Monday Insight: July 10, 2023

ATC: The New Lethal Blow
To Small Community Local Airport Service

Let’s cut to the chase and stop the political ballroom dance around small community air service. It was challenging enough before, but now there are two new economic dynamics that are pounding nails into the obsolete coffins of traditional ASD programs.

Let’s start with a bare-knuckles outline of small community air service realities:

The challenges to keeping scheduled flights at the local small community airport are clear, but too often they are completely – and intentionally – ignored in a lot of air service development programs. It’s all about just doing another market study, then revise that leakage analysis, redraw the “capture map,” and we’ll keep on doing more voodoo until we get that air service the community needs.

About as ethical as a rigged carny game.

In most cases – not all, but most – the local consumers already have air service access. Only, it’s not at the local airport, and in most cases never will be again.

Typically, the only metric in these traditional approaches is “luring” or retaining scheduled flights, with the obsolete and inexcusable assumption that any service at the local airport will fill the air access needs of the community.

Ridiculously, many communities are dishonestly convinced that having ULCC flights to one or two vacation destinations is the same as network air service. ULCC service has entirely different economic underpinnings and different consumer bases. It doesn’t deliver air access. Just great low-fare flights to satisfy a thin impulse consumer sector, not the market in general.

They are great to have, but the fact that some consultants don’t clearly differentiate this to airport clients is a blot on the industry.

Completely ignored are:

Better Consumer Alternatives. In many cases, there are far more time-effective air access options that cannot be matched at the local airport. How about Topeka. Youngstown. Toledo. And more. The consumer alternatives of Kansas City, Pittsburgh and Detroit (respectively) are far too strong and service-effective than the two or three flights to a connecting hub from the local airport to compete against.

Cost Issues. The nonsense put out in programs such as SCASD about small communities suffering from “higher than average” air fares is inexcusable and bogus. The cost of air travel is dependent on several variables, including market size, location, local air service communities of interest and more. Yet the DOT still thinks that “air fares” are like apples, watermelons or a gallon of unleaded: all the same commodity whether in Grand Island, Spokane, or JFK.

Point: Small communities will by nature have air service that on a per-seat basis is more expensive than larger population airports. Fact: there is not one single example of a SCASD grant resulting in lower air fares at a truly small community airport.

Fleet Changes. Obvious. For the past 40 years, the size of airliners that can economically serve small population local airports has been growing. Please take a look. In the 1980s there were hundreds of 19-seat to 30-seat airliners under the marketing control of major airline brands. The economics of air transportation as well as new invasive communication channels have now resulted in the future smallest airliners available for small community air service is heading to 76 seats, and even there, they won’t replace 50-seaters on a one-to-one basis.

Now, there are two other factors that affect the potential of retaining connective air service at small community local airports.

Road Hubbing – The Death of The Concept of “Leakage.’ Driving from a small community to a larger community with better air service has traditionally been called “leakage.” This definition comes with the assumption that it’s just an aberrant situation – an opportunity to re-attract that traffic by recruiting local air service.

Not anymore.

Today, the highway system is part of the air transportation system. Consumers can often access far better service by driving, in some cases even 90 minutes to a larger airport. The canard that they would use the local airport if only – if only – there were flights there is blown to smithereens when one does a travel-time comparison. Which, naturally, can be a deal killer for future consultant updates to that “true market study.”

So, that gets usually replaced with unreliable data from Survey Monkey, illuminating that “75% of local consumers would prefer to use the local airport.” Naturally, there are never any specifications of what the service might be at the local airport.

The Unreliable Air Traffic Control System. This is not a drill.

Write this down, because it’s truth: Without the reasonable assurance that flights can operate reliably, airports with low-frequency service (read: small communities) can wave their local service good-bye.

And that is exactly where we are headed.

The incompetently managed, understaffed and unreliable ATC system is now in the process of killing much of the small community local air service that actually is still financially viable.

When we are having ground stops at major airports due to controller staffing, and entire regions of the nation seeing air transportation intentionally reduced due to ATC incompetence, the first to go will be small community service.

That doesn’t mean airlines pulling back, necessarily. But it does mean that consumers increasingly cannot rely on the dependability of the local service. Having under five flights a day makes the community vulnerable to cancellations that incredibly will inconvenience consumers. So they will drive to larger airports with more options and less vulnerability to the ATC mess.

Take Wichita Falls, Texas. If one of the two flights there gets zapped by system delays causing misconnects or cancellations, the consumer will have no choice but to take the 2.5 – 3.5-hour drive to DFW. The entire schedule underpinning for service at the local airport is destroyed.

Buttigieg can do all the fancy dancing he wants. The media can swoon to protect his DOT. The excuse can be given that it’s been developing for years. But now, under his watch, the air transportation system in the USA is deteriorating, and the best he can do is jive press programs with Biden attacking airlines.

What Now? What this means is that small communities need to re-think and re-plan the economic development program for the local airport.

When the data shows that getting network carrier service is less than lottery odds, stop the jive studies. Start with a new plan to engineer the local airport into an economic generator. Even if connective air service is viable, the potential for attracting new business still is there.

We’ll leave it at that. But the point is that the market situation outlined above will not be addressed in trying to bring back the 1980s.

The next ten years can be a lot more valuable.