United Airlines will cut 1,300 jobs and reduce flying in Houston after losing a fight to block Southwest Airlines Co. from adding international flights there.
United uses Bush Intercontinental Airport to funnel passengers between U.S. destinations and to Latin America.
On Wednesday the City Council ignored United’s protests and voted to let Southwest offer international flights from Hobby Airport if it will pay the $100 million cost of adding new gates and a customs facility.
Southwest says its first flights to Latin America and the Caribbean won’t leave until 2015, but United’s reaction to the City Council decision was much quicker.
In a memo to employees, United CEO Jeff Smisek said the airline will cut passenger-carrying capacity in Houston by 10 percent starting this fall, which will result in 1,300 lost jobs.
United also said it will scrap a planned route between Houston and Auckland, New Zealand, which was to be the airline’s first using Boeing’s new 787 aircraft. United said the route won’t be economically feasible now.
Instead it’s selling its first 787 tickets for Denver to Tokyo.
Alan Bender, who teaches airline economics at Embry-Riddle Aeronautical University, said United will have to cut flights "because they’re inefficient and they can’t compete with Southwest."