Flight Blog

 

Delta Airlines is dropping its service between Springfield and Cincinnati, effective August 31. We received word late Friday afternoon. The airline says “The decision was made after careful review of the passenger demand and where they are connecting to and from in regards to the SGF market place.  With the price of fuel at all time highs, we find ourselves having to make decisions like the CVG-SGF service.”

 

The news is disappointing but not a surprise. As we’ve said many times on this blog and in public: “we’ll be lucky to get through the year without losing service.”

 

While the airline cites fuel prices as the reason, the pending merger between Delta and Northwest may be a factor as well. To get a sense of how the merger could play into this, consider the following:

 

  1. Delta and Northwest provide Springfield-Branson with service to five destinations: Cincinnati and Atlanta via Delta. Minneapolis, Memphis and Detroit via Northwest.
  2. Each of these destination cities is a hub for the airlines.
  3. Look at a United States map. See how you can almost draw a straight line from Memphis to Cincinnati to Detroit? That’s too many hubs too close together for one airline. Something has to give with hubs that close together. Considering the fact that Delta dropped Cincinnati service to at least twelve other cities as well, it looks as if the hub status of the Cincinnati airport is in for some major adjustments.

On a vaguely brighter note, Delta is tentatively adding another Springfield daily flight to Atlanta, for a total of four. The airline says it “can serve the demand flowing over CVG from ATL.” Translation: passengers that connected in Cincinnati to other cities can now connect in Atlanta.

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exjet.gifExpressJet is ending its branded service. The culprit–high fuel prices. The ExpressJet situation is a bit complicated, so please bear with me.

 

ExpressJet is a regional airline that has flown under its own name and for big airlines. Today ExpressJet announced it will stop flying under its own name, but will continue flying under the Continental Express brand. The move does not directly affect Springfield-Branson service, but will apparently affect the Tulsa airport. ExpressJet provides Tulsa with service to points west and Canada. Read the Reuter's story here. Read the company press release here.

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Steve wants to know:

 

"What is Springfield Airport doing to be proactive to do their best to land low cost airlines to the Springfield Airport to minimize competition with Branson?"

 

Steve is talking about the airport being built in Taney County, south of Branson.

 

Here's what we're doing, Steve: we’re doing what we’ve always done. We talk to airlines on a regular basis. We share data and aviation studies. We tell them about our ground services program. We tell them about our marketing incentives program and our low airport fees. We tell them about the strength of the air market and how it has grown so much the past 20 years. We continue to do what we’ve done because it has proven so successful. Our passenger numbers have grown 30% since the beginning of the decade. We have five airlines and 12 destination cities—an exceptionally strong showing for a small market airport.

 

If this strikes you as nothing more than bragging on the past then let me offer this: I’m not very good at blowing smoke. I’ve never been good at excessive “spin” and what I call “happy talk.” We all know what happy talk is. Example: you ask me when we’ll have a low cost airline flying to New York? My response: "we’re hopeful that we’ll have that service soon! We’re talking to airlines right now!" Happy talk is delivered with effusive energy and a big smile on your face.

 

I don’t do happy talk because people can see through it; they’re tired of spin–they can spot it a mile away (it’s everywhere!); all they want is a straight answer. So here it is… The Springfield-Branson air market is unusually strong for being such a small market. Even so, it is not strong enough or big enough to attract a big low cost airline. The business metrics just aren’t there-especially in today’s plunging airline economy. The metrics weren’t there even when oil cost less than a hundred dollars a barrel. Consider today’s situation:

 

Consider this: vacation destinations are seeing reductions in air service. Air service in Las Vegas is down 12 percent. Orlando is down about eight percent. Why would airlines cut service to such cities? Because vacation travelers are low yield traffic—meaning that the airlines don't make much money on them. Airlines (both low-cost and legacy carriers) prefer to concentrate on business travelers. That's where the money is.

 

Steve also wonders: "How can Branson attract low cost airlines when Springfield can't, especially when their 1st year emplanements are projected at 250,000 - 300,000, with  capacity at 750,000?"

 

It's conceivable that that airport could pay a big airline for limited service—something like the arrangement in Wichita where the city, state and county pay AirTran millions of dollars for service. If you want some entertaining reading on the subject of Wichita, plug this into Google and hit return: "airtran wichita subsides." Don't use my quotation marks. Read a previous posting on the general subject of air service development by clicking here.

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Jul 01 2008 BTC Boloney BY adminTAGS Boloney

 

We've received several inquiries about a report issued a week or two ago by the Business Travel Coalition. The report is long on sensationalism and short on facts. Here’s a quote: “Not only are U.S. airlines and their passengers facing their darkest future, but fast-approaching airline liquidations will cripple the U.S. economy that depends on affordable, frequent intercity air transportation.”

 
Notice it says these things will  happen—not that they might  happen. But wait, it gets worse. The report comes with a list called, “At-Risk Communities for Losing Commercial Air Service.”
 
And guess what?
 
That’s right, you guessed it, Springfield is on the list. In fact, we’re the only Missouri city on the list. This fact alone proves that the BTC has neither the knowledge or expertise to make such judgments. It obviously has no hard analytical analysis of Springfield's air service. I think I can safely say that Springfield is the only major Missouri airport, that HAS NOT suffered big cuts the past few months. Kansas City has. St. Louis has. And the report somehow forgot to mention the Essential Air Service airports and their woes: Joplin, Columbia, St. Joe, et al.
 
Could Springfield lose some destinations? Of course it could. Are we going to lose all commercial air service (as the title of the list suggests)? Not likely.
While I can applaud the BTC's goal of raising awareness of how the airlines are/might be affected by the energy bubble, to suggest that Springfield will lose commercial air service is irresponsible and Chicken Little.
 
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Jun 25 2008 High Fares to Texas BY adminTAGS Fares

 

Mike blogs these thoughts:

 

"I have posted a few times complaining about the cost of flying out of Springfield, but here is another example on costs. Short notice flight to San Antonio; Leave 6/30 return 7/1. Out of Springfield: $1152! Out of XNA (NW Arkansas):401. I know that planning out 3 weeks will get me the cheapest air fare, but why can other airports get reasonable fares (actually great fares for short notice trips) and SGF does not? It just does not make sense. I would not consider travel to another airport if our local fare was in the $600-$700. Here is hoping the new terminal will bring our fares inline...."

 

I feel your pain. Why such a difference? Well, there are those reasons that I've blogged about several times:

 

  • Supply and demand; ticket prices are higher in smaller markets (smaller supply of seats) and lower in bigger markets (bigger supply of seats). The NW Arkansas airport is bigger than us.
  • The longer you wait to book, the smaller the supply of seats, the higher the fare.

Those are some of the usual reasons. But in this case there's another factor: competition. Think about our situation here in Springfield—American has a monopoly on service going to a southern hub. But the NW Arkansas airport has three (!) airlines flying to southern hubs. Besides American service to Dallas, Continental and Delta provide service to Houston. We sort of have a similar situation here with both Uniited and American flying to Chicago—it's the reason why you can often find United fare to Chicago for less than $200 (I just saw United fare from here to Chicago for $150 roundtrip; flying this weekend.)

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