This past week, Bradley Penrod was ousted as President
and Chief Strategy Office of the Allegheny County Airport Authority which is,
primarily, Greater Pittsburgh International Airport. [Though let me add that from my years in
corporate America and having grown up below the flight path to Allegheny County
Airport, every major city needs at least one general purpose airport to
accommodate the wealthy and powerful who don’t care to endure the current state
of air travel like the rest of us do.
Thank goodness Allegheny County exists and seems to thrive in its
arena.] Much has been made about what
Mr. Penrod did or didn’t do for PIT during his tenure. And I note that no one in the Pittsburgh
media has really been kind to him. This
is despite differing opinions reported from airline analysts outside of
Pittsburgh. Allow me to come to Mr.
Penrod’s defense on this account as well.
My bottom line is that PIT is a fine airport. It’s not Atlanta or Chicago and thank the
good Lord above for that. As a frequent
flyer and a million-miler on one airline, I can tell you I go out of my way to
avoid the so-called fortress hubs.
My support for Mr. Penrod comes here in the form of a
series of questions that I cannot answer but I hope those at the Airport
Authority are at least are studying. But
first here are a couple facts that stand out boldly when discussing PIT’s
standing among other big, and not so big, city airports. Pittsburgh is relatively small. I love the fact that Pittsburghers believe
they should measure themselves against New York, Chicago and San
Francisco. So shall it ever be and that
kind of thinking has benefits longer term.
But the cold, hard fact is that a market area of about 2.5 million
people cannot sustain the same kind of O&D [origin and destination traffic]
that those cities and even Philly or Denver or Seattle can.
Airlines are very opportunistic from a business
perspective. If there is demand between
any city pair, one of them will offer a route.
Air travel produces some of the best marketing data available. Every airline knows exactly where every flier
is headed. There is no need for a market
study; it’s all in the reservation system.
If PIT suddenly had 2,000 fliers a day traveling to Europe or Asia via
connecting hub cities, there would be more than just Delta offering a seasonal
flight to Paris. Austin’s new non-stop
service to London on British Airways is testament to that: a relatively small
mid-continent US city gains a non-stop overseas. Mr. Penrod can offer all kind of incentives
short of paying the bills of an air carrier and none of that matters as much as
O&D traffic between destinations.
And PIT, domestic US airports, and every US-based carrier
are facing even stronger headwinds than is being reported by the popular media
in the US: the growth of international mega-hubs. Longer range jets and the super sized jumbos
like the A380 favor the new mega hubs such as Dubai, Qatar and Seoul. These places make Atlanta and Chicago look
like …St. Louis and Cincinnati and Pittsburgh.
Even America’s largest airport, Atlanta, will find it hard to compete as
these new hubs and their primary carriers are government financed. Allegheny County does not have a rich sugar
daddy oil chieftain to subsidize rates.
Now to my questions:
- Why
is it that PIT’s passenger traffic has continued to fall almost every month for
the last two years when airline traffic in general is growing post-9/11?
- Is
this mostly attributable to USAirways continued pullback? If so, is PIT reaching some sort of
equilibrium?
- Why
do Pittsburghers complain about an airport that is not overly crowded, pleasant
to negotiate, and with more than adequate traveler amenities and services? Gosh golly when I land at ATL or LGA I have
to physically steel myself for the assault on my senses, not to mention my legs
as I have to dodge the great unwashed INfrequent flying public.
- Has
PIT tried for more cargo service? OK,
admittedly cargo service also follows demand and Pittsburgh itself is not a
regional transportation hub like Atlanta, Charlotte or Dallas, where interstate
highway convergence lends itself to multi-modal transport. But, cargo carriers are always looking for a
better deal and doesn’t the local Chamber of Commerce always tout Pittsburgh’s
being within 500 miles of most of the planet’s population, or something close
to that? What gives?
- I
asked the above question because cargo can lead to airline service. Witness EVA Air and Taipei. EVA Air is mostly a cargo carrier for the
Republic of China [Taiwan]. They fly
jumbo jets only and started out with just cargo. But they discovered that with only some
modifications, every cargo plane could carry some passengers as well; and they
do. An EVA Air, or similar airline,
could bring an overseas connection to Pittsburgh not totally dependent on
passenger volume.
- Finally,
a metaphysical question: what is unique about the Pittsburgh economy that a now
growing economy, serving almost 2.5 million people, has an airport that is
continuing to lag passenger numbers in similarly, and smaller, regions? Is it demographics?
To that last question, here’s
an anecdote from the recent past. When
British Airways operated a direct flight from PIT to Heathrow, it was typically
close to sold out. I flew it once and in
coach class, it was sold out and hard to get a reservation. But that’s the
important detail: coach class was sold out, first class was not, and hardly
ever was. A friend of mine who served on
a local government airport commission at the time relayed that BA specifically
pulled that route because it was a money loser.
“But how could that be when you practically could not get a
reservation?”, I asked. Because the
difference between making money on an overseas route and losing it depends on
first class capacity, he replied. In
these days of corporate penny pinching, I fear even fewer first class seats can
be sold out of our static corporate center in western Pa.
As I said, a dose of reality
is in order and Bradley Penrod deserves a break for his efforts on behalf of
the airport. Good luck to his successor.
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