On August 20th American Airlines announced plans to drop air service to 15 cities unless the government forked over another $6 billion in subsidies. The cities were spread across 14 states (28 Senators!) and many of the airports slated to lose service October 7 are represented by members of the House Transportation Committee.
However the plan while containing a certain amount of logic was too clever by half. As I noted the same day, no one at American Airlines realized the problems – and I promised they would walk back the plan to drop at least two of the cities specifically Sioux City, Iowa and Joplin, Missouri – and pointed out a wrinkle in eliminating service to Roswell, New Mexico as well.
So it was no surprise to see the report that American is pausing its plan to drop service to Sioux City, Joplin, and Roswell. (HT: Live and Let’s Fly)
- Sioux City and Joplin are ‘Essential Air Service’ cities
- American agreed to continue flying these routes without subsidy to block United Airlines from receiving subsidies
- EAS cities that were part of the program prior to September 2011 have special conditions. An airline with an EAS award cannot stop serving the route without providing notice to DOT, and is usually required to continue operating flights until DOT finds a replacement.
- American announced the plan to drop service but hadn’t realized this notification requirement.
When I asked American about the rule they’d be breaking by dropping service October 7 without having served notice, they offered “We will follow the DOT process with regard to EAS markets.”
Meanwhile Roswell, New Mexico is performing poorly. Though it’s far from the next-nearest air service, New Mexico restrictions have limited air recovery to an extent greater than many other cities. It’s understandable that American wouldn’t want to continue passenger service.
Back in March American Airlines parked Boeing 737, 737 MAX; 757; 767; and 777-200 aircraft in Roswell. They’ve made the decision to retire the 757s and 767s, and have been ferrying MAX aircraft to Tulsa.
Since they’re storing aircraft in Roswell and ferrying mechanics back and forth to maintain planes, they’d still need to fly without passengers – or send mechanics to Albuquerque and rent cars for the 3 hour, 200 mile drive each way.
Expect the American Airlines filing with DOT to drop Joplin and Sioux City service to show up online this week. Meanwhile American “hasn’t decided how long it will continue air service to Roswell.” I imagine they’ll work out a deal to pick up subsidies for their Roswell flight. And they may receive subsidies during any DOT-mandated holdover period at Joplin and Sioux City.
When you realize how many attorneys are employed or on retainer by such a major transportation company as American, it is most difficult to conceptualize how they missed such a major regulation as EAS.
To paraphrase Casey Stengel, manager of (initially) hapless NY Mets, “doesn’t anyone here know how to play this game.”
Sioux City is eligible to be an EAS city but is not receiving funding, plus the fact it now has United service to Denver.
@John Dornoff – American has the EAS contract at a $0 subsidy.