SOUTHWEST AIRLINES LEAVING JACKSON

Expert on airlines predicts Jackson-Evers will keep remaining carriers

by Ross Reily and Ted Carter
Published: December 5,2013
Tags: Banking & Finance, Business, economic development, education

The bad news for Central Mississippi air travelers is that Jackson-Medgar Evers International is very unlikely to get a low-cost carrier to fill the void that will be left by Southwest Airline’s June 7 departure. The good news, however, is that the regional airport will keep its remaining carriers – American Airlines (set to merge with U.S. Air Airlines), Delta Airlines and United Airlines.
That’s the assessment of national commercial aviation consultant Michael Boyd, principal of Evergreen, Colo.-based Boyd Group International, a firm that does consulting work for the Jackson Airport Authority and had a hand in persuading Southwest to come to Jackson in 1997.
“There aren’t any airlines out there” that can profitably add Jackson to their routes, Boyd said.
But, he added, Central Mississippi “is not a dying market…. The other carriers won’t leave.”
The remaining carries at Jackson-Evers “are in a very strong position,” he said, and predicted they will incrementally pick up some of the passenger traffic that would otherwise be flying on Southwest. The airlines are likely to use 70-seat and 100-seat aircraft to accommodate the extra passenger traffic, Boyd added.
“They will fill in the capacity that was being lost,” he said, and noted with Southwest gaining weak passenger load factors of roughly 70 percent, it can’t necessarily be said that the airline is leaving behind a void.
As for Southwest, Jackson became ill-suited from a cost standpoint to be part of the Dallas-based carrier’s future after the acquisition of Atlanta’s AirTran.
As Southwest began merging the operations, it moved away from life as a discount carrier serving a handful of large cities and a roster full of mid-cities. Now its ambition is to be a national carrier concentrating on the largest markets.
Getting there requires slimming down – and deploying an aircraft fleet that will be fewer in number than before the AirTran acquisition, Boyd said. “With the merger they took on a carrier that was very different.
“Some of the ones (aircraft) inherited in the merger they are releasing.”
What Southwest is doing is in line with the rest of the industry, noted Boyd, whose aviation consulting and research firm does an annual commercial airlines forecast.
In an interview this year with the Denver Post, Boyd projected the commercial airline industry will handle 50 million fewer passengers than the Federal Aviation Administration is currently forecasting.
An early 2013 analysis by the trade group Airlines for America forecast a reduction of 2.4 percent in scheduled domestic flights.
In detailing the thinking behind the shutdown of Jackson service, Southwest spokesman Brad Hawkins said years of charting passenger counts at Jackson-Evers led to a conclusion the service was no longer financially worthwhile. “We saw waning demand for Southwest service in the local market,” he said, emphasizing the flight passenger numbers were significantly below Southwest’s expectations for a sustained period
“It really just comes down to the numbers. We can’t continue to operate in such a challenging environment,” Hawkins said.
“We are definitely focused on the larger cities. It’s where the profitability sustains our ability to serve more markets.”
Jackson, a Southwest destination since 1997, is the only legacy market Southwest is leaving. The airline said it will cease services in June to Key West, Fla., and Branson, Mo., both markets formerly served by AirTran.
Hawkins said he could not say with certainty that Southwest would decline to consider incentives from Jackson and other Mississippi government entities to reverse its decision, but voiced doubt the airline would change its mind. “You never say never, but I think this is a structural and significant change” Southwest is making,” he said.
The airline’s 37 employees at Jackson International will be offered jobs elsewhere in the company. Southwest will not book flights to or from Jackson after June 7, he said.
Jackson Municipal Airport Authority CEO Dirk Vanderleest said Southwest’s departure does not result in the elimination of air service access to any metro area served by the Jackson airport.
Boyd said, however, that direct flights to Orlando from Jackson are unlikely to resume after Southwest leaves. “You are not going to get service back to Orlando. They (Southwest) could barely fill half the seats there.”