The recently approved American Airlines and US Airways merger could soon mean fewer flights from fewer airports, including regional destinations like T.F. Green Airport, and Manchester-Boston Regional Airport in New Hampshire. The flights that remain will be more expensive and on smaller aircraft – and that may push some airports to downsize, according to one airline expert.
The airline industry is trending toward reducing the number of small airport destinations, favoring instead to fly into larger hubs, such as Boston’s Logan Airport. Traffic at Logan has never been better. In 2012, Logan reported a record 29.3 million passengers traveling through its gates. The jump was nothing new. Airline traffic through Boston has been on a steady incline, with about a 4 percent increase at Logan since 2008.
While this increase has been great for Boston, it’s been at the expense of smaller, regional airports.
The R.I. Airport Corporation, which issues monthly traffic reports at T.F. Green, has reported a steep decline in airline traffic in and out of the Ocean State in the past seven years. Providence had 3.6 million passengers walk through its gates in 2012, down about 6 percent from the previous year. That decline pales when compared to the long-term declines. Since 2005, traffic at T.F. Green has dropped about 36 percent. That year, more than 5.7 million passengers used T.F. Green to fly.
The same declines happened in Manchester. After making multimillion dollar investments to its terminal, it got a large bump in airline traffic – only to see traffic drop off a cliff a few years later. Manchester-Boston Regional Airport traffic fell by 10 percent in 2012 and is down 50 percent since 2005.
The American airline industry has seen many changes in the past decade, from the growth of discount airlines to recent airline mergers. What was once a vibrant industry that offered passengers low-cost tickets to thousands of locations has now become an industry synonymous with bad service, fewer flights and shrinking airplane seats. With reduced flights in and out of New England’s regional destinations, smaller airports in the Northeast are feeling the effects.
The reason for post-merger drops in flights is a cost-cutting measure. Airlines try to make the most money possible on each seat they sell. If US Airways has flights from Manchester to Orlando and American also has flights from Boston to Orlando, the post-merger airline wants to cut redundancy and keep the flights with the greatest potential for profit. That could mean regional flights that are harder to fill will be cut and the airline will only offer those flights from Boston. The result is pushing passengers who used to fly from Manchester or Providence into Boston’s Logan Airport.
The American brand is the one that’s sticking around, so the routes from Providence and Manchester are the ones likely to get cut. US Airways has flights to both T.F Green and Manchester, but American Airlines does not.
Another way airlines will likely cut costs is by diverting the larger planes in its fleet to the larger airports. The pressure for airlines to fill every seat on a plane is high. With fewer flights and fewer passengers coming in and out of places like Providence, airlines will want to use the smaller planes in its fleet at the smaller airports.
These statistics coming from T.F. Green and Manchester don’t mean that New Englanders are flying less, they just aren’t flying out of local airports as often. Families going on vacation must travel farther and spend more money getting to or parking at the airport. New England business travelers will feel the impact too. Sending an employee to Boston for a quick flight to Chicago or to a conference in Las Vegas means more money and time spent in transit, raising the cost of doing business in Rhode Island.
The annual revenue at T.F. Green may take a hit. The investments and improvements made to the airport in recent decades were done to boost this regional economic engine. But if fewer people are flying in and out of Providence, the airport loses revenue, the businesses that support the airport lose revenue, as does the Greater Providence area. •
Greg Raiff is CEO of Private Jet Services Group, a private aviation charter brokerage based in Seabrook, N.H.