Southwest leads the way
A big part of the "snowball effect" can be attributed to the "Southwest effect." After years of a relatively stable schedule in Kansas City, Southwest began flying nonstop between Kansas City and Dallas in December 2005 after congressional action removed restrictions on the direct flights. Eight months later, Southwest did the same between KCI and Denver, creating competition with United and Frontier airlines.
Those moves not only lowered fares, but they also generated more air traffic by persuading travelers to leave their cars at home and fly to those cities. Both were already among the 10 most popular destinations from Kansas City.
Before Southwest, an average of 400 passengers flew daily from KCI to Denver at an average one-way fare of $200, said Justin Meyer, the Aviation Department's air service development manager. Now, KCI handles about 800 passengers to Denver daily, and they pay an average ticket price of $100. Denver has also become the most popular destination from KCI.
Virtually the same thing happened when Southwest started service to Dallas in competition with American. Since Southwest began flying nonstop to Dallas Love Field from Kansas City in late 2005, the average number of daily passengers going to both airports there has nearly doubled, to 744. Fares to Love Field are 65 percent lower than what it previously cost to fly to Dallas-Fort Worth International Airport, and the price of flying to DFW from KCI has dropped 48 percent.
"People always talk about the Southwest effect," Meyer said. "It's alive and well in Kansas City."
With the Dallas and Denver flights, the number of Southwest passengers at KCI jumped 15.6 percent in January from January 2006. Southwest's market share at KCI has vaulted to 37.2 percent from 33.8 percent last year.
Southwest is seeing many Dallas customers on their way to Denver for the skiing season connecting through Kansas City, said Whitney Eichinger, a Southwest spokeswoman.
"We're very happy with what's going on with our Denver service," she said. "The Kansas City-Denver flights have become important to our system."
For several years, KCI had its busy Southwest schedule flying point-to-point to various cities. That was supplemented by the major carriers offering service to their various hub cities, along with a smattering of low-cost carriers with flights to niche locations.
Vanguard was attempting to become the No. 2 airline at KCI with service to cities not on Southwest's schedule when industry turmoil contributed to its demise. Midwest, which suffered several years of losses after 9/11, has emerged in that role and has begun to report profits.
In January, Midwest had an 11.2 percent market share at KCI --second to Southwest -- after passing American Airlines' KCI traffic in the past year. Midwest, which is in the midst of fending off a hostile takeover offer from AirTran, will add Seattle to its Kansas City schedule next week. By June, the carrier will have 37 daily departures at KCI, more than any carrier except Southwest since Braniff in the late 1980s.
Midwest is adding more planes and six cities to its system. At a recent news conference announcing this spring's new service, Midwest Chairman Timothy E. Hoeksema said more than half of the airline's total expansion in 2007 would be in Kansas City.
"We consider Kansas City to be a focal point for us," he said. "The market has supported us, and it's very important for our growth plans. We have just over 200 employees here now."
Meyer of the Aviation Department noted that Midwest had committed resources to a marketing campaign directed at Kansas City travelers. In addition, the airline is involved in civic activities such as the arts and is the airline for the Kansas City Royals.
"They've really worked hard to create a strong brand name in Kansas City, and it's paid off with a loyal customer base," Meyer said.
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