Charlotte is US Airways’ primary East Coast hub for flights to the Caribbean, Mexico, and Central America. These areas haven’t really been a growth area for the airline; service plateaued four or five years ago, and hasn’t changed much since then.
And based upon this, it’s absolutely obvious that the next destination the airline would want to serve is… Rio de Janeiro, Brazil, right? OK, no, that’s not obvious at all.
Couple of factors in play here. Air service to many South American countries is still restricted, with only a limited number of daily flights between the U.S. and these counties allowed. The flip side of this is that these flights generally are profitable for the airlines lucky enough to hold the route authorities.
The U.S.-Brazil bilateral is among the more restrictive but was recently amended to allow for 14 extra flights a week beginning this year (seven a week beginning in June, seven more a week beginning in October); 14 more flights a week become available at various point next year. As is often the case, there’s a catch though: Sao Paolo, Brazil’s largest market, is effectively out-of-bounds because of a lack of airport capacity.
Seeing a strategic opportunity, US Airways applied for daily flights between Charlotte and Rio, Brazil’s second largest market. Yesterday, the DOT tentatively awarded the route to US Airways/Charlotte.
So can we expect more flights from CLT to South America? Yes. And no. And no. Yes, US Airways is likely to apply whenever route authorities they don’t current have to major markets become available. That may not happen very often though.
And US Airways and Charlotte won’t necessarily win future competitive route awards. Exactly because flights are limited, other airlines will also bid. US Airways would be new to the market, which the DOT likes. And Charlotte is a nicely located hub for serving U.S. — South American country YYY demand that doesn’t come from Florida (OK, that might cut both ways).
There’s a big weakness though: North Carolina in general, Charlotte specifically. Or rather that Charlotte is a relatively small market, with just not that many people flying from CLT to South America. Continental Airlines in its application for Rio flights noted that currently 19 times as many people fly between Houston and Rio as fly between Charlotte and Rio. (Easy to see why Continental/Houston got the other route award.)
If enough other airline present strong applications, CLT won’t get the route award. That’s what happened two years ago when US Airways applied for CLT-Bogota. The four available U.S. – Colombia route authorities when to other airlines with proposals that linked bigger markets. And that might easily happen in the future.