SFO carriers wage airfare war with Virgin

JetBlue Airways and Southwest Airlines have matched the introductory low fares offered by Virgin America, firing the first shots in the summer airfare war that industry analysts and San Francisco InternationalAirport have been anticipating for months.

Burlingame-based startup Virgin America started selling tickets last week for its new service at SFO, set to begin Aug. 8. As expected, JetBlue and Southwest, its two biggest competitors in the low-cost carrier division, announced shortly thereafter that it would match the newcomer’s introductory fares until Nov. 14.

JetBlue plans on offering round-trip flights from all three Bay Area airports to New York’s John F. Kennedy International Airport for $278, matching the $139 one-way ticket offered by Virgin America, company spokeswoman Alison Eshelman said. Regular one-way fares on this route were previously $189.

“It’s going to take a year for the market to mature properly,” Eshelman said. “But we’re meeting projections and welcome the new competition.”

Though Southwest does not start service at SFO until Aug. 26 and will not offer nonstop service to Los Angeles, the company has dropped its fares slightly for flights between Oakland and the greater Los Angeles area.

Southwest is now offering $44 one-way flights between Oakland and some Los Angeles area airports, down from $49, previously the cheapest one-way flight on that route, spokeswoman Whitney Eichinger said. Flights between SFO and Los Angeles International Airport, a popular domestic route, are $44 one-way on Virgin America.

“All airlines offer something different,” Eichinger said of the competition. “We’ll be offering frequency to places such as San Diego that another low-fare competitor might not offer. We think with our name and our service, we’ll be able to compete strongly.”

Aviation consultant Michael Boyd had predicted, along with many of his peers, that with the addition of Virgin to the fray, enticing low fares would be the short-term result because of the low-cost carrier clamor to SFO. But he doesn’t expect this trend to go on for much longer than a few months, especially as the low-travel months of September and October approach.

He said that of the three airlines, Virgin America appears to have the most amenities that would draw new customers, with entertainment systems and mood lighting aimed at capturing younger customers.

“People used to be all about no-frills airlines,” Boyd said. “But now people really want the frills.”

Web woes snarl early ticket sales

Virgin America’s ticket sales are meeting first-week projections, though officials there are convinced they could have been higher if not for an Internet hiccup on the first day of sales.

The company is not releasing sales numbers, said airline spokesman Gareth Edmondson-Jones, adding that projections for the first week have been met. Virgin America said sales hit a snag July 19, the first day of business, when the company Web site was hacked.

“We’re right where we wanted to be,” Edmondson-Jones said. “But we left money on the table and could have done even better if not for the Web site issue.”

The airline expects to sell more than 1 million tickets between the July 19 launch and mid-February 2008.

The airline starts service Aug. 8 with two daily flights between SFO and John F. Kennedy International Airport in New York, and five daily flights between SFO and Los Angeles International Airport. By Sept. 9, there will be four scheduled daily flights between SFO and JFK.

By the end of this year, the airline plans to run daily service to and from Washington, D.C.’s Washington Dulles International Airport and McCarran International Airport in Las Vegas. Service to San Diego is also expected at an as-yet undecided date.

tramroop@examiner.com

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