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CAA: Airport Marketing & Public Relations, "With Airlines Cutting Service We Ask: Where Did Flights Go?"

Friday, April 11, 2003

With Airlines Cutting Service We Ask: Where Did Flights Go?
The Wall Street Journal

Las Vegas may be a hot tourist spot, but it's now a little harder to get
there from Los Angeles. the route out of LAX has 100 fewer weekly flights
from a year ago. Need a nonstop to Maui from St. Louis? It's history. And if
you're flying out of Pittsburgh, don't wait for a late flight -- nearly a
quarter of the after-dinner departures have been eliminated over a year.

To a degree that's surprising even travel experts, the nation's
much-publicized airline troubles are reshaping the American skies, and
giving fliers a whole new set of hassles. Indeed, seating capacity dropped
4.2% last year nationally and in some big cities as much as 25% -- the
biggest downsizing since the early 1970s. And while many of the changes
simply match the nation's steep drop in travel, others range from the
haphazard (a spike in flights out of Palm Springs) to the uncomfortable (a
lot more small jets). "We're only beginning to figure out what's happening,"
says analyst Michael Allen at BACK Aviation Solutions.

But who are air travel's new winners and losers? We analyzed every domestic
route at the top 200 U.S. airports, using data we commissioned from
consulting firm Travel Analytics -- and found some little-known side effects
from a year's worth of cuts. Business travelers, for example, have fewer
early-morning options, and even routes like Atlanta-Dulles have
significantly fewer seats. The familiar hub-and-spoke system is going
through some changes, with new approaches at US Airways and
American (get ready for the "rolling" hub). And if it seems like you've been
stuck on more smaller planes lately, you're right -- use of those regional
is up 30% from just a year ago.

But the biggest surprise may be where the airlines have picked for their
changes -- and what that means to veteran fliers like Richard Horowitz. With
seat capacity down 6% in a year at his home airport in Philadelphia, he's
been spending more time around the country waiting for connecting flights.
Next week he's stuck for an extra night in Los Angeles because his usual
morning flight is gone. "It's just harder now," says Mr. Horowitz, a
private-equity manager.

Series of Problems

Of course, this isn't the first time the airlines have shrunk service. It
happened in the early '70s during the energy crisis and again during the
Gulf War. But in the '90s, passengers came to expect frequent departures and
ample connections, with airlines even expanding hourly "shuttle" service.
Now the problems just keep coming, with airline bankruptcies and the war in
Iraq following on the heels of Sept. 11 and the weak economy. Just last
month, Delta, Northwest, American and others announced further
cuts. Before the year is over, the Air Transport Association estimates, the
airlines may cut 2,200 daily flights systemwide.

The goal, airlines say, is to get rid of all those costly empty seats, and
some of the bigger cuts have already been made on overseas routes.
Certainly, their decisions are far from guesswork; airlines have spent
heavily on computer systems that can track and predict where people want to
fly. Northwest, for example, says it "surgically" went after slow time
periods such as Saturday nights, while US Airways reduced Pittsburgh flights
to revamp its hub system (now all its north-south connections go through the
better-situated Charlotte, N.C.). "There were redundancies," says a US
Airways spokesman.

Still, even the airlines admit some of the changes can seem random. Our
analysis, for example, found things all over the map among the top 10
airports -- San Francisco and Washington's Dulles are down, New York's JFK
and Minneapolis have grown. Short hops, while popular with fliers, have been
pared back almost twice as much as all nonstops. The nation's big airport
winner? Long Beach, Calif., where airline capacity has nearly tripled in the
last year, thanks largely to the arrival of JetBlue Airways. Besides
offering an
alternative to LAX, it's also a $33 cab ride to Disneyland.

Another curious change: Atlantic City's capacity has jumped 35% even though
traffic is up a fifth of that. "It's less congested," says Spirit Airlines
chief executive Jack Schorr. "It's an ideal market for us." Then there's
Peoria, Ill., where airlines have cut capacity 32%, or three times more than
the fall in demand -- the biggest drop on our list. In San Francisco,
flights are down only 5%, but the drop in available seats is almost twice
that. "A lot of this is hit-and-miss," says Richard Aboulafia at Teal Group,
an aviation consulting firm in Fairfax, Va.

For Christin Evans, all this means one thing: a Murphy bed. That's all the
hotel had left when she recently spent an unexpected layover in Boise,
Idaho. The problem: United dumped its big jets off the route home to San
Francisco, leaving Ms. Evans with fewer options when her flight was
canceled. The only remaining flight was already filled -- all 25 seats. "You
feel like you're in 'Groundhog Day' " when you're back at the airport at 6
a.m., she says.

To some degree, all the cutbacks are just the latest twist for weary
travelers. A few years ago, flights were so plentiful that crowded terminals
and air-traffic delays were making headlines. Indeed, many analysts think
the slowdown is probably a blessing in the long run, especially for
overstressed airports, which now won't need to rush as many pricey runway

Still, worried airports are resorting to old-fashioned lobbying with the
airlines. At Palm Springs International, deputy director Richard Strickland
says he's met with 16 airlines in the past year and a half, trying to
convince them that business visitors would rather fly direct instead of
driving from LAX. It seems to be working; capacity is up 30%. But not every
city is so lucky. In Syracuse, N.Y., almost half the gates are empty despite
local efforts to woo low-fare carriers. "Nothing yet," says a spokesman.

Changes to Come

Joe McClure says he can barely keep up with it all. The president of
Montrose (Calif.) Travel, says the airlines' shuffling means his customers
are finding flights they've already booked aren't there anymore. Now his
staff has to process as many as 100 changes a day from the airlines'
schedule-switching. In Redmond, Wash., Microsoft's corporate travel chief
Kathy Rust says people are grumbling about the added connections.
"Everyone's braced for the changes to come," she says.

The airlines, for their part, say they may not be done yet. Even with the
worst of the fighting in Iraq apparently over, it may take some time for the
industry to rebound. The nation's largest carrier, American, is still
talking about seeking bankruptcy-court protection if unions don't agree to
concessions -- and no one knows what will happen to United. And there's a
new problem to worry about: SARS, the mysterious respiratory illness that's
already scaring some travelers off and forcing some airlines to hand out
on Asian routes.

For Elisabeth Sumpter, all the upheaval has meant a chance to slow down --
to 60 miles an hour. Returning from vacation in Alaska, she missed a
connection in Seattle and was told she'd have to spend the night because the
late-night flight had been eliminated. Her solution? Rent a van and drive
the three hours back to Portland, Ore. "At least we weren't at their mercy
any more," she says.

Winners and Losers: Airports ...

How's your town doing? We looked at 200 domestic airports to gauge the
change in the number of flights, and seats, they've gained or lost in the
past year (average week in March 2003 compared to an average week in March
2002). Below, a sampling of big hubs, and airports with the biggest swings:

City/Airport  Two Biggest Carriers*  % Chg Flights  % Chg Seats    Comments

Atlantic City, N.J.  Spirit, Delta                 +40%                 +35%
Call it an airline gamble: Spirit has

added 20 flights a week, while

Delta has launched 27 new  flights to

Boston, Cincinnati and Washington National.
Charlotte, N.C.  US Airways,
      -5                    -8   Across the U.S., smaller airports

like this are cutting short routes

(recently cut: Hickory, N.C.). US

Airways is behind much of the

airport's loss of 31,000 seats.
Dallas-Ft. Worth  American, Delta                   +2                    -5
The nation's No. 4 airport shows

how industry cuts may mean more

flight options but less space.

Traveling to Washington or

Cincinnati? Expect smaller planes.
Kansas City, Mo.  Southwest, American   -14                  -11
Spurned again: Eastern and

Braniff pulled out of this hub in the

'80s, and Vanguard took 29 daily

flights with it when it ceased

operations. US Airways has

scaled back, too.
Long Beach, Calif.  JetBlue, American               +191              +225
Yes, you read that right. Most of

the jump comes from upstart

JetBlue, which skirts busy LAX and

unloads passengers here from

New York, Atlanta and Vegas.
Los Angeles  United, American                   -3                  -3
The change may look small, but at

this big airport it translates into

24,000 seats lost since last March.

Still, LAX is going ahead with some

expansion plans.
Memphis, Tenn.  Northwest, Delta                +17               +15
Appearances can be deceiving:

Levels are up here because

Northwest reinstated some night

flights it cut after 9/11, but

capacity remains down 10% from

March 2001.
Minneapolis-St. Paul  Northwest, United  +7              +11
Will life ever get better for fliers at

this legendary Northwest hub?

Yes, flights are up, but better get

out early -- airport officials say

service is pretty slow after 8 p.m.
New York (JFK)                American, JetBlue  +3                +9
While JFK won nearly 40,000 seats

during the year -- thanks in part to

JetBlue additions  La Guardia

grew slightly and Newark's

numbers stayed flat.
Palm Springs, Calif.                Alaska, American   +13        +17
Forecast: sunny. Having rebranded

itself as a year-round business

destination, Palm Springs has new

flights to Chicago and Dallas

(American) and Denver (United).
Peoria, Ill.                United, American    -35                -32
This was the hardest hit of our

survey's 200 airports, with

American cutting 45 weekly flights,

or two-thirds of its operations;

airport blames a slump in local

business travel.
Pittsburgh                US Airways, Delta   -18                -25
Don't count on getting out of Steel

City midweek. This month, US

Airways is cutting 127 evening

flights from its Tuesday and

Wednesday schedule.
San Francisco                United, American  -5                  -9
Blame hub carrier United for a

drop in international departures

and West Coast flights.

Transcontinental commuters, take

heart: There have been few cuts

to East Coast routes.
Savannah, Ga.                Delta, US Airways  -9                 -21
Airport serves Hilton Head, S.C.,

and 75% of its market is leisure

travelers. Recent cuts
                         -- early-morning departures, late-

evening arrivals -- may hit

business travelers the most.
Sioux Falls, S.D.                Northwest, United  -30                -10
Used to be even New Yorkers

could fish the Big Sioux River

without connecting en route.

Airport has also lost direct flights

to New Orleans, Buffalo, Nashville

and Madison, Wisc.
Washington (Dulles)  United, Delta         -10                  -6
Tight fit: Travelers to Houston,

Dallas, Boston and Chicago may

have to squeeze into more

all-coach 50- and 70-seat regional


*Airlines with highest passenger capacity

Data source: Travel Analytics, Inc. and OAG

Attached Graphic:

Route Map

GIF image

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