April 4, 2012
HOUSTON EMPLOYEE BULLETIN
The city of Houston is considering a proposal to develop Hobby as a second international airportin Houston. Southwest Airlines has asked the city to build a Federal Inspection Services (FIS)facility at Hobby so it can fly AirTran flights to Latin America.We welcome that competition at IAH, where there are plenty of gates and facilities and an
existing FIS, but we don’t welcome the serious injury to IAH and to Houston’s economy and
jobs that would result from the proposal to create a second international airport.The consequences to us will be severe if the city allows this to happen. We told Mayor Parkertoday that the diversion of customers from IAH to Hobby would make flying to a number of markets uneconomic and cause us to have to reduce capacity and not fly planned new routes,which would mean a 10 percent reduction in our planned capacity at IAH. This would directlydisplace about 1,300 United jobs in Houston.We must work together to prevent this from happening. We will do everything we can to protectyour jobs and our investment at IAH.
Why is this bad for IAH and United?
The proposal to have a second international airport in Houston would reverse a long-standing,successful aviation policy that IAH is the sole international airport. That ensures that passengersconnecting to international flights go to one place, helping fill the large planes necessary toeconomically fly to Asia, Europe and Latin America. The proposal would reverse the policy thatGordon, and later Larry and Jeff, relied on in having Continental, and now United, invest morethan $1 billion since 1996 to make IAH a world class international gateway. It would reverse thepolicy on which Jeff recently relied in deciding United would go forward with the first phase of a$700 million project to redevelop Terminal B.Houston Airport Director Mario Diaz seems intent on taking this forward. His consultants haveprepared a rushed, flawed study that makes Hobby international service sound like a tremendouseconomic benefit to Houston, even to IAH. Southwest is quoting publicly from that draft study,
which hasn’t even been released, to justify its proposal.
Our internal and external experts are
telling us that the study is fatally flawed because it assumes fares so low that Southwest’s flying
the proposed routes would result in their losing tens of millions of dollars annually. The study
doesn’t take into account today’s skyr
ocketing fuel costs, which Southwest also pays. The study