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OST-97-2932

Spirit Airlines, Inc. (Exemption, Myrtle Beach-New York LaGuardia)

OST-97-2932 | September 24, 1997

Application for an Exemption

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Requests such an exemption so that Spirit may provide two daily non-stop round trip scheduled jet services between Myrtle Beach, South Carolina (Myrtle Beach) and New York's La Guardia Airport. Spirit intends to introduce one daily roundtrip frequency in this market on or about December 15, 1997, and to introduce a second daily frequency in late January 1998. Accordingly, Spirit requests that the relief requested in this application be granted by November 1, 1997. With the loss of Air South's service at Myrtle Beach, Myrtle Beach has lost its nonstop access to New York.

Answers are due by October 9, 1997

Exhibit 1 - Service Proposal | Service List

Counsel: Galland Kharasch, Anita Mosner, 202-342-5200

Spirit Airlines, Inc. (Exemption, Myrtle Beach-New York LaGuardia)

OST-97-2932 | October 6, 1997

Answer of Trans World Airlines

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Spirit's application fails to disclose an essential fact. Throughout its pleading, it suggests that Myrtle Beach has recently lost all its service to New York, and that such service can only be restored if Spirit receives LaGuardia slots. Such allegations are quite surprising in light of Spirit's actual institution of daily nonstop New York - Myrtle Beach service on October 2, 1997 via Kennedy Airport. Attached are copies of displays from SABRE and WORLDSPAN showing such service. In view of the limited time -- eight days -- between the filing of its application and its institution of service, the Department may want to consider whether Spirit deliberately misled it.

Attachment: CRS Display from WorldSpan and Sabre

Counsel: TWA and Richard Fahy, 202-457-4764, rfahy@ibm.net

• Comments of The Michael Gaich Company in Support - September 24, 1997
• Comments of Florida Today/USA Today in Support - September 22, 1997

Spirit Airlines, Inc. (Exemption, Myrtle Beach-LaGuardia)

OST-97-2932 | October 7, 1997

Re: Correction to Answer of Trans World Airlines Filed October 6, 1997

On October 6, 1997, TWA filed an answer to Spirit's application for Laguardia slots to provide service to Myrtle Beach. TWA hereby withdraws Paragraph 1 of that Answer, which suggested that Spirit had failed to advise the Department that it was inaugurating service from Kennedy to Myrtle Beach. TWA had failed to note that such disclosure was included in a footnote. TWA apologizes for this error.

Counsel: TWA and Richard Fahy

Spirit Airlines, Inc. (Exemption, Myrtle Beach-New York LaGuardia)

OST-97-2932 | October 9, 1997

Answer of Business Express Airlines

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BEX does not object to the continuation of nonstop air service in the MYL-JFK market. It is very concerned, however, at the weak arguments new entrant air carriers are presenting to the Department as the ''exceptional circumstances" needed to justify exemptions from the High Density Rule and the awarding of free "slots. BEX, which has recently emerged from Chapter 11 bankruptcy, has made a substantial investment in its 24 LGA slots, most of which are used in furthering the real public interest. These slots are each currently worth between $200,000 and $300,000, and many are used to provide service to points which the Department has determined are eligible for basic essential air service.

Counsel: Allan Markham, 202-337-2149

Answer of Horry County and its Department of Airports

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The nonstop service proposed by Spirit will be of significant benefit to the traveling public -- offering both convenience and low fares. When Air South introduced nonstop service between New York and Myrtle Beach, the average round-trip fare fell by 27 percent from $263 to $192. Spirit, a low-fare carrier, will continue to offer the public low fares. If Myrtle Beach were left without nonstop air service to its largest market, traffic levels will decline, fares will rise to their previous levels, and the Myrtle Beach economy will suffer. Given that the Myrtle Beach area accounts for one-third of South Carolina's total revenue from travel and tourism, such a prolonged condition would have significant impact on tourist related air travel for Horry County and the State. As a result, prompt approval of Spirit's application is very important to the Myrtle Beach community.

By: Steven Gosnell, Acting Director

Ex Parte Letter to Howard Futch, Florida House of Representatives - October 3, 1997

By: Charles Hunnicutt

Spirit Airlines, Inc. (Exemption, Myrtle Beach-New York LaGuardia)

OST-97-2932 | October 20, 1997

Reply of Spirit Airlines

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In a situation where passengers might have been faced with limited service options and high fares, Spirit has offered as a stopgap measure a single daily service between New York and Myrtle Beach, offering fares as low as $59 each way. By taking this step, Spirit has fumed a potentially negative situation into a positive one. Spirit would hope that the Department would not succumb to the entreaty of TWA that Spirit should be penalized for offering emergency service at JFK by having its LGA application denied.

Counsel: Galland Kharasch, Anita Mosner, 202-342-5200

Spirit Airlines, Inc. (Exemption, High Density Rule, LaGuardia)

OST-97-2870 | OST-97-2932 | December 18, 1997

Reply of Spirit Airlines to Answer of The Office of the Queens Borough President and Motion for Leave to File

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The arguments raised by the Borough President are either directed to the existence of the slot exemption procedure itself, or, with respect to the application filed by Spirit, largely are a rehash of arguments raised by other parties. The Borough President's overriding general comment in response to Spirit's application is that services proposed for LGA can as easily be offered at Newark. This is simply untrue. Spirit has devoted considerable time and energy to seeking gates at Newark, and has been unable to secure access to gates at any price during the afternoon evening hours, times which are necessary to mount a viable service. Newark is in fact more congested than LGA, and is simply not a workable alternative. The Borough President's assertions about Newark also have been contradicted by the GAO, which has recognized on several occasions the severe access restrictions at Newark.

Counsel: Spirit and Galland Kharasch, Anita Mosner, 202-342-5200

Applications of ACCESSAIR HOLDINGS, INC. / AMERICAN TRANS AIR, INC. / AMERICA WEST AIRLINES, INC. / COLGAN AIR, INC. / SPIRIT AIRLINES, INC. / PAN AMERICAN WORLD AIRWAYS, INC. and CARNIVAL AIRLINES, INC. / THE PEOPLE AND BUSINESSES OF BLOOMINGTON-NORMAL, IL; MOLINE-QUAD CITIES, IL; TOLEDO, OH; AND AKRON/CANTON, OH

ORDER GRANTING AND DENYING APPLICATIONS FOR SLOT EXEMPTIONS AT NEW YORK'S LAGUARDIA AND JOHN F. KENNEDY INTERNATIONAL AIRPORTS

After considering applications for exemptions from 14 CFR Part 93, Subparts K and S, for slots at New York's LaGuardia and John F. Kennedy (JFK) Airports, the Department has decided to grant five slot exemptions to American Trans Air, Inc. (ATA) for nonstop service in the Chicago (Midway)-LaGuardia market; and four slot exemptions to Spirit Airlines, Inc. (Spirit) for nonstop service in the Melbourne, Florida-LaGuardia market. We find that granting these exemptions is in the public interest and meets the statutory "exceptional circumstances" test. Grant of these exemptions is conditioned on their being used solely for nonstop service in the city-pair markets designated in the carriers' applications. The Department has also decided to deny the remainder of ATA’s and Spirit's applications as well as the applications of AccessAir Holdings, Inc., America West Airlines, Inc., Colgan Air, Inc., and the joint application of Pan American World Airways, Inc. and Carnival Air Lines, Inc. Further, we deny the petition for reconsideration of AirTran Airways' application filed by the People and Businesses of Bloomington-Normal, IL; Moline-Quad Cities, IL; Toledo, OH; and Akron-Canton, OH. In reaching our decision on all of these requests we were committed, among other guidelines, to avoiding significant congestion and environmental problems. Primarily for these reasons, we are granting only a limited number of exemptions.

By: Charles Hunnicutt

Spirit Airlines, Inc. (Exemption, Myrtle Beach-New York LaGuardia)

OST-97-2932 | July 23, 1998

Motion for Reallocation of Slots

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Spirit understands that certain carriers which have received new-entrant slots at LGA are not fully using those slots, and are unlikely to do so. To the extent this is true, and to the extent DOT intends to reallocate such slots, Spirit wishes to reiterate its longstanding interest in the Myrtle Beach market. Spirit remains ready, willing and able to introduce nonstop scheduled service between Myrtle Beach and LGA. If DOT were to reallocate any or all of the unused slots, Spirit requests that DOT allocate to Spirit at least two of the available slots so that Spirit promptly may inaugurate scheduled air service between Myrtle Beach and LGA

Counsel:  Galland Kharasch, Anita Mosner, 202-342-5200

AccessAir Holdings, Inc. / America West Airlines, Inc. / Chautauqua Airlines, Inc. / Pro Air, Inc. / Spirit Airlines, Inc.

Order 98-10-29 OST-98-4499 OST-97-2970 OST-98-4425 OST-98-3583 OST-97-2932

Issued and Served October 27, 1998

Order Granting and Denying Applications for Slot Exemptions at New York's LaGuardia Airport

High Density Rule, New York LaGuardia

After careful consideration of these applications for exemptions from 14 C.F.R. Part 93, Subparts K and S. for slots at New York's LaGuardia Airport, the Department has decided to grant two slot exemptions to Pro Air, Inc. for nonstop service in the Detroit City Airport-LaGuardia market and two slot exemptions to Spirit Airlines, Inc. for nonstop service in the Myrtle Beach-LaGuardia market. We find that granting these exemptions is in the public interest and meets the statutory "exceptional circumstances" test. Grant of these exemptions is conditioned on their being used solely for nonstop service in the city-pair markets designated in the carriers' applications.

By:  Charles Hunnicutt

Spirit Airlines, Inc.

Counsel:  GKMG Consulting, Anita Moser, 202.342.5201

Spirit Airlines, Inc.

Spirit's planned services would advance the public's interest and comport with the Department's criteria for granting an exemption in all respects. Spirit is a new entrant, low-fare airline that is poised to bring the benefits of competition -- and low fares -- to a market that is presently non-competitive. If granted the requested exemption from the slot rule at LaGuardia Airport, Spirit proposes to offer low-fare, nonstop schedule service using MD-80 jet aircraft that meets Stage 3 noise requirements. In Order 97-10-17, the Department expanded its definition of exceptional circumstances to recognize the need for competitive service in a market -- especially for low fare competitive service. The Department clarified that exceptional circumstances exist "where consumers would be able to obtain significantly lower fares in noncompetitive or under served markets."

Counsel:  Broward County Aviation Diector, William Sherry

New York continues to rank as the number one market for the region in terms of visitation and passenger traffic. However, the fluctuations in the number of passengers from year to year are a direct reflection of a lack of stable and affordable air service. Our air trade area can support - and desperately needs - more frequent and affordable New York service to meet the growing market demand. It is the only way we will be able to realize the economic benefits of Southwest Florida's popularity in the New York market. We have already experienced the benefits related to Spirit's entry into the market. Detroit has consistently ranked as one of the top visitor markets to Southwest Florida. Its full potential was constrained due to a lack of frequent and affordable air service.

By:  Lee County, Robert Ball

The New York-Orlando market has enough capacity to sustain Spirit's proposed service. Two of the three New York City area airports (Newark and LGA) are the top two domestic O&D markets for Orlando, according to second quarter 1999 data. The third (JFK) was in the top 20. As such, these three airports -- both individually and collectively -- represent a very significant passenger and shipper market for Orlando.

Counsel:  Preston Gates, Jonathan Blank, 202.662.8450

Spirit Airlines, Inc. hereby files the attached letter in support of its Application from Palm Beach International Airport. Spirit Airlines is seeking the award of fourteen exemption slots so that it may provide new nonstop jet service between New York's LaGuardia Airport, on the one hand, and Detroit, MI, Ft. Lauderdale, FL, Ft. Myers, FL, Orlando, FL, Tampa, FL, and West Palm Beach, FL, on the other hand. As demonstrated by the attached letter in support (Exhibit No. 1), there is great need and desire for reliable, convenient, low-fare nonstop jet service to and from LaGuardia.

Counsel:  GKMG, Anita Mosner, 202-342-5201

Spirit Airlines, Inc.

The President of the Borough of Queens is the highest level county-wide executive in Queens County in New York City. If Spirit Airlines' application for 14 slot exemptions at LaGuardia Airport is granted, it would have a significant adverse impact on the residents of Queens County, which is the home of both LaGuardia and John F. Kennedy International Airport and has a population of approximately two million individuals. Because the Borough President is elected by and represents the entire county, and works closely with the aviation industry to balance the economic and transportation benefits of that industry with its negative impacts on residents, the Borough President's Office is in the best position to represent Queens County's interest in this proceeding.

Counsel:  Queens Borough President, Hugh Weinberg

Spirit Airlines, Inc.

If there is any room left for discussion of the benefits to be offered by Spirit’s proposed services, the Department need only look at the use Spirit has made of its LGA-Melbourne and LGA-Myrtle Beach exemption authority. Since Spirit introduced service at Melbourne, average fares in the market have declined 63%, and O&D traffic has increased 964%. At Myrtle Beach, Spirit’s service has brought a 67% fare reduction, and a greater than 500% traffic increase. See Application of Spirit, at 5. The Borough of Queens’ claim that there is a "lack of public benefits that would accrue from any new service" (Answer, at 10) should be put to rest.

Counsel:  GKMG Consulting Services, Anita Mosner, 202.342.5201

Spirit Airlines, Inc.

Counsel:  Office of the Queens Borough President, Hugh B. Weinburg

Spirit Airlines, Inc.

The Office of the President of the Borough of Queens in New York City hereby requests permission to file this unauthorized document in order to supplement its original answer to Spirit Airlines' application for slot exemptions at LaGuardia Airport. We seek to file this document in light of recent factual developments which, we believe, should be considered in connection with Spirit's application. 
While Spirit is factually accurate in its observation that it is within its legal rights to fly the MD-80 aircraft in the routes for which it is seeking exemptions, we believe that it is within the discretion of the decision-makers at the United States Department of Transportation (DOT) to take notice of the particular aircraft model which those seeking exemptions seek to use.  In this case, given the recent problems experienced by Alaska Airlines with its MD-80 aircraft and the federal government's recent decision to inspect all MD-80 and similar aircraft, we respectfully request that the DOT give added weight to Spirit's proposed use of the MD-80 aircraft. The Borough President's Office is of course concerned about the safety of air travel for all those traveling, as well as for all those living near and around airports and under flight paths. For all the reasons stated in the Borough President's December 8, 1999 response and in all subsequent submissions to the DOT, it is respectfully submitted that Spirit's application be denied in its entirety.

Counsel: Queens Borough President, Hugh Weinberg

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