Musings with Mary Rose

Mary Rose Loney, A.A.E., President and CEO, The Loney Group, Chicago Previous experience: • Chicago Commissioner of Aviation • Philadelphia Director of Aviation • Chicago First Deputy of Aviation • San Jose Int’l Airport, Assistant Director • Albuquerque Int’l Airport, Assistant Director • For information, visit www.TheLoneyGroup.com

CHICAGO — To many in the circle of airport managers, she is merely Mary Rose, the surname Loney not necessary. She has helped direct three of the busiest U.S. airports, but started her career marketing tours for Grand Canyon Airlines. And, she is well-versed on capacity and other issues facing airports today, having served twice in Chicago’s aviation system. She recently shared her thoughts on challenges facing the industry.

In 2000, Mary Rose Loney formed The Loney Group, an airport consulting firm based in downtown Chicago, having resigned her post as Commis-sioner of Aviation to start her own firm. It was her second tour of duty in Chicago, where she previously directed activities at O’Hare International. She has also served in airport administration at D/FW, Philadelphia, San Jose, and Albuquerque.
Following is an edited transcript of her recent interview.
AIRPORT BUSINESS: Can you talk a bit about your new venture and why you gave up a rather prominent position among airport managers?
Loney: The primary mission is to build on my 25 years of experience as an airport director and use that as the basis for assisting airports, airlines, vendors, suppliers, and other consultants. I also see the company as a way to work with other entities, so that we can partner together. What I’ve learned is that it takes that kind of collaboration because the industry itself is a collaboration between the federal government, local governments that own and operate the airports, and then the private sector which provides the primary air transportation product.
One area I see a lot of opportunity is on the technology side, particularly as more and more personal computing devices are being more widely used in an airport environment.
Throughout my career I’ve always worked at making airports more efficient; with the advancement of technology, there is such a terrific opportunity to transform the way airports are managed.
Moving from land-based navigation systems to satellite systems has such terrific potential for air transportation, yet the schedule for doing that unfortunately is going to put more pressure on airports to create infrastructure on the ground.
AB: As Commissioner of Aviation for Chicago, you were also responsible for Meigs Field, which is scheduled to close and be converted into a park. Would you agree with those who contend that it would be a mistake to allow the city to lose its downtown airport?
Loney: If you look at the history of Chicago, the original lakefront plans always contemplated that area to be park land. Preserving the lakefront has always been a part of Chicago and a very passionate pursuit for Mayor Daley. There are significant airspace contraints, given the interdependencies of the airspace between O’Hare and Midway.
I’m not an advocate for either position.
AB: You’ve been heavily involved in redesigning retail efforts at Philadelphia and Chicago airports. One of the things you hear from the retail people is that their needs are rarely considered when shop areas are being designed for airports. In line with your idea of collaboration, shouldn’t they be involved up front?
Loney: Absolutely. I think the most successful food and retail programs in airports today are ones that have been collaboration, not only between the vendors that are providing the service, but the architectural teams that are designing the space as well as the airlines. Now, it can make for some thorny negotiations, but I think at the end of the day you’re going to have a better product.
Another thing is, I think what we have learned as airport managers is that you need to negotiate business terms that will make it attractive for companies to invest in restaurants that require all of the warehousing and distribution capabilities so that the rents still leave them with an opportunity to be profitable. That way they won’t have to charge outlandish prices.
I strongly support a public process. Airports are a public facility, so it’s important that processes are in place that allow anybody that has the experience, the capital, and the skill to provide a service an opportunity to compete. But at the same time, those processes need to be managed more efficiently so that they don’t become protracted events.
AB: That brings up the subject of streamlining, which is very much the topic today when talking about building airport infrastructure, particularly runways. What are your thoughts on this discussion?
Loney: First of all, there needs to be a recognition at the local level of how those procurement practices and requirements are affecting the airport’s ability to move forward. DOT and FAA should encourage local governments to examine their own practices and requirements. DOT and FAA have played that type of role in the past when they asked airports to look at their competition levels, to examine how their leasing and other contracting requirements affected the level of competition at their airports.
AB: How does one convince the locals to examine how they can expedite airport development when they may not yet be convinced of the value of the airport to the community?
Loney: I think that that has changed significantly, particularly in the last five years. I think now more than ever there is a stronger recognition of the value and importance of airports and air transportation for local communities.
When I was still running O’Hare, you’d see a local community like Charleston, WV, seeking slot access to O’Hare. They not only recognized the importance of O’Hare as a hub center for global connections, but the importance of their airport in Charleston and the importance of linking the two together.
Now more than ever, airport directors are seeing support from the local community to make their airports viable components of our nation’s air transportation system.
AB: One of the potential solutions some people point to related to capacity at airports is peak period pricing. Do you have a position on what, if any, impact that could have?
Loney: I worked with a group of airline economists who have said that demand management pricing is the unfinished business of deregulation. My concern with it is, I don’t know that you could price a landing at an airport, particularly at the hubs, to the point that it’s going to make a significant difference. Airport fees are still a relatively small part of an airline’s operating expense, so at what point would you need to set a landing fee where an airline is willing to change their pattern of operating a flight? At the same time, we need to be careful with how it might affect small community access to a large hub, as well other users such as corporate and general aviation.
Should it be examined? Sure. I have never liked the fact that there had been a blanket prohibition against considering those types of measures. I’m just not certain as to whether it can be effective, particularly at the most congested airports.
AB: Regarding small community access, one of the reasons Congress sought to remove slots at four of the most congested airports was for that expressed purpose. The irony, of course, is that the type of aircraft that is going to be serving those communities will be smaller aircraft, compounding the congestion problem.
Loney: It is a conundrum.
I do know that when I ran O’Hare I never liked the fact that it was artificially constrained by slots. In fact, the slot prohibition at O’Hare would oftentimes negatively affect our ability to attract additional international route awards for additional foreign carriers — the obvious growth area for that airport.
AB: Chicago has recently become somewhat of a poster child for the capacity issue in the U.S., where the discussion currently centers around another runway at O’Hare versus building a new airport, or both. Where do you see the answer lying for Chicago’s commercial system?
Loney: I think it’s certainly making the assets work better as opposed to constructing an additional airport 50 miles from the business district. There’s unfinished business at O’Hare. The most important gain at O’Hare can be additional efficiency, along with added capacity by reconfiguring the airfield. Of all the hubs in the U.S., O’Hare has the most complex airfield geometry.
The difficulty with the concept of [a new airport at] Peotone is that everything at O’Hare is synchronized for a hub.