After announcing plans to expand service to Miami, Southwest Airlines declared their intention to serve both Houston Intercontinental and Chicago O’Hare starting next year. These are highly non-traditional moves for the airline that’s historically focused more on lower cost airports in cities with multiple airports. However the Covid pandemic accelerates change, makes it possible to get gates as other airlines reduce service, and changes the competitive landscape. With these moves Southwest is directly going after American Airlines and United.
Southwest is already strong in South Florida (Fort Lauderdale), Houston (Hobby), and Chicago (Midway). They also have a huge customer base in Dallas (Love Field) where they were founded, and I wondered “could Dallas Fort Worth be on the horizon?” And the answer is no, not any time soon.
I had forgotten – but the Airlines Confidential podcast this week reminded – that Southwest Airlines is legally precluded from just flying out of Dallas Fort-Worth. To understand why requires going back four decades.
- Southwest Airlines was founded at Dallas Love Field. Other airlines had agreed to move to DFW. They fought in court to keep Southwest from serving the closer-in airport. Southwest eventually won.
- In response, Congress passed the Wright Amendment which limited what Southwest could do at Love Field. They were limited initially to flying within Texas and to contiguous states.
- The list of states airlines could fly to from Love Field was expanded slightly, and the limitation didn’t apply to aircraft with 56 or fewer seats. Legend Airlines pulled seats out of planes to offer all premium cabin service from Love Field to business markets. They faced lawsuits over the plan, and American Airlines dumped capacity with their own premium cabin Fokker 100 service – putting Legend out of business.
- When the Wright Amendment was finally lifted, Southwest went from being the oppressed to being the oppressor. The deal required the destruction of gates leaving Southwest in control of 18 out of 20 gates at the airport at the time. No one could come in and really compete against Southwest, and Love Field service couldn’t grow to compete against American at DFW.
While the Wright Amendment’s restrictions on flying to specific states with aircraft that have more than 56 seats was lifted, I had forgotten that not all restrictions were eliminated. Southwest would have to give up some of its Love Field gate space if it wanted to serve DFW airport. That’s a restriction that remains in place until 2025.
It is effectively illegal for Southwest Airlines to come in and compete against American Airlines at DFW.