"Economy puts small U.S. airports in vulnerable spot"

Sunday, June 29, 2008

Economy puts small airports in vulnerable spot
By Hank Hayes
The Kingsport (TN) Times-News


BLOUNTVILLE - A "feeling of panic" exists in the small airport community,
Tri-Cities Regional Airport Executive Director Patrick Wilson told airport
commissioners last week.

Wilson made the observation based on meeting with members of a small airport
committee affiliated with the industry group Airports Council International.

Regional airports, it seems, are in the crosshairs of negative economic
signs and publicity enveloping the airline industry.

TCRA recently turned up on a Business Travel Coalition list of 100 regional
airports most likely to lose air service. Knoxville's McGhee Tyson Airport
and Chattanooga's Lovell Field were also on the list.

In a memo sent to airport commissioners earlier this month, Wilson said none
of the airport's existing air carriers has given any indication of
significant reductions in the Tri-Cities, but he noted the "volatile state"
of the airline industry makes predicting the future difficult.

He also put together TCRA's operating budget for the coming fiscal year
"using a conservative scenario with negative passenger growth."

About 80 percent of the airport's total revenue is generated from airline
and passenger-related fees - including passenger facility charges, landing
fees and parking charges. Wilson indicated he is attempting to hold landing
fees steady or with a small increase in negotiating new contracts with the
airlines.

TCRA's last passenger survey, released in 2004, showed that 57 percent of
its customers were business travelers.

In this year's first quarter, TCRA's ridership was up 8 percent compared to
the same quarter last year, mainly because of the addition of low-fare
Allegiant Air service to Florida that began in May 2007.

The airport currently has air service to seven destinations with four
carriers - Delta Connection, Northwest Airlink, US Airways and Allegiant.

Delta Connection and US Airways have a combined 78 percent market share at
TCRA, according to an air service evaluation released in March.

Airport officials are awaiting a consultant's report on the effects of a
Delta-Northwest merger expected to be completed later this year. Cities
served by both Northwest and Delta are "more likely to lose service,"
according to BTC.

BTC suggested that with airlines unable to rely on Chapter 11 reorganization
due to a tight credit market, it's very likely that at least one - and
perhaps several - major airlines could be liquidated entirely this year and
early next year.

"The fuel crisis is having an impact beyond the gas pump and is now likely
to cause irreparable harm to businesses large and small through a
significant reduction in air service," BTC Chairman Kevin Mitchell said in
an e-mailed release.

BTC called on leaders in Washington, D.C., to take "swift and sure action to
stop the catastrophe." These actions include eliminating manipulation of
commodities markets; strengthening the U.S. dollar against foreign
currencies; and incentivizing producers to increase energy supplies, refine
capacity and develop new environmentally responsible aviation fuels, BTC
advocated.

BTC recently launched a Web site, www.SaveMyAirport.com, for citizens to
learn more and to help them engage their elected officials.

For more information go to www.businesstravelcoalition.com.

For more about TCRA go to www.triflight.com.

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