Virginia scores twice with Southwest dual selection

Washington DC
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Southwest Airlines’ earmarking today of two Virginia airports for future service is a surprise coup for the state, capping a six-year effort to attract the low-fares carrier.

Hoping to instill competition in its central and southern regions, Virginia began courting Southwest in 1995. To further its promotion efforts, the state went as far as placing a billboard near Southwest’s Dallas headquarters saying: “Virginia is for LUV”, referring to both the state’s slogan and the airline’s stock ticker symbol.

The state was forced to take it down when Southwest complained consumers were flooding its reservations line asking about its new service to Virginia.

Clearly, however, the incident did not hurt Virginia’s chances. With its pledge today to begin serving Norfolk in October and Richmond at an undetermined later date, Southwest took the unusual step of giving away its plans for future cities more than a few months in advance.

“It’s not been heard of,” says the air service and policy coordination of Virginia’s department of aviation, Keith McCrea. “They usually keep their location decision very tightly wound up until the very last second.

“We had some good intelligence they were in interested in both, but I was definitely surprised they essentially announced two at one time.”

The decision also surprised those behind the decade-long lobbying efforts for Richmond International and Norfolk International airports. The two airports have some of the highest air fares in the country and Southwest’s decision to eventually serve both will change dramatically the competitive landscape in the region.

“It significantly relieves the air fare pressure locally and will open up a lot of opportunities for new services,” says Norfolk Airport director of market development Charles Braden.

Braden’s counterpart in Richmond, Troy Bell, adds: “We’re probably the second happiest community in the country. We are excited about the service for Virginia and think it’s a victory for our consumers.”

Some are questioning why Southwest chose to go first with Norfolk, however. The airline says it has to wait for a more “appropriate time” to start Richmond service because the destinations it wants to serve from the city do not have the infrastructure to support the new service.

But Richmond and Norfolk are very similar markets and only 90 miles apart. The only difference in their demographics is Norfolk-Washington DC is a much stronger market than Richmond-Washington, which this may explain Southwest’s thinking.

Excluding Washington DC, the two airports essentially have similar traffic patterns, counting New York City, Atlanta, Chicago and Boston in their top five city pairs. Southwest offers service to all these cities except Atlanta, but some of their airports are running out of space for expansion.

Braden also points out Norfolk is no stranger to low-fares service, having been served by People’s Express in the 1980s and Continental Lite in the 1990s. The closest Norfolk now comes to low fares is at nearby Newport News/Williamsburg International Airport, which is served by AirTran Airways from Atlanta.

Norfolk, Richmond and Virginia did not offer any incentives to Southwest, but Virginia is willing to help fund an expansion plan at Richmond, including a seven-gate terminal project.

Room to expand is key for Southwest. Braden says Norfolk still has five gates available beyond the two Southwest is taking and a third concourse is in the airport’s footprint. Norfolk will also open a new arrivals area next year, doubling its ticketing area, and has begun studying adding a parallel runway.

A study commissioned by Virginia to examine long-term airports needs in the Richmond-Newport News-Norfolk corridor recommended the construction of a new airport near Newport News. But none of the three airports support the plan and are moving forward with their own expansion plans in hopes of attracting more new service.

The largest metropolitan area between Washington and Atlanta, Norfolk is served by eight of the tem major US carriers and North Carolina-based Midway Airlines.