"Report: Costly fees are crippling Myrtle Beach airport"

Wednesday, May 16, 2007

Report: Costly fees are crippling airport
No new airlines means fares will rise, expert says
By Dawn Bryant
The Myrtle Beach (SC) Sun News


Airlines' cost of doing business from Myrtle Beach International Airport is
high compared to other cities - sometimes twice as much - and hurts the
area's chances of recruiting more flights to more destinations, according to
a report released Tuesday.

And without more airlines serving the beach, passengers will continue to pay
more to fly - with fares from Myrtle Beach rising 25 percent from 2004 to
2006 - more than twice the national average of an 11.7 percent increase, the
study by aviation consultant The Boyd Group showed.

"The primary mechanism to achieving additional lower fares - or at the very
least a greater availability of the lowest published fares - will be to
create a more competitive environment at Myrtle Beach through the
recruitment of additional air service," according to the report.

Consultant Mike Boyd, hired by area business leaders to learn how to attract
more airlines, urged the beach to create a marketing plan for the airport
and target carriers such as Allegiant Air.

The 52-page report also outlined ideal markets for the beach - Dallas/Fort
Worth topped the list - and made it clear that landing much-desired carrier
Southwest isn't likely because there are not enough passengers to and from
Myrtle Beach.

The fees the airport charges airlines to operate hurt its chances of
attracting more carriers, especially considering the beach already is at a
disadvantage because of the extreme seasonality that makes it tough to fill
planes in the winter, the study showed.

And airlines, which have gone through a shakeout of the industry in recent
years, are watching their costs more closely, including those of doing
business in a particular city, the report noted.

"The cost of flying to a market does make a difference," Boyd told about 60
area leaders who gathered at the Sheraton Myrtle Beach Convention Center to
hear the presentation.

The fees are reasonable considering the airport's costs and need to
accumulate money for future growth, Airport Director Bob Kemp said after
Boyd's presentation. Decreasing the airline fees would force cuts in airport
operations, he said.

He doesn't think the fees are keeping airlines away.

"No airline, to my knowledge, has said they are not going to come here
because costs are too high," Kemp said. "It's a whole package."

The study comes as the bitter debate over building a $229 million terminal
continues.

Boyd said the area needs a new or expanded terminal to accommodate the
100,000 additional passengers he predicts the area will have in the next
five years, but urged officials go with a stripped-down terminal without
pricey frills such as artwork and fountains that passengers don't care
about.

"Don't build a Taj Mahal," he said. "People want to come through here and
get on the golf course."

The Boyd Group compared Myrtle Beach's fees to five other airports. The
airlines' cost of doing business per outgoing passenger is $8.56 in Myrtle
Beach; $4.05 in Gulfport, Miss.; $4.65 in Las Vegas; $4.69 in Orlando, Fla.;
$4.06 in Phoenix and $4.83 in Pensacola, Fla.

"The Boyd Group believes that the level of cost differential may place
Myrtle Beach International Airport at a disadvantage when attempting to
recruit and retain air service," the report says. "This is particularly true
given the seasonal and price-sensitive nature of the traffic base" in Myrtle
Beach.

The costs concern Mickey McCamish, president of Myrtle Beach Golf Holiday,
who has been part of an unofficial group of airline recruiters.

"We've got some work to do there - $8 versus $4: there is a tremendous gap
right there," he said. "We've got to get the cost to where it is
reasonable."

The Myrtle Beach Area Chamber of Commerce and Golf Holiday, the two groups
that paid for the $17,000 study, plan to use Boyd's suggestions to develop a
strategy for boosting air service that includes a marketing plan. That will
take about a month to six weeks.

"As a community, we desperately need that [additional air service], with or
without a new or expanded terminal," chamber President Brad Dean said.
"Because of the seasonality and unique nature of this market, it will take a
creative, customized plan."

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