War between United, Southwest looms over Houston (Houston Chronicle 03-18-12)

A proposal by Southwest Airlines to offer international flights from Hobby Airport has triggered an intense lobbying duel with United Airlines, which still wields considerable local clout as the successor to Houston-based Continental.
If it gets city approval, Southwest says it would spend an estimated $75 million to $100 million to build a new international terminal equipped with full-scale Customs facilities, as well as to improve the aging airport's domestic terminals. Southwest flights would depart from the new terminal to destinations such as Cancun and the Caribbean.
But United has already broken ground on what may become another international terminal, a $700 million investment piled on top of an additional billion it has pumped into Bush Intercontinental Airport since the late 1990s.
United says this town isn't big enough for both projects.
While the city awaits two consultants' reports, expected next week, on the pros and cons of Hobby going international, both airlines have dispatched emissaries to City Hall. The outcome of their lobbying battle will determine whether Houston becomes the sixth among the nation's 10 largest cities to have two full-scale, international airports.
Mayor Annise Parker and the Houston Airport System director, Mario Diaz, have not publicly picked a side. They say only that they're obligated to listen to Southwest's pitch.
"The airport is not in the position of choosing winners and losers," Diaz said. "We're in a position of laying down a level playing field."
In letters to airport officials in the past week, United has argued that the deal would damage the economy by diluting international traffic at Bush - traffic United depends on to fill overseas flights, many of which originate elsewhere. Those flights create jobs and boost trade by making Houston accessible from spots across the globe, United said in a letter to Parker.
Increased competition
Southwest argues that its plan would create jobs and decrease airfares because United - which dominates local flights to Latin America - would face more competition.
"More passengers will fly to IAH because fares will be lower and that will stimulate demand at both airports," said Ron Ricks, executive vice president for Southwest.
United also fears that equipping Hobby with a full-scale Customs and Border Protection facility would force the federal government to split Customs officers between Hobby and Bush Intercontinental.
Brian Znotins, United's managing director of international planning, said fewer Customs officers would result in longer lines and longer layovers and eventually would prompt more international air travelers to book flights through another hub. Customs officers are scarce, Znotins said.
"To the extent we can get more officers from the federal government - or keep them - they're much better used at Bush Intercontinental than they are at Hobby," Znotins said.
Ricks called that argument the "biggest red herring I've heard in my 40-year career." The federal government has a duty to staff airports with an appropriate number of officers, he said.
Threats to leave
Diaz said the airport system would never let Customs staffing at Intercontinental diminish to the point where passengers would suffer.
If Diaz decides the Hobby plan is promising enough to forward to the City Council for a vote as early as May 9, he said he "could make a very, very good argument" for sending more Customs officers to Houston.
U.S. Customs and Border Patrol declined to comment on whether it would have to reassign officers to a new facility.
Both airlines are threatening to take their business elsewhere if they're on the losing end of what Parker called a "historic" decision that's affected by recent shakeups in the airline industry.