Industry Expert Discusses High Airfare Costs with Huntsville Leaders
HUNTSVILLE, Ala. (WHNT) – New numbers, same old story. Huntsville International Airport was recently listed once again as America’s most expensive place to fly out from.
The latest report from the U.S. Department of Transportation shows Huntsville has retained its most expensive crown, with an average round-trip ticket from the Rocket City now running at a whopping $544. The DOT’s numbers were taken from the fourth quarter of 2012, the most recent reporting period. It’s the second straight quarter that Huntsville International Airport has topped the list. The airport’s previous ticket average was $522.
Thursday, research engineer with MIT’s International Center for Air Transportation, Bill Swelbar, addressed Huntsville leaders regarding trends and forced driving the current cost situation in the Rocket City.
Swelbar says the past six years have been challenging ones for domestic air service in the United States. Many airports have seen a reduction in flights as a result of a difficult global economic climate and a U.S. recession, high and volatile fuel prices, and a recent trend of “capacity discipline” strategies at major airlines that have resulted in fewer scheduled flights and higher percentage of seats filled. The nation’s small and medium-sized airports have been disproportionately affected by these reductions in service, and recent airline behavior appears to signal a trend toward consolidation of service at large hub airports with fewer direct flights available from smaller airports.
“Fares across the board are being increased because the airline industry simply has a profit motive today that it hasn’t had in its history,” explains Swelbar.
He says within this current profit motive, chances for reductions in airline fares across the board are slim to none.
“They are going to be reluctant to make major changes to their pricing that would not be at least revenue neutral for the three markets [of Huntsville, Nashville and Birmingham].”
Swelbar says while Huntsville has a wonderful commercial air service the city is unique compared to others its size.
“There is not a lot of leisure activity here, this is predominately a very strong business core which makes it not so much a price elastic market,” say Swelbar.
There are claims inside the Huntsville community that high fares are causing the community to lose convention and tourism business. What the critics do not appreciate, says Swelbar is just how well-connected Huntsville is to the global airline map–and that, he says, comes with a price.
“There is no convention activity without connectivity. The question for the community is a simple one: would you rather be connected to the global air transportation grid or not?”
The industry expert says the fact that Huntsville is better connected to the global air transportation grid than nearly 400 other commercial air service airports should be a source of community pride. Finally, being a relatively price inelastic airport market should also be a source of community pride as it is a statement of the strength of the business core in Huntsville, according to Swelbar.