Why Southwest is cutting back at PHL

Airline reporter Linda Loyd explains thoroughly in a story published today why Southwest will be making deep cuts in its PHL service early next year. As noted in many earlier posts on this blog, US Airways (after two trips through bankruptcy court) now has lower operating costs and has better overall management than it did when Southwest came to PHL seven years ago, making it much more competitive.

The fact is, if Southwest has such low fares on some of its PHL routes that it can't make money and is giving up, then US Airways is unlikely to be making money on those routes at the same low fares either. The difference is US Airways has a much larger investment and a much larger route network at PHL, and thus can absorb losses on some routes while making it up on others.