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Another BTC report: Airline cuts endanger dozens of airports; American details its coming cutbacks

The Business Travel Coalition has another distressing report today, following up on the report we wrote about Monday on the economic fallout from multiple airline failures because of fuel costs. BTC has created a Web site Savemyaiport.com that lists virtually every secondary and tertiary airport in the country, saying all of them are in danger of seeing some cutbacks by carriers now serving them. In a few cases, airports could lose all of their service. Big airports, including PHL, are not on the list because that is where carriers in trouble will hunker down and continue to protect their turf. But in Pennsylvania, Allentown, Erie and Harrisburg are on it. Remember these are not announcements of something imminent: They are forecasts by one expert on the topic.

Coincidentally (or maybe not, who knows), American yesterday detailed where it would cut flights this fall (a move it said previously it would do but hadn't revealed specifics). Read more about that here. Harrisburg will lose its American flights, yes, but the airport will still have service by other carriers.

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Comments (3)

YHS:

This is not new...Everyone expects the airlines to cut service. There will be more, no doubt.You don't have to be smart to understand why this is happening and will happen in the future.. Big benefit... Less flights to take off,, Less wait in line for YOUR flight...
YHS

Tom Belden:

This response is from Northwest Airlines, verbatim:
"The report issued by the BTC -- which is an egregious attempt to scare small communities into thinking they will lose service -- is based solely on one person's opinion, not on actual schedules published by the airlines. The BTC also erroneously asserts that cities served by both Northwest and Delta are more likely to lose service with their proposed merger. To the contrary, the merger of NW and DL is one with very little overlap in city pairs. The merged carrier will be more durable and have a greater likelihood of maintaining service to small communities than either would as a standalone airline. To be clear, any service reductions are purely a function of the high price of oil -- not the merger. The BTC does not have any insight into our business plans and Kevin Mitchell's assertions should be viewed as wild, unfounded speculation."

>

Here’s a second opinion, one from the Air Transport Association, whose current Chairman is Northwest Airlines’ CEO Doug Steenland.

The New York Times Front Page story (http://tinyurl.com/5ltnwe) Saturday, June 28 states: "By year’s end, roughly 100 American communities will be left without regular commercial air service, and that number may double next year, according to the Air Transport Association, the industry trade group.”

BTC only said last week that 150 communities are AT RISK of losing SOME or ALL service if oil stays at $130/barrel (Friday’s price: $140). The ATA projection is FAR MORE specific and ominous, yet like BTC’s alert, it is not accompanied, at least publically, by detailed analysis at the local airport-market level. BTC’s 150 communities and ATA’s 200 are no doubt 90% the same. Time is of-the-essence to get the word out about this crisis.

BTC doesn't want any local airports shut down - to the contrary, it wants to do all it can to keep and expand air service. There will be no joy for BTC if any of our dire projections come true. Our motivation is to catalyze action that will make our predictions wrong and obsolete.

To get the attention of a sometimes lethargic Congress, it's often necessary to be very blunt and direct about what's at stake, particularly at the local level. And judging by the attention that the fuel crisis and its impact on U.S. airlines are currently receiving, some of it as a result of BTC's advocacy, it seems as though our alerts are having an impact. Saturday’s New York Times also reported: “I implore American Airlines, as well as the other carriers considering various cost-saving scenarios, to take into account more than profit when they evaluate routes,” Gov. David A. Paterson of New York said this week after American announced a series of cuts affecting La Guardia and other state airports.”

>

The Northwest Airlines’ reaction immediately above is as silly as it is hyper-defensive, as if BTC were endeavoring to bring attention to the proposed Delta / Northwest merger in its current outreach over the fuel crisis. BTC already shared its views before the Senate Antitrust Subcommittee on April 24 (http://tinyurl.com/5babay) and the House Transportation Committee on May 14 (http://tinyurl.com/6z48zz). While sitting next to Delta’s and Northwest’s CEOs at the Senate witness table, I listened to carefully parsed responses to Senator’s questions about service cutbacks. The CEOs always took great care to leave wiggle-room regarding fuel costs as a justification for service cuts.
There is not an industry observer in the world that does not assume flights, routes and maybe airports will be dropped like hot rocks as a direct result of the Delta / Northwest merger, should it be approved. This was certainly not lost on the Chairman of the Senate Antitrust Subcommittee Herb Kohl when he wrote on June 25 to the U.S. DOJ: “…In addition, I believe that any promise by the merging airliners to maintain service ought to be made into legally binding conditions of the merger.” (http://tinyurl.com/6b5oom)

Congressman Jim Oberstar also wrote the DOJ on June 5 (http://tinyurl.com/5kbp5q) strongly opposing the merger for a variety of reasons including the potential for service reduction and anticompetitive pricing in hundreds of overlapping one-stop markets.

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Author

Tom Belden, a former Inquirer business writer, has written about Philadelphia International Airport, airlines, the travel industry, the conventions and meetings business for 25 years. He has traveled to all 50 states and extensively in Europe and Mexico.


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