Saturday, September 17, 2011

Slump hits Memphis airport businesses

Slumping traffic at Memphis International Airport is starting to take a bite out of concessions.

Delaware North Corp. closed Arby's in the terminal lobby and Edy's Ice Cream near international departure gates effective Sept. 8.

Hudson News & Gifts, which runs multiple newsstands, closed an outlet in A Concourse.

Statistics presented to the Airport Authority board Thursday showed passengers down 10.3 percent through Aug. 30 compared to last year. For August, flights were down 19.2 percent and passengers were down 16.7 percent from a year earlier.

Delta Air Lines, the city's dominant carrier, announced in March it would cut 25 percent of its flights, 8-10 percent of its Memphis capacity, by year's end.

Airport officials said the Delta cuts would mean 800,000 fewer people a year in the building.

Delta said Tuesday that next year's capacity would drop another 2-3 percent, but a spokesman said it was too early to tell how specific markets would be affected.

The store closings were approved as temporary measures by the authority, allowing vendors to preserve their ability to reopen in the same spaces in the future.

"The closings are due to Delta and other airline flight reductions," airport president and CEO Larry Cox said. "They will be reopened as passenger activity increases."

Business had been declining at the Arby's and Edy's since 2008, said Delaware North's general manager and regional director at Memphis, Steve Bass.

"The decline began with the start of the recession. While enplanements have been decreasing the last few years, most recently with Delta, we just couldn't sustain the business levels here," Bass said.

"It's just too much real estate and not enough traffic."

The Edy's, which was one of two in the airport, took a hit when Delta routed international flights through Atlanta and, starting this month, reduced the Memphis-Amsterdam flight from daily to four days weekly.

Traffic fell in the A Concourse, where Hudson closed, when Delta consolidated in the B Concourse, after its merger with Northwest, and AirTran moved into A from the C Concourse.

Bass said he hopes to see additional traffic over the next 12-18 months as Southwest integrates AirTran as part of their merger.

Airport Authority board member Jack Sammons suggested local flavor, found in outlets such as Interstate and Corky's barbecue, is a recipe for success. "All due respect to Arby's, nobody goes to the airport to get an Arby's," Sammons said.

http://www.commercialappeal.com

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