BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C.

Transcription

1 BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C. 2014/2015 U.S.-Haneda Frequency Allocation Docket DOT-OST In Response to Order SUPPLEMENTAL COMMENTS OF LOS ANGELES WORLD AIRPORTS, OPERATOR OF LOS ANGELES INTERNATIONAL AIRPORT, IN SUPPORT OF AMERICAN AIRLINES LAX TOKYO HANEDA PROPOSAL Communications with respect to this document should be addressed to: January 5, 2015 Ms. Gina Marie Lindsey Executive Director Los Angeles World Airports One World Way Los Angeles, CA Mr. Samson Mengistu Deputy Director, Administration Los Angeles World Airports One World Way Los Angeles, CA

2 Los Angeles World Airports ( LAWA ) supports the application of American Airlines (AA s) to operate seven (7) weekly nonstop frequencies starting January 15, 2015 from Los Angeles International Airport ( LAX ) to Tokyo- Haneda ( HND ). LAWA is a City of Los Angeles Department that owns and operates a system of three airports including LAX, LA/Ontario International Airport and Van Nuys Airport. LAX has the largest U.S. passenger market demand to/from Tokyo- Haneda in the contiguous U.S. and the first nonstop flight serving oneworld passengers from LAX will offer enhanced service to a significant number of travelers and further shipping opportunities. Nine supporting points are outlined below and provided to the U.S. Department of Transportation for serious consideration of AA s proposed HND- LAX service. 1.0 LAX is the largest U.S. gateway to Asia LAX is the sixth (6 th ) busiest passenger airport in the world 1 and the international gateway serving the greater Los Angeles region, the second (2 nd ) most populated U.S. market with over 18 million residents 2. LAX is also the top gateway to Asia, with more nonstop service - - flights and markets - - to Asia than any other U.S. airport and in the last four years, capacity increases have been met by strong demand. 2.0 LAX is Haneda s largest O&D market in the contiguous U.S. Tokyo- Haneda is the fourth (4 th ) busiest passenger airport serving the most populated city in the world. Los Angeles ranks as HND s largest O&D market in the 1 Airport Council International (ACI) world rankings U.S. Census, Los Angeles, Orange, Ventura, San Bernardino and Riverside counties 2

3 contiguous U.S. with almost 117,750 annual passengers or 161 passengers daily each way (PDEW), up over 6 percent since {Exhibit 1} Since gaining nonstop service by ANA (member of Star Alliance) and Delta (member of Skyteam) to HND, the LAX market has responded well with average load factors increasing from 69.2% in 2011 to 81.7% in 2014 (YEJun2014 latest data available). {Exhibit 2} 3.0 Of the original U.S. carrier route allocations to Haneda, only service at LAX has succeeded from the contiguous U.S. In late 2010, the Japanese government allowed HND limited international service from the U.S. and three U.S. carriers were given authorization to operate including Hawaiian Airlines from Honolulu, Delta from LAX and Detroit Metro International Airport (DTW) and American from NYC/JFK. DL moved its DTW flight to Seattle International Airport (SEA) in the spring of 2013 and American discontinued its JFK service in November 2013, relinquishing its slots. Upon USDOT approval, United Airlines began operating from San Francisco (SFO) in October In addition, both Japanese carriers provide daily nonstop service from HND to the U.S. including JAL and ANA from Honolulu, JAL from SFO and ANA from LAX. 4.0 oneworld members lack U.S. carrier access to Haneda and need AA s application to succeed in order to gain a direct link to Haneda LAWA believes flights from LAX by American would provide a more effective use of the HND slot pairs. A daily nonstop flight by American would enhance service levels in the large local Los Angeles market by giving travelers the option of a third global 3

4 alliance 3 carrier providing nonstop access to Tokyo- Haneda airport. American Airlines has a strong market presence at LAX with a nineteen (19) percent share of total seat capacity and carries the largest share of traffic at twenty (20) percent. In addition to the important local market, connecting passengers are also key to the success of most international long haul flights. At LAX, AA offers nonstop service to 51 markets (including 2 seasonal destinations) with 156 daily departures, which will provide travelers considerable connecting opportunities. {Exhibit 3} 5.0 American is the only carrier proposing to start HND service immediately American Airlines has shown its belief in the LAX- HND market quite clearly by proposing that if awarded HND authorization, AA will start daily service as soon as possible after authorization is permitted using 247 seat Boeing aircraft. 6.0 Los Angeles succeeds in part because it has the largest Japanese population in the U.S. and strong trade ties to Japan Los Angeles has strong ethnic ties with Tokyo as California is home to the largest Japanese- American population in the US at almost 430,000. {Exhibit 4} California also has important trade links with Japan, exporting $12.5 B 4 annually in 2012, more than any other state in the U.S. 3 Delta is a member of Skyteam, ANA is a member of Star Alliance 4 Dept. of Commerce, Asiamattersforamerica.org 4

5 7.0 Delta agrees that LAX is a strong choice, proposing LAX as one of its service options for Haneda launch flights In 2010, DL was awarded service at LAX and also DTW as both cities were proposed as part of its original application. Within a few years, DL was permitted to transfer its DTW authority to SEA, a much smaller market, with a population of slightly more than 3.6 million. SEA is Tokyo- Haneda s 6 th largest O&D market in the U.S. with almost 24,000 annual passengers or 32 PDEWs, representing 20 percent of the local LAX market demand. SEA- HND service, which started June 2013, has experienced a lower passenger response with load factors averaging 56.6% 5. Delta carries eleven (11) percent of the passengers and operates fifteen (15) percent of the seats at SEA 6. Total seat and traffic levels at SEA are half the size of LAX. Delta offers 78 daily departures to 32 markets (including 6 seasonal destinations), a level approximately 50-57% less than AA at LAX. {Exhibit 5} 8.0 By awarding the third U.S. carrier from the only alliance unrepresented in the HND market, oneworld (AA), and from the largest O&D market to/from Haneda, U.S. economic benefits are maximized. Supporting Delta s application concentrates the benefits on one carrier, one alliance and a smaller market. AA s proposed service to Tokyo- Haneda will provide the best service benefit to the U.S. traveling public. Including a oneworld service option at LAX, the largest passenger market to/from Haneda in the contiguous U.S., will provide the U.S. traveling public with a flight choice by all three global alliances. In addition, Los 5 US DOT, T100 International, YEJun2014 (most recent data available) 6 Port of Seattle Traffic Statistics; Worldwide Flight Schedules CY2014 5

6 Angeles would experience strong economic benefit from an additional daily flight at Tokyo- Haneda. According to an economic impact analysis performed for LA, each new non- stop transoceanic route introduced at LAX provides $623 million annually and supports 3,120 direct and indirect jobs Hawaiian Airlines has indicated its interest to apply for slot pairs in the near term, however a second allocation to Hawaii would serve Japan s interest while sacrificing the broader U.S. interest best served by oneworld from the contiguous U.S. The largest Japanese visitor market to the U.S. is Hawaii 8 and the majority of passenger demand is from inbound tourists. Passenger demand for LAX- HND is over 30 percent originating U.S. traffic versus HNL at less than 20 percent 9. It is clear the benefits of nonstop HND service would be best provided to more of the U.S. traveling public at LAX. For all the reasons outlined above, Los Angeles World Airports supports American Airlines proposal for nonstop service in the LAX- HND market and believes LAX provides the best use for the slot pair at Haneda- Tokyo. Ms. Gina Marie Lindsey Executive Director Los Angeles World Airports 7 Economic impact of international service at LAX, 2007 LAEDC, HR&A, SH&E analysis 8 Dept. of Commerce, 2013 Market Profile: Japan Report 9 MIDT Passenger bookings, Sabre, 12 months ended Oct

7 Certificate of Service I certify that I have this date served this document on the following by sending a copy electronically in accordance with the Department s rules of practice. paul.gretch@dot.gov (DOT) brian.hedberg@dot.gov (DOT) brett.kruger@dot.gov (DOT) todd.homan@dot.gov (DOT) peter.irvine@dot.gov (DOT) john.allen@faa.gov (FAA) EngleTS@state.gov (Dept. of State) cristinasa@state.gov (Dept. of State) eugene.alford@ita.doc.gov (Dept. of Commerce) ejames@jamhoff.com (Allied Pilots Association) seth.waxman@wilmerhale.com (Delta) sascha.vanderbellen@delta.com (Delta) chris.walker@delta.com (Delta) Mike.Donatelli@alpa.org (Delta MEC/ALPA) jhill@cooley.com (Hawaiian) Perkmann@cooley.com (Hawaiian) bberlin@cooley.com (Hawaiian) Robert.Lamansky@hawaiianair.com (Hawaiian) howard.kass@aa.com (American) francis.heil@aa.com (American) abigail.donovan@aa.com (American) robert.wirick@aa.com (American) charles.hunnicutt@thompsonhine.com patricia.snyder@thompsonhine.com ishiwata.k@portseattle.org (Port of Seattle) safora.i@portseattle.org (Port of Seattle) dan.weiss@united.com (United) steve.morrissey@united.com (United) gmurphy@crowell.com (United) sseiden@crowell.com (United) info@airlineinfo.com (AirlineInfo.com) 7

8 Exhibit 1 Exhibit 2 Average Load Factors LAX- HND Source: USDOT, T100 8

9 Exhibit 3 Exhibit 4 9

10 Exhibit 5 10