Delta Air Lines has reached agreement with US Airways to exchange flying rights and airport facilities at New York’s LaGuardia and Washington D.C.’s Reagan National airports, allowing Delta to expand its New York customer service and convenience by creating a domestic hub at LaGuardia Airport.
If approved by the U.S. government, the agreement will also allow US Airways to bolster its already-intensive operation at Washington Reagan National Airport to make US Airways (and its regional affiliates) by far the largest carrier at the airport.
The agreement, which is subject to government approvals, calls for US Airways to transfer 125 operating-slot pairs to Delta at LaGuardia and Delta to transfer 42 operating-slot pairs to US Airways at Reagan National. The airlines also will swap gates at LaGuardia between the Marine Air Terminal and US Airways’ Terminal C to consolidate all Delta operations ― including the Delta Shuttle ― into an expanded main terminal facility with 11 additional gates for Delta customers.
This will enable Delta to build a hub operation at LaGuardia that will increase the number of customers served at each takeoff and landing slot without increasing congestion.
US Airways also will obtain 42 pairs of Delta’s slots at DCA and acquire route rights from Delta to expand to Tokyo, Japan and Sao Paulo, Brazil.
US Airways says it will retain a significant presence at LGA and that the reduction in flying necessitated by the transfer of LGA slots will be accomplished through reductions in US Airways Express flying. The airline does not plan to make any changes to mainline flight levels, including its popular US Airways Shuttle service with hourly flights from New York to Boston and Washington. US Airways says that after the transaction is complete, it will be the third-largest carrier at LGA (based on peak day departures) and will operate up to 72 peak-day flights.
“We are very excited about today’s announcement which presents an excellent opportunity to strengthen our network while bringing more jet air service to smaller communities from our nation’s capital,” said US Airways Chairman and CEO Doug Parker. “This transaction will improve US Airways’ near and long-term profitability to the benefit of our employees, our customers, the communities we serve and our shareholders.
As contemplated, the transaction will be structured as two simultaneous asset sales and is expected to be cash neutral to US Airways. US Airways estimates the transaction will improve its profitability by more than $75 million annually.
Delta expects to more than double the number of nonstop destinations it serves from LaGuardia by adding or preserving service to more than 30 small- and medium-sized communities. The airline plans to add new flights to more than a dozen cities not currently served by US Airways.
In every slot where US Airways operates small turboprops today, Delta says it will operate larger jets. These new markets and larger aircraft would allow more than two million additional passengers to transit LaGuardia each year without increasing the total number of takeoffs and landings, according to Delta.