Tuesday, February 28, 2017
Small airports seeing big cuts in connectivity
By Robert Silk
LAS VEGAS -- Concern about reductions in air service to many midsize- and small-market U.S. airports emerged as a major theme at the Routes Americas conference here earlier this month, where delegates from 100 airlines and 260 airports gathered to explore potential new flight offerings.
"We've got to find a way to solve that problem," Erik Hansen, vice president of government relations for the U.S. Travel Association, said on a panel at the conference.
According to U.S. Travel, 60% of U.S. airports have lost connectivity over the last decade. In addition, two-thirds of U.S. states have seen a decline in air service quality and convenience since 2007, meaning they are seeing fewer flights and routes.
The reductions have come as consolidation has reduced the number of major U.S. airlines from 11 to four since 2004. As they consolidated, airlines concentrated their operations at fewer hubs, leaving former hub cities such as Memphis,
Milwaukee, Cleveland, Cincinnati and Raleigh-Durham, N.C., with empty gates.
Meanwhile, the pilot shortage plaguing regional airlines has combined with moves by the major airlines to phase out 30-seat aircraft and reduce their 50-seat fleets to take an additional toll on service options at small-market airports.
Approximately 30 small airports in the continental U.S. lost commercial service between the middle of 2013 and the end of 2015, according to a list provided by the trade group American Association of Airport Executives.
In 2016, at least seven more airports lost service, according to an analysis of data obtained by Travel Weekly from the commercial aviation analytics company Diio Mi.
Small markets such as Huron, S.D.; Hot Springs, Ark.; and Los Alamos, N.M.; were among the casualties.
On the same panel at Routes Americas, John Slattery, CEO of the Brazilian regional aircraft manufacturer Embraer, called an overemphasis on major hubs the biggest challenge for commercial aviation in the Western Hemisphere.
"I think it will really hurt North America," Slattery said.
He said that in the fast-growing markets of China and India, the aviation industry has been focusing on spreading connectivity beyond the major cities and into tertiary markets.
"Look outside the United States for best practices," Slattery advised the aviation executives at Routes Americas.
Among the small airports represented at the conference was Colorado Springs, Colo. The facility's director of aviation, Greg Phillips, said he had meetings scheduled with seven airlines during the three-day event.
Last year was a relatively good one for Colorado Springs, with Frontier Airlines entering the market with three routes, thereby increasing the number of destinations served by the airport from nine to 12.
Still, Colorado Springs Airport's 600,000 enplanements in 2016 were just half of its enplanements in the mid- to late-1990s, when the short-lived Western Pacific Airlines was based there.
Phillips said the Broadmoor resort, a Colorado Springs institution, recently told him that its best year was 1997, during the Western Pacific run.
"That connectivity is absolutely critical to minor markets," Phillips said.
For the most part, speakers at the conference said the solution to the connectivity issue should come from the private sector.
"I don't have the answers, but I don't think it can be rooted in regulation," Slattery said. "Airlines will fly where they will make money."
He said it is up to the airports to attract the airlines. Phillips said that doing so can be a challenge for small markets. Colorado Springs must compete for passengers and airline service against the larger Denver Airport about 90 minutes away.
To entice customers, the airport promotes its convenience for locals and its ease of use. To attract airlines, Colorado Springs, home to the Air Force Academy, is attempting to diversify its revenue sources beyond commercial air service so it has more freedom to lower the fees it charges carriers.
Low fees are key, Lukas Johnson, Allegiant's vice president of network, told Routes Americas attendees. Allegiant has been a leader in recent years among the mainline U.S. carriers in expanding to small and midsize markets.
The carrier counts Punta Gorda, Fla., as its fifth-largest base, for example, and it is currently growing faster in St. Petersburg, Fla., than any other market, Johnson said. In January, Allegiant named its newest destination, Louisville, Ky., offering six routes to other minor markets such as Destin, Fla., and Savannah/Hilton Head in Georgia. Johnson said airport deals are "incredibly important" in Allegiant's expansion decisions.
"If you've ever sat face-to-face with us, you know how big the deal is," he said. Fees, incentives and marketing arrangements are among the inducements Allegiant negotiates with potential new airports.
While the loss of air service connectivity across U.S. markets is a concern to tourism authorities, it's a positive for Allegiant.
"Anywhere there is a reduction, we think it's an opportunity to go in and backfill that demand or even to grow it," Johnson said.
But while conference attendees touted private-sector efforts as the primary means of bringing air services back to secondary U.S. markets, U.S. Travel said that government can help as well by getting out the way.
U.S. Travel CEO Roger Dow used the occasion of Routes Americas to announce that the group will release a white paper in April called Air Travel Blueprint. Among other topics, the blueprint will call for a rollback on federal rules that prohibit airports from using their funds to promote the cities they serve and the airlines that fly to them. Such rules, said Dow, serve as an impediment for air service recruitment by small and midsize airports.