New low-fare airlines keep eye on BWI

TRANSPORTATION & THE PORT

May 13, 1994|By Suzanne Wooton | Suzanne Wooton,Sun Staff Writer

Baltimore-Washington International Airport's reputation as the discount fare mecca of the East Coast could be a drawing card for some new low-fare airlines who're eyeing service there.

"Baltimore's definitely on our radar screen," said Tad Hutcheson, a strategic planner with the Newark, N.J.-based KIWI International Air Line.

Founded in September 1992, KIWI is one of several discount airlines that bought up the excess jets of financially struggling major carriers at low prices and hired their laid-off workers.

KIWI is seen by BWI officials as the most likely new carrier to expand there. Currently, it flies to seven cities, offering fares comparable to Southwest Airlines. A round trip from Newark to Chicago or Orlando, for instance, is $138.

Like other small carriers, KIWI is following Southwest's successful model, adding flights to cities it currently serves before beginning new service.

Spurred by Southwest's arrival at BWI last summer, Continental Airlines and USAir lowered their fares dramatically, with other major carriers following suit in some cities. Because of the lure of discount fares, BWI has grown faster than any other major airport in the country and is the second largest in the Washington area after Washington Dulles International.

This week, Midway Airlines announced it will begin service from National Airport to Chicago, giving the Arlington, Va., airport its first discount service to the Midwest.

Even with a relatively high $169 one-way fare, Midway could lure back some of the passengers who've been driving to BWI to take advantage of $89 one-way fares to Chicago. But, with few landing and takeoff slots available, the congested National can't handle much growth by discount airlines.

Space is considerably better at BWI although all of the airport's 65 gates currently are leased. But some of those gates are not used frequently and BWI could lease back space from airlines to accommodate new carriers.

While BWI could have an edge in attracting new entrants, it will have plenty of competition. Airports around the country are vying intensely for the popular discount carriers.

"They call me constantly," said Mr. Hutcheson. "They're always coming up with new ideas to get you to the airport."

Typically, airlines must consider landing fees and the cost of renting terminals. In addition, they size up the volume of passengers and how much competition is already there.

"We're not scared off by other discount airlines and we're definitely not scared off by hub carriers like USAir," Mr. Hutcheson said.

Others, however, tend to avoid airports where competition is heavy. In January, the Atlanta-based ValuJet began service at Dulles with fares as low as $59 one-way to Atlanta.

"We were attracted to Dulles because it didn't have low-fare competition," said Katie deNourie, a spokeswoman for the carrier that operates 14 jets and serves 15 Southern cities.

"Baltimore's a pretty saturated market now for discount fares," said Sue Putnam of Reno Air, which flies mostly on the West Coast. The airline is trying to secure gates at Chicago's O'Hare Airport and that could be a steppingstone to the East Coast, she said.

"Who knows where we'll go after that," she said. "Baltimore could be in the picture."

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