SAN FRANCISCO, Calif. – Virgin America, the only major airline headquartered in California, today filed an application with the U.S. Department of Transportation (DOT) for the right to serve its home base of San Francisco International Airport (SFO) with two nonstop daily flights to Ronald Reagan Washington National Airport (DCA). For the first time, Bay Area travelers and businesses may benefit from low-fare flight competition to DCA thanks to the recently signed FAA Modernization and Reform Act of 2012, which included a provision authorizing the DOT to award new flights between DCA and domestic airports located beyond that airport’s 1,250 mile “perimeter limit.” Previous “beyond perimeter” awards have all been made to non-California airports – with the exception of a single daily flight at Los Angeles. Despite the size of the travel market and the region’s vibrant innovation-based economy, the San Francisco Bay Area has never had nonstop flights to DCA. As a result, local consumers and businesses have suffered for decades with higher fares and limited options – either travel to Washington Dulles or a one-stop connecting flight when traveling to downtown Washington, D.C.
“With no current service at DCA and as the only airline headquartered here in the Bay Area, Virgin America is uniquely suited to bring low-fare competition to the largest market in the nation previously without nonstop flight service to DCA,” said David Cush, President and CEO of Virgin America. “The move to open up service to DCA by the DOT is to be applauded, and we hope that we can provide meaningful low-fare competition on the route so that local travelers and businesses can enjoy lower fares and more choice.”
Previous beyond perimeter awards were last made in 2004. The Bay Area and SFO have respectively been the largest beyond perimeter market and airport that have not had nonstop flights to DCA. Smaller markets awarded DCA flights in the past include: Denver (four frequencies), Seattle (two frequencies) and Phoenix (three frequencies). The San Francisco Bay Area dwarfs these and all other beyond perimeter markets not yet served. According to publicly available traffic data, the Washington DC-Bay Area travel market is more than 78 percent larger than the DC-Denver market. In addition, SFO alone is nearly twice the size of all other non-California beyond perimeter airports previously allocated.
“California and the Bay Area in particular have suffered with no nonstop DCA flights – and one of the most populous and economically important regions in the nation deserves better,” said California Lieutenant Governor Gavin Newsom. “When Virgin America launched in August 2007, I saw firsthand that when more airlines compete, travelers tend to win with lower fares and better service. I am supportive of Virgin America’s intent to deliver more options and lower fares to local travelers and businesses.”
Launched in August 2007, Virgin America has been a case study for how more airline competition can directly improve fares and service for consumers. The airline has seen fares drop by as much as 30 percent when entering less competitive long-haul markets from SFO. When Virgin America entered the SFO-Chicago O’Hare (ORD) market in 2011 and the SFO-Dallas-Fort Worth International (DFW) market in 2010, fares dropped by over one-third on these routes. An SFO-commissioned study shows the impact of new low-fare service from 2006-2011 as having lowered fares for SFO travelers overall by 18 percent.
With fleetwide WiFi, power outlets, touch-screen live entertainment and new aircraft with three classes of service, Virgin America’s business-friendly product has offered a unique new option for local businesses and flyers. Many Bay Area civic groups and business organizations have signed on in support of Virgin America’s application to fly to DCA, including: The Bay Area Council, San Francisco Travel, The San Francisco Chamber of Commerce and the Silicon Valley Leadership Group.
“In a March 2011 survey of more than 100 of our member companies, 67 percent indicated that they travel from the Bay Area to Washington D.C. on business,” said Carl Guardino, President and CEO of the Silicon Valley Leadership Group. “Although our region powers the global economy, to date, we have had no nonstop flight service from the Bay Area to the closest airport to our nation’s capital. Two additional nonstop flights to the DC area would better link our regions by providing these companies direct, low fare flights to downtown Washington. It is past time that we had direct flights that link the world’s innovation capital with our nation’s capital.”
“The positive impact of improving the connection between Washington D.C. and the Bay Area’s innovation-based economy cannot be over-stated,” said Jim Wunderman, CEO of the Bay Area Council. “Allocation of two round-trip flights to our hometown carrier will ensure that local businesses will finally have long-awaited and badly needed flight service to DCA.”
“On behalf of over 1,500 local businesses, we strongly support Virgin America’s proposal to provide two nonstop flights between San Francisco International Airport and Reagan National,” said Steve Falk, President and CEO of the San Francisco Chamber of Commerce. “The award of two roundtrip flights to Virgin America will ensure that local business travelers will benefit from real competition in the DCA market.”
Virgin America has applied with the DOT today for two of the four total DCA-beyond perimeter frequencies now opened up to “new entrant and limited incumbent” airlines. There is a separate DOT allocation process for the largest legacy airlines. If approved, Virgin America would launch SFO-DCA flights by summer 2012. The airline’s proposed SFO-DCA schedule is focused on convenient morning and afternoon/evening departures and arrivals for Bay Area travelers. The proposed daily schedule is as follows:
Virgin America flies to San Francisco, Los Angeles, New York, Washington D.C. (Dulles), Seattle, Las Vegas, San Diego, Boston, Fort Lauderdale, Orlando, Dallas-Fort Worth, Los Cabos, Cancun, Chicago, Puerto Vallarta, Palm Springs and as of April 4 – Philadelphia.