The Issue is Air Service

LANSING, MI - This year’s annual National Air Service Conference, hosted here by the American Association of Airport Executives (AAAE) and its Great Lakes Chapter, drew some 75 attendees and included a comprehensive agenda focused on flushing out the...

On gaining specific passenger data about a particular market, Schorr says in smaller communities, it’s often helpful to talk to travel companies. “They may know exactly who’s flying where and when, how they’re getting there, how much they’re paying, and if people are driving to another airport to get there.”

He adds, “Air service development isn’t only about new service; focus on existing service as if it could be pulled at any minute.”

Think big-picture; be adaptable

Says John DeCoster, senior VP at Trillion Aviation, “The airline speech hasn’t changed; something for airports that is important to understand is that you will hear a lot of the same stuff you’ve heard over the years, but you have to attack it differently that you’ve done before.

“You have things like non-airline revenue that has to grow. An airline will typically tell you that they want to pay about 25-30 percent of your operating budget with rates and charges. Some are 60; it’s imperative that airports have a strategy of how to get there.

“You’re actually going to be expected to run your airports as businesses; with entrepreneurialship comes risk. I totally agree with approaching things as if you’re going to lose your service tomorrow.”

Things are changing and airports need to be adaptable and be thinking of the big-picture plan, says DeCoster. “There is a little bit more of an effort right now for airlines to be partners with airports,” he explains.

On ground handling, DeCoster says there are some airlines out there that have realized that when there is only three or four flights per day, or in the case of Sun Country or Allegiant, two, three, or four flights per week ... they cannot afford the cost of the infrastructure like a legacy carrier would, so airports have to have something on the table for them.

Greg Donovan, director at the Northwest Florida Regional Airport, says it’s incumbent upon the airport to mine information and data that goes beyond what is regularly available, such as O&D data; current yield, flow. That was the dilemma for several years at Northwest Florida, he relates.

“We approached Vision Airlines and shared with them specific data that we had on the hotel industry,” comments Donovan. “The airport played the ambassador role to quantify what was taking place in the hotel industry; from an airport and airline standpoint ... there was no data on this before.

“The end result was we obtained 17 cities; it is really taking off. The airlines don’t have the data that you have at the local community level; we had the hotels help us create the dialogue and data that was necessary to win this.”

Donovan says the airport asked, ‘What do we need to do to get the right kind of service that we know we can support?’

“The bottom line answer is to have the right amenities in place,” explains Donovan. “We are doing a shared-gate process; Vision didn’t have enough frequency initially to warrant having a dedicated gate, so we started going to the shared-use concept.

“We look at our non-aeronautical revenue sharing, and we are looking at things like convenient stores and gas stations because there aren’t any close by; we share more than 60 percent of our non-aeronautical revenue with the airlines to keep the cost per enplaned passenger down.”

Capacity discipline; fleet trends

Says Seabury’s Mike Lopez, “Capacity discipline is sort of this new buzz term that carriers are using. For the first time in a long time where things used to be a lot more about picking up market share and adding capacity to bring in that share ... that gets expensive when oil is at $120 per barrel ... carriers have really gotten onboard with trying to be more reasonable with capacity.”

Carriers are being very responsible in terms of when they are flying, and what they are flying, says general manager for network planning at Delta Air Lines, Anthony Canitano. “The capacity reductions don’t necessarily mean that across the board, everyone is going to lose 5 percent of their seats. There’s utilization flying that carriers do, and there are seasonal demands; so I think the carriers are getting more agile to identifying when the market is there and when it’s not.”

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