US Airways to cut more Las Vegas flights

By Richard N. Velotta

Published Wednesday, April 30, 2008 | 2 a.m.

Updated Wednesday, April 30, 2008 | 11:46 a.m.

US Airways, the second-busiest operator at McCarran International Airport, has notified its workers that it will discontinue its hub operation in Las Vegas and curtail the number of flights here.

US Airways currently operates about 100 round trips daily to McCarran. The airline, based in Tempe, Ariz., had 131 daily round trips to and from Las Vegas a year ago but began scaling back its “night hub” operations to cut costs in the past few months.

The airline’s cuts signal further declines in the tourism industry that drives the Las Vegas economy. They also highlight the struggle airlines face as they are squeezed by demands for low fares and the soaring cost of jet fuel. The price of a barrel of oil hit a record $120 this week.

A spokesman for US Airways would not confirm that a decision has been made on cutbacks, saying only that the company is evaluating options to reduce the number of flights to and from Las Vegas.

But US Airways employees at McCarran said they were told the airline plans to discontinue its hub operation in Las Vegas on Aug. 19.

US Airways spokesman Morgan Durrant said that even if the airline trims its schedule, it would avoid furloughs or layoffs of its more than 1,000 employees in Las Vegas.

McCarran officials had no comment on the report. A decrease in flights could result in a decline in revenue for McCarran, because landing fees are part of what the airport collects from all airlines.

US Airways was short on details of prospective cuts at McCarran because the airline has been in the news all week for another reason: It’s a potential merger partner with Chicago-based United Airlines.

On Sunday, another prospective United merger partner, Houston-based Continental Airlines, formally announced its decision to operate independently of United. That opened the door for talks between United and US Airways. By midweek, both companies said merger talks were in “advanced stages” with an announcement possible within two weeks.

Durrant said the airline could not speculate on merger prospects and wouldn’t say whether flight cutbacks at McCarran or any other airport were in any way related to merger talks.

United is the third-busiest carrier at McCarran with an average of 39 flights a day to and from Las Vegas.

Aviation analysts say US Airways’ possible cuts at McCarran shouldn’t have an effect on Las Vegas, especially if it’s the airline’s hub operation that is lost. In the past, when airlines cut capacity, low-cost carriers have picked up the slack. But they could affect Las Vegas because in an era of $120-a-barrel oil, even low-cost operators may not be able to deliver that level of capacity.

In an airline hub-and-spoke system, flights arrive and depart within a two- to three-hour window so passengers can change planes to other destinations. US Airways has maintained two “banks” of flights at McCarran after 9 p.m. The first is between 9 and 11 p.m., when the airline operates an average of seven flights. The second is from 11 p.m. to midnight, involving 23 flights.

If the entire night hub operation is discontinued, eliminating both banks of flights, Las Vegas could lose 30 flights, or about one-third of its operation.

Passengers would feel the pinch in a loss of convenience. Las Vegas has been a popular night hub for US Airways and other airlines because passengers not only transfer to other flights, but can arrive in the late hours and still have ground transportation amenities because of the city’s 24-hour lifestyle. The night schedule is also helpful to local businesspeople who want to fly to the East Coast and arrive at the start of the day.

But within the past several months, US Airways has determined that its combination of low fares and skyrocketing fuel costs makes it more economical for the company to park its planes than to run them to Las Vegas at night.

Since April 2007, US Airways has cut the number of flights arriving by 23 percent — which corresponds directly with the airline’s passenger performance for March, according to statistics released by McCarran this week.

US Airways’ passenger counts were down 24 percent in March to 684,200. That and United’s 12 percent decline to 266,220 passengers over the same period led to an overall decline of nearly 2 percent in arriving and departing passengers at the airport.

Overall, 4.12 million passengers flew in and out of McCarran in March. Although that represented a decline in traffic, it was being compared with a high number: 4.19 million passengers into and out of McCarran in March 2007. At the time, that was a single-month record. It was surpassed in August.

Southwest Airlines, the busiest carrier at McCarran, increased traffic by 4.3 percent over March 2007 with 1.43 million passengers.

No. 4 Delta Air Lines and No. 5 American Airlines had months comparable to the previous year’s.

(Editor's note: This story was updated to include that Durrant said the airline could not speculate on merger prospects.)