Southwest Airlines execs plotting expansion strategy in Las Vegas

DALLAS -- Southwest Airlines, the airline that serves the most passengers at McCarran International Airport, will get even bigger in Las Vegas next year.

While crews at McCarran work to make more than $14 million in improvements on the concourse where Southwest served 8.4 million passengers last year, the airline plans to schedule more flights into Las Vegas.

"Vegas has been tremendous for us," said Pete McGlade, vice president of schedule planning, whose staff analyzes Southwest's 55 markets and makes decisions on when to fly, how much to charge and where to go next.

"If we had known before what we know about Las Vegas now, we would have begun adding flights sooner," McGlade said during the airline's annual media conference and tour of its Dallas headquarters operations.

Three-quarters of the way through this year, Southwest's passenger count in Las Vegas reached 7 million, 83 percent of its 1998 total.

McGlade isn't revealing specifics yet on the company's Las Vegas expansion. But his enthusiasm for Las Vegas is unbridled.

Already, Southwest is the busiest air carrier at McCarran with 147 daily departures from 16 gates in the airport's C concourse. That's nearly twice as many flights as its nearest competitor, Phoenix-based America West Airlines.

With any new Las Vegas flights, McCarran would vault ahead of Houston's Hobby Airport into the No. 2 slot among Southwest's top 10 destinations.

Houston has 148 daily flights from 14 airports and was one of Southwest's original three cities when the company began flying in 1971. The airline began service to Las Vegas in 1982.

The completion of McCarran's D gates in the summer of 1998 set a new standard at the nation's 11th busiest airport and initiated a giant game of musical chairs for airlines that had operations in the C gates.

United and American airlines had gates in the C concourse and moved into the new D facilities. That left Southwest to expand within the C gates.

Under an $8 million contract, McCarran will build gate counters similar to those in the D concourse, add new restrooms to the south end of the terminal, remodel the existing restrooms, install new carpet and ceiling tile and expand some of the boarding areas.

McCarran also will install queing stations and boarding signage consistent with Southwest's passenger loading plan.

Southwest doesn't assign seats; it boards passengers on a first-come, first-served basis with passengers lining up in groups of 30 to get on the plane. The queing stations will separate the different waves of boarding passengers within the gate area.

The interior remodeling is scheduled to be completed by April 2001. Meanwhile, another improvement project due for completion in September is a $6.5 million ramp resurfacing project.

McCarran is completing the resurfacing incrementally to minimize disruption of Southwest's flights. But some gates will be out of commission while construction crews resurface the tarmacs that surround the concourse.

When American and United left the C gates and Southwest took its new positions, the airline explained the move as an effort to provide more elbow room. After all, with the number of its flights in the 135 range, employees were concerned that customer service would suffer, even though Southwest is geared to handle about 12 flights per gate per day.

Now, Southwest plans to operate 20 gates. That means the company could have a capacity of about 240 flights. McGlade only smiled when asked exactly how many flights would be added.

He pointed out that Southwest's most recent push has been into the Northeast, recently beginning operations in Islip, N.Y.; Manchester, N.H.; Providence, R.I.; and, on Sunday, Hartford, Conn. Southwest began flying to Baltimore in 1993 and that already has become the airline's ninth busiest city with 86 daily departures.

Few things would please Las Vegas' tourism industry more than to see Southwest increase its nonstop flights to the East Coast. About a year ago, several resort executives met with Southwest Chief Executive Officer Herb Kelleher in Dallas in a bid to boost the number of East Coast flights.

The meeting was termed an exchange of information, but both sides had their agendas: The resorts, concerned about filling thousands of new hotel rooms in the year ahead, wanted to develop more markets east of the Mississippi River and get nonstop flights to do it. Southwest, believing it was being taken for granted as primarily a short-haul carrier, wanted to be included when the resorts went courting big airlines for long-haul flights.

The resort executives met with Kelleher and both sides said the exchange was valuable, although McGlade said the meeting had little to do with Southwest's decision to bulk up in Las Vegas. McGlade said cities court the airline all the time, but his office develops research independently.

At about the same time Kelleher met with the resort executives, Southwest was doing its own experimentation with long-haul flights. It had just started taking delivery of a new generation of Boeing 737 jets that were more fuel efficient than its older cousins, giving it greater range.

Of the company's 306 jets, 49 are Boeing 737-700s. Southwest, which was the launch customer for the 700 series, is committed to buying 101 of the planes with an option for 62 more. McGlade said about 30 of them would be delivered next year.

It's up to McGlade's staff how the new planes will be pressed into service. Will there be flights to the Northeast? What about Raleigh-Durham, N.C., where Southwest began operating in June? Will the company beef up flights to its four Florida cities? What about flights to a new destination? Southwest officials are hinting that there could be one or two new cities added to the route map next year.

McGlade said it isn't a simple as throwing open the door and loading the planes. For example, the runway at the airport in Providence, R.I., isn't long enough to accommodate a full jet loaded with enough fuel to make the five-hour trip to Las Vegas. Cutting back on the number of seats that could be sold wouldn't be economically feasible.

But some airports, like the one in Manchester, N.H., are looking to lengthen their runways to give air carriers the option of offering flights farther away.

Another potential solution -- getting larger planes -- isn't in the cards for Southwest. A key part of Southwest's profitability strategy is building the airline around one aircraft type.

McGlade said it could "poison the well" if Southwest introduced a new type of plane since the company's parts inventory is built around the 737 and all employees, from ramp workers to pilots, are familiar with the twin-engine jet that is the most popular airliner in the world.

"The 737 is a perfect aircraft type for our operation," McGlade said. "Any change for us would be so radical that we could lose our efficiency. We've never considered it."

archive