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OST-2005-20069 - American Airlines - Los Angeles-Mexico City
OST-2005-20071 - Continental Airlines - Los Angeles-Mexico City
OST-2005-20073 - Alaska Airlines - Los Angeles-Mexico City
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American Airlines, Inc. OST-05-20069 - Exemption - Los Angeles-Mexico City January 7, 2005 American Airlines, Inc., under 49 USC 40109, hereby applies for an exemption authorizing scheduled foreign air transportation of persons, property, and mail between Los Angeles and Mexico City. American proposes to start service on May 1, 2005, or upon securing all required governmental authorizations. American will operate two daily frequencies with 188-seat 3757W aircraft (22F/166Y). Illustrative schedules and other data are attached. Counsel: American, Carl Nelson, 202-496-5647, carl.nelson@aa.com OST-05-20069 - Exemption - Los Angeles-Mexico City January 11, 2005 Letter in Support from an Anonymous Person Since 1998, American Airlines has risen from being LAX' s fourth largest airline behind United, Delta and Southwest to being its second largest, rivaling United Airlines' presence in many key markets. American's enormous operational and marketing presence in the Los Angeles area in general, and at LAX specifically, make it the ideal candidate for this route which is so heavily focused on local originating VFR (visiting friends and relatives) market. American Airlines' entrance into the Los Angeles-Mexico City market would not only provide new access for passengers, shippers and freight‑forwarders in this singular O&D market, but also provide hundreds of online connections to hundreds of cities across the globe. Because American codeshares with Alaska on virtually all of its flights from Los Angeles, American's LAX-Mexico City service would still allow online connections to Alaska Airlines aircraft. The Los Angeles-Mexico City market is the single largest air market between the United States and Mexico. The market currently receives a single daily nonstop flight from both U.S. carriers, Delta and United, two flights from Aeromexico, and up to seven daily flights by Mexicana (depending on the day) American Airlines has proposed the largest initial capacity of any applicant with proposals to service the market. American proposes to fly two Boeing 757 aircraft daily, a total of 376 daily seats. Alaska Airlines has proposed a single daily Boeing 737 flight (presumably with a 120-seat capacity) while Continental's application proposes a single daily flight a Boeing 737 of unnamed capacity. American is proposing to offer over three times the number of available seats in the market as Alaska and perhaps as many more seats as Continental. By: ??? OST-2005-20069 - American Airlines - Los Angeles-Mexico City Delta Notice to Department: January 21, 2005
January 24, 2005 Consolidated Answer of Alaska Airlines Alaska is unquestionably best qualified for selection to serve the Los Angeles Mexico City route. Alaska has a longstanding and well‑known interest in providing service between Los Angeles and Mexico City, and will serve the market with year round twice daily flights utilizing Next Generation B737 aircraft. Service will commence on May 1, 2005, or as soon as practical after all regulatory approvals are obtained. Respectfully requests that the Department of Transportation institute a carrier selection proceeding for the Los Angeles-Mexico City route, grant Alaska's pending exemption application and deny the applications of all other applicants. Counsel: Squire Sanders, Marshall Sinick, 202-626-6651
January 24, 2005 Consolidated Answer and Motion of America West Airlines for Consolidation American is already a significant force at LAX and code shares with Aeromexico in a number of LAX markets including Mexico City. An award to American will not promote low– fare competition in this market. Indeed, given its code share with Aeromexico, such an award will effectively shrink the number of carriers that are currently in the market. Like American, Continental and Alaska will not offer the simple low-fare pricing that passengers will gain from an award to America West. Continental has not developed LAX to the same extent as America West and proposes only a daily roundtrip. Over the last 18 months, the sum of Continental's average daily seats at LAX has actually declined while America West's average daily seats increased by almost 1,200 over the same period. Over the last several years, Continental has never applied for any mainline LAX-Mexico routes, and it is not clear why it is applying for this route. Alaska is already the dominant carrier between LAX and points in Mexico. An award to Alaska will extend this dominance. Until such time as the U.S. is able to expand route opportunities for U.S. carriers, it is in the public interest for the Department to seek to create more balance when market entry is contested. An award to America West, as opposed to Alaska, will promote this balance. At the same time America West's low fares will offer the strongest competition to the four carriers ‑ Mexicana, Aeromexico, American (code share) and United – now operating in the market. Counsel: Baker Hostetler, Joanne Young, 202-861-1532
January 24, 2005 Consolidated Answer of American Airlines With four applicants for this one opportunity, the Department is required to conduct a carrier-selection proceeding. See Ashbacker Radio Corp. v. FCC, 326 U.S. 327 (1945) In that proceeding, American will demonstrate why its application, submitted in OST-2005-20069 on January 7, 2005, should be granted. Effective May 1, 2005, or as soon as all required governmental authorizations have been secured, American will operate two daily nonstop roundtrips between Los Angeles and Mexico City, using 188-seat B757W aircraft (22F/166Y) . Based on its service proposal and well-established presence and identity at Los Angeles and Mexico City, American should be selected for the award, and the competing applications by Continental, Alaska, and America West should be denied. Counsel: American, Carl Nelson, 202-496-5647, carl.nelson@aa.com
January 24, 2005 Answer of Continental Airlines Continental has been pursuing Los Angeles-Mexico City operating rights for decades, no such rights have been available to it. Continental and its codeshare partner ExpressJet operate flights serving more cities in Mexico than any other U.S. carrier, including new services between Los Angeles and smaller Mexican cities, but they have been unable to offer nonstop Los Angeles-Mexico City flights. In sharp contrast, American today offers service on seven nonstops and a one-stop from Los Angeles to Mexico City and five nonstops and a one-stop from Mexico City to Los Angeles on flights operated by its codeshare partner, Mexicana. Alaska serves resort destinations in Mexico but offers no service whatever at Mexico City despite the availability of other opportunities to serve Mexico City from various points along its north-south west coast route network. Although America West's application brags about its growth at Los Angeles and claims that America West scheduled its proposed flights for connections at Los Angeles, America West's Los Angeles service is at cities where America West could offer far better Mexico City connections at Phoenix than it could offer at Los Angeles. Counsel: Continental and Crowell & Moring, Bruce Keiner, 202-624-2615 OST-2005-20069 - American Airlines - Los Angeles-Mexico City January 25, 2005 Re: Correction to Consolidated Answer and Motion of America West Airlines for Consolidation In its Consolidated Answer filed January 24, 2005, in the above-referenced proceedings, America West, in the first paragraph on page 4 inadvertently identified American Airlines' codeshare partner in the LAX -MEX market as Aeromexico instead of Mexicana. Accordingly, America West hereby amends this paragraph to refer to Mexicana as American's code-share partner. Counsel: Baker & Hostetler, David Kirstein, 202-861-1532 OST-2005-20069 - American Airlines - Los Angeles-Mexico City
February 2, 2005 Consolidated Reply of Alaska Airlines The record developed thus far leaves no doubt that Alaska would be the best choice to replace Delta Air Lines, Inc. on the Los Angeles-Mexico City route. Selection of Alaska would generate the greatest benefits for the largest number of consumers from the entire West Coast ranging from southern California to the State of Alaska as well as the intermountain region, increase intra-gateway and inter-gateway competition by adding a new and vigorous competitor in the United States-Mexico City market and permit Alaska to diversify its Mexico services beyond resort destinations. Alaska further requests that the Department expeditiously approve its application so that service may be instituted as soon as possible. It is critically important that service by a second U.S. carrier be restored between Los Angeles and Mexico City at the earliest opportunity given the importance of this market and its history of dominance by the two principal Mexican carriers. The two Mexican carriers' market share already approximates 75 percent and, not surprisingly, Aeromexico has already announced, as a result of Delta's termination, that it will be increasing its level of nonstop service. Counsel: Alaska, Marshall Sinick, 202-626-6651, msinick@ssd.com
February 2, 2005 Consolidated Reply of American Airlines In its answer, Continental requested an interim award pending the Department's long-term decision. That request should be denied. The Department should instead focus its resources on instituting and concluding the required selection proceeding on an expedited basis. American's Los Angeles-Mexico City application should be granted as best serving the public interest. Counsel: American, Carl Nelson, 202-496-5647, carl.nelson@aa.com
February 2, 2005 Continental agrees with the other applicants that the Department must consider the four applications comparatively, and Continental has urged the Department to adopt expedited procedures to reach a final decision promptly based on the applications and answers submitted by each applicant. If the Department is not prepared to reach a decision on such an expedited basis, Continental has asked the Department to give it authority pending completion of the carrier‑selection proceeding. Nothing in the applications or answers submitted to date by the other applicants would suggest that expedition or award of interim authority would be inappropriate. America West claims that Continental's exemption application should be denied and that America West should be awarded Los Angeles‑Mexico City authority instead because America West would offer "simple low‑fare pricing," because America West's seats offered at Los Angeles have been increasing, because Continental would institute service prior to May with one daily roundtrip flight while America West would institute two daily roundtrip flights in May or thereafter and because Continental has not previously applied for "any mainline LAX‑Mexico routes." Counsel: Crowell Moring, Bruce Keiner, Jr., 202-624-2615, rbkeiner@crowell.com 2005 Los Angeles-Mexico City Combination Service Proceeding Order 2005-2-8 Issued and Served February 14, 2005 In view of our ability to designate only one additional U.S. carrier to serve the Los Angeles‑Mexico City market, and in light of the competing applications filed for this limited‑entry route right, we have decided to institute the 2005 Los Angeles‑Mexico City Combination Service Proceeding to select one primary and one backup carrier to provide scheduled foreign air transportation services of persons, property, and mail in the Los Angeles‑Mexico City market. The supplemental information is to be filed no later than seven (7) calendar days from the service date of this order. The Parties' responses to these submissions and their briefs will be due seven (7) calendar days thereafter. By: Karan Bhatia |
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