A planned new Las Vegas-based airline differs from previous contenders in that its backers, two of the largest casino companies in the US, have a strong vested interest in its success.
National Airlines expects to begin operations in early 1999 and has already raised more than US$50 million in capital. Rio Hotel & Casino and Harrah's Entertainment have each contributed $15 million.
It is getting more difficult and expensive to fly to Las Vegas, the city that boasts it has the most hotel rooms in the world. Several US majors have reduced services as they focus on higher yield markets. Many services that are still available are between 10pm and 2am, as airlines like America West and Southwest Airlines use the Las Vegas routes to push up aircraft utilisation.
National's chief executive, Michael Conway, argues that this leaves a large niche to be filled. 'None of the other carriers operating in Las Vegas have more than a 20 per cent revenue share of the market,' he says. 'At the same time, over 11,000 additional daily airline seats will be required to deliver Las Vegas visitors to the 21,000 new hotel rooms being added by 2000.'
National plans to launch with four Boeing 757s - with both first class and coach seats - offering nonstop services between Las Vegas and New York, Miami, Los Angeles and San Francisco.
Low costs will be key to National's success. Analysts point out that America West and Southwest are able to make their night flights work because they have some of the lowest costs in the country. The last startup to try and cash in on the tourist boom in Las Vegas failed not long after its launch in the mid 1990s.
Source: Airline Business
