U.S. DOT Awards New Beyond-Perimeter Slots At Washington Reagan

These new slot awards, granted under the 2024 FAA Reauthorization Act, allow each of the carriers to launch new daily round-trip service to destinations beyond the 1,250-mi. flight restriction typically imposed on DCA flights.

Under the new allocations, Alaska will use the exemption for service to San Diego, while American will fly to San Antonio. Southwest will add a Las Vegas route, and United plans service to San Francisco. Additionally, Delta will launch flights to Seattle, complementing existing service to the city by Alaska.

The move follows the May 16 signing of the FAA Reauthorization Act by U.S. President Joe Biden, which authorized additional slots at DCA. The slots are designed to enhance nonstop travel options to underserved beyond-perimeter airports and boost competition in these markets.

The awards follow a competitive application process that saw eight airlines vying for the limited exemptions. Alongside the five carriers that have tentatively secured new slots, Frontier Airlines, JetBlue Airways and Spirit Airlines also submitted proposals.

However, controversy surrounded the allocation of one specific slot reserved for a “limited incumbent,” classed as an airline with fewer than 40 DCA slots (excluding slot exemptions). Alaska and Air Canada were considered limited incumbents by the DOT, but Spirit and Frontier challenged this definition.

Breeze Airways, which was not eligible to apply, also criticized the exclusion of new entrant airlines, calling it a “failure of aviation policy.” Breeze argued that the DOT missed an opportunity to inject more competition.

Despite these objections, Alaska was awarded one of the five new slots, marking a key victory for the airline as it expands its West Coast presence at DCA with the new San Diego route. American, Delta, Southwest, and United will also receive slots as “non-limited incumbents.”

Currently, seven airlines operate 20 daily roundtrips from DCA to 10 beyond-perimeter cities, including Los Angeles, Denver, Las Vegas, Phoenix, San Francisco, and Seattle. The addition of these new routes will bring the total number of beyond-perimeter destinations served from DCA to 12.

Alaska To San Diego

The DOT says the decision is based on the lack of current nonstop service on this route and the significant demand, with approximately 139,000 annual passengers traveling between DCA and San Diego International Airport (SAN). It adds that 34% of all local O&D customers between DCA-SAN are carried by American, with the second-largest share of O&D customers carried by Southwest (23%). Alaska currently carries a negligible share of less than 1%. The DOT says that air fares for DCA-SAN are currently 30% higher than the average for DCA, as well as the average air fare for the Greater Washington DC market, and the U.S. national average

American To San Antonio

San Antonio is the second-largest market without nonstop service from DCA, with approximately 110,000 annual passengers traveling between the two cities, according to the DOT. It says the introduction of nonstop flights will increase competition, particularly against Southwest, which currently holds 45% of the market share via connecting flights. Despite concerns about American’s dominance at DCA, the DOT concluded that adding service to this unserved market will benefit travelers without reducing service to other beyond-perimeter destinations.

Delta To Seattle

Currently, Alaska is the only carrier operating nonstop flights between DCA and Seattle, commanding 73% of the market. Delta’s entry is expected to enhance competition, as the DCA-SEA route sees around 232,000 passengers annually, with fares currently 60% higher than the DCA and national averages. Despite concerns from other carriers, including JetBlue and Southwest, the DOT concluded that Delta’s service would add capacity and provide more affordable options on a high-demand route dominated by a single carrier. Delta’s backup proposal for service to Salt Lake City was not selected.

Southwest To Las Vegas

The DOT says the decision responds to significant demand, as approximately 275,000 annual passengers travel between DCA and Las Vegas, but current nonstop capacity is insufficient to meet this need, with only 137,000 available seats. Currently, American operates nonstop flights on this route and carries nearly 56% of local O&D customers, while Southwest holds a 20% share but does not offer direct service. The introduction of Southwest’s flights is expected to enhance competition and provide more affordable options, as fares are currently 27-29% higher than average, according to the DOT.

United To San Francisco

With approximately 238,000 annual passengers traveling between DCA and San Francisco, the route is currently served by both United and Alaska, which each hold around 36% and 35% of the market share, respectively. While some competitors argued that United’s existing service limits competition, the DOT says that a second daily United flight will provide additional options in a high-demand beyond-perimeter market, expanding accessible one-stop markets from DCA. It therefore concluded that the benefits of awarding the exemptions to United outweigh those of other proposals, selecting United’s primary market over a backup service to Los Angeles.