Monday Insight – December 13, 2021

Air Service Access:
Change Can’t Be Stopped With Another Market Study

But Good News:
Air Service Isn’t The Only Area That’s Evolving

Heresy: There Is Life After Delta. And American. And United.  Actually, The Small Community Airport Future Has Never Been Brighter

It doesn’t take an MBA from Wharton to figure this one out.

We’re hearing the nasty sounds of air service “splat” spreading across the USA. Air service Humpty-Dumpties are coming down all over the place.

Delta Joins The Trend. This past week, Delta announced a range of route cuts from DTW, MSP and SLC. In this, they are completely red-lining at least two airports – Grand Junction and Lincoln – off their route map. American has dropped a number of feed routes from CLT and DFW. United has done the same at ORD and IAH.

It’s not just one-offs. It’s unmistakable proof that air transportation economics are shifting.

More Traditional ASD Programs Won’t Solve It. The reality that’s going to start hitting home at many communities is that all the king’s consultants and all the king’s desperate speed-date presentations, won’t put Humpty back on the wall. This air service egg has been scrambled for good.

The Fleet Projections Are Not To Be Ignored. Here are some numbers that need to be considered. Based on Boyd Group International fleet trend projections, the coming floor will be closer to 100 seats, as existing small jet airliners age and get recycled into Budweiser displays.

The average age of CRJ-200 airliners operating in the USA is 19.5 years…

Less than 50% of CRJ-200s built are still in active service (456) and all but 28 are in operation with just three USA small lift providers.

Of all the ERJ-135/145 airliners built, less than half are still in operation, and all but a handful at three USA small lift providers. Next year, they will be able to vote, with a current average age of 20.1 years.

The Mitsubishi MRJ, 80-100 seats, has been apparently cancelled.

The AVIC/CCP ARJ-21 from China is a lead-sled, and an embarrassment to the Chinese nation. (This airplane is a non-sequitur, but is mentioned only to hopefully avoid the gadfly emails.)

Boyd Group International forecasts indicate that we can likely expect another 125-150 CRJ/ERJ airliners to head to the desert by the end of 2022.

Conclusion, a lot more route pink slips coming.

With Emerging Aviation Dynamics, Small Airports Are In Better Shape Than May Be Expected. These fleet data mean that communities and regions across the nation need to re-think and re-plan to assure communication connectivity with the rest of the world, possibly in lieu of having scheduled flights at the local airport. Or more devastatingly accurate: having scheduled flights at the local airport that consumers might actually use.

Don’t misunderstand what’s happening: The yanking of 50-seat jets, or the pilot supply situation, or CCP-Covid are just a few of dozens of seen and unseen economic icebergs that are changing how air transportation will shift in the future. The message to every small and mid-size airport is that when a route is dropped, there likely isn’t any alternative airline option.

That’s ‘cause there usually are no other airlines out there.

Traditional ASD Programs Can Waste A Lot of Money In the Future. Let’s get real. For Lincoln, the elimination of Delta from the airport’s A&D boards won’t be remediated by a trip to a speed date conference. For Grand Junction, the loss of access to the Delta SLC connect hub can’t be replaced by the wondrous findings in another giant “leakage” study.

That’s because the bottom line is not just lack of traffic to meet the increasing revenue hurdles to support service. It’s lack of airlines, both in number and in fleets.  The “lack” is due to changing economics, and not shortage of flying machines or pilots.

Okay, Now’s The Future. It’s Called Airport Strategy Opportunity Reviews. The real issue for every small airport in the nation – whether it has commercial service or not – is to candidly and boldly take a look at every aspect of their operations and revenue streams, and match them to the emerging realities of future aviation. There are changes coming in general aviation. There are huge emerging opportunities in the area of executive aviation. Air delivery logistics are coming.

What’s unfortunate is that too many communities and airports are on automatic, assuming that the future is just going to be a continuation of the past. Wake up, please. Opportunities are emerging… just not in the same format as in the past.

Call BGI To Get A Jump On The Future. We could go into this in detail, but better give us a call or e-mail. Boyd Group International has assembled a team of associates that can analyze where an airport stands in regard to the new market dynamic trajectories. A team that works on the future, not tired and obsolete pre-CCP-Covid data.

This of course includes innovative analyses of air service issues. Be we go on to look at the rest of the opportunities that airports in the USA are facing in the midst of all these changes. Take a look at our team of associates… from regulatory changes to facility reviews, to market outreach, BGI has the expertise.

The new year will illuminate even more changes. Whether they are painful or are opportunities is usually a planning decision.

Let’s talk about the future!