"Competition makes South Florida airports a bargain"

Sunday, December 2, 2007

 

Competition makes South Florida airports a bargain

Low-fare carriers make region's airports a bargain

By Tom Stieghorst

The South Florida Sun-Sentinel

 

Competition keeps fares lower at Palm Beach International Airport, where five airlines each fly more than 10 percent of the passengers.

South Florida residents using Fort Lauderdale's busy airport pay lower airfares than 90 percent of the country. And flying out of Palm Beach International Airport is pretty cheap, too.

On average, it costs only $250 to fly somewhere from Fort Lauderdale, and $266 to fly from West Palm Beach, compared with $326 from the typical U.S. airport. That ranks the two airports among the cheapest on a list of 100 airports tracked for fare prices by the U.S. Department of Transportation.

Competition is key. Five airlines each fly more than 10 percent of the passengers at each airport, including several that pride themselves on low fares, such as leading discounters Southwest Airlines, JetBlue Airways and Spirit Airlines.

And although fares have been rising with higher oil prices, airline executives say South Florida should remain among the least expensive destinations.

"There is high natural demand for the area," said Ponder Harrison, managing director of Allegiant Air, which in November became the 37th carrier flying to Fort Lauderdale-Hollywood International Airport.

By providing an array of cheap flights, airlines serving South Florida change the lifestyles of some residents. Take Jack Steinman, for example. Born just 11 months ago, Steinman has been on five airplane trips already, said Janet Steinman, his mom, who is a full-time homemaker in Weston.

Interviewed before a recent departure from Fort Lauderdale, Steinman said Jack's jet-set lifestyle wouldn't be as easy to pull off elsewhere. "Here you can fly JetBlue for $59 or $69 one-way," she said. "It makes travel really inexpensive."

Not that JetBlue is the only name in the game. Analysts say it is the variety of low-fare carriers touching down in Fort Lauderdale that keeps fares so low.

Robert W. Mann, an airline consultant in Port Washington, N.Y., said passengers start to reap the benefit once an airport has more than three airlines with double-digit market shares.

Allegiant is the latest example. Founded in Las Vegas, Allegiant's average one-way fare in the third quarter was only $83. That's enough to get you to Allentown, Pa., or Knoxville, Tenn., or some of the 10 other small cities that Allegiant started serving from Fort Lauderdale on Nov. 15.

Fort Lauderdale's central location in a population of more than 5 million people draws airlines to the airport, Harrison said. "It's kind of a gateway to South Florida." he said.

But other cities also function as gateways. Boston, for example, is a portal to New England and its Logan International Airport is one of the few in the country outside of South Florida where five airlines — JetBlue, Delta, American, US Airways and United — each hold more than 10 percent of the market.

And yet even in Boston, average fares as measured by the U.S. Department of Transportation were $349 in the 2007 second quarter, 40 percent above Fort Lauderdale. The difference, Mann said, is that Boston is full of legal, medical and financial firms willing to pay extra for a last-minute flight.

South Florida skews more to leisure travelers, he said.

Both leisure and business fliers usually pay more where one airline dominates. In Cincinnati, where 91 percent of all traffic leaves town on Delta Air Lines or one of its commuter partners, the average flight costs $562, making it the most expensive market tracked by federal regulators.

In Miami, American Airlines' grip isn't that tight, but its 68 percent market share keeps popular carriers such as Southwest Airlines and JetBlue Airways off the tarmac. That affects travelers like Judy Arndt, a retired nurse who lives in Homestead but drives up to Fort Lauderdale to fly.

Arndt often uses Southwest to visit relatives. She prefers the airline because of its quick boarding, Arndt said before a recent flight to Austin, Texas, that cost her $321 round-trip. "The prices are very good, too," she said. Southwest's average one-way fare in the third quarter was $105.

In the transportation department's ranking of the top 100 U.S. airports from most to least expensive,90 airports were more expensive than Fort Lauderdale, and 83 more expensive than West Palm Beach in the second quarter, the latest available. Palm Beach International has fewer low-fare carriers than Fort Lauderdale, but is similar in that no one carrier dominates.

"You've got everybody and their brother," airport marketing manager Dick Haller said. "It's been like that for a while."

One increasing difference between the two airports is the schedule of Spirit Airlines, which had the largest market share at Fort Lauderdale over the summer, but didn't even fly to West Palm Beach. The Miramar-based airline resumed its winter seasonal service to Palm Beach International on Nov. 15 with two daily flights.

Analysts say Spirit, which doesn't report its average fare to the public, helps lower ticket prices at airports it serves even as fares in general are rising. Airlines have raised fares seven times since Labor Day to offset soaring fuel prices, but that didn't stop Virginia and Rafael Ordonez from getting a bargain.

The couple owns a carpentry business in Guatemala City, where Spirit began a route to Fort Lauderdale in May. Rafael Ordonez had heart surgery in Miami last year and had to return for follow-up treatment in November.

Although they had never traveled through Fort Lauderdale, the couple booked a flight on Spirit. The big lure was the fare, an eye-popping $315 for two round-trip tickets.

Interviewed before heading back home, Virginia Ordonez said they had no complaints and would fly through Fort Lauderdale again, primarily to save for Rafael's medical bills. The best round-trip fare on American Airlines, which serves Guatemala City nonstop from Miami, is $350 for each ticket.

"It was cheaper to fly with Spirit," Ordonez said.