LCC Adds To Denver Operation; Cuts Other Flights Back

When it comes to the impact a declining economy has on airlines, not even mighty low-cost carrier Southwest Airlines is immune. On Wednesday, the Dallas-based carrier announced it would cut dozens of flights, and add that capacity to busier markets.

Reuters reports the carrier will cut 57 existing flights -- including 10 from Oakland, eight from Chicago Midway and seven from Baltimore. Forty new flights will be added, including 17 new flights from Denver.

The changes will take effect May 10, and should better-position the airline to weather what's expected to be a summer marred by high fuel prices, and fewer passengers.

"Southwest Airlines is concerned about slowing economic growth, and we want our flight schedule to be built around flights that are in high demand," said Southwest CEO Gary Kelly.

The new flights from Denver will put added pressure on the two airlines that have hubs in Denver -- United Airlines, and Frontier.

While the schedule shuffling amounts to a net loss of capacity, Southwest remains adamant it will not cut the number of available seats on its flights. The carrier is sticking to earlier statements it plans to reduce planned growth to between 4-5 percent in 2008, about half its earlier projections.

In order to add flights at a faster pace, however, Southwest will need to take in an additional $1 billion in revenue... through such avenues as its new "Business First" seating package, selling more code-share flights on ATA Airlines, and upselling existing passengers on the airline's vacation packages.

If successful in generating the additional revenue, "I'm hopeful we'll be able to grow at levels that we're all used to," Kelly said in a recent interview with Bloomberg. "Until we do, there's no reason to continue to grow."

FMI: www.southwest.com