Now leaving Las Vegas: airlines

las-vegas-airport-address.jpgVegas rolls – and loses. Las Vegas is the big loser in the airline stakes, as US Airways confirms that it will slash its flights there, effectively shuttering its LV hub, while AirTran is trimming LV flights to smaller communities. And United is shutting Ted, its only presence in the gaming city. The cutbacks could not come at a worse time for the city, which will have more than 11,000 new rooms by year end. But US Airways is cutting back to about 80 daily departures down from 140 in September. Major casinos all reported losses or lower profits in the first quarter, in part as rising gas prices deter visitors who usually drive from Southern California.

Allegiant will still fly there in a big way, but Vegas is at the top of the list of cities that people want to get to cheap. As Delta chief executive Richard Anderson said on CNBC the other day, the places that folks insist on paying no more than $200 to get to are the places that are going to lose service in this crisis. With airlines cutting capacity, “it’s going to particularly hit markets like Orlando, Hawaii, Las Vegas – those kinds of leisure markets where people want to travel for $200 round-trip fares, and those fares don’t work anymore,” he said. McCarran is still a very busy airport, but this, we think, is the way the dice are going to roll.

 

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7 Responses to Now leaving Las Vegas: airlines

  1. Las Vegas Managing Editor June 17, 2008 at 9:04 am #

    With all due respect, this is a little bit overblown.

    United is dropping the “Ted” service here but seems set to continue (or resume) United service. That is actually a good thing:

    Every United flight into Las Vegas was a “Ted” flight.

    “Ted” has no first class, and Las Vegas more and more caters to upscale visitors. Plus caters to Europeans who view our dollar as “monopoly money” because it is so cheap for them to visit here and buy the best of everything on an otherwise (European) middle-class budget.

    US Airways/America West will continue to be a huge precense here. They are simply shuttering their “midnight hub” here… where they flew planes in and out with a connection/departure around midnight.

    (This “midnight hub” helped keep their planes in the air more hours a day making money in previous times. But… because red-eyes out of Las Vegas don’t sell for high ticket prices, it isn’t profitable right now).

    Southwest continues to do OK and always jumps into areas where other airlines leave. Southwest is already the huge presence at McCarran Las Vegas airport and (some say) lookin to expand even more.

    Allegiant simply flies where they make money. If they don’t, they quit flying to the destination. Despite flying MD-80′s which guzzle fuel… they might have the best plan:

    Fly to second market airports that want the service. Do it a a price that will let them fly to Vegas at a lower rate than the aggregate cost of the customers driving/parking at a major airport.

    If people use the service at that price point, keep the service. If not, ditch the service.

    It will be interseting to see what happens!

    Ted Newkirk
    Managing Editor
    http://www.accessvegas.com

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