PASSENGER DEMAND ANALYSIS – COLUMBIA REGIONAL AIRPORT Section 4
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COLUMBIA PASSENGER REGIONAL AIRPORT DEMAND ANALYSIS Year Ended December 31, 2017 [email protected] 618-656-2848 TABLE OF CONTENTS Section 1. Introduction…………………………………………….....2 Section 5. Airlines………………………………………………….....19 Objectives…………………………………………............................3 Airlines Used at COU………………………........................... 19 Methodology………………………………………………………….. 3 Airlines Used at STL.……………………………......................... 20 Section 2. Executive Summary……………………………………..4 Airlines Used at MCI.……………………………......................... 21 Airlines Used at Diverting Airports...……………......................... 22 Section 3. Airport Use……………………………………………….. 6 Section 6. Factors Affecting Air Service Demand and Airport Catchment Area………………………………………………6 Retention………………………………………………………....23 Air Service…………………………………………………………......7 Passenger Activity Comparison..…………………………………. 23 Onboard Passengers and Population Trend……………………… 7 Airfares….……………………………………………………...........24 Load Factor, Available Seats and Passengers …………………...8 Nonstop Service Availability………………..………………………26 Airport Use …………………………………………………………....9 Quality of Air Service at Competing Airports…………………..…27 Airport Use By Community …………………………………………10 Retention Rate Sensitivity………………..………………………...28 Section 4. True Market……………………………………………...11 Section 7. Situation Analysis………………………………………29 True Market Estimate ………………………………………………11 Top 25 True Market Destinations …………………………………12 Appendix A. Top 50 True Markets……………………………...... 31 IRPORT Originating Airport For The Top 25 Domestic Destinations….....13 A Appendix B. Glossary…………….…………………………….......33 Top 10 Domestic Destinations By Originating Airport…………...14 Originating Airport For The Top 15 International Destinations… 15 EGIONAL Federal Aviation Administration (FAA) Geographic Regions…...16 R Regional Distribution of Travelers…………………………………17 Distribution of International Travel………………………………...18 OLUMBIA C – NALYSIS A EMAND D ASSENGER P PAGE 2 SECTION 1. INTRODUCTION he airline industry, like other vibrant sectors of the US T economy, continues to evolve. Over the last four years, the US airline industry has shown record profits driven by industry consolidation, capacity discipline, low fuel prices and continued fleet renewal. However, the industry continues to be dependent on long lead time resources such as facility and aircraft availability and a workforce whose rules inherently impact the ability for airlines to react quickly to market opportunities. Capacity restraint has been a major focus in the industry over the last 10 years and has left communities in the position of competing for scarce resources. Stronger profitability and fleet IRPORT A transitions to larger aircraft over the past two years provided a moderate uptick in seat capacity, but, in 2017, as fuel prices and labor costs began to increase, there was a renewed commitment by many airlines on capacity discipline moving forward. Given the limited number of airlines to work EGIONAL R with, in many cases there may be only one potentially viable service provider. With airlines primarily focused on major markets, smaller markets are generally in the position of having to be more aggressive to maintain/improve existing service or attain new service. OLUMBIA C – This places the responsibility on airports to monitor their market and be proactive with their ongoing air service development efforts, especially when performance issues are noted. When service NALYSIS improvements or new service is sought, it is important that airports and communities know and A understand their market. The Passenger Demand Analysis is a critical tool to help communities understand their market. It provides objective air traveler data, compiled from industry accepted EMAND D sources using standard methodologies. Accordingly, airlines accept data included in the Passenger Demand Analysis as a credible basis for air service forecasts. This report reviews scheduled commercial air service potential and does not include information on general aviation activity. ASSENGER P PAGE 3 OBJECTIVES The objective of the Passenger Demand Analysis is to develop information on the travel patterns of local airline passengers who reside in the Columbia Regional Airport (COU) catchment area. The report provides an understanding of the COU situation, formulates strategies for improvement and includes: • The originating airports used by air travelers • Diversion of airline passenger traffic to competing airports • An estimate of total airline passengers in the catchment area and related destinations • Airlines used by local air travelers • Average airfares by origin and destination airport • Service levels at COU and competing airports • An assessment of the air service situation at COU METHODOLOGY The Passenger Demand Analysis combines Airline Reporting Corporation Online travel agency data (e.g. Expedia, Orbitz and Travelocity) is reported (ARC) ticketed data and US Department of Transportation (DOT) airline data by the customer zip code used to purchase the ticket. Although limitations to provide a comprehensive overview of the air travel market. For the exist, ARC data accurately portrays the airline ticket purchasing habits of a purposes of this study, ARC data includes tickets purchased via online travel large cross-section of catchment area travelers, making the data useful to agencies by passengers in the COU catchment area (Exhibit 3.1, page 6). It both airports and airlines. Adjustments were made for Allegiant Air, Frontier IRPORT A does not capture tickets issued directly by airline Web sites (e.g., Airlines, Southwest Airlines and Spirit Airlines since those airlines do not www.aa.com, www.united.com) or directly through airline reservation offices. process tickets through ARC. A total of 20,910 ARC tickets for the year The data used include tickets for the zip codes in the catchment area, NOT ended December 31, 2017, were used in this analysis. EGIONAL R all tickets. As a result, ARC data represents a sample to measure the air travel habits of catchment area air travelers. OLUMBIA C – NALYSIS A EMAND D ASSENGER P PAGE 4 SECTION 2. EXECUTIVE SUMMARY AIRLINE TICKETS/ AIRPORT USE REGIONAL DISTRIBUTION OF TRAVEL CATCHMENT AREA Twenty-three percent of catchment area travelers Nineteen percent of travelers were traveling to The Passenger Demand Analysis includes used COU, while 47 percent diverted to St. Louis the West region, a total of 141,910 travelers, 20,910 ARC tickets from the catchment area for Lambert International Airport (STL), 28 percent to followed by the Southeast region also with 19 the year ended December 31, 2017. The Kansas City International Airport (MCI), 1 percent percent. The highest retention occurred in the catchment area has an estimated population of to Springfield-Branson National Airport (SGF) and Southwest region at 42 percent, while the lowest 512,526 in 114 zip codes. In addition to ARC 1 percent to Chicago O’Hare International Airport retention occurred to/from Alaska at 12 percent. data, Diio Mi origin and destination and schedule (ORD). Twenty-three percent of domestic Of the international travelers, the top three data are used throughout the report. Adjustments travelers and 17 percent of international travelers international regions were Mexico and Central were made for Allegiant Air, Frontier Airlines, used COU. America, Europe, and Asia, with shares of 26, 23 Southwest Airlines and Spirit Airlines. and 21 percent, respectively. DESTINATIONS DEPARTURES AND AVAILABLE SEATS AIRLINES USED Fifty-seven percent of travelers, or 416,365 American Airlines and United Airlines served passengers, were destined to or from one of the Of passengers using COU (based on US DOT IRPORT COU during the year ended December 31, 2017. top 25 markets. Dallas-Fort Worth was the data), American served 82 percent of the market A American and United each provided service to number one destination with 4.4 percent of followed by United (17 percent) and other carriers two destinations. United commenced service at passengers. COU retained 74 percent of (1 percent). When passengers divert to alternate EGIONAL COU in August 2017. passengers to Dallas-Fort Worth. The next airports (based on ARC data), the top airlines R largest markets were Denver, Washington- used were Southwest (45 percent), American (23 TRUE MARKET National, Phoenix-Sky Harbor and ORD. COU percent), Delta Air Lines (16 percent), United (11 OLUMBIA had service to three of its top five destinations. percent), Alaska Airlines (3 percent), Frontier (1 C – The COU true market is estimated at 729,961 percent), Allegiant (1 percent), Spirit (less than 1 annual origin and destination passengers. For international destinations, Cancun, Mexico, percent) and other airlines with less than 1 Domestic travelers accounted for 655,088 of the was the largest market, with a retention of 5 percent. NALYSIS A total true market (90 percent). International percent. London-Heathrow, United Kingdom, and travelers made up the remaining 74,873 San Jose del Cabo, Mexico, were the second and EMAND passengers (10 percent). third largest international destinations from COU. D ASSENGER P PAGE 5 AVERAGE FARE TREND year-over-year. While American’s load factors were clearly impacted by the new capacity, From year ended December 31, 2008, through American has already added the third frequency year ended December 31, 2017, the average to both Dallas and ORD and upgraded service to domestic airfare for COU increased at a CAGR of primarily Canadair Regional