OST-00-7180 / National Airlines / High Density Rule - Chicago O'Hare / Answer of America West / April 21, 2000

Application of

for an exemption from 14 C.F.R. Part 93,

Subparts K & S, pursuant to 49 U.S.C. § 41714

Response of America West Airlines, Inc.

America West Airlines, Inc. ("America West") hereby requests leave to file the following response to the April 7, 2000 Notice of Continuing Interest and Supplement to Application of National Airlines, Inc. ("National Airlines") for an Exemption in the above-captioned proceeding. In support of its motion for leave to file America West notes the Notice of Continuing Interest and Supplement to which this responds was itself an unauthorized filing, acceptance of this response will help ensure the completeness of the record for the Department's disposition of the National Airlines application, this response is being submitted within the fifteen days now allowed for an answer to an exemption application, and no party to this proceeding will be prejudiced by granting America West's motion for leave to file.

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The application of National Airlines for an exemption from the High Density Rules of Part 93 of the Federal Aviation Regulations ("HDR") for slots at Chicago O'Hare International Airport ("ORD") to provide service to Las Vegas, Nevada (LAS) should be denied. The enactment of the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century ("Air 21 ") has not made National Airlines any more deserving of still-scarce ORD exemption slots than when it first filed its application a year ago. Air 21 makes available only 30 exemption slots for new entrants and limited incumbent air carriers at ORD. See 49 U.S.C § 41717(c). When allocating such scarce resources, the Department should not award exemption slots for use by a carrier offering only point-to-point service when greater public benefits would result from awarding them to a network carrier applicant. This is particularly true when the proposed point-to-point service could be operated without the need for a slot allocation. In this case, granting America West's request for three ORD exemption slots to add two daily round-trip flights to the one flight it currently operates between ORD and LAS (See Docket OST-00-7198) would result in greater public benefits than granting National Airlines' request.

National Airlines' attempt to characterize America West as an incumbent in the ORD-LAS market is misleading. In fact, as National Airlines is aware, America West is a post-deregulation carrier that did not, unlike United Air Lines and American Airlines, receive grandfathered ORD slots. Indeed America West has been forced to drop one of its two daily Las Vegas flights because it could not operate that flight at a competitive time. America West does not have sufficient service in the market to significantly affect

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prices to consumers. National Airlines and America West are both "new entrant and limited incumbent air carriers" at ORD for purposes of Air 21. See 49 U.S.C § 41714(h)(5); 49 U.S.C § 41717(c). Therefore the few slots available at this time should go to carriers that can maximize the public benefit.

National Airlines has not justified its need for ORD slots given its point-to-point, leisure service operating model and its ability to operate flights between LAS and Chicago using Midway Airport rather than ORD. As a carrier that does not currently serve O'Hare it could implement the proposed service through Midway. On July 1, 2001 with the elimination of slots before 2:45 p.m. and after 8:14 p.m. National could operate some flights and seek exception slots that will then be available in the evening for additional service.

The Department has recognized that it must use its limited resources to promote 41maximum transportation benefits." See Application of the Communities of the Virginia Peninsula, Order 99-3-12 (March 12, 1999). Granting America West's competing application for ORD exemption slots to serve LAS over National Airlines' application would further this policy because America West can immediately enhance competition in this market and in connecting markets. America West's proposal would enable America West to operate 3 daily round trips at reasonable fares using only three additional slots. Additionally, it would be unfair to grant National Airlines' application instead of, or pni or to America West's application, in light of America West's longstanding plans to expand operations at ORD to the extent possible and the Company's strong commitment to

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serving LAS, its second largest hub. Accordingly and given the greater merits of America West's competing application for ORD slots for operations to LAS, the limited number of new entrant and limited incumbent exemption slots available, and the limited competitive benefits likely to be realized from National Airlines' proposed ORD service, America West opposes National Airlines' application for Air 21 slot exemptions at ORD.

Respectfully submitted,

Joanne W. Young

David M. Kirstein

BAKER & H STETLER LLP

Washington Square, Suite I 100

1050 Connecticut Avenue, N.W.

Washington, D.C. 20036-5304

(202) 861-1532

Counsel for America West Airlines, Inc.

April 21, 2000