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The sensible traveler

Southwest to join Philly fray

Email|Print| Text size + By Bruce Mohl
Globe Staff / February 29, 2004

Flying to Philadelphia from eastern Massachusetts is becoming more affordable, thanks to discount airlines that are knocking the wheels out from under US Airways.

Philadelphia is one of three US Airways hubs, the other two being Pittsburgh and Charlotte, N.C. The Arlington, Va.-based airline operates 383 nonstop flights a day out of Philadelphia, almost four times the number that depart from Boston. Its dominance in Philadelphia has given it the ability to keep fares high.

But last June, Air Tran Airways launched service from Boston's Logan International Airport to Philadelphia with round-trip fares that were a third what US Airways was charging.

Now US Airways is facing an even greater challenge from the largest of the discounters: Southwest Airlines. Southwest plans to launch 14 daily flights out of Philadelphia starting May 9. Five of the flights will head north to Providence, three each will go to Chicago and Orlando, Fla., and one each to Phoenix, Las Vegas, and Tampa, Fla. From those six cities connections will be available to 31 other destinations.

Southwest says it will charge $58 for a round-trip, 14-day advance purchase fare to Providence and $98 for walk-up fares. That's chump change compared with what US Airways has been charging: nearly $800 for a 14-day advance purchase fare and nearly $900 for a walk-up fare.

As it was forced to do with Air Tran, US Airways is matching the Southwest fares, and it's probably only a matter of time before it will have to do more fare matching.

Southwest is likely to expand its operations out of Philadelphia in the future. For example, it could launch flights between Philadelphia and Manchester, N.H., putting downward pressure on fares again. US Airways currently charges $350 for a round-trip, 14-day advance purchase fare from Manchester to Philadelphia.

US Airways says the attacks on its Philadelphia hub are more than an economic blow. Spokesman David Castleveter, appearing to speak to the company's unions as much as the public, said the attacks are a sign that the airline is out of step with what travelers want and expect.

''The model has shifted," Castleveter said. ''The buying patterns of our customers have changed. They're not willing to pay what they have been paying."

The nation's leading low-cost airlines (Southwest, Air Tran, ATA Airlines, America West Airlines, JetBlue Airways, Spirit, and Frontier) now control more than a quarter of the overall air travel market. Last year, the low-cost airlines gained as much business as the seven leading airlines lost. They made money, while the seven majors had $3 billion in losses.

None of the big airlines have been immune. They are all trying to cut costs, but some are having more success than others. Delta Air Lines, for example, saw costs increase last year, despite laying off 6 percent of its workforce.

The cost squeeze was an ominous sign for Song, Delta's discount airline-within-an-airline. Song's operations have been cut back slightly and its rapid expansion plans put on hold.

But no airline is in more trouble than US Airways. It emerged from Chapter 11 bankruptcy last year with its costs down and a business plan. But with its Philadelphia hub under assault, the airline says it needs to cut costs a lot more. It is asking its unions for more concessions, and has hired investment banker Morgan Stanley to explore the sale of assets.

There has been no decision about what might be put up for sale, but speculation is rampant that US Airways may sell its shuttle service between Boston, New York, and Washington.

Henry Harteveldt, principal travel analyst with Forrester Research in Cambridge, said US Airways is under siege and unlikely to survive unless it can reinvent itself quickly. He said consumers have little loyalty to the airline.

''They could disappear and no one would miss them. They are the Aeroflot of the Northeast," Harteveldt said, referring to the Soviet airline that was notorious for poor service.

New chatter aimed at hotels, and more

Hotelchatter.com, developed by a Charlestown resident, is the latest entry in the hotel gossip category.

As I've noted before, I like getting the dirt from travelers on hotels and other issues. The problem is that while there are a number of sites that solicit consumer reviews, there aren't that many reviews on any of the sites.

Mark G. Johnson is hoping to change that. Hotelchatter is nicely designed with sections on travel news (where Britney Spears stayed in London), tips (how MIT students ''gamed" Priceline), and deals (cheap hotels in Mexico and elsewhere). When controversy erupted over the construction and design of the Hotel Commonwealth in Kenmore Square, Johnson tried to get a debate going by posting news stories and soliciting neighborhood commentary and management responses.

Then there are the sections dubbed Hotel Hell and Hotel Heaven. They are pretty much what you would expect, but the offerings are skimpy here, too. Most are written by Johnson or others whom he has solicited for commentary.

''More people and more content. It's happening more and more every day," Johnson said.

Bruce Mohl can be reached by e-mail at mohl@globe.com.

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