Effects of Airline Industry Changes on Small- and Non-Hub Airports (2015) / Chapter Skim
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Pages 142-154
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From page 142... ...
142 C H A P T E R 7 7.1 Introduction This chapter synthesizes the lessons learned from the case studies and focus groups. Additionally, analysis of key variables related to the success of ASD efforts are presented to support the lessons learned.
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Lessons Learned 143 • Many of the factors that determine whether an air carrier will start new service in a community are out of the hands of airport and community leaders. Unfortunately for many airport managers and local officials in small communities, many of the factors that determine whether an air carrier will start new service (or end existing service)
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From page 144... ...
144 Effects of Airline Industry Changes on Small- and Non-Hub Airports • When deciding whether or not to initiate an ASD program, communities must weigh the cost of the initial investment in incentives for new air service with the likelihood that their market can sustain the service once the incentives end. Before beginning an ASD effort, a community must assess if current and future local market demand can sustain service and reduce the risk of losing the service given the cost of the initial investment in an incentive package.
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Lessons Learned 145 dilemma -- Is it population and employment growth that drives the demand for new air service or vice versa? Exhibit 7-3 illustrates the relationship between population growth and available seats in the case study and focus group communities.
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146 Effects of Airline Industry Changes on Small- and Non-Hub Airports development rather than air service incentives may be an effective strategy to building demand that leads to new service. • Local economic development strategies that focus on limited or sustainable growth can be successful in attracting new service.
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Lessons Learned 147 service was an important way to remind local passengers of the service offered at STS. Although passengers may not choose STS every time they travel, they may opt to avoid the 1- to 2-hour bus ride to San Francisco to enjoy the convenience of flying from STS.
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148 Effects of Airline Industry Changes on Small- and Non-Hub Airports the airline industry and who has a strong reputation among community and business groups is essential to ASD efforts. In Redding, the reputation of the President of the EDC of Shasta County among the business community led to an instant sense of trust among investors who donated funds to the travel bank.
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Lessons Learned 149 and then publicly denounce the local airport for a lack of flight options. In these cases, airport officials must work to educate the community on the importance of business and community support for new service in today's competitive ASD environment.
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150 Effects of Airline Industry Changes on Small- and Non-Hub Airports have on the community. Whether a market is primarily a "business" or "tourism" destination has little bearing on the success of ASD efforts (Exhibit 7-5)
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Lessons Learned 151 station manager to operate the airport's ground-handling service, AGS provided a valuable service to new entrant airlines that reduced their risk at a relatively small cost to the airport. • Community-driven incentive programs signal to air carriers a community's commitment and demand for new service.
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From page 152... ...
152 Effects of Airline Industry Changes on Small- and Non-Hub Airports Although much of the focus of ASD efforts is on incentive programs, there is no one particular incentive a community can offer to an air carrier that can overcome subpar market demand. However, to be competitive with communities with similar market characteristics, a region may have to use various incentives to attract new service.
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From page 153... ...
Lessons Learned 153 The survey of airline network route planners found that the most influential information that a community can present during a meeting with airline officials is economic development and tourism plans along with an analysis of untapped market demand. Specifically, communities need to demonstrate how their local economic development and tourism plans, if carried out to their full extent, will result in additional market demand.
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From page 154... ...
154 Effects of Airline Industry Changes on Small- and Non-Hub Airports • Once new service is started in a region, the community must work to market and support the flight to ensure its success. A consistent theme that emerged from several of the case studies and focus groups was that many involved in ASD efforts believe that, if they are successful in attracting new service to their airport, the community will support the new service.
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