City Council approves Hobby Airport expansion deal
raw video: Exclusive: United CEO Jeff Smisek speaks out
raw video: Mayor talks about airport expansion plan
raw video: Southwest Airlines agrees on expansion plan
HOUSTON (KTRK) -- Houston is one step closer to having two international airports. City Council Wednesday morning approved the $100 million expansion of Hobby Airport in southeast Houston to allow for international flights.
The roar of approval from Southwest Airlines employees was deafening. The months long fight for international flights out of Hobby Airport was finally over as City Council approved the memorandum of understanding in a landslide 16-1 vote.
"We have had tremendous support. We have always had the best interest of Houston in our minds and it's a great opportunity to lower fairs and allow more people to fly," said Southwest CEO Gary Kelly.
As Kelly beamed, United Airlines, which fought vehemently against the expansion, says flights and jobs would be lost at Bush Intercontinental Airport as early as later this year.
"We're going to be looking to cut our fall flight schedule as a result of this and there is going to be jobs that are associated with that are going to be lost. We are going to do our best to help our employees with voluntary programs and finding them locations in other places if we can. So we want to mitigate the harm, but we said all along this would be the outcome of this," said Stephanie Buchanan with United Airlines.
The only 'No' vote was by City Council Member Jerry Davis, who also said he is worried.
"We just were not confident in everything going the way it was proposed," Davis said.
However, Mayor Annise Parker points out flights are not scheduled until 2015, and she believes the greater Houston community is big enough to support two international airports.
"Once everything calms down a little bit, we're going to have a rational discussion, and we'll be long-term partners and have a productive partnership," Mayor Parker said. "The competition is at least three years away, so for United to say that there are going to be 1,300 people laid off next week or so, that's just not reasonable."
The mayor announced the deal last week. The $100 million plan would be paid by Southwest Airlines. The airline would add a customs facility and five international gates and offer flights to the Caribbean and Latin America.
United says it already operates some flights at a loss at Bush Intercontinental Airport because it was anticipating growth, but with Southwest taking away that potential growth, they say they want to stem the bleeding and move the non-profitable flights away sooner, and bringing in fewer international flights.
"The Dreamliner was, you know, going to come to Houston based on the assumption that we'd have, you know, international service that made sense," Buchanon said. "Flights like Auckland which we were going to do on the Dreamliner isn't going to make sense anymore."
Southwest brushes away United's doom and gloom projections, convinced that competition will be good for both airlines.
"It's all about competition, it's all about lowering fares and making travel more affordable, and for the first time now international markets to the south," said Kelly.
Houston leaders say there is enough business for two international airports in America's fourth largest city.
"It's just a bit puzzling to me that they would make the announcement right after the council vote," said Council Member James Rodriguez. "Southwest hasn't built the facility yet, they haven't started international flights. We are looking at 2015. And so to announce that they are not competing yet is probably a bit premature."
Last week, United Airlines CEO Jeff Smisek spoke with Eyewitness News and said that the airline maintains that any job losses are not retaliation.
"I am not threatening anything. This is what will be forced to happen. This isn't a threat. I mean, this is nothing I want to do. Why would I ever want to do that? This is a natural reaction to a decrease in demand and a decrease in the profitability of the flights here," Smisek told Eyewitness News.
Stay with Eyewitness News for the latest on this story.
hobby airport, southwest airlines, united airlines, bush intercontinental airport, local
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