BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C. ) ) SLOT ASSIGNMENT PHASE OF THE ) Docket DOT-OST-2015-0070 DELTA AEROMEXICO ATI PROCEEDING ) ) ) CONSOLIDATED ANSWER OF SOUTHWEST AIRLINES CO. Communications with respect to this document should be sent to: Mark Shaw Robert W. Kneisley Senior Vice President General Associate General Counsel Counsel and Corporate Secretary Leslie C. Abbott SOUTHWEST AIRLINES CO. Senior Attorney 2702 Love Field Drive SOUTHWEST AIRLINES CO. Dallas, TX 75235-1611 919 18th Street, N.W., Suite 600 Washington, D.C. 20006 Andrew Watterson bob.kneisley@wnco.com Senior Vice President, leslie.abbott@wnco.com Chief Revenue Officer (202) 263-6284 SOUTHWEST AIRLINES CO. 2702 Love Field Drive Dallas, TX 75235-1611 January 30, 2017
BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C. ) ) SLOT ASSIGNMENT PHASE OF THE ) Docket DOT-OST-2015-0070 DELTA AEROMEXICO ATI PROCEEDING ) ) ) CONSOLIDATED ANSWER OF SOUTHWEST AIRLINES CO. On January 23, 2017 five carriers, including Southwest Airlines, 1 filed applications for an allocation of slots at Mexico City International Airport (MEX) pursuant to the Department s Instituting Order in this proceeding (Order 2017-1-6, January 6, 2017). The Instituting Order directed Delta and Aeromexico (the Joint Applicants) to divest a total of 24 MEX slot pairs to eligible carriers - 14 slot pairs in Phase One of the proceeding and up to 10 additional slot pairs in Phase Two. 2 Southwest files this Consolidated Answer to the applications filed by the other eligible carriers. In total, three U.S. carriers requested 14 MEX slot pairs, while two Mexican carriers requested 17 slot pairs. The U.S. carrier requests are modest and would utilize little more than half of the available 24 slots (10 pairs in Phase One and 4 in Phase Two). The two Mexican carriers requested over 70% of the total available slots (8 pairs in Phase One and 9 in Phase Two). 1 Common names of carriers are used herein. 2 Instituting Order at 2. 1
Consolidated Answer of Southwest Airlines January 30, 2017 Exhibit WN-A-1 Southwest urges the Department to grant all U.S. carrier requests in full before allocating any MEX slots to Mexican carriers. Not only would this be consistent with the Trump Administration s clearly stated goal to put America s interests first, but there is no basis for depriving U.S. carriers of scarce MEX slots in order to increase the holdings of Mexican carriers that already have vastly more slots than all eligible U.S. carriers combined. As explained in detail below and in Southwest s prior pleadings, U.S. LCC carriers have a miniscule presence at MEX, while Mexican LCCs have large portfolios of MEX slots that are currently used for domestic Mexico service and could be repurposed to transborder service at their discretion. U.S. LCCs have no such option. 2
Consolidated Answer of Southwest Airlines January 30, 2017 Further, U.S. consumers will predominantly fly U.S. flag carriers in transborder markets and thus will benefit exponentially more from added U.S. LCC flights than from additional Mexican LCC service, which is already plentiful at MEX. It is the responsibility of the United States Department of Transportation to act in the United States public interest. In this case, that responsibility would be achieved by putting American carriers interests first. In fact, comparing the applicants service proposals side-by-side shows beyond doubt that Southwest s proposed service will produce by far the greatest benefits for U.S. consumers. In sum, there is no policy or competitive justification for allocating slots to Mexican carriers until all U.S. carrier requests are satisfied. It would not advance the U.S. public interest for the U.S. government to allocate scarce divested slots to foreign airlines in a manner that penalizes U.S. carriers. I. Mexican LCCs Already Hold Vastly More MEX Slots than U.S. LCCs and Do Not Require Slots in this Proceeding to Increase Transborder Service. During the Delta/Aeromexico ATI portion of this proceeding, Southwest provided extensive evidence showing why Mexican carriers should be ineligible to receive MEX slots. 3 Although the Department s Final Order allowed MEX LCCs to participate in the slot divestiture process, Southwest s original rationale for excluding Mexican carriers now supports giving priority to U.S. carrier requests before allocating the remaining MEX slots to Volaris and/or VivaAerobus (Viva). This would still provide the Mexican carriers with over 40% of the available slot pairs, or 10 out of 24. 3 See, e.g., Southwest Answer, Sec. III, July 6, 2016; Southwest Reply, pp. 2-4, July 15, 2016; Southwest Surreply, Sec. VII, July 28, 2016; Southwest Consolidated Response, Sec. II, Aug. 9, 2016; Answer to Show Cause Order, Sec. II, Nov. 18, 2016; Consolidated Reply to Show Cause Order, Sec. IV.A., Nov. 30, 2016. 3
Consolidated Answer of Southwest Airlines January 30, 2017 There are several reasons why the Department should prioritize U.S. carrier requests, not the least of which is the fact that Mexican LCCs already hold vastly more MEX slots than U.S. LCCs and should not be granted additional slots at the expense of U.S. LCC carriers, which hold almost none. In the slot-controlled hours at MEX, Mexican LCCs hold a staggering 193 MEX slot pairs in total, while U.S. LCCs hold only two nearly a 100 to one advantage for the Mexican carriers. 4 Exhibit WN-A-2 Just as importantly, 174 of the 193 total slots Mexican LCCs hold at MEX are currently used for domestic Mexico service and could be redeployed, at the carriers 4 Although the Department ruled Interjet, Mexico s largest LCC, ineligible for additional slots in this proceeding due to its already large holdings at MEX, Interjet should be included in the Department s analysis of Mexican LCC competition at MEX. Interjet has 125 MEX slot pairs in the controlled hours, or almost twice as many as Volaris and Viva combined (Exhibit WN-A-2), any of which could be deployed in transborder markets at Interjet s discretion. 4
Consolidated Answer of Southwest Airlines January 30, 2017 discretion, on U.S. Mexico transborder routes (Exhibit WN-A-2). This represents 90% of Mexican LCC slot holdings, any of which could simply be shifted to the transborder market should these carriers desire to compete on new U.S. Mexico routes now that the liberalized bilateral agreement is in effect. In stark contrast, U.S. LCCs have only five slot pairs at MEX in all hours of the day and two slot pairs in the slot-controlled period. Volaris and Viva are each much larger at MEX than the U.S. LCCs. During the slot-controlled hours of the day (0700 2259) Volaris currently holds 21.5 times as many slot pairs as Southwest, and Viva holds more than 12.5 times as many (Exhibit WN-A-3). Volaris and VivaAerobus Already Hold Many Times More MEX Slot Pairs Than Southwest MEX Scheduled Round Trips, 0700-2259 (June 9, 2017) 45 43 40 35 30 25 20 21.5 x 25 15 12.5 x 10 5 2 0 Exhibit WN-A-3 Volaris Southwest VivaAerobus (JetBlue and Alaska have no slots during 0700-2259) 5
Consolidated Answer of Southwest Airlines January 30, 2017 Further, the vast majority of these slots are used on domestic (intra-mexico) routes, which means the Mexican carriers can easily expand MEX transborder operations to U.S. cities using their existing portfolios without taking slots that would preclude U.S. LCC service. Volaris could, for example, repurpose any of its 37 slot pairs currently used for Mexico domestic service to transborder service (Exhibit WN-A- 4) at its discretion. Similarly Viva can redirect any number of its 25 slot pairs currently used in domestic Mexico service to inaugurate transborder U.S. service (Exhibit WN-A- 5). Volaris could also free up some MEX slots for transborder service by up-gauging aircraft in some of its domestic MEX markets where it has multiple frequencies, such as Cancun (CUN) and Guadalajara (GDL) (Exhibit WN-A-6). In fact, since 2010, Volaris has been able to expand its MEX transborder service to an additional 10 markets, while Southwest has been unable to acquire any additional MEX slots in that period. 5 Volaris own exhibits in this case highlight its extensive Mexico - U.S. network of 51 routes, 10 of which are MEX - U.S. routes. 6 In the text of its application Volaris acknowledges how fungible its 43 MEX slot pairs are: After the new Agreement was signed, Volaris announced service from Mexico City to Miami, JFK and Houston. As Volaris noted elsewhere in this docket, Volaris was able to launch those services only by withdrawing some of its domestic service to Mexico City (emphasis supplied). 7 The point is that Volaris and Viva have many options today to increase their presence in U.S. - MEX markets now or in the future if they wish to do so. If, as Southwest 5 In addition, Volaris entered four other MEX transborder routes during that period that it later abandoned (MEX-FLL/MDW/PHX/SAN). 6 Volaris Application, Exhibits 3 and 6. 7 Id. at 5, n.15. 6
Consolidated Answer of Southwest Airlines January 30, 2017 recommends, Volaris and Viva receive a total of 10 slot pairs after all requests for slots and schedule time preferences of the three U.S. carriers have been satisfied, this will be a meaningful increase in their already large portfolios. They would then have a total of 78 slot pairs at MEX in the controlled hours, compared to only 16 slot pairs for the U.S. carrier applicants, assuming the latter are awarded 14 pairs (Exhibit WN-A-7). 8 Exhibit WN-A-7 II. More than Half of Volaris Proposed Connecting Markets are Excessively Circuitous, Discrediting Its Traffic Forecast. Volaris application states that it will serve 60 connecting markets via MEX if granted the slots it requests in this proceeding. However, a close examination shows 8 According to currently published schedules for June 2017. 7
Consolidated Answer of Southwest Airlines January 30, 2017 that 34 of its proposed connecting markets would have a mileage circuity ranging from 41% to 1,321% (Exhibit WN-A-8). 9 In fact, 18 of Volaris connecting markets have greater than 100% circuity, which is absurd. Exhibit WN-A-8 Nevertheless, by virtue of Volaris dubious traffic forecasting methodology Volaris claims significant traffic from all 34 of these highly circuitous connecting markets. 10 Such a fundamental analytical flaw calls into question how committed Volaris is to these routes and minimizes their likely competitive impact. 9 By contrast, Southwest capped the circuity of its proposed connecting markets at 40%, a reasonable limit given passenger travel preferences. (For example, see Southwest Application Exhibit WN-10.) 10 Volaris simply assumes its MEX segment load factor, and when this is multiplied by its seat capacity the traffic forecast is born. 8
Consolidated Answer of Southwest Airlines January 30, 2017 III. Viva s Unreliable Transborder Service Record Further Supports Prioritizing U.S. LCC Slot Requests. Since the beginning of 2008 Viva has entered 14 Mexico - U.S. markets and suspended or interrupted service in 13 of them. VivaAerobus Transborder Service Has Been Extremely Inconsistent Period Served Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Jan 14 Jan 15 Jan 16 Jan 17 AUS-MTY AUS-CUN AUS-PVR LAS-MTY HMO-LAS IAH-MTY MDW-MTY MCO-MTY MIA-MTY MTY-SAT GDL-IAH CUN-IAH DFW-GDL DFW-MTY Exhibit WN-A-9 No Longer Serves Currently Serves Today the airline serves just three transborder routes, of which only one (IAH- MTY) has operated continuously. The company s irregular service history creates no lasting consumer benefits and will likely not survive in the highly competitive Mexico City market. Nothing is stable about Viva s transborder routes (Exhibits WN-A-9 and WN-A-10) or its weekly frequencies which have ranged from zero in June 2009, to 48 in June 2015, and now six in June 2017 (Exhibit WN-A-10). 9
Consolidated Answer of Southwest Airlines January 30, 2017 In addition, Viva has no codeshare relationship with any U.S. airline and does not offer connecting service on itself at MEX (Exhibit WN-A-11). So, virtually all of its traffic will be local to the MEX segment, and no network benefits can be expected. This is a dubious predicament for Viva since every one of its seven proposed MEX - U.S. markets is currently served by Volaris, among other carriers. IV. Southwest s Proposed New U.S. - MEX Service Will Deliver the Greatest Consumer Benefits. When comparing the carrier applications side-by-side, it is clear that Southwest s proposed U.S. - MEX service will provide the most effective competition with the Joint Applicants and deliver the most consumer benefits of any carrier by a wide margin. Southwest alone provided the Department with an empirical analysis to demonstrate the consumer benefits that will flow from its proposed service due its low fares and the size and scope of its existing network. 11 It is also the only applicant that developed model-based traffic forecasts route-by-route (including connecting markets) rather than by simply picking a load factor based on other experience and then assuming it to hold true for the newly proposed markets. 12 Specifically, Southwest showed that its proposed service will reduce fares in all three transborder markets by 19% and increase traffic by 33%. 13 11 See Southwest Application, Sec. V and Exhibits WN-20, 21 and 22. 12 Southwest s traffic forecasts include an average local to connecting ratio of 73:27. See Id. at Appendix 2, pp 2, 4 and 6). 13 Southwest Application, Sec. V and Exhibits WN-20, 21 and 22. 10
Consolidated Answer of Southwest Airlines January 30, 2017 The Southwest Effect from Proposed MEX Slots Will Decrease Fares and Increase Passengers Significantly % Change Yr/Yr 40% +33% 30% 20% 10% 0% +472,633-10% -20% -30% -19% -$35 Per Passenger Decrease in Fares Southwest Application Exhibit WN-20 Increase in Passengers Together, these fare reductions and traffic stimulation will save consumers nearly $50 million annually in the three markets. 14 Granting Southwest the four slot pairs it has requested will enable it to expand its extremely limited transborder service and bring the Southwest Effect to important U.S. - Mexico City markets. Moreover, Southwest s projected benefits dwarf Mexican carrier benefits, especially for U.S. consumers, who favor U.S. carriers in transborder markets. As 14 Id. at p.14 and Exhibit WN-23. 11
Consolidated Answer of Southwest Airlines January 30, 2017 shown in its Application, 15 Southwest s proposed flights will connect MEX with three major U.S. gateways (HOU, FLL and LAX) and provide convenient connecting services to 49 U.S. behind/beyond airports that penetrate all significant Mexican-American population centers (Exhibits WN-A-13 and WN-A-14). Exhibit WN-A-13 Neither Mexican carrier applicant can provide on-line connecting services within the U.S., so the public benefits to U.S. consumers to be derived from slots used by Volaris or Viva will necessarily be minimized. 15 See, e.g., Southwest Application, Exhibits WN-10, WN-12, WN-14, WN-16 and WN-19. 12
Consolidated Answer of Southwest Airlines January 30, 2017 Another indicator of service quality and consumer benefits is the percentage of routes where the carrier offers daily, as opposed to less-than-daily, service. Southwest provides daily service in 95% of the routes it operates. By contrast, both Volaris and Viva provide daily service in less than half their nonstop routes (Exhibit WN-A-12). % Routes Served Less than Daily 60% Over Half of All Volaris and VivaAerobus Routes Are Served Less Than Daily Compared to Only 5% for Southwest 50% 52.4% 51.6% 40% 30% 20% 10% 4.7% 0% Volaris VivaAerobus Southwest Exhibit WN-A-12 While both carriers are proposing daily service in most of their requested markets in this proceeding, their past history suggests they will ultimately provide a less-than-daily pattern in many of them. V. Southwest s Service Would Have a Significantly Larger Competitive and Fare Impact on U.S. - MEX Markets Than Either JetBlue or Alaska. Among the three U.S. applicant carriers (Southwest, JetBlue and Alaska), Southwest currently operates two-thirds of all domestic service and capacity, and 13
Consolidated Answer of Southwest Airlines January 30, 2017 carries twice as many domestic O&D passengers as JetBlue and Alaska combined. Further, Southwest s domestic network is significantly larger and more extensive than either JetBlue or Alaska. (Exhibit WN-A-15). U.S. Domestic Nonstop Routes 700 Southwest Operates More U.S. Domestic Nonstop Routes Than All Other Applicant Carriers Combined 649 600 500 400 300 232 200 173 100 0 0 0 Southwest Alaska/Virgin JetBlue Volaris VivaAerobus America % Share 61.6% 22.0% 16.4% 0% 0% Exhibit WN-A-15 This demonstrates that Southwest is the only applicant with extensive nationwide reach, while the other U.S. carrier applicants concentrate service in a few cities or regions. Consequently, Southwest s network benefits for its U.S. MEX service will be far greater than the two other U.S. applicants and, as shown earlier, the network benefits are zero for Viva and close to zero for Volaris. Importantly, Southwest is the only carrier in this proceeding that has the scope and scale of domestic network service to be able to discipline the legacy carriers, 14
Consolidated Answer of Southwest Airlines January 30, 2017 including Delta/Aeromexico, across the entire country (Exhibit WN-A-16). Southwest s long track record of expanding into high-fare markets has brought sharp decreases in average fares, which have stimulated dramatic increases in passenger traffic (the Southwest Effect). 16 Similarly, the four new MEX slot pairs Southwest is requesting will enable it to bring vigorous low-fare competition to important U.S. MEX markets, reducing fares and stimulating additional passengers, in direct competition with the Joint Applicants and other legacy carriers. CONCLUSION As stated above and in its previous pleadings, Southwest urges the Department to grant all U.S. carrier MEX slot requests before allocating slots to the Mexican applicants. As part of this grant, Southwest s four new MEX slot pairs will enable it to provide new high-quality, low-cost travel options for U.S. passengers in direct competition with the Joint Applicants and other high-fare legacy carriers. Respectfully submitted, Robert W. Kneisley January 30, 2017 16 Recent Southwest Effect examples include Southwest s expansion of service at DCA with slots divested by American Airlines, where average fares dropped 21% in Southwest s new markets and traffic increased 40%. YE Q2 2014 vs. YE Q2 2016. Similarly, following repeal of the Wright Amendment restrictions at Dallas Love Field in October 2014, fares decreased 24% and traffic increased 34% in Southwest s new nonstop Dallas markets U.S. DOT O&D Passenger Survey. YE Q3 2014 vs. YE Q2 2016. 15
CERTIFICATE OF SERVICE I hereby certify that on January 30, 2017, a copy of the foregoing was served via e-mail on the following persons: jeremy.ross@alaskaair.com (Alaska Airlines) dheffernan@cozen.com (Counsel for Alaska Airlines) robert.wirick@aa.com (American Airlines) howard.kass@aa.com (American Airlines) chris.walker@delta.com (Delta Air Lines) alex.krulic@delta.com (Delta Air Lines) matwood@cozen.com (Counsel for Frontier) slachter@cozen.com (Counsel for Frontier) robert.land@jetblue.com (JetBlue Airways) esahr@eckertseamans.com (Counsel for JetBlue Airways) dderco@eckertseamans.com (Counsel for JetBlue Airways) rdavidson@eckertseamans.com (Counsel for JetBlue Airways) jyoung@yklaw.com (Counsel for Spirit Airlines) dkirstein@yklaw.com (Counsel for Spirit Airlines) mathew.friebe@suncountry.com (Sun Country Airlines) dan.weiss@united.com (United Airlines) mwarren@crowell.com (Counsel for United Airlines) robert.cohn@hoganlovells.com (Counsel for Aeromexico) patrick.rizzi@hoganlovells.com (Counsel for Aeromexico) mroller@rollerbauer.com (Counsel for Interjet) Anita.Mosner@hklaw.com (Counsel for Volaris) susan.mcdermott@dot.gov brian.hedberg@dot.gov todd.homan@dot.gov peter.irvine@dot.gov kristen.davis@dot.gov joseph.landart@dot.gov benjamin.taylor@dot.gov brett.kruger@dot.gov bob.goldner@dot.gov jeffrey.gaynes@dot.gov matt.zisman@dot.gov EngleTS@state.gov info@airlineinfo.com Amanda Hoff
BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION SLOT ASSIGNMENT PHASE OF THE DELTA AEROMEXICO ATI PROCEEDING Docket DOT-OST-2015-0070 Exhibits Supporting the Answer of Washington, D.C. January 30, 2017
Summary of MEX Slot Requests Docket OST-2015-0070 Exhibit WN-A-1 Applicant Airline Phase 1 (In rank order) Phase 2 (In rank order) Southwest 2 HOU 1 FLL 1 LAX Alaska JetBlue Volaris 1 LAX 1 SFO 1 LAX 1 SAN 1 FLL 2 MCO 1 FLL 1 JFK 1 SAT 1 IAD 1 ORD 1 LAX 2 LAX 1 OAK 1 DEN.5 ONT.5 SJC VivaAerobus 1 LAX 1 LAS.5 OAK.5 SAT 1 LAX 1 JFK.5 OAK.5 SAT 1 IAH 1 JFK 1 ORD Total 18 (14 available) 13 (10 available) U.S. Carriers 14 10 4 Mex. Carriers 17 8 9 Source: Carrier DOT Applications.
Mexican LCCs Operate Nearly 100 Times As Many Slot Pairs As U.S. LCCs Docket OST-2015-0070 Exhibit WN-A-2 MEX Scheduled Round Trips, 0700-2259 (June 9, 2017) 200 193 Total 180 25 VivaAerobus 160 140 43 Volaris 120 100 80 60 125 Interjet 40 20 0 Mexico LCCs 2 Total U.S. LCCs Note: During controlled hours (0700 2259). Actual schedules used as a proxy for slot holdings. Source: Innovata schedule data, via Diio, for June 9, 2017.
Volaris and VivaAerobus Already Hold Many Times More MEX Slot Pairs Than Southwest Docket OST-2015-0070 Exhibit WN-A-3 MEX Scheduled Round Trips, 0700-2259 (June 9, 2017) 45 43 40 35 30 25 20 21.5 x 25 15 12.5 x 10 5 2 0 Volaris Southwest VivaAerobus (JetBlue and Alaska have no slots during 0700-2259) Note: During controlled hours (0700 2259). Actual schedules used as a proxy for slot holdings. Source: Innovata schedule data, via Diio, for June 9, 2017 as of January 24, 2017.
Volaris Uses 37 MEX Slot Pairs For Domestic Mexico Service That Could Be Shifted to Transborder Routes Docket OST-2015-0070 Exhibit WN-A-4 MEX Slot Pairs Market 0700-2259 Domestic TIJ MXL HMO LAP SJD CUU CUL MZT PVR GDL MTY MEX MID CUN CUN 8 CUL 0.5 CUU 1 GDL 6 HMO 1 HUX 1 LAP 1 MID 1 MTY 2.5 MXL 1 MZT 1 OAX 1 PVR 1.5 SJD 2 TAP 1 TGZ 1.5 TIJ 4 VSA 1 ZIH 1 Total 37 ZIH OAX HUX VSA TGZ TAP Note: During controlled hours (0700 2259). Actual schedules used as a proxy for slot holdings. Source: Innovata schedule data, via Diio, for June 9, 2017 as of January 24, 2017.
VivaAerobus Uses 25 MEX Slot Pairs For Domestic Mexico Service That Could Be Shifted to Transborder Service Docket OST-2015-0070 Exhibit WN-A-5 MEX Slot Pairs Market 0700-2259 Domestic CJS 1 TIJ SJD CJS CUU MZT TRC MTY REX CUN 4 CUU 1 GDL 4 HUX 0.5 MID 1 MTY 6 MZT 1 PVR 1 REX 1 SJD 1 TGZ 0.5 TIJ 1.5 TRC 1 PXM 0.5 VSA 0.5 Total 25 PVR GDL MID CUN MEX VSA TGZ PXM HUX Note: During controlled hours (0700 2259). Actual schedules used as a proxy for slot holdings. Source: Innovata schedule data, via Diio, for June 9, 2017 as of January 24, 2017.
Volaris Could Up-Gauge Aircraft on its High Frequency MEX Domestic Routes to Release Slots for Transborder Service Docket OST-2015-0070 Exhibit WN-A-6 Volaris MEX Domestic Routes with More than One Departure during Slot-Controlled Hours Where All Departures Are Not Already Assigned Its Largest Aircraft Type (A321) Route Aircraft Seats Dep Time CUN 321 230 07:18 CUN 321 230 08:20 CUN 321 230 12:00 CUN 321 230 14:02 CUN 320 179 16:34 CUN 320 179 17:09 CUN 321 230 20:22 CUN 321 230 21:45 GDL 321 230 08:39 GDL 321 230 12:56 GDL 321 230 15:45 GDL 320 174 16:55 GDL 320 179 18:18 GDL 320 186 22:03 MTY 320 174 08:41 MTY 320 179 15:20 PVR 321 230 14:44 PVR 320 179 19:26 SJD 320 186 10:46 SJD 320 186 16:22 Note: Actual schedules used as a proxy for slot holdings. Source: Innovata schedule data, via Diio, for June 9, 2017 as of January 24, 2017.
Even if all U.S. Carrier Requests are Granted, Mexican Applicants Will Still Have 62 More MEX Slot Pairs than U.S. LCCs MEX Scheduled Round Trips, 0700-2259 (June 9, 2017 and Proposed) Docket OST-2015-0070 Exhibit WN-A-7 90 80 70 78 10 Recommended Allocation Current Service 60 50 + 62 Slot Pairs 40 30 68 20 16 10 0 Volaris and VivaAerobus 14 2 U.S. Applicant Carriers Note: Actual schedules used as a proxy for slot holdings. Source: Innovata schedule data, via Diio, for June 9, 2017.
More than Half of Volaris' Proposed Connections Are Excessively Circuitous Docket OST-2015-0070 Exhibit WN-A-8 1,321% 127% 108% 134% 75% 51% 238% 263% 183% 153% 197% 65% 101% 41% xx% = Circuity via MEX Note: Only 4 of 9 examples shown. The same circuity problems occur on Volaris other proposals. In fact, 34 of Volaris 60 total proposed connecting markets exceed 40% circuity. Source: Volaris DOT Application Direct Exhibits. 62%
VivaAerobus Transborder Service Has Been Extremely Inconsistent Period Served Docket OST-2015-0070 Exhibit WN-A-9 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Jan 14 Jan 15 Jan 16 Jan 17 AUS-MTY AUS-CUN AUS-PVR LAS-MTY HMO-LAS IAH-MTY MDW-MTY MCO-MTY MIA-MTY MTY-SAT GDL-IAH CUN-IAH DFW-GDL DFW-MTY Source: Innovata schedule data, via Diio. No Longer Serves Currently Serves
VivaAerobus Mexico - U.S. Departures Have Fluctuated Greatly from Year to Year Docket OST-2015-0070 Exhibit WN-A-10 VivaAerobus Mexico-U.S. Weekly Flights 60 50 48 40 30 20 20 22 10 12 10 10 10 8 6 0 June 2008 0 June 2009 June 2010 June 2011 June 2012 June 2013 June 2014 June 2015 June 2016 June 2017 Source: Innovata schedule data, via Diio, for the sample week in June of each year.
VivaAerobus Does Not Offer Connecting Service At All, Even Between its Own Flights Docket OST-2015-0070 Exhibit WN-A-11 Source: VivaAerobus DOT Application Direct Exhibits at page 29.
% Routes Served Less than Daily 60% Over Half of All Volaris and VivaAerobus Routes Are Served Less Than Daily Compared to Only 5% for Southwest Docket OST-2015-0070 Exhibit WN-A-12 50% 52.4% 51.6% 40% 30% 20% 10% 4.7% 0% Volaris VivaAerobus Southwest Source: Innovata schedule data, via Diio, for the week of June 5-11, 2017.
Southwest s Extensive Domestic Network Will Serve the Mexican-American Population in the U.S. TPA TPA TPA TPA TPA TPA TPA TPA TPA BWI BWI BWI BWI BWI BWI BWI BWI BWI IAD IAD IAD IAD IAD IAD IAD IAD IAD SNA SNA SNA SNA SNA SNA SNA SNA SNA RDU RDU RDU RDU RDU RDU RDU RDU RDU CLT CLT CLT CLT CLT CLT CLT CLT CLT BHM BHM BHM BHM BHM BHM BHM BHM BHM MCO MCO MCO MCO MCO MCO MCO MCO MCO PNS PNS PNS PNS PNS PNS PNS PNS PNS LGA LGA LGA LGA LGA LGA LGA LGA LGA EWR EWR EWR EWR EWR EWR EWR EWR EWR PIT PIT PIT PIT PIT PIT PIT PIT PIT STL STL STL STL STL STL STL STL STL AUS AUS AUS AUS AUS AUS AUS AUS AUS SAT SAT SAT SAT SAT SAT SAT SAT SAT ABQ ABQ ABQ ABQ ABQ ABQ ABQ ABQ ABQ MAF MAF MAF MAF MAF MAF MAF MAF MAF DAL DAL DAL DAL DAL DAL DAL DAL DAL TUL TUL TUL TUL TUL TUL TUL TUL TUL MCI MCI MCI MCI MCI MCI MCI MCI MCI OMA OMA OMA OMA OMA OMA OMA OMA OMA OKC OKC OKC OKC OKC OKC OKC OKC OKC DEN DEN DEN DEN DEN DEN DEN DEN DEN SLC SLC SLC SLC SLC SLC SLC SLC SLC SEA SEA SEA SEA SEA SEA SEA SEA SEA PDX PDX PDX PDX PDX PDX PDX PDX PDX SJC SJC SJC SJC SJC SJC SJC SJC SJC LAS LAS LAS LAS LAS LAS LAS LAS LAS RNO RNO RNO RNO RNO RNO RNO RNO RNO SMF SMF SMF SMF SMF SMF SMF SMF SMF OAK OAK OAK OAK OAK OAK OAK OAK OAK SFO SFO SFO SFO SFO SFO SFO SFO SFO LAX LAX LAX LAX LAX LAX LAX LAX LAX FLL FLL FLL FLL FLL FLL FLL FLL FLL HOU HOU HOU HOU HOU HOU HOU HOU HOU MEX MEX MEX MEX MEX MEX MEX MEX MEX ATL ATL ATL ATL ATL ATL ATL ATL ATL BNA BNA BNA BNA BNA BNA BNA BNA BNA DCA DCA DCA DCA DCA DCA DCA DCA DCA ECP ECP ECP ECP ECP ECP ECP ECP ECP MDW MDW MDW MDW MDW MDW MDW MDW MDW MEM MEM MEM MEM MEM MEM MEM MEM MEM MSY MSY MSY MSY MSY MSY MSY MSY MSY SJU SJU SJU SJU SJU SJU SJU SJU SJU BOS BOS BOS BOS BOS BOS BOS BOS BOS CHS CHS CHS CHS CHS CHS CHS CHS CHS IND IND IND IND IND IND IND IND IND BUF BUF BUF BUF BUF BUF BUF BUF BUF ISP ISP ISP ISP ISP ISP ISP ISP ISP PHL PHL PHL PHL PHL PHL PHL PHL PHL PVD PVD PVD PVD PVD PVD PVD PVD PVD Source: Southwest s DOT Application and U.S. Census, American Community Survey. Docket OST-2015-0070 Exhibit WN-A-13 Proposed nonstop route Existing nonstop market within 40% circuity and 4 hour connecting time constraints Mexican-American population
Docket OST-2015-0070 Exhibit WN-A-14 Southwest s Proposal Would Provide Benefits in Numerous U.S. Connecting Markets, while the Mexican Carriers Offer Benefits in the Local Market Only Number of Online U.S. Connecting Markets 50 49 40 39 30 Mexican carriers cannot offer network benefits to U.S. points beyond the U.S. gateway. 20 13 10 7 0 Southwest-HOU Proposal Southwest-FLL Proposal Source: WN Application Direct Exhibits WN-10, WN-14 and WN-19. Southwest-LAX Proposal Southwest Proposal Combined 0 0 Volaris Proposal Combined VivaAerobus Proposal Combined
U.S. Domestic Nonstop Routes 700 Southwest Operates More U.S. Domestic Nonstop Routes Than All Other Applicant Carriers Combined 649 Docket OST-2015-0070 Exhibit WN-A-15 600 500 400 300 232 200 173 100 0 Southwest Alaska/Virgin America Note: Includes all service within the United States. Source: Innovata schedule data, via Diio, for the week of June 5-11, 2017. 0 0 JetBlue Volaris VivaAerobus % Share 61.6% 22.0% 16.4% 0% 0%
Southwest is the Only Applicant with Nationwide Reach Docket OST-2015-0070 Exhibit WN-A-16 Southwest JetBlue Alaska/Virgin America Notes: Size of dots is proportional to the number of weekly flights at the airport. Source: Innovata schedule data, via Diio, January 2017.