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Southwest, BWI aim for international flights

Air Transportation IndustryAirTranMassachusetts Institute of TechnologySouthwest AirlinesUS AirwaysBritish Airways Plc

Southwest Airlines and BWI Thurgood Marshall Airport are talking about adding overseas flights, perhaps as early as 2015.

"International is going to grow at BWI, and it's going to grow with Southwest," said Paul Wiedefeld, the airport's executive director, who recently had dinner with Southwest CEO Gary Kelly.

Kelly's "primary focus is international. If you look at the new Houston terminal, it looks very much like us," Wiedefeld said. "By 2015, [Southwest officials] are going to be very aggressive in that area, and we are working with them on how we meet that demand."

Signaling its commitment to go beyond its domestic low-cost image and get into the global game, Southwest is paying for a $156 million international terminal at Houston's Hobby Airport.

But the Dallas-based airline is saying little about its international plans. There are no expansion specifics yet, said Southwest spokesman Brad Hawkins, but BWI is a logical place for the airline to look.

Southwest's footprint at the airport in Anne Arundel County is huge. Baltimore-Washington International Thurgood Marshall Airport is Southwest's third-busiest and its top East Coast hub. With subsidiary AirTran, it occupies 28 gates and accounts for more than 70 percent of the passenger market. It employs more than 3,000 people based in the Baltimore region.

Southwest's decision to expand at BWI about a decade ago transformed the airport, which was reeling from USAirways' contraction in the wake of the terrorist attacks of Sept. 11, 2001. Behind Southwest's growth into the nation's No. 3 airline, BWI rebounded to become the largest airport in the Baltimore-Washington market.

"What we have there is substantial. That's why it would make sense for us, when looking at a focal market, to look at Baltimore-Washington," Hawkins said. "People think of them as landlords and us as renters. But we are very much partners in economic development. We can develop where our costs are most attractive, and BWI is one of those great partners for us."

A spokeswoman for AAA Mid-Atlantic, which books travel for members, called the possibility of Southwest international flights at BWI "welcome news."

"It would mean more options for fliers and hopefully more competitive rates," Christine Delise said. "Having international service to Europe means Baltimore-area customers won't have to go to Dulles International outside Washington or to Philadelphia."

William Swelbar, a research engineer at the Massachusetts Institute of Technology's International Center for Air Transportation, said it makes sense for Southwest to expand overseas from BWI.

While the domestic market continues to grow, the merger of American and US Airways means four major carriers account for nearly 90 percent of U.S. traffic, Swelbar said. To achieve long-term growth, airlines must expand to international routes where profit margins are greater.

"Southwest is struggling to find new flying opportunities that are profitable and the international market provides that," he said. "Any airline that is standing still and not looking at five years from now is making a big mistake. Southwest recognizes it has little choice but to get into the chase, and it makes good sense to look at BWI, which also has international aspirations."

The "international" part of BWI's name looked shaky at times during the past two decades as the airport lost much of its European business to Dulles and to Philadelphia's airport.

In the late 1990s, then-USAir stopped service from BWI to South America and the Caribbean. Icelandic Airlines left in 1999. In 2004, Aer Lingus ended service to Ireland that began in 2000. Mexicana pulled out in 2007 after two years. Icelandair ended 17 years of flights from BWI to Reykjavik in 2007.

Annette Stellhorn of Accent on Travel, an agency in Towson where 80 percent of the bookings are international, said BWI has been "last on the list" for getting good deals on international connections or ticket prices.

"Everyone's preference in this marketplace is to fly out of BWI, and we have to show them that there's not many options. So customers migrate to Dulles or Philadelphia or get a connection to New York. Delaware and Eastern Shore customers do, too. It has been too challenging. This would be exciting and positive news."

But international traffic is on the upswing at BWI. International passenger traffic rose almost 26 percent in March 2013 compared with a year earlier.

This summer, there will be times when the six international gates in Concourse E will be full, Wiedefeld said. The airport has agreements with British Airways, Air Canada, Condor Airlines and the Air Mobility Command.

To accommodate more international traffic, BWI likely would need to expand again. It is in the midst of a $100 million project to upgrade Concourse C and build a connector between it and Concourses A and B.

"Generally, international traffic leaves later in the evening and the larger aircraft, they can stay on the ground for three or four hours. They need those six gates," Wiedefeld said.

"We're pushing a lot through there, and we have to start thinking about that," he said of BWI's international gates. "We will have to come out fairly soon with what our plans will be."

The state has been willing to move quickly on airport construction projects. The most recent expansion was approved on an emergency basis by the Board of Public Works and will be completed within 10 months.

"I believe international expansion is in the future, and it takes a while to get things going," said Wiedefeld. "But we have to be very aggressive in making sure we're ready because we don't want to let that business slip through our hands."

Southwest has been getting its ducks in a row, too. First, it acquired AirTran and its Caribbean and Latin American destinations. Then it upgraded its ticketing system. It decided to buy 180 of the next generation of Boeing 737, the 737 Max, with extended range. Delivery of the first planes is due in 2017.

MIT's Swelbar said that if the 737 Max planes do not have the range needed for Southwest's desired routes, the airline could partner with a European carrier. But it would likely start by adding flights to the Caribbean, Latin America, Mexico and Canada.

Offering a hint of what those planes might offer Southwest's customers, Hawkins said: "We could definitely get to Western Europe."

candy.thomson@baltsun.com

Copyright © 2014, The Baltimore Sun
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Air Transportation IndustryAirTranMassachusetts Institute of TechnologySouthwest AirlinesUS AirwaysBritish Airways Plc
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