Virgin America currently operates 19 flights a day out of its two gates at Dallas Love Field. It finished filling out its schedule with the somewhat controversial decision to operate five nonstops per day to Austin-Bergstrom International Airport (AUS) effective at the end of April (since dropped to four per day). At the time, I found this a questionable strategy and use of resources, primarily given the plethora of choices already available to Metroplex travelers needing to fly to Austin, along with fares just not being all that high to begin with. Shall we say, as the name of the plane above suggests, a strategy akin to chasing unicorns?
Fast forward just four months, and it appears Virgin America may already be having second thoughts about the route. From Terry Maxon’s Airline Biz Blog over at the Dallas Morning News, we get this mini-bombshell that Virgin America CEO David Cush dropped at the annual Boyd Conference:
“Maybe Austin is not the best use of gates going forward,” Cush said, per the Associated Press’ David Koenig. “Maybe we will look at some other business markets.”
So there you have it straight from the horse’s mouth, though Cush seems to place the blame on the airport’s capacity situation.
“We’re using our gates there quite intensely. Love Field is our lowest performing airport in terms of dependability just because of the amount of volume there,” Cush told us on July 30.
I suspect the operational issues are just a smokescreen for the real reason, that is, the flights aren’t making money, but blaming airport congestion gives them a way to save face. Indeed, at the Boyd Conference, Cush implied that pricing pressures continue to be an issue at Love Field, describing the aiport as “successful from a consumer standpoing” but “tremendously disruptive” to the industry. When it comes to the airline industry, “disruptive” is usually corporate-speak for “fare wars”, which indeed continue to affect the Dallas market at both DAL and DFW. Great for someone like me who can get pretty much anywhere nonstop at bargain basement prices, not so great for the airlines. In any event, I’ve been skeptical from the get-go as to the viability of these AUS flights, not just because of the stiff competition out there, but because I just don’t see the advantage of product differentiation for a 50-minute flight. Advances such as the touch-screen order system, power ports at all seats, and free TV are nice for a flight to Los Angeles (though Southwest now also offers the free TV), but why would anyone really care on a flight where you’re at cruising altitude for maybe 5 minutes?
As far as the operational issues go, using FlightStats data from the last 30 days, VX has an on-time rate for departures from and arrivals to Love of 79.1% and 86.3%, respectively. Those numbers don’t sound bad at first blush, but given that most of the Metroplex hasn’t seen so much as a drop of rain since the middle of July, there’s not much excuse for even 21% of flights to be departing late (the arrivals number is pretty good under any standard). The fact that departures are more significantly delayed than arrivals suggests some sort of issue with aircraft turns; one possibility I have heard is that due to ramp work in the vicinity of Virgin’s two gates, they tend to get trapped and can’t push back until Southwest traffic behind clears. If this is indeed the case, it should be rectified in due course. I should also note, Virgin America’s numbers have improved considerable over roughly the last 2 1/2 weeks, with on-time departure/arrival rates of 84.3% and 90.7% since the 19th of August, so perhaps the issues are starting to get worked out.
So what’s going to happen if AUS does get the axe? Cush hints that the flights will get reallocated to existing markets as opposed to a new one being launched, which means take your pick of an extra nonstop to Washington-Reagan, New York LaGuardia, LAX, or San Francisco. That won’t stem the fare wars in those markets, but I think it still makes more sense than Austin. Why, you might ask, doesn’t Virgin just reduce their total flights from 19 to 15 if they’re complaining that high gate usage is leading to delays? Ah, that brings us to the little drama going on involving Southwest, Delta, the DOJ, and the City of Dallas regarding who gets to use the two gates that United abandoned earlier this year. I’m working on an update to that soap opera, which I’ll have posted shortly, but the short answer here is, that’s why I think these Austin flights were put in place in the first place – gate squatting to lock Delta out of gate space. Apparently the game, at least in this iteration, was blowing through too much money, so they’ll squat on some other routes instead.
Photo at top: Virgin America A320 at Los Angeles International Airport, headed to Dallas Love Field, March 1, 2015