Small airports: Why smaller airports are shrinking

Posted: May 17, 2013 in economy
Tags: , ,

WHAT’S happening to America’s smaller airports? Since 2007 they have seen greater percentage drops in flight and passenger numbers than bigger hubs, according to a study released last week by the Massachusetts Institute of Technology. And though it may be tempting to attribute that shift to the global economic downturn, the real reasons are significantly more interesting.First, rising fuel costs have made shorter trips, especially those by the small aircraft that tend to serve small airports, less profitable. As Gulliver noted last July, that fact even affected Delta Air Lines’ new contract with its pilots union, which will cut the number of small 50-seat jets in the fleet by nearly 50% and accelerate a transition to 117-seat Boeing 707s.Industry mergers have also fuelled the shift away from small and medium-sized airports. Big airlines are increasingly concentrating their services at big hubs, a strategy that offers many cost-saving efficiencies. Although domestic flights from all airports fell during the 2007-2012 period covered by the study, they were down just 8.8% at America’s 29 largest airports, compared with a 21.3% fall at smaller sites. Much of this reduction has been due to capacity cuts, as airlines slashed seats to keep prices up in the face of drastically reduced demand.But the broader story here is that America’s airlines are doing a better job managing …

via Economic Crisis http://www.economist.com/blogs/gulliver/2013/05/small-airports?fsrc=rss

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s