Monday Insight – September 26, 2022

The Fantasy Is Over. ASD Is Out.
Now, It’s Airport Economic Development

When there is change, there is confusion and situations ripe for consumers to be taken for a ride by folks selling snake oil.

When it comes to air service access, that’s where we are today. Lotsa promises for bringing back or recruiting new air service, even when any rational person could see it’s mostly smoke, mirrors, and consultant contracts for up to six figures.

Confidence men have been around for centuries, bilking unsuspecting victims by promising things that in the hard light of reality are bogus. The idea is to find “marks” that want something so much that they can easily be misled into scams that make the confidence player wealthy.

Keep The Fear & False Hope Flowing. They know that to keep a scam going, it’s critical to keep potential victims in the dark regarding the facts of the situation. So, they always appear as the “expert with the solution.” They always assure that the “mark” thinks the confidence game will bring in success, money, or … in the latest case for small communities, air service. Then, give them a list of past air service recruitment miracles, some of which the airlines involved might not remember, and the game is on.

It is unfortunate that a lot of communities have fallen into this trap.

Delta: We’re Not Coming Back to Where We Lose Money. Last week, the hard light of truth once again was seen. It’s hard truth that another “leakage study” won’t cover up.

Ed Bastian, CEO of Delta, clearly stated that some places where Delta has dropped service won’t be added back. He made clear that there will be others that the airline may simply drop. The increased costs and declining economics of small airliner operations – read 50-seaters – are the reasons, and they cannot be reversed.

We’ve seen it already with Delta dropping CID-DTW, FWA-DTW, MLI-MSP and a few others. It’s not the “pilot shortage,” which is the quick-fix pablum that is being spouted by the RAA and others. It’s the escalation of the raw economics of pilots, aircraft and resources that once made such feed markets viable.

It’s also the changes in the role of air transportation in the milieu of evolving communication channels. In many cases, other modalities – mostly electronic – have eliminated the need for one-on-one physical contact. It’s the reason that short-haul business markets have evaporated. It’s the reason that the once-robust regional airline industry – small airlines with their own geographic route systems – is now gone.

It’s the reason that the many projects to restore intra-regional commuter air service have been total failures. Tried or discussed in South Dakota, Indiana, California, Idaho, and other places. Failed – and in most recent attempts the writing was on the wall from the start. Scheduled air service is just that – scheduled. If that schedule doesn’t fit the time-travel needs of a large number of consumers, it offers no real value. Again, it’s a fact that’s been proven time and again. But most air service “advisors” don’t want that to be well known.

Review of Competitive Air Access Options Are Not a Part of The Confidence Game. The major misconception is that if there is no service at the local airport, the community is cut off from the world. Sort of like losing air service is akin to losing running water. Yet, the advances in other communication modalities now make small communities a lot more economically-competitive to attract business, and the cancellation of two 50-seaters doesn’t change that.

Also missed in most media stories is that in many cases, the consumer has already made the decision.

In the case of Toledo – lately the poster-child for articles on small community air service – they’ve shifted to using Detroit – an hour or less away, with over 300 daily flights, many nonstop to major destinations. The inconvenience of the two to four departures from TOL to connect at ORD or CLT or wherever was the deal-killer. And that won’t change, regardless of any number of studies, surveys, analyses or other voodoo. The Toledo market has excellent air access. This is the case with many of the communities that no longer have scheduled flights at the local airport.

The Future: Go After Businesses Yearning to Be Free of Woke Regulations. However, the economic future of small communities in the heartland of America is bright. Air service or not, the new communication systems have leveled the business development playing field between Midtown Manhattan and Manhattan, Kansas.

The future for all smaller communities – with or without air service – is in capitalizing on the increasing migration of businesses from regions of the nation devastated by bad economic planning. That includes the value of the local airport.

Nobody awake and sober would want to invest in a business or factory in California, or Oregon or Washington. But lots want out. The quality of life in places like Northwest Ohio, or the Rio Grande Valley, or rural Pennsylvania is far better than what’s in California, where criminals are immediately released on no bail and shoplifting under $1,000 isn’t prosecuted.

The warnings from Ed Bastian, and the obvious trends in the economics of air transportation are great directional indicators for the economic development plans of small and rural communities.

Interested in exploring this further? Give us a call. We’re into futurist planning.

Not trying to bring back the 1980s.