Airline key to Vegas tourism lowers its sights

Monday, Dec. 10, 2007 | 7:06 a.m.

One of the key tourism pipelines to Las Vegas is reducing expansion plans nationwide in response to the weakening U.S. economy.

Southwest Airlines, which flies more than 1.2 million passengers a month to and from McCarran International Airport, will add only five to 10 jets to its fleet in 2008, about half of what it had planned. At one time, Southwest was projecting adding 35 jets to its fleet in 2008.

Southwest joins other airlines that are scaling back growth or cutting capacity in response to soaring fuel prices and consumer confidence damaged by the weakened housing industry.

Economic analyst Jeremy Aguero of Applied Analysis of Las Vegas said Las Vegans shouldn't be too concerned just yet.

"It's important to monitor the situation, since in any given month Southwest Airlines can account for 30 percent of our arrivals at McCarran," Aguero said, "and realistically, we can't turn a blind eye to what's going on nationally.

"But this is a reaction to reduced demand nationally, not locally," he said. "Southwest is in the business of placing supply where there is demand and based on our 90 percent occupancy rate, I'd say there is considerable demand."

Aguero bolsters his case by noting that McCarran passenger counts continue to be at record levels, with the 4.07 million passengers arriving in October taking the 2007 total to more than 40 million. Roughly half the visitors to Las Vegas arrive by air.

A longer version of this story appears in In Business Las Vegas, a sister publication.