What capacity cuts?

This past weekend I flew through Dallas/Fort Worth International Airport twice and I struggled to find any signs of DFW’s recent double-digit drop in traffic. In fact, two things occurred which would normally point to growth rather than contraction.

Yesterday we had to wait 15 minutes for a gate to open up after my American Airlines flight landed from Austin. And we were not alone – a couple of Boeing MD-80s were directed to taxi to some out of the way holding point until a gate opened up at one of American’s concourses.

Given all the capacity cuts implemented at American last year, how is it possible that there aren’t enough gates available? In November, the most recent month in which statistics are available, American’s traffic at DFW was down 12%. As American has a whopping 86% share of the DFW market (pictured below is an American aircraft near one of DFW’s three control towers), total traffic has been down a similar amount in recent months.



You would think one silver lining of the downturn is airlines don’t have to worry anymore about gate crunches at their hubs. Having more flights than available gates is costly as more fuel is burned and crews have to be paid while an aircraft waits for a gate to open up. It also has a ripple effect on an entire operation, causing delays to escalate.

Another silver lining of the downturn you would think would be an increased availability of spare aircraft. US majors last year removed hundreds of narrowbodies from their active fleets as they cut capacity by about 10% in response to rising fuel prices and a slowing economy.

This should have given airlines an opportunity to improve their reliability by utilising aircraft less and having more spares on hand. But on Friday my flight from DFW to Austin was cancelled after one of the engines wouldn’t start and a spare aircraft could not be found.

The flight was being operated by an MD-80, the most common aircraft at American and at DFW. In fact DFW, which is one of the world’s 10 busiest airports, is by far the largest MD-80 base in the world. It is also the largest hub for American (which until the Delta-Northwest merger was the largest airline in the world). So how come American couldn’t find a single spare MD-80?

I asked the pilots and they said while American removed about 30 MD-80s from the schedule last year (about 12% of the total MD-80 fleet) all the extra aircraft have been moved to the desert. So it seems American didn’t take the opportunity to increase the pool of spare aircraft and therefore improve their reliability.

In fact, according to the US DOT’s Bureau of Transportation Statistics, American cancelled 1.08% of their flights at DFW in November 2008. In November 2007 the cancellation rate was 0.98%, which indicates the roughly 12% fleet and capacity cut implemented over the last year has had no positive effect on American’s reliability at its main hub.

On Friday a spare aircraft would have really come in handy as the flight was full and most of the roughly 150 passengers ended up in DFW for six hours waiting for the next available flight to Austin. DFW, which is the host for our annual Network conference in six weeks time, is a relatively pleasant airport. But no one wants to spend six hours in any airport waiting for a 30-minute flight covering a distance which could easily be driven in less time.

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