Memphis Rides Southwest Out Of Top 10 Highest Fare Airports

April 24, 2014
Drop due to "Southwest effect" in which the low-cost carrier's arrival pushes down prices

April 23--Memphis has fallen from the nation's 10 highest fare airports, pointing to a "Southwest effect" in which the low-cost carrier's arrival pushes down prices.

Memphis International Airport dropped to No. 14 among the busiest 100 airports in the October-December quarter of 2013, the Bureau of Transportation Statistics reported this week.

Average roundtrip domestic airfares at Memphis fell 10.8 percent from a year earlier, to $434.43, but still far north of the national average -- $381.05. Fares nationally inched up slightly in the quarter.

High airfares have angered Memphians for decades, a reflection of noncompetition created by fortress hubs, operated most recently by Delta Air Lines and before Delta, Northwest Airlines. The airport routinely ranked in the top 10 most expensive, fueling a steady flow of Memphians to lower-fare airports in Little Rock and Nashville.

With Delta eliminating hub status for Memphis last year and drastically reducing service here, the airport welcomed Southwest Airlines last October and discount carrier Frontier in March. Air travelers have long recognized the "Southwest effect," a decrease in fares and increase in air travel when the Texas-based carrier enters a market.

Airport president Scott Brockman said Southwest was partly responsible for the positive news.

"I think it is safe to say that our newfound competition with Delta's reduction has caused the reduction in fares," Brockman said. "Southwest and Frontier will probably end up being the largest factors down the road but over the period being reported on, it would be best to credit a combination of Southwest and the other carriers who are now competing much harder in the absence of the Delta hub."

Along with lower fares, the airport has seen an increase in passengers whose origin or final destination is Memphis. So far this fiscal year local passenger numbers are up nearly 65,000. The steep decline in overall volume from Delta's de-hubbing has been connecting passengers who never left the airport.

Brockman said airport officials aren't satisfied just to be out of the top 10 fare list.

"We're getting there. We're making the right moves," he said.

"Goal No. 1 was to get out of the Top 10," Brockman said. "Goal No. 2 is to get out of the Top 25."

Memphis's average was down more than $50 from a year earlier.

Despite the improvement, airfares were still markedly cheaper in nearby cities where Southwest is well established.

Little Rock checked in at No. 42, at $394.16; Nashville at No. 70, $364.39; and St. Louis at No. 73, $360.11.

Highest U.S. average domestic airfares in October-December 2013 occurred at:

1. Huntsville, Ala., $527.52

2. Cincinnati, $510.36

3. Washington Dulles, $505.62

4. Newark-Liberty, $498.71

5. Houston Bush, $497.61

6. Fayetteville, Ark., $485.41

7. Savannah, Ga., $480.54

8. Madison, Wisc., $479.08

9. Cleveland, Ohio, $458.53

10. Pensacola, Fla., $451.68

Source: U.S. Department of Transportation Bureau of Transportation Statistics

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