The hotly contested Houston battle between Southwest Airlines and United came to an end when the Houston City Council voted 16-1 in favor of allowing Southwest Airlines to start international routes from/to Houston Hobby Airport beginning in 2015.
United Airlines did not respond kindly and immediately terminated the employment of 1300 workers at its hub at Bush Intercontinental, even though Southwest does not start operating for at least 3 years.
In a statement, United explained why the pink slips were handed immediately:
"Throughout the debate on the development of HOU (Hobby-Houston) as an international airport, United has made the point that a competing international airport at HOU would result in a diversion of passengers we carry today to Hobby.
This would drive a reduction of 1,300 jobs at United and our partner airlines at IAH (roughly 800 jobs today and 500 jobs in the future). We expect to begin a 10 percent reduction in planned IAH capacity beginning with the fall 2012 schedule change.
Some of you have asked, “Why so soon, if Southwest does not intend to fly international flights out of HOU until 2015?”
Here’s why: There is a segment of our operation at IAH that is not profitable today. We have operated these flights expecting that future growth will improve the routes and make them profitable. As a result of the city’s decision to develop HOU as a competing international airport, the growth will not occur and, as a result, we will cut unprofitable flying in our schedule now rather than continue to lose money with no expectation of improvement.
“These are the kind of tough decisions we make every day,” said Network SVP Greg Hart. “We have a responsibility to our investors and all of our employees to invest where we have the best opportunity of generating profits.”
The changes would reduce current capacity at IAH by about 6 percent with reductions planned for several domestic and international markets. The other 4 percent of the 10 percent reduction in planned capacity will come as a result of not starting service that was part of our longer-term plan for IAH." www.premieretravel.com
Monday, June 4, 2012
Air Wars: United loses Battle of Houston, Immediately Lays Off 1300
The hotly contested Houston battle between Southwest Airlines and United came to an end when the Houston City Council voted 16-1 in favor of allowing Southwest Airlines to start international routes from/to Houston Hobby Airport beginning in 2015.
United Airlines did not respond kindly and immediately terminated the employment of 1300 workers at its hub at Bush Intercontinental, even though Southwest does not start operating for at least 3 years.
In a statement, United explained why the pink slips were handed immediately:
"Throughout the debate on the development of HOU (Hobby-Houston) as an international airport, United has made the point that a competing international airport at HOU would result in a diversion of passengers we carry today to Hobby.
This would drive a reduction of 1,300 jobs at United and our partner airlines at IAH (roughly 800 jobs today and 500 jobs in the future). We expect to begin a 10 percent reduction in planned IAH capacity beginning with the fall 2012 schedule change.
Some of you have asked, “Why so soon, if Southwest does not intend to fly international flights out of HOU until 2015?”
Here’s why: There is a segment of our operation at IAH that is not profitable today. We have operated these flights expecting that future growth will improve the routes and make them profitable. As a result of the city’s decision to develop HOU as a competing international airport, the growth will not occur and, as a result, we will cut unprofitable flying in our schedule now rather than continue to lose money with no expectation of improvement.
“These are the kind of tough decisions we make every day,” said Network SVP Greg Hart. “We have a responsibility to our investors and all of our employees to invest where we have the best opportunity of generating profits.”
The changes would reduce current capacity at IAH by about 6 percent with reductions planned for several domestic and international markets. The other 4 percent of the 10 percent reduction in planned capacity will come as a result of not starting service that was part of our longer-term plan for IAH." www.premieretravel.com
