McCarran flights forecast to fade in 2013

Airline service at McCarran International Airport, a critical component of the visitor industry's financial well-being, will continue to recede through the first half of next year.

According to schedules compiled by the trade group Airlines for America, the number of outbound flights will drop by 4.3 percent compared with the same period in 2012. With some carriers sending larger planes to Las Vegas, the seat capacity will decline 2.7 percent.

Schedules can change quickly, however.

The flight lineup is shrinking as Las Vegas' visitor count is on track to hit a record high. But other key benchmarks such as room rates, hotel occupancy, convention attendance and Strip gaming revenue lag prerecession levels.

Airlines account for about 42 percent of the visitor totals and surveys have shown that passengers typically stay longer than spend more than people who drive in.

How much the latest round of airline cuts will hit the resorts is debatable.

"It's not troubling from what we have seen," Union Gaming analyst Bill Lerner said. "What has been lost in air capacity has been more than made up with auto traffic."

With planes flying fuller and international flights increasing, he said the quality of passengers has risen when judged by spending and length of stay. Therefore, he said his projection of Strip revenues growing in the low-to-mid single-digit percentages remains intact.

But a Dec. 5 report by Deutsche Bank analyst Carlo Santarelli found a consistent tie between airline schedules and the lodging industry, particularly room rates. He expects the correlation to continue to hold true, with the tighter seat supply driving up airfares and deterring some people from vacationing here, while causing those who come to spend less.

"We believe that the higher cost of flying will be yet another impediment that may somewhat slow down the Las Vegas growth in 2013," he wrote.

The flight cuts at McCarran are widespread. Only nine of the 32 airlines listed by Airlines for America as landing in Las Vegas at least one year will post higher numbers. Three of the biggest, Southwest/AirTran, Delta and American, will boost their presence.

Several international carriers, including Air Canada, north-of-the-border rival WestJet and British Airways will also add capacity. Foreign flights have continued to grow at McCarran even as domestic service stumbled, driven by WestJet and the entry of several smaller airlines, although both Philippine Airlines and Mexico's VivaAerobus plan to exit in January.

Otherwise, other airlines will pull back, including discounter Spirit, which added numerous flights and destinations starting in mid-2011. Las Vegas-based Allegiant Air, which has aggressively added flights for several years, will also cut back. Virgin Atlantic, a star attraction of McCarran's international service for more than a decade, will cut capacity as British Airways expands.

Contact reporter Tim O'Reiley at toreiley@reviewjournal.com or 702-387-5290.