 

rbtrinder@zsrlaw.com

For the City of Houston 

Dated: December 29, 2014 
CERTIFICATE OF SERVICE 

I certify that on this 29th day of December 2014, a copy of the foregoing was 

served on the parties named below in accordance with the Department’s Rules of 

Practice. 

Rachel B. Trinder 

rsilverberg@sgbdc.com, 

jjohnson@sgbdc.com, and 

mgoldman@sgbdc.com 

(Counsel for ABX Air) 

chuck.hill@airtransport.cc

(Air Transport International) 

msinick@ssd.com

(Counsel for Alaska Airlines) 

agoerlich@ggh-airlaw.com 

(Counsel for Allegiant Air) 

robert.wirick@aa.com, 

francis.heil@aa.com, and 

howard.kass@aa.com

(American Airlines) 

jcanny@amerijet.com

(Amerijet) 

jrichardson@johnlrichardson.com 

(Counsel for Amerijet) 

rpommer@atlasair.com

(Atlas Air) 

john@mietuslaw.com

(Counsel for Centurion Air Cargo) 

sascha.vanderbellen@delta.com, 

chris.walker@delta.com, and 

sametta.c.barnett@delta.com

(Delta Air Lines) 

cefelts@fedex.com and 

nssparks@fedex.com

(Federal Express) 

matwood@cozen.com and 

slachter@cozen.com

(Counsel for Frontier) 

jhill@cooley.com and 

perkmann@cooley.com

(Counsel for JetBlue Airways) 

robert.land@jetblue.com

(JetBlue Airways) 

kevin.montgomery@polaraircargo.com

and peter.beckett@polaraircargo.com

(Polar Air Cargo) 

robert.cohn@hoganlovells.com and 

patrick.rizzi@hoganlovells.com

(Counsel for Republic Airlines) 

ethan.blank@rjet.com

(Republic Airlines) 

temerson@skywest.com

(SkyWest Airlines) 

bob.kneisley@wnco.com and 

leslie.abbott@wnco.com

(Southwest Airlines) 

dkirstein@yklaw.com and 

jyoung@yklaw.com

(Counsel for Spirit Airlines) 
john.fredericksen@suncountry.com and 

thomas.ting@suncountry.com

(Sun Country) 

hershel.kamen@united.com, 

dan.weiss@united.com, 

steve.morrissey@united.com, 

thomas.bolling@united.com, and 

abby.bried@united.com

(United Airlines) 

sseiden@crowell.com and 

gmurphy@crowell.com

(Counsel for United Airlines) 

anita.mosner@hklaw.com and 

jennifer.nowak@hklaw.com

(Counsel for UPS) 

dsmalls@ups.com

(UPS) 

john.varley@virginamerica.com and 

barbara.russell@virginamerica.com

(Virgin America) 

paul.gretch@dot.gov, 

susan.kurland@dot.gov, 

brian.hedberg@dot.gov, 

brett.kruger@dot.gov, 

reese.davidson@dot.gov, 

todd.homan@dot.gov, 

peter.irvine@dot.gov, 

laura.remo@dot.gov, and 

robert.finamore@dot.gov

(DOT) 

john.s.duncan@faa.gov

(FAA) 

ronald.williams@ustranscom.mil 

(USTRANSCOM) 

englets@state.gov and 

cristinasa@state.gov 

(State Department) 

info@airlineinfo.com 

pjackson@swapa.org 

(Southwest Airlines Pilots’ Association)