The plight of cities with smaller airports

The U.S. airline industry is a leaner operation after years of financial hardship. And that's not boding well for travelers trying to get to and from smaller cities.
Written by Kirsten Korosec, Contributor

The U.S. airline industry--after a challenging six years marked by the global financial crisis and volatile fuel prices--is a leaner operation. And that's not boding well for travelers, especially those trying to get to and from smaller cities.

U.S. airlines cut the number of scheduled domestic flights by 14.3 percent between 2007 and 2012, according to a study released today by the Massachusetts Institute of Technology.

The nation's small and medium hub airports, an FAA designation based on percentage of air traffic passengers in a given year, took the brunt of those cuts. The United States' 29 largest airports lost 8.8 percent of their yearly scheduled domestic flights between 2007 and 2012, compared to a 21.3 percent reduction at smaller airports during the same time period.

Medium-hub airports were the worst hit. Carriers cut 26 percent of their scheduled flights at 35 of the nation's mid-sized airports, according to the study.

The upshot? The average domestic roundtrip fares have risen 4 percent to $374 in 2012 from 2007, adjusted for inflation, according to the WSJ, which also reported on the study.

The cuts to domestic flights also pose a problem for smaller cities trying to bolster, or even maintain, their local economies. Companies seeking out potential cities might pass over areas with limited airline service. A 40 percent cut to flights to Boise, Idaho over the study period has pushed inflation-adjusted fares up by 18 percent, stifling efforts of the city's developing technology industry to attract new workers, report the WSJ.

Fuel prices and the U.S. recession did prompt airlines to consolidate and change the way they do business. But they aren't the only explanations for the cuts, the study noted. Some of these cuts have been in a response by larger carriers to the stiff competition it has faced from Southwest Airlines.

Southwest Airlines targeted medium hub airports including Oakland, Calif., Providence, Rhode Island and Love Field in Dallas in the early stages of its development to serve as alternative options for passengers wanting to avoid the crowded hubs of competing airlines. The network carriers began cutting service to these airports because they had trouble competing with Southwest's prices and frequency, according to the study.

As operating costs at Southwest have continued their rise, the low-cost carrier has started to employ the capacity strategies practiced by larger network carriers. Southwest cut nearly 10 percent of its domestic departures from 2007 to 2012, leaving some medium-hub airports in the undesirable situation of having both network carriers and the low-cost airline cutting service.

Photo: Southwest Airlines

This post was originally published on Smartplanet.com

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