Source: Denver Post
Author: Kelly Yamanouchi

Denver International Airport and city officials say United Airlines could bring in more flights on larger jets instead of regional jets in future years.

They call that good news for consumers. United's hub in Denver is critical for the economy and is an important factor in drawing more international flights.

United and DIA struck a tentative deal last week to forgive about $184 million in debt for United's automated baggage system.

United and DIA struck a tentative deal last week to forgive about $184 million in debt for United's automated baggage system. In exchange, United pledged to increase the number of connecting passengers through Denver.

The belief is "that they would be bringing more mainline traffic through. That's good for the consumer, good news for the market," said DIA spokeswoman Sally Covington.

The increase would benefit the city, said Denver City Councilman Michael Hancock.

"This is a deal that, on the front side, looks like we're giving United a sweet deal," he said. "But in essence what we're doing is protecting the city's interests, No. 1 with a major hub out of our city, and secondly, with a major employer."

Not everyone is happy about the deal.

"On the face of it it would appear it's not favorable to airlines like Frontier that have contributed significantly to the growth of DIA," said Frontier spokesman Joe Hodas.

Though the United deal may not change cost structures for other airlines, "the issue is that money that is used for United could be used for other things. There's always a trade-off," said Jessica Soltz Rudd, senior director at Fitch Ratings.

United spokesman Jeff Green said, "We believe customer demand will continue to increase."

He did not specify how United plans to increase the number of connecting passengers through Denver.

At DIA, United has 43 gates on Concourse B and four gates on Concourse A. The deal includes canceling plans for a regional jet facility off the B concourse.

Green said the airline no longer needs the facility because it has increased efficiency in scheduling and ground handling and improved turn times to provide additional capacity at current gates.

"We can always revisit it if there's a need for that," he said.

Covington said having a United hub in Denver makes it more attractive for United and other carriers to consider adding international flights to Denver.

Denver officials are renewing efforts to add direct service from Denver to Tokyo from which passengers could also connect to China.

If United orders the new Boeing 787 airplane, "that might be the perfect plane" to fly from Denver to Tokyo, Covington said.