Virgin America (VA): We Love New York but Here's Why We Can't Use All Our Slots - TheStreet

San Francisco-based Virgin America (VA)  said it's constrained in New York because it holds just a handful of slots at the region's three major airports.

Yet Virgin America "is not even using all the New York slots it already has," Delta (DAL) - Get Report Chief Legal Officer Peter Carter wrote recently in a letter to federal regulators. He generally urged retention of the existing slot policy, which "ensures that slots can continue to be allocated to their most efficient use through unrestricted market transactions."

Slots are takeoff and landing times assigned at a handful of congested airports, including the three New York airports: Newark, LaGuardia and Kennedy.

A month ago, Virgin America was one of five "new entrant" carriers that wrote to the regulators asking for a slot policy change that would open up the major airports in New York, where American, Delta and United have 91% of the slots at Newark, 88% of the slots at LaGuardia and 63% of the slots at Kennedy.

Must read: Delta to Rivals: Stop Whining, We Spent Years Acquiring Our N.Y Slots

"It is most ironic ... that Virgin America would make the claim that it has been 'frustrated' in its efforts to obtain New York slots," Carter wrote, given that Virgin leases four LaGuardia slots to JetBlue and two Newark slots to Porter Airlines, a Toronto-based carrier that flies Bombardier jets.

"Even with those transfers, however, Virgin operates almost two dozen daily flights to/from slot-restricted New York airport, an increase of 12 round trips since 2011," Carter wrote.

Virgin America operates a limited schedule at all three airports. From LaGuardia, it flies four times a day to Dallas. From Newark, it flies three times a day to Los Angeles and three times a day to San Francisco. From JFK, it operates five daily flights to both Los Angeles and San Francisco and once a day to Las Vegas and Fort Lauderdale.

In an interview Wednesday, Virgin America spokesman Dave Arnold said the irony is that Delta "is trying to imply that airport access is somehow not a challenge for smaller carriers including Virgin America."

Delta "has benefited over multiple decades from favorable slot purchase opportunities that have made it an entrenched incumbent carrier in New York and other airports around the country," Arnold said.

He added that "Delta's specific assertions about Virgin America's use of its very limited slot portfolio are frankly disingenuous {because} Virgin America has not transferred any of its slots to other carriers."

When Virgin America leased a package of Newark slots from American, American was already leasing two slots to Porter Airlines. "Virgin America continued to honor the Porter Airlines two-slot lease arrangement," he said.

Additionally, Arnold said, "commercially viable slots at LaGuardia are very rarely made available, so we jumped at the opportunity to bid on an all-or-nothing package of slots there, even though we did not yet have any new delivery aircraft available to begin fully utilizing all of the slots at that time.

"In order to cover the use of the slots in an interim period, Virgin America entered into a short term lease of four LaGuardia slots to JetBlue," he said. "This just further reinforces how difficult it is for small carriers to secure slots that are dominated by the major carriers."

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.