June 22, 2017 - Airline Business Development Update - Reagan National Airport
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Airline Business
Development Update
June 22, 2017
Office of Airline Business Development’s Primary Mission
Expanding Air Service at Dulles International
and
Discouraging New Flights at Reagan National
Stemming from Obligations within the Airports Authority Lease
Article 11.B “The Airports Authority shall operate, maintain, protect, promote and develop the Metropolitan
Washington Airports as a unit and as primary airports serving the Metropolitan Washington Area.”
3
Managing the Federal Government’s Assets
■ Reagan and Dulles Airports – federal airports turned over in 1987
“Transfer Act” to MWAA to manage as “a unit”. Rationale:
– Capital investments in the two airports needed
– Access to the bond markets critical
■ Congress directed:
– Reagan - short-haul, origin/destination airport
– Dulles - long-haul, growth airport
■ Passenger activity at Reagan National was steady from1987 until 2000 –
when Congress began adding slots and beyond perimeter flights.
■ In the past 25 years, the character of the two airports has changed due
to commercial transactions and regulatory changes.
4
Changing Character of
Reagan and Dulles Over 25 Years
Total Passenger Activity
(Millions)
30.0
25.0
20.0
15.0
10.0
5.0
0.0
Reagan Dulles
5
2016 Marked 2nd Year of Growth in Both Domestic and
International Activity at Dulles International
• Total enplanements increased 1.4% over Dulles International – Enplanements(1) (in millions)
2015: domestic and international 12
11.74 11.52
11.17 10.86 10.71 10.86
enplanements increased 0.1% and 4.0%, 10.68
10
respectively, in 2016
8
• United’s domestic enplanements increased 73% 72% 70% 68% 67% 67% 66%
6
4.2% over 2015, the first increase since 2010
4
• Dulles International served a record 3.7
2 27% 28% 30% 32% 33% 33% 34%
million international enplaned passengers in
2016 - the 13th consecutive year of -
2010 2011 2012 2013 2014 2015 2016
international traffic growth
Domestic International
AND THE GROWTH CONTINUES: Top
2015 2016
• In April 2017, overall passenger activity at Dulles rose Carriers
United 62.4% 63.6%
for the 11th consecutive month with an increase of
American 4.8% 4.6%
10.7% (182k passengers) from a year ago to 1.9
Delta 4.4% 4.4%
million.
Southwest 2.5% 2.4%
• Domestic traffic increased 8.9% (103k passengers) Virgin
1.8% 1.8%
primarily due to robust growth by United, which had a America
Foreign
12.3% (106k passengers) increase in domestic activity. Flag
19.1% 20.1%
• International activity also rose 14.9% (81k passengers) Other 5.0% 3.1%
1 - Excludes general aviation and military enplanements.
Slot Changes at Reagan National and Uncontrollable Outside Factors
Have Challenged Dulles Domestic Service
Southwest /
AirTran
Independence Independence merger
Air begins Air
IAD service dissolution
American US Airways
files for / American
AIR-21 United files US Airways United Recession bankruptcy merger
FAA Reauth. for files for emerges from
(24 new bankruptcy bankruptcy bankruptcy
DCA slots- Delta / United / Delta / US Airways
12 within/12 Northwest Continental DCA slot swap
outside VISION 100 Delta files for merger merger
perimeter) FAA bankruptcy
Reauth. 22.1 JetBlue slot
(20 new purchase doubles
Domestic Passengers (millions)
9/11 DCA slots- DCA service
terrorist 8 within/12
attacks outside FAA Reauth.
perimeter) 18.8 8 new outside
perimeter slots/8
Recession 17.6 converted outside
17.2 perimeter slots
17.0
18.2 16.7
17.8
15.9 15.9
15.0
14.4 14.5 14.5
14.0
13.1
12.9
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
7Expanding Air Service at Dulles International
Airport Operators work hard to influence BUT Airlines decide where to fly
Incentives
Incentives
Costs
Costs
Market
Market
Recruiting Air Service - The Paradigm Has Shifted
Market Revenue, Operating Costs and Incentives are All Key Factors
Airlines Consider When Deciding on New RoutesMarketing Dulles International • Market Revenue - The Washington-Baltimore Combined Statistical Area (CSA) is the one of the top 5 largest CSA’s in the country, and home to one of the wealthiest regions of the country. • Costs - Airports Authority aggressive efforts have reduced Cost per Enplanement. • Incentives - Airports Authority Airline Incentive Programs are available only at Dulles.
Dulles International’s catchment area spans both the
Washington and Baltimore MSAs - a population of 8.5 million
MSA Population
Percent
MSA Population
of Total
Washington 5,776,833 68%
Baltimore 2,713,747 32%
Total 8,490,580 100%
Washington-Arlington-Alexandria
DC-VA-MD-WV MSA
Source: ARC Data, InterVISTAS Analysis, CY 2015 Baltimore-Columbia-Towson MD MSADulles International is Conveniently Located in the Most Affluent Area of the Region 7 of the top 15 wealthiest counties in the U.S. surround Dulles
Cost per Enplanement is Carefully Managed
Cost per Enplanement
Historical Forecast
$30
$26
$22
$18
$14
$10
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
DCA IAD Airport System
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
DCA $12.79 $13.39 $11.26 $13.32 $13.44
Historical Forecast
IAD 25.01 26.47 26.55 23.67 21.00
Domestic 21.62 22.98 22.21 19.27 17.66
International 37.44 38.12 38.62 31.98 27.51
DCA $12.73(1)$12.27(2) $13.70(3) $13.18(4) $13.85(5) $13.79(6) $12.81(6)$12.94(6)$11.76(6)$13.46(6)$14.63(6)
IAD 27.46(1) 28.39(2) 28.52(3) 24.60(4) 21.15(5) 17.57(6) 19.68(6) 21.18(6) 22.23(6) 23.17 (6) 22.64(6)
Domestic 13.90* 15.52* 17.09* 17.97* 18.69* 18.13
International 24.71* 27.77* 29.13* 30.51* 31.86* 31.41
Airports System
$19.29 $20.11 $18.96 $18.30 $17.06 $15.60 $16.13 $16.94 $16.88 $18.24 $18.60
(Historical/Forecast5)
(1) From 2011 ROAC Forecast
(2) From 2013 ROAC Forecast CPE lower than forecast $50 million grant impact
(3) From 2014 ROAC Forecast
(4) From 2015 ROAC Forecast * Internal estimates
(5)
(6)
From
From
2016
2017
ROAC Forecast
ROAC Forecast
Source: Report of the Airport Consultant (2011, 2013, 2014, 2015, 2016, 2017) 12Non-Airline Revenue Growth Reduces Airline Costs and
Improving Access
• Silver Line Express bus connects the
Metrorail Silver Line to Dulles.
– Non-stop service between Dulles
and Wiehle-Reston East for just $5
– Ridership has exceeded
expectations
14New Airlines at Dulles May 2016 Air Canada began three daily flights between Dulles International and Toronto Pearson International Airport. LATAM began three weekly flights from Dulles International to Lima, Peru. September 2016 Royal Air Maroc began three weekly flights between Dulles International and Casablanca, Morocco July 2017 Air India will begin three weekly flights between Dulles International and Delhi, India
New Air Service by Existing Airlines
April 21: 4 weekly flights to Austin and a daily flight to
Denver.
July 10: Daily summer seasonal service to Colorado
Springs; and these flights will also provide
one-stop, same plane service to San Diego in
both directions.
July 16: Daily service to Las Vegas.
June 4: Daily service to Fort Lauderdale.
April 24: Daily flight to Salt Lake City.
June 19: Daily service to Montreal.
April 4: Rome daily seasonal service resumes.
May 5: Lisbon and Madrid daily service resumes.
May 24: Barcelona daily service resumes.
June 8: Fort Lauderdale extended through summer.
United has also announced it will increase frequency to
Jacksonville, Providence, Portland (Maine) and Roanoke.The Airports Authority works closely with local
governments, chambers and other groups to support
Dulles InternationalDiscouraging New Flights at Reagan National • Members of Congress regularly attempt to stretch the perimeter further. The latest attempt came just last week, when members from Texas proposed expanding the perimeter to include San Antonio. • An attempt to add San Antonio failed last year, when it was blocked in a House Committee through the bi-partisan teamwork of Barbara Comstock and Eleanor Holmes Norton. • It was killed again in Committee several days ago. Then it appeared in an amendment to a Defense bill, where it also was defeated. Currently, the Texas members are trying to push a perimeter-expanding amendment onto a bill in the Senate Commerce Committee. • It’s an issue that never seems to go away and MWAA is working to defeat it again.
What Can You Do to Help?
Advocate to your appointing elected officials that they need to support
“NO MORE CHANGE” to Reagan National allowing growth.
&
Fly Dulles!Thank You
Mike Stewart
Vice President, Airline Business Development
Metropolitan Washington Airports Authority
mike.stewart@mwaa.comYou can also read
