US' Houston Mayor Annise Parker announced (23-May-2012) her support for international service at Houston Hobby Airport and released details of a proposed agreement under which Southwest Airlines will cover all costs related to the USD100 million expansion. The Memorandum of Agreement (MOA) requires Southwest to design and build the five new gates and customs facility to the City’s specifications. When finished, the City will own the improvements debt free. In return for its investment, Southwest will have preferential scheduling rights and pay no rent for its use of four of the five new international gates, and will also pay no rent for its use of the customs facility. The fifth additional gate and the customs facility will be available for use by all other airlines at Hobby, but unlike Southwest, the other airlines will pay rent. The addition of international service at Hobby will mean approximately 20 more departures daily, which is still far below the historical record-setting activity levels of 1997. Southwest intends to utilise new Boeing 737 aircraft for the services. As an additional incentive for airlines who agree to a long-term lease at Hobby, the agreement allows a rebate of airport revenues for every additional passenger they bring to the airport above the base passenger levels in the year price to the start of international service, with a cap of USD3.9 million annually. This is based solely on an anticipated increase in concession sales inside the airport from additional passenger growth. The proposed MOA is subject to approval by Houston City Council and Southwest Airlines management. City Council consideration is expected on 30-May-2012. Construction is planned for the spring of 2013. In the interim, the City will work closely with the carrier and Washington to obtain the necessary federal approvals as well as a commitment for an adequate number of customs and border patrol agents at the airport. [more - original PR] [more - original PR II]
Southwest to cover all costs related to USD100m international expansion at Houston Hobby
You may also be interested in the following articles...
Alaska Air Group: locked in limbo until the government renders a decision on Virgin America merger
Alaska Air Group remains in limbo as it waits for the US Department of Justice (DoJ) to complete a review of the proposed Alaska-Virgin America merger. Alaska had originally hoped to gain government approval and close the deal in early 4Q2016, but the regulatory review unsurprisingly is taking longer than expected. However, Alaska remains confident of finalising the arrangement before the end of 2016, and is taking the proper financial steps to finance its acquisition of Virgin America.
In the short term Alaska is experiencing slightly improving trends in the US marketplace, and its unit revenue improved on a sequential basis from 2Q2016 to 3Q2016. Another positive development for Alaska is a slowing of competitive capacity growth in its markets in 4Q2016 and in early 2017. The tempering of growth is reflective of most US airlines planning to lower capacity expansion in 2017 as higher oil prices heighten the importance of returning to positive unit revenue.
Alaska also plans slower capacity growth of 7% in 2017, versus 8.5% in 2016. Approximately 3ppt of the increase is driven by longer stage lengths and the annualisation of nearly 10 new routes launched in 2016 – a mix of smaller and larger markets with varying levels of competition.
European airline seat capacity growth accelerates - perhaps too quickly: Outlook for winter 2016/17
The summer 2016 season came to an end on 29-Oct-2016. Adjusting for an extra week relative to the previous summer, it produced seat growth of 6% for capacity to/from/within Europe, matching the rate of growth in summer 2015, but higher than the 10-year average rate of 4% and higher than any other summer since 2010.
Current indications from data filed with OAG are that Europe will also experience accelerating capacity growth in the winter 2016/2017 season, which runs from 30-Oct-2016 to 25-Mar-2017. Adjusting for the season being shorter by one week relative to last winter, total seat growth in Europe is set to reach 7%, compared with 6% growth in winter 2015/2016 (and 6% growth in summer 2016). This is higher than the 10-year average rate for winter of 3% and the highest winter growth since 2007/2008.
On routes to all but one region from Europe, seat growth this winter will both be faster than last winter and higher than its 10-year average. The one exception is Europe to Middle East, the fastest-growing region, where capacity growth will remain at 10%. This report presents analysis of this winter's seat growth for Europe by region and by airline group.