MIAMI — The City of Dallas officially signed off on a deal that awards Virgin America two gates at Dallas Love Field, ending a month’s long battle for the coveted space.
With the deal firmly in place, Virgin is set to begin service to Los Angeles LAX, New York LaGuardia, San Francisco, and Washington DC after the Wright Amendment expires in October, 2014. Chicago is expected to be added in 2015. The carrier will move all operations from its current home at Dallas / Ft. Worth International Airport to Dallas Love at the same time. It will be the first location, aside from its Californian hubs, to operate as a focus city.
The deliverance of the gates to Virgin sealed a sublease agreement that was penned between itself and present owner American Airlines. The two carriers reached the agreement several weeks back, which in turn received a blessing from the Department of Justice (DOJ). The gates were pried out of the hands of American as part of its merger settlement with the DOJ.
The carrier held a splashy press conference late last month declaring itself the probable winner. Yet the deal turned into an ordeal as the decision making process dragged on through red tape and politics. Virgin, perhaps sensing it may be slipping away, trotted out minority owner Richard Branson last week to help gel the deal as the process dragged on. Following the visit Dallas City Manager A. C. Gonzalez announced he would chose a winner by last Friday, but instead prolonged the decision until today.
From the sound of it, Gonzalez does not appear to have had much choice in the matter. Speaking through a prepared statement, Gonzalez said “Contrary to reports, this was not a competition…while initially, the City was told to expect a collaborative process, the Justice Department eventually required American Airlines to sub-lease the Love Field gates to a chosen airline.” It is believed the DOJ told Gonzalez and other Dallas stakeholders that it would reject proposals from not only Delta, but Southwest as well, citing concerns over competition.
The decision formally rules out the other two contenders for the gates: Delta and Southwest.
Delta, which the DOJ functionally ruled out from the competition early on, was not immediately available to return a request for comment. The Atlanta-based carrier would’ve added service mostly to its hub cities, and took the bold move of selling tickets for the routes back in November.
Southwest, which had vied hard for the two gates and was considered the only other competitor to pose a realistic threat to Virgin’s bid, remarked that it was “very disappointed” by the decision. Company CEO Gary Kelly added that they were “proud of the offer we made to the City of Dallas to expand service.” Kelly had gone so far as to personally appear at several public meetings and city council hearings, as did Virgin CEO David Cush. Southwest currently owns sixteen of the airport’s twenty total gates, and is restricted by federal law from growing further in the region.
While the carrier no doubt may have been unhappy about the decision, it at least played it classy and cool on social media: