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Wyoming Air Service Market Research Prepared by Mead & Hunt, Inc. For more information, please contact: [email protected] 678.364.9738 TABLE OF CONTENTS Section 1. Introduction/Background .................................................................. 1 1.1 Industry Trends ............................................................................................... 2 1.2 Summary of SWOT Determinations .............................................................. 10 Section 2. Existing and Historical Air Service ................................................ 11 2.1 Current Air Service ........................................................................................ 11 2.2 Historical Air Service ..................................................................................... 13 2.3 Seasonality ................................................................................................... 15 2.4 Summary of SWOT Determinations .............................................................. 17 Section 3. Air Service Demand ......................................................................... 19 3.1 Passenger Trends in Wyoming ..................................................................... 19 3.2 Passenger Trends by Wyoming Region ........................................................ 21 3.3 Top Origin and Destination Markets .............................................................. 23 3.4 Summary of SWOT Determinations .............................................................. 35 Section 4. Air Service Performance ................................................................. 37 4.1 Revenue and Fare Trends ............................................................................ 37 4.2 Load Factor Trends ....................................................................................... 40 4.3 RASM Performance ...................................................................................... 43 4.4 Summary of SWOT Determinations .............................................................. 59 Section 5. Airport Benchmarking ..................................................................... 61 5.1 US Airport Comparison ................................................................................. 61 5.2 Northwest Region Airports Comparison ........................................................ 64 5.3 Airline Comparison ........................................................................................ 68 5.4 Summary of SWOT Determinations .............................................................. 78 Section 6. Airline Situational Analysis ............................................................ 79 6.1 Type of Service ............................................................................................. 79 6.2 Major Network Airlines .................................................................................. 80 Disclaimer: The User agrees to limitations placed 6.3 Low-Cost Airlines .......................................................................................... 88 on the use of international data by the US Department of Transportation (DOT). The US 6.4 Ultra Low-Cost Airlines ................................................................................. 94 DOT states that users of international data may 6.5 Regional Airlines ........................................................................................... 98 not share the data at any point with parties who 6.6 Summary of SWOT Determinations ............................................................ 100 are not employed by US-owned entities, which Section 7. SWOT Summary ............................................................................ 101 would include foreign airlines, foreign airports or 7.1 SWOT Determinations ................................................................................ 101 foreign governments. Additionally, the data may 7.2 Other Factors for Consideration .................................................................. 105 not be used for publication where readers may not be US citizens or affiliates of non US- 7.3 Recommended Air Service Development Action Items ............................... 107 owned entities. Appendix A. Glossary ..................................................................................... 113 2016 WYSASP – Air Service Market Research SECTION 1. INTRODUCTION/BACKGROUND he Wyoming Department of Transportation (WYDOT) is reviewing air service at Wyoming’s 10 commercial Tservice airports to understand each airport’s air service requirements and how these airports can best meet the region’s future transportation and economic development needs. With six of Wyoming’s 10 commercial service airports experiencing declines in traffic year-over- year, this Air Service Market Research (ASMR) report is an effort to provide an alternate review of macro and micro trends impacting commercial service within the state and to better understand and evaluate Wyoming’s air service market. This report is not intended to provide in-depth implementation plans to facilitate actions that counter the threat of further air service reductions, loss of federal money for capital improvements or to improve the odds for service improvements. This ASMR report provides objective, comparative data and statements of fact compiled from industry sources on Wyoming’s commercial service airports. It is considered a performance report or “report card” with general recommendations. An ASMR is similar to a strengths, weaknesses, opportunities and threats (SWOT) analysis but is focused on helping communities identify potential air service needs, threats and opportunities in the context of today’s airline industry. Its purpose is to provide market and airline performance information that can be used to guide air service retention and development efforts. The ASMR provides a greater level of understanding of the current air service market and develops realistic estimates of long-term future airline passenger demand. This outlook can also be useful in assuring that long lead-time airport infrastructure needs are attuned to air service and market demand needs. Airlines take many factors into consideration when making capacity and route decisions, and it is the intent of this report to provide insight into several of those market considerations. 1 2016 WYSASP – Air Service Market Research The following commercial service airports are reviewed in this report. The map to the left provides the relative location of each of the airports within the state of Wyoming. COD – Yellowstone Regional Airport, Cody CPR – Casper-Natrona County International Airport, Casper CYS – Cheyenne Regional Airport, Cheyenne GCC – Gillette-Campbell County Airport, Gillette JAC – Jackson Hole Airport, Jackson LAR – Laramie Regional Airport, Laramie RIW – Riverton Regional Airport, Riverton RKS – Rock Springs-Sweetwater County Airport, Rock Springs SHR – Sheridan County Airport, Sheridan1 WRL – Worland Municipal Airport, Worland2 1.1 Industry Trends The first SWOT identifier is industry trends, specifically trends that have impacted or will impact air service in Wyoming. For example, recent airline profitability is a strength that could provide opportunities to Wyoming commercial service airports whereby the pilot shortage is a weakness and may impact the amount of air service in individual communities. The following topics are reviewed in this section: Frequency and capacity changes Airline profit and loss Bankruptcies, mergers and acquisitions Fleet changes Fluctuating price of fuel Pilot shortage Essential Air Service (EAS) This discussion expands on the review of industry trends and the impact on commercial service in Wyoming provided in the Air Service Enhancement Program document completed in September 2014 by the Wyoming Aeronautics Commission. 1 SHR lost scheduled commercial air service in March 2015. In November 2015, Denver Air Connection, a public charter company based out of Centennial, CO, began daily service to Denver. Denver Air Connection also added service to RIW in July 2016. Denver Air Connection is not required to report under the US DOT guidelines and, as such, data is not available through Diio Mi. 2 The US DOT issued the final order 2016-5-16 terminating WRL’s EAS eligibility effective September 30, 2016, for exceeding the statutory $1,000 per passenger subsidy cap for fiscal year 2015. 2 2016 WYSASP – Air Service Market Research Declining Seats at 1.1.1 Frequency and Capacity Changes Non-Hub Airports Over the past decade many airports While seats at medium experienced capacity reductions as carriers EXHIBIT 1.1 US DOMESTIC CAPACITY CHANGE BY AIRPORT SIZE hub and large hub merged, mainline hubs/fleets were airports have realigned, regional jets replaced mainline increased, seats at flying in the US and carriers shifted non-hub airports 10% resources to international markets. A total 9% decreased 1 percent 8% while seats at small of 99 US airports with air service in 2006 7% 7% hub airports have do not have scheduled service in 2016. 6% decreased by 3 Much of the negative change in the last five 4% percent. years was experienced by non-hub and 2% small hub airports as shown in Exhibit (1%) 1.1. 0% (3%) (2%) While seats at medium hub and large hub (4%) airports have increased, seats at non-hub % change in seats July 2016 vs. July 2011 airports decreased 1 percent and seats at small hub airports have decreased by 3 Non-hub Small
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