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With more flights, cheaper fares predicted

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Southwest Airlines has filed an application with the U.S. Department of Transportation for permission to fly from Los Angeles to three more Mexican cities, including Cancun.

With more flights, fare reductions surpassing 20 percent are predicted by analysts. Visitors could increase by half a million a year.

The Dallas-based low-cost carrier intends to operate non-stop flights between Los Angeles and the Mexican destinations — Cancun, San José del Cabo/Los Cabos and Puerto Vallarta — starting Nov. 6, 2016, assuming that it gets the approval by June 30.

The carrier intends to operate two daily flights to Cancun and San José del Cabo. One flight connecting Los Angeles and Puerto Vallarta would operate per day.

Southwest Airlines has also asked the DOT for extra-bilateral authority so that it can operate the additional flights even before the liberalized aviation deal between the U.S. and Mexico materializes.

If Southwest Airlines manages to gain the approval for the beach destinations in Mexico, competition on these routes will intensify manifold which may lead to lower ticker fares, predicts NASDAQ.

Economic analysis firm Campbell-Hill Aviation Group believes that fares may reduce in excess of 20 percent from the current levels while traffic is likely to increase by more than 500,000 passengers annually. The firm further predicts annual savings to the tune of $50 million from these routes.

This would be Southwest’s first direct connection between Los Angeles and Mexico. Currently, the carrier serves four Mexican destinations from eight U.S. cities.

Source: NASDAQ

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