Bidding for Cuba, Airline-Style

The rush is on to grab route authorities between the US and Cuba, but it may not be quite as large a rush as some expected. US government delegates were in Havana on Tuesday signing the paperwork to formalize the agreement reached two months ago and also opened up the application process from US-based airlines for the limited slots available. The application window is two weeks long with the authorities being granted in March. Flights will commence later in the year, though likely not all 110 daily frequencies immediately, for a couple reasons.

One of the biggest challenges with adding that many flights so quickly is the impact to the fragile infrastructure Cuba is operating with. A massive influx of visitors would be incredibly challenging for the country to manage. Plus there’s the part where demand likely does not exist to fill all those seats every day. Sure, the 20 daily flights to Havana are likely to see significant bidding from US carriers but I would be surprised if the 9 other cities are fully allocated at this point.

Oh, and US policy still prohibits travel as tourists. Admittedly it is far easier now to self-declare as a member of one of the 12 eligible classes of visitors for whom travel is legit, but it is still a stretch to believe that as many as 200,000 20,000 daily passengers are ready to be making those trips; even 30,000 3,000 daily to and from Havana may be a stretch.

And just about everyone wants in on the action. Southwest, United, American, Delta and JetBlue all issued statements indicating their intention to seek access to the market. Spirit will, too. Alaska Airlines is less likely, though it is evaluating its options; with hubs in the Pacific Northwest it would be a stretch to make such service work. Ditto for Virgin America and its mostly west coast operations. Sun Country is the other wildcard right now; unclear if the carrier will seek access. Allegiant is similarly unlikely to pursue access until leisure travel is permissible; it does not otherwise match the company’s operating profile.

As for which routes will be served, only two of the carriers named names, so to speak. AA specifically named its Miami hub but it “is also considering applying to serve Cuba from other hubs.” United Airlines says Havana is in its crosshairs from multiple US hubs but does not mention other possible Cuban destinations. JetBlue’s statement suggests multiple destinations on both sides of the Straits of Florida. Southwest is not committing quite as strongly, stating that it will “engage in a process to consider that service.” Presumably Spirit will serve the island from its Ft. Lauderdale hub. And Delta did specifically call out Havana as a destination but the statement left open possibilities for other options, too.

Oh, and the charter operations can remain, so there is no need for US carriers to “waste” slots on those flights if they do not want to. I also wonder if US carriers will get to move into the reasonably modern Terminal 3 as Jose Marti International Airport in Havana, a notable upgrade from the warehouse-esque building they operate from today.

Havana will see plenty of service as operations open up; that’s a certainty. I’m more interested in the smaller cities, though. Many get only a couple flights a day; significantly increasing that could be a huge burden in many ways.