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• Chicago - 4.5-star - from $89/night
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• New York City to Norfolk - 01/12-01/15 - $100
• Detroit to Chicago - 01/18-01/21 - $107
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• Los Angeles to Phoenix - 01/18-01/21 - $129
• Los Angeles to Las Vegas - 01/18-01/21 - $129
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• Chicago to Fort Lauderdale - 01/19-01/22 - $154
• Washington to Atlanta - 01/18-01/21 - $159
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Southwest Airlines has dropped their Wanna Get Away rates to only $49-$99 each way (purchase 14 days in advance).

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Purchase by April 6 for travel through Aug. 14.

Combined with hotel-casinos slashing their rates to the lowest in years, this makes a trip to Las Vegas one of the cheapest vacations you can find (more money to spend on gambling and food).

Getting healthy at our expense US Airways service cuts leave Las Vegas holding the bag LV Sun TEMPE, Ariz. — US Airways, the second-busiest airline operating at McCarran International Airport, is on a mission to achieve consistent profitability and has a game plan to reach that goal. But unfortunately for Las Vegas, its path to profitability includes contraction — not expansion — in Southern Nevada as the resort community wants more flights to help fill the thousands of hotel rooms coming on line in the months ahead. Reducing flights and available seats increases their value and enables airlines to charge more for tickets. In past recessions, low-cost carriers have contracted by establishing legacy carriers to steal market share and grow. But in this recession, few carriers have the resources to grow. Even Southwest Airlines, McCarran’s busiest carrier and one of the few airlines that has consistently made money, is shrinking capacity. That gives US Airways hope that capacity will continue to fall and enable it to make money this year. Addressing reporters at its media day last week, US Airways outlined plans to develop consistent profitability by maintaining focus on moderating capacity, minimizing expenses and generating ancillary revenue. High-profile airline mergers are one of the most aggressive ways to trim capacity, and US Airways’ management is among the most vocal advocates for mergers as a means to trim what it considers an oversupply of seats. Executives put their money where their mouths were by engineering the merger of America West Airlines and US Airways in 2005. Before the ink had dried on that deal, the new US Airways was involved in a hostile takeover bid for Atlanta-based Delta Air Lines. Although the bid failed, US Airways leadership thinks its efforts drove the recently completed merger of Delta and Northwest Airlines. Between those mergers and the discontinuation of operations by airlines such as Aloha, ATA and Skybus, capacity has dropped to a level that is making US Airways CEO Doug Parker optimistic about his company’s future, even though it lost $803 million in 2008. Parker says for the industry and his airline to make money, the business model has to change. “We can revert to underperformance, or we can, for once, convert the quirky airline business into a real business. Frankly, I think we really need to do the latter,” Parker said. “Now I realize that many of you have followed the business for a long time ... And I know what a lot of you are thinking — which is that I’m nuts, that I don’t get it. This is the way this business works and that’s the way that it’s always been and that the way it’s always going to be. Over the years, I’ve heard a lot of you say that this is the way the business works, it’s what makes it interesting, it’s charming, it’s romantic, all those things,” Parker said. “I’ve never bought into that, never have. There’s nothing charming nor romantic about any of this. This is really bad business and it can’t continue.” In addition to mergers and shutdowns, several airlines, including US Airways, have been aggressive in trimming schedules. US Airways capacity cuts already have hit Las Vegas hard. Before the merger, McCarran was a hub airport for America West, which used its hometown airport in Phoenix as another hub. That meant nearly every flight went through either Phoenix or Las Vegas. The airline took advantage of Las Vegas’ 24-hour lifestyle and flew a majority of its operations to and from McCarran after 8 p.m. Passengers were offered lower fares if they traveled late, and the system resulted in the airline having more than 130 daily flights to more destinations than any other carrier serving Las Vegas. When America West’s biggest rival, Southwest, expanded in Las Vegas as the community grew in the 1990s, the competition became even more intense. The two dominated the market, and the rivalry spurred fare wars that kept ticket prices low. When the merger occurred, the company initially said it would continue to use Phoenix and Las Vegas as hubs as well as US Airways’ established East Coast operations in Charlotte, N.C.; Pittsburgh; and Philadelphia. But the strategy changed. The airline dramatically reduced its presence in Pittsburgh, deciding to focus on Charlotte and Philadelphia. When oil prices surged last summer, the airline reevaluated the Las Vegas night hub concept and determined it no longer made economic sense. Even with full aircraft, the airline wasn’t making enough money to make the flights viable. After the night hub was shut down, the airline intensified its bid to cut capacity as a means to make money. Las Vegas was an easy target because its leisure market position wasn’t as profitable as business travel markets such as Philadelphia. Las Vegas’ primary business travel component — conventions — isn’t like traditional business travel because conventiongoers, like leisure travelers, book flights in advance and are less likely to purchase higher-priced spur-of-the-moment trips. Airlines generate most of their profits from business travelers who buy at the last minute. Today US Airways has about half the flights it once had in Las Vegas — an average of 69 a day. In the past 12 months, the local operation has contracted by 34.8 percent. The airline no longer refers to Las Vegas as one of its primary destinations, and most US Airways flights are point to point like those of rival Southwest. “Vegas was one of the hardest hit (destinations) in the system,” said Robert Isom, executive vice president and chief operating officer. “But any flights that we pulled were money losers.” Isom said even though fuel costs have come down, the airline is focused on becoming profitable and customers haven’t been rushing to book flights in the down economy. The lower demand resulted in decisions to cut capacity more in Las Vegas. “For us, it has to be profitable and we just don’t see the demand,” Isom said. “There may be an infinite number of people that would go to Vegas if the pricing from New York to Vegas was $10 a ticket. But the fact is that is not something we could ever make money on. Even though you may see very full planes in Vegas, in many cases we’re just mitigating losses. Even though you may see a completely full flight, it has nothing to do with the profitability of that flight.” Fewer operations at McCarran translated into job cuts. The airline offered to transfer Las Vegas employees to other cities, but its local workforce was different. Donna Paladini, vice president of airport customer service, said by reducing the number of Las Vegas employees by around 60 in February, it has a little more than 500 workers. “The majority of the employees that left were part-time workers just because of the nature of our operation there,” Paladini said. “A lot of those folks were working full time at hotels and part time with us to get the flying benefits.” Because many workers had other Las Vegas jobs, few accepted transfers. US Airways hasn’t been alone in cutting capacity in Las Vegas. McCarran’s peak capacity occurred in October 2007, when there were 8,212 flights a week and 1,159,580 seats in and out of the market. March’s capacity was 7,024 weekly flights and 1,007,655 seats — a 14.5 percent flight and 13.1 percent seat decrease. Because US Airways is cutting back, it’s devoting more energy to operations. One of its biggest accomplishments in 2008 was a dramatic turnaround in key Transportation Department performance measures through its RCA program — reliability, convenience and appearance. For on-time arrivals — showing up at the gate within 14 minutes of the scheduled time — US Airways was among the bottom of the pack of 10 major U.S. air carriers in 2007, finishing seventh or worse for eight out of 12 months. But after a first-place finish in December 2007, the airline reeled off first-, second- or third-place finishes among 10 carriers in nine of the next 12 months. Overall for 2008, US Airways was the leader in on-time arrivals, increasing efficiency by 11.4 percentage points. Frontline employees profited as a result, as the airline pays workers $50 any month it finishes in the top three in any three performance categories. The company ended up paying employees $18 million in “Triple Play incentive” bonuses in 2008, $500 per employee. In other key categories, US Airways was 20.1 percentage points better in on-time departures in 2008 (No. 2 among networked airlines) and had a 43.5 percent improvement on lost baggage statistics (No. 3). Some of the improvement in tracking bags was attributed to its new scanning technology to monitor luggage movement. In addition, the airline bolstered its financial position in 2008, rolling out a series of controversial ancillary fees. Ancillary revenue, a concept jump-started by Las Vegas-based Allegiant Air years ago and embraced by more mainline carriers last year, involves charging passengers for services they once got for free. US Airways instituted a fee for checking a suitcase, another for a second bag and it also charged more for choice seats and for soft drinks. The reluctance of other airlines to charge for drinks and the resulting consumer backlash forced US Airways to abandon that charge later in the year. But in 2008, the airline generated $165 million in ancillary revenue, with $116.5 million of that coming from the fees charged for the first checked bag. With fuel costs well below what they were a year ago, the airline has been able to get to firmer financial ground. Executives estimate that even with a 15 percent decline in passenger revenue, the airline should be profitable. Going forward, the airline should be even more stable since it took a conservative fuel-hedge position, ending its program last August. Airlines that have hedged aggressively such as Southwest, benefited when fuel costs soared and the airline was able to lock into a price well below what other carriers were paying. But when oil prices collapsed as they did in the second half of 2008, Southwest was at a disadvantage, having to pay above market prices. US Airways ranks in the middle in total cash on hand as a percentage of annual revenue. It’s ahead of AirTran, Delta, American and United, but behind Alaska, JetBlue, Southwest and Continental. The company has negotiated union contracts with all of labor groups except pilots and flight attendants and those battles, primarily over seniority, have raged since the 2005 merger.

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