AirTran Airways will start flying between the Twin Cities and Chicago on Dec. 6, replacing ATA as the low-fare carrier on that route.
On Friday, ATA, which is in the midst of a Chapter 11 bankruptcy reorganization, said it was dropping service on the route as of Dec. 1. The move was part of a pullback from unprofitable routes, ATA said.
AirTran, which has been managing to make money, will offer four daily nonstop flights between Minneapolis-St. Paul and Chicago's Midway airport. It will fly 117-seat Boeing 717s between the two markets.
Fares will range from $89 to $249 each way. With ATA on the route, fares could be had for as little as $59 each way. Northwest Airlines, the dominant Twin Cities airline, typically would tweak its fares in response to ATA.
Eagan-based Northwest said it's ready to take on AirTran on the route.
"We have competed with a low-cost carrier to Chicago Midway for many years,'' said Northwest spokesman Kurt Ebenhoch.
Northwest, he said, offers more flights, more first-class seats and a better frequent flier program, along with competitive fares.
AirTran's 717s are better-sized for the Twin Cities-Chicago route than the 175-seat Boeing 737-800s ATA deployed on it, said AirTran spokesman Tad Hutcheson
"ATA's planes were too big,'' he said. "Big planes are hard to fill (every day). You either deeply discount tickets and lose money on everything you sell — or fly half-empty and lose money. We have the right plane for that market."
The 717s also burn 23 percent less fuel than the DC-9s Northwest flies from the Twin Cities to Chicago, he added.
"We'll have lower costs and can make money at the prices we charge,'' said Hutcheson.
And AirTran is deploying free XM satellite radio service on its 100 planes, he noted. On Monday, AirTran also announced it will offer three daily flights between Chicago-Midway and Boston.
Flights on AirTran from the Twin Cities to Boston via Chicago will cost $119 to $366 each way, AirTran's online reservation site indicates.
From Chicago, AirTran already serves Atlanta with eight daily flights; Orlando, Fla., two and Florida's Sarasota/Bradenton, one. Down the road, AirTran may add more destinations from Midway.
From the Twin Cities, AirTran offers four daily nonstop flights to Atlanta and one nonstop flight to Orlando. The airline indicated that service will continue.
Unlike most airlines, AirTran has been flying in the black of late.
In the first half of 2005, it had operating earnings of $10.1 million on $666 million in revenue. Northwest, which filed for Chapter 11 bankruptcy protection last month, lost more than $490 million on nearly $6 billion in revenue during the same period.
A key difference between AirTran and Northwest is their cost of flying. In the first half of this year, AirTran's overall operating cost per seat-mile flown was 8.96 cents; Northwest, 11.2 cents.
The two carriers have an especially huge gap in labor costs. In the second quarter of this year, Northwest says its labor cost per seat mile flown was 4.4 cents; AirTran's, 1.7 cents.
Northwest aims to extract $1.4 billion in annual wage cuts and other givebacks from its employees.
Martin J. Moylan covers airlines and be reached at 651-228-5479 or [email protected].
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