BEFORE THE DEPARTMENT OF TRANSPORTATION 

WASHINGTON, D.C.

2013/2014 U.S.-Brazil Combination 

Frequency Allocation Proceeding

Docket DOT-OST-2013-0072

ANSWER	OF	LOS	ANGELES	WORLD	AIRPORTS,	OPERATOR	OF	LOS	ANGELES	

INTERNATIONAL	AIRPORT, IN	SUPPORT	OF	AMERICAN	AIRLINES

Communications	with	respect	to	this	document	should	be	addressed	to:

Ms.	Gina	Marie	Lindsey

Executive	Director

Los	Angeles	World	Airports

One	World	Way

Los	Angeles,	CA	90045

glindsey@lawa.org

Ms.	Celine	Cordero

Sr.	Director,	External	Affairs

Los	Angeles	World	Airports

One	World	Way

Los	Angeles,	CA	90045

ccordero@lawa.org

Ms.	Patti	MacJennett

SVP	Business	Affairs

LA Tourism	&	Convention	Board

Los	Angeles,	CA	90071

pmacjennett@LATourism.org

May	14,	2013
Los	Angeles	World	Airports (“LAWA”)	and	its	partner	the	LA	Tourism	&	Convention	

Board,	support the	application	of	American Airlines	for	seven	(7)	weekly	frequencies	

in	 November	 2013	 to	 start daily	 nonstop	 service from	 Los	 Angeles	 International	

Airport (“LAX”)	to	São	Paulo,	Brazil, Guarulhos	International	Airport (“GRU”). LAWA	

is	a	City	of	Los	Angeles	Department	that	owns	and	operates	a	system	of	three	airports	

including	 LAX,	 LA/Ontario	 International	 Airport	 (“ONT”)	 and	 Van	 Nuys	 Airport

(“VNY”).	The	LA	Tourism	&	Convention	Board’s	mission	is	to	advance	the	prosperity	

of	LA's	visitor	economy	and	the	livelihoods	that	depend	on	it.

LAWA and	 LA	 Tourism	 believes strongly	 that	 American	 Airlines	 proposal	 for	 daily	

nonstop	service	between	LAX-GRU	is	the	only	application	that	should	be	considered	

among	the	candidate	cities	for	the	following	reasons:

• Los	Angeles	is	the	only	market	with	sufficient	demand	(O&D)	to	Sao	Paulo	and	

is	the	largest	market population without	daily	nonstop	service

• Los	Angeles	is	the	largest	airport	without	daily	nonstop	service

• Los	Angeles’	largest	South	American	O&D	market	is	Sao	Paulo

• Los	Angeles	is	the	forth	largest	US	O&D	market for	GRU,	ranked	behind	three	

US	cities with	frequent	daily	nonstop	service

• Los	Angeles	has	the	largest	community	of	interest	without	daily	nonstop

service

• Los	Angeles is	the	largest	city	among	the	top	US	destinations most	frequented	

by	Brazilian	visitors	without daily	nonstop	service
LAX	 is	 the	 sixth	 (6th)	 busiest	 airport	 in	 the	 world. It	 is	 also	 the gateway	 airport	

serving Greater	Los	Angeles,	 the	second	(2nd) most	populated	metro	area in	 the	U.S.	

GRU	ranks	as	the	forty-fifth	(45th)1 busiest	airport	worldwide	and	has	the	ninth	(9th)2

largest population in	the	world.	Despite	these	rankings,	the	Los	Angeles	– Sao	Paulo	

market is	 extremely	 underserved	 and	 lacks daily	 nonstop	 service that	 can	 be	

supported	by	existing	demand.

Sao	 Paulo is	 LAX’ 29th largest	 O&D	 market	 with	 128,094 annual passengers	 (12	

months	ended March	2013),	up	almost	16 percent	from	the	previous	year.	Sao	Paulo	

is	also LAX’ largest	South	American	destination,	even	without	daily	nonstop	service,	

demonstrating	a	high	level	of	demand	exists. {Exhibit	1}

The	last	 decade	experienced unprecedented air	 service	 challenges starting	with	 the	

tragic	events	of	9-11.	 In	2000,	LAX’	peak	 traffic	 year,	three	 (3)	foreign	 flag	carriers,	

including	 Varig,	 JAL	 and	 Korean3 provided 18 weekly	 nonstop	 flights	 between	 LAX	

and	GRU.	After 9-11, JAL and	Korean airlines	discontinued service	and	by	2006	Varig	

dissolved.	For	 18	months	 the	LAX-GRU	market	lacked	 nonstop	 service	 until	Korean	

Airlines re-entered with	limited	frequencies	of	three	(3) weekly	operations.

Despite	 the	 service	 declines/disruptions,	 the	O&D	at	 LAX	has	 continued	 to	increase

over	the	last	decade.	From	2002 through	YEMAR2013,	GRU-LAX	traffic	has	grown	by	

more	than	six	(6) percent annually.	When	compared	to	the	other	proposed	gateways	

for	new	GRU	frequencies,	LAX’	incremental	traffic	has	increased second	only	to	JFK.	It	

is	important	to	note	that	while	LAX	experienced	declining	service	levels over	the	last	

																																																							 1 ACI	2011	World	Airport	Rankings

2 2012	World	Atlas

3 From	1994-1999	four	carriers	served	LAX-GRU:	Vasp,	Varig,	JAL,	and	Korean;	Vasp	

left	in	1999	and	ceased	operations	after	a	long	bankruptcy
decade,	 JFK’s	 operations	 increased	 by	 2	 daily	 flights	 to	 its	 current	 level of	 five	 (5).

{Exhibit	2}

A	comparison	of	the	proposed	gateways	shows that	average	daily	demand	in	the local	

market	 is	 most	 underserved	 at	 LAX	 among	 the	 cities	 with	 existing service. The	

number	of	average	daily	nonstop	seats	in	Los	Angeles	does	not	adequately	serve	its	

local	demand,	falling	short	by	over	46	percent. The	other	candidate	cities	with	flights	

have	more	than	adequate	levels	of	service. {Exhibit	3}

Los	Angeles	has	the	forth	(4th)	largest	Brazilian	ancestry	population	in	the	US	behind	

three	extremely	well	served	cities	to	Brazil,	including	Miami,	New	York	and	Orlando4.	

Additionally,	 Los	 Angeles	 is the	 fifth	 (5th)	 most	 frequented	 US	 cities	 by	 Brazilian	

visitors.	In	2012,	approximately	114,000 visitors	came	to	Los	Angeles	from	Brazil,	up	

almost	7	percent	 from	20115.	Clearly	 there	is	a	high	interest	by	Brazilian	visitors	 to	

travel to	Los	Angeles	and	strong	ties	between	LA	and	Brazil.	{Exhibit	4}

Los	Angeles	is	also	a	top	market	for	Sao	Paulo,	ranking	as	GRU’s	forth (4th)	largest	US	

O&D	 market behind	 three	 extremely	 well	 served	 destinations including	 Miami,	

Orlando	and	New	York	City.	Los	Angeles’	high	ranking	is	impressive	given	the	lack	of	

daily	nonstop	seats.	{Exhibit 5}

Flights	operated	by	a	US	carrier	would	greatly	enhance	service	levels	in the	local	LA	

market. American	 Airlines	 has a strong	 market	 presence	 at	 LAX with	 almost	 a

seventeen	(17)	percent share	of	total	seat	capacity6.	American serves	41	markets	and	

has	 160 daily	departures at	 LAX	and	its	 proposed	GRU	flight	will	 support	 the	large	

local	 market	 as	 well	 as provide	 many	 online	 connections.	 American	 Airlines	 has

																																																							 4 Daily	flights	to	GRU:	MIA=6,	MCO=2 and	JFK=5	in	winter,	4	in	summer

5 Dept. of	Commerce,	Office	of	Travel	and	Tourism	Industries

6 Worldwide	flight	schedules,	May	2013
enjoyed	a	long	history	of	service	in	Brazil	and has the	largest	market	share	between	

the	US	and	Brazil	as	measured	by	seats	and	departures.	American	Airlines	believes in	

the	potential	of the	LAX-GRU	market	as	they	have proposed that	if	they	are	awarded

only Chicago	exemptions	in 2014	 they	will	defer that service	until	 full	open	skies	in	

late	2015	and	instead	serve	LAX.	Daily	nonstop	flights	between	LAX-GRU	will	provide	

significant	 consumer	 benefit	 to	 an	 extremely	 large market	 in	 the	 US	 that	 is	 clearly	

underserved and will	increase	competition	and	provide	more options	for	travelers.

Sao	Paulo	and	the	whole	of Brazil	are	important	to	Los	Angeles.	The	current	market	

size	is	large	and	the	O&D	growth between	LAX-GRU	has	been	strong despite	the	daily	

nonstop	access	challenges.	Brazil	is	an	important	and	growing	visitor	market	for Los	

Angeles.	American	Airlines	will	 be	a	 strong	 competitor	in	 the	market	and	it	is	clear	

that	Los	Angeles	can	support	more frequencies.	In	addition,	new	daily	international	

service	 will	 provide	 significant	 economic	 benefit	 to	 Los	 Angeles.	 According	 to	 an	

economic	 impact	 analysis	 performed	 for	 the	 City,	 each	 new	 international	 flight

operating	 at LAX	 provides $623	 million	 annually	 and	 supports	 3,120	 direct	 and	

indirect	jobs.7 For	all	these	reasons,	Los	Angeles	World	Airports	and	the	LA	Tourism	

and	Convention	Board	support American	Airlines	proposal	 for	daily	nonstop	service	

in	 the	 LAX-GRU	 market.	We	 believe	 by	 large	 measure, the	 LA	 market	 provides	 the	

best	use	for	these	exemptions.

Ms.	Gina	Marie	Lindsey

Executive	Director

Los	Angeles	World	Airports

																																																							 7 Economic	impact	of	international	service	at	LAX,	2007	LA	Economic	Dev.	Corp,	HR&A	study
CERTIFICATE	OF	SERVICE

I	hereby	certify	that	I	have	on	May	14, 2013	served	the	foregoing	Reply	of	Los	Angeles	

World	Airports	and	LA	Tourism	and	Convention	Board in	Support	of	American	

Airlines on	the	following	email	addresses	by	electronic	mail:

Francis.Heil@aa.com

Robert.Wirick@aa.com

howard.kass@usairways.com

benjamin.slocum@usairways.com

dan.weiss@united.com

thomas.bolling@united.com

Sascha.Vanderbellen@delta.com

paul.gretch@dot.gov

esta.rosenberg@dot.gov

brian.hedberg@dot.gov

brett.kruger@dot.gov

urskr@state.gov

joe.cambron@wcaa.us

louis.miller@atlanta-airport.com

Steve.Luben@atlanta-airport.com

info@airlineinfo.com

/s/	Sonjia	T.	Murray

Sonjia	T.	Murray

Air	Service	Development

Los	Angeles	World	Airports

One	World	Way

Los	Angeles,	CA	90045-5803

310-709-7277

424-646-5020
Exhibit	1

LAX	Top	International	O&D	Markets

O&D	Psgrs Y/Y YEMar13 Wkly

No. Destination YEMar13 YEMar2012 Chg PDEW	 N/S	Svc

1 London 703,076	 705,519	 -0.3% 963	 57	

2 Guadalajara 618,547	 677,155	 -8.7% 847	 45	

3 Seoul 550,925	 710,350	

-

22.4% 755	 36	

4 TYO-Narita 504,174	 472,675	 6.7% 691	 47	

5 Mexico	City 490,916	 505,090	 -2.8% 672	 60	

6 Vancouver 467,911	 505,399	 -7.4% 641	 70	

7 Sydney 409,356	 361,761	 13.2% 561	 36	

8 Toronto 398,865	 378,876	 5.3% 546	 50	

9 Taipei 381,916	 390,852	 -2.3% 523	 29	

10 Manila 376,375	 375,061	 0.4% 516	 11	

11 Paris 357,325	 366,667	 -2.5% 489	 15	

12 Shanghai 338,091	 304,637	 11.0% 463	 22	

13 San	Jose	del	Cabo 329,464	 298,533	 10.4% 451	 33	

14 Hong	Kong 272,684	 276,468	 -1.4% 374	 20	

15 Cancun 236,303	 210,735	 12.1% 324	 13	

16 Beijing 218,910	 208,141	 5.2% 300	 14	

17 Melbourne 203,387	 200,046	 1.7% 279	 10	

18 San	Salvador 189,559	 182,868	 3.7% 260	 19	

19 Saigon 183,912	 180,398	 1.9% 252	 -

20 Guatemala 178,942	 175,476	 2.0% 245	 14	

21 Calgary 169,671	 160,431	 5.8% 232	 29	

22 Tel	Aviv 158,635	 148,427	 6.9% 217	 4	

23 Pappeet 157,068	 149,786	 4.9% 215	 12	

24 Brisbane 156,013	 155,293	 0.5% 214	 10	

25 Auckland 151,504	 140,276	 8.0% 208	 14	

26 Frankfurt 147,237	 126,439	 16.4% 202	 9	

27 Bangkok 143,108	 156,023	 -8.3% 196	 -

28 Puerto	Vallarta 141,259	 137,982	 2.4% 194	 10	

29 Sao	Paulo 128,094	 110,765	 15.6% 175	 3	

30 Lima 127,936	 87,759	 45.8% 175	 13	

Subtotal	Above 8,891,163	 8,859,888	 0.4% 12,180	

Source:	MIDT	Psgr Bookings,	Sabre
Exhibit	2

SUMMARY	OF	PASSENGER	ACTIVITY

2002-YEMAR13	SELECT	US	GATEWAYS	FOR	GRU	SERVICE

O&D	Psgrs N/S	Wkly	Svc Absolute

Proposed	Mkts CY2002 YEMar13 AAG Aug-03 May-13 Increase

JFK-New	York 129,555	 407,281	 12.1% 21	 35 277,726	

Los	Angeles 69,561	 128,094	 6.3% 7	 3 58,533	

CHI-O'Hare 31,235	 70,114	 8.4% 7	 7 38,879	

Atlanta 20,422	 28,200	 3.3% 7	 7 7,778	

Detroit 15,467	 24,588	 4.7% 0 1 9,121	

Philadelphia 8,052	 8,482	 0.5% 0 0 430	

Charlotte 4,178	 7,143	 5.5% 0 0 2,965	

Source:	MIDT	passenger	bookings,	Innovata	worldwide	schedules	5/13,	2003	latest	data	available	

Exhibit	3

Summary	of	Avg	Daily	Seats	and	Psgr	Demand

Avg	N/S Daily	Seats	Filled

Market PDEW Daily	Seats w/	Local	Psgrs

JFK-New	York 558	 1,128	 49%

Los	Angeles 175	 120	 146%

ORD-Chicago 96	 271	 36%

Atlanta 39	 246	 16%

Detroit 34	 215	 16%

Philadelphia 12	 n/a n/a

Charlotte 10	 n/a n/a

Source:	MIDT	Psgr	Bookings	Sabre	and	Innovata	Worldwide	schedules,	5/13;	

PDEW=Psgrs	Daily	Each	Way
Exhibit	4

Top	US	Cities	for	Brazilian	Visitors

2011	Est.

No. City BR	Visitors

1 New	York	City 720,000	

2 Orlando														 403,000	

3 Miami																			 336,000	

4 Las	Vegas											 173,000	

5 Los	Angeles							 107,000	

Source:		Office	of	Tourism	and	Travel	Int'l	and	DOC

Exhibit	5

GRU's	Top	US	O&D	Markets

YEMAR13 Wkly	N/S

No. Market	 Total	O&D Flights

1 Miami	 531,439	 41

2 Orlando	 407,545	 14

3 NYC-JFK/1	 407,281	 23

4 Los	Angeles	 128,094	 3

5 Newark	 96,895	 7

6 Las	Vegas	 94,101	 0

7 Chicago	 70,114	 7

8 San	Francisco	 61,751	 0

9 Washington	 47,286	 7

10 Boston	 40,402	 0

Source:	Innovata	worldwide	schedules,	May	2013

Note:	JFK	service	peaks	at	36/wkly	flights	Oct-Mar