JetBlue, Southwest gain slots at Reagan Airport

• JetBlue wanted 12 pairs of slots%3B Southwest 27 pairs
• Other carriers are eyeing the remaining slots that need to be relinquished
• Analyst says travelers will benefit

JetBlue and Southwest won their bids for some of the highly coveted takeoff and landing slots at Washington's Reagan National Airport that American and US Airways had to give up to settle a lawsuit that threatened their planned merger.

JetBlue announced Thursday that its bid for 12 pairs of slots at the tightly constrained Washington, D.C., airport has been "provisionally accepted.'' Later, Southwest said that its request for 27 slot pairs at Reagan had also been accepted.

The Department of Justice has to give its approval for the handoff to both carriers. But once that occurs, JetBlue says it intends to add a dozen new round-trip flights from Reagan National, including some new non-stop routes between Reagan and various destinations. And Southwest says that its daily departures from Reagan will go from 17 a day to 44.

"Reagan has long been a convenient but high-fare airport,'' Gary Kelly, Southwest's president and CEO, said in a statement. "Southwest plans to change that by bringing much-needed competition to the nation's capital.''

Securing slots at Reagan was a years-long quest for JetBlue, according to Rob Land, the airline's senior vice president of government affairs and associate general counsel.

"For more than a decade, JetBlue worked tirelessly to gain access to (Reagan), a high-fare market perfectly made for our everyday low-fare business model," Land said in a statement.

The shedding of takeoff and landing slots was a key part of an agreement that settled a lawsuit brought by the U.S. Department of Justice to block American from merging with US Airways.

To curb concerns that the tie-up — the latest and likely last merger of major U.S. carriers — would stifle completion and lead to higher fares, American and US Airways agreed to give up 52 slot pairs at Reagan airport and 17 pairs of takeoff and landing slots at LaGuardia. They also said they would relinquish two gates each at Chicago's O'Hare, Boston's Logan, Dallas' Love Field and airports in Miami and Los Angeles.

LaGuardia and Reagan are among a handful of airports in the U.S. where slots are limited, making competition fierce among airlines that want a strong presence in those lucrative markets.

The slot openings that have resulted from the Justice Department settlement are giving lower-cost carriers in particular, like Southwest, JetBlue and Virgin America, the chance to expand their footprints. In December, Southwest and Virgin America acquired slots at LaGuardia. Each carrier got 12 slots, and Southwest also got permanent control of 10 takeoff and landing slots that it already leased from American.

JetBlue made a play for the LaGuardia slots and lost out. But it's poised to substantially grow its presence at Reagan. It was already leasing 16 takeoff and landing slots — or eight slot pairs — at Reagan from American before the merger, and those slots will become theirs permanently as part of the Justice Department settlement. And if Justice officials sign off on its acquiring the 12 additional slot pairs, JetBlue will fly up to 30 round trips per day out of Reagan.

Meanwhile, just last week in an earnings call, Southwest's Kelly noted his airline's interest in Reagan National Airport.

"It is among the most constrained airports in terms of supply vs. demand,'' Kelly said. "We have a lot of customers that love Southwest Airlines ... and a lot of them want to go to Reagan.''

Southwest, along with its AirTran subsidiary, currently offers 17 daily round-trip flights flying non-stop between Reagan National and Atlanta, Austin, Fort Myers, Houston, Milwaukee, St. Louis and, starting Saturday, Kansas City.

The airline says it will announce schedules and destinations for its 27 new round-trip flights later this quarter, and expects to launch the new service by the fall.

Passengers looking for more choices and better deals should benefit, says Henry Harteveldt, travel industry analyst with Hudson Crossing.

"Combining JetBlue's 12 new flights with the 27 flights Southwest will be able to add means that Washington Reagan National has the potential to become a much more competitive airport,'' he says. "This is a good day for both business and leisure travelers."

Contributing: Ben Mutzabaugh