"Tucson airport master plan looks to future with uncertainty"

Thursday, August 12, 2004

Tucson airport master plan looks to future with uncertainty
Ongoing change keeps planning dynamic
By Philip S. Moore
Inside Tucson (AZ) Business


Only days after announcing the launch of daily nonstop airline service
to New York City, Tucson Airport Authority staff looks for high gasoline
prices to keep Tucson's passengers from driving to Phoenix Sky Harbor to
take advantage of a fare war.

In an Aug. 3 meeting, where the TAA board of directors approved the
fourth revised 20-year master plan, they received an object lesson on
the limits of planning in a dynamic marketplace.

Alex Kovach, director of air service research and development, said the
future of the New York service depends on the ability of the city to
meet Continental Airline's expected volume.

On a 100-passenger aircraft, this means 80 or more people per flight.
"Continental is intending to increase utilization. Whether they continue
depends on the load factor," he said. With Jet Blue offering a similar
flight from Phoenix to New York City and igniting a fare war with a $199
round-trip ticket, the choice to purchase a $328 round-trip ticket from
Tucson will depend on the value that local passengers place on
convenience.

Kovach said the earlier Tucson flight, at 10:55 p.m. rather than 12:45
a.m., and the ease of commuting to Tucson International Airport are both
factors that people will consider in making their choice.

"It's commonly known that people in Tucson use Phoenix, too. But that
was before gas went up. We're already seeing a 6.5 percent increase in
passengers here and at least part of the reason is the cost of driving
to Phoenix."

Drawing on projections by consultants Landrum & Brown which forecast a
1.1 million increase in passenger traffic and a 42,000 increase in
aircraft takeoffs and landings by 2023, Tucson Airport Authority
approved a plan to purchase 225 acres from the U.S. government, leased
to Raytheon, then move and expand the general aviation runway as part of
the master plan.

The airport authority also plans to expand the passenger and freight
terminals, as well as general aviation-corporate aircraft facilities,
and identified locations for a new control tower and aircraft
maintenance and repair complex. Overall, the cost of the improvements
will be approximately $300 million, with the runway move, alone, costing
$148.6 million.

Although about 90 percent of the cost will be paid by the Federal
Aviation Administration and through other grant programs, Suzanne
McLean, TAA vice president of planning and development, said the
decision to go forward depends on demand triggers.

"Demand forecasts drive the timing for the improvements," she said,
which means the work awaits the expected results.

"Long-range planning is a guideline," said board member Jim Sakrison.
"It allows us to make projections and meet the requirements from the FAA
to get funding."

What else could happen along the way isn't as easy to predict, Kovach
said, but the planning attempts to anticipate it by leaving wide margins
between low and high scenarios. "You have to understand that the whole
master planning process is one of trying to look five, 10 or 20 years
down the road. We throw a lot of different things into the forecast."

However, some things, like the arrival of Southwest Airlines in 1994 and
the change from large to small aircraft, can't be anticipated. The
change meant more flights for the same number of passengers. "There are
a lot of different variables and some things are moving targets," Kovach
said. "The price of gas is not one of the things you can consider in
developing a master plan."

One of the things the airport could consider in the master plan but
doesn't is cargo volume. "Airlines expect that a portion of their
revenue for any flight will come from what else the plane can carry in
its baggage compartment. Plus, you have the straight cargo carriers, but
this isn't something we forecast," he said.

"In forecasting infrastructure needs, airside and landside, you say 'we
need X-number of square feet per passenger.'" For the rest, he said,
airports have to deal with the dynamic nature of the airline industry.
"We can probably expect some change over time. That's why a master plan
is not written in stone.

"You have to retain the ability to be flexible," Kovach said, but that
doesn't mean plans are useless. "This is an exacting time and there may
be airlines now that won't be around in the future. This is the way
things are, but we have to look at the eventualities and consider how we
our positioning ourselves."


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