Tuesday, February 14, 2012

New York’s Smallest Planes Dwindle as Delta Hub Ousts Turboprops

By Mary Jane Credeur  
February 14, 2012 12:01 AM ET

New York’s smallest passenger planes are poised to fade away as Delta Air Lines Inc. (DAL) builds a domestic hub at LaGuardia Airport served chiefly by bigger jets.

US Airways Group Inc. (LCC), the region’s largest operator of aircraft like the 37-seat Dash-8 turboprop, is paring commuter flights to upstate cities such as Albany and Syracuse while pulling back in New York. Filling the gap is Delta, which is focused on larger jets -- and no turboprops.

Once vital to carriers serving thinly populated markets, airliners that carry only a few dozen fliers now are seen by management and travelers in a harsher light: Too costly with fuel almost doubling since 2007, too small for amenities such as first-class cabins, and too loud and cramped.

“The jets are more comfortable, more reliable, cleaner, quieter,” said Doug Pinckney, 47, who is president of advertising firm Pinckney Hugo Group in Syracuse and flies to LaGuardia every two to three weeks. “It’s a better airplane. I can’t wait for the switch.”

Delta is using landing rights from a trade with US Airways to expand daily LaGuardia departures by 75 percent, to 264, by July. The world’s second-biggest airline will control half of all LaGuardia flights by then, according to data compiled by OAG, a unit of UBM Aviation in Bedfordshire, England.

More than three-quarters of the flights will be on jets with at least 70 seats. Planes in that category, such as larger models of Bombardier Inc. (BBD/B)’s CRJ series, will have a business- class cabin, a few rows of coach seats with extra legroom, and Wi-Fi, said Gail Grimmett, Delta’s vice president for New York.
‘Very Powerful’

“The ability to go to New York corporate travelers and say ‘We have all-jet service’ is very powerful,” said Henry Harteveldt, an airline analyst at Atmosphere Research Group LLC in San Francisco. “Delta’s offering will be quite compelling.”

Delta’s mainline jets on LaGuardia routes include Airbus SAS (EAD) A319s and Boeing Co. (BA) MD-80s. US Airways’s plan to shrink at LaGuardia by about two-thirds to 65 daily departures while keeping jet shuttle flights to Washington and Boston means that many of the Dash-8s in New York will go elsewhere, though a spokesman, Todd Lehmacher, declined to give a number.

US Airways subsidiaries were flying 44 Dash-8s as of December 2010, or almost half the carrier’s regional planes, according to the latest annual report. The airline received landing rights at Washington’s Reagan National from Delta in exchange for more LaGuardia access, giving Tempe, Arizona-based US Airways a chance to cut money-losing New York flights to and from small cities.

Dropping Albany

“A few turboprops” will remain at LaGuardia to serve cities such as Philadelphia, Lehmacher said. Nonstop routes to Syracuse and Albany are among those getting the ax, based on schedule data. Most of the planes being pulled from New York will go to Washington or Charlotte, North Carolina, Lehmacher said.

“The Dash-8 has been a workhorse for us,” he said. “It’s a remarkable plane and really allows us to serve a lot of markets that we couldn’t profitably serve with other aircraft.”

Pinckney, the advertising executive, is looking forward to larger planes after taking US Airways Dash-8s to LaGuardia to meet clients. The planes originally were made by de Havilland, now a part of Bombardier.

“Turboprops are very noisy,” Pinckney said. “It’s hard to work on them and if you get stuck back in the corner you feel really boxed in.”

U.S. airlines’ turboprop fleet has tumbled 67 percent to 416 planes since the start of the last decade, while 70-seat jets surged 21-fold to 433, according to data compiled by Bloomberg. The smallest regional jets, those with 50 or fewer seats, have declined 18 percent from a 2005 peak of 1,356.

‘Largely Replaced’

“Turboprops have been waning since at least 2000 and were largely replaced by the 50-seat jet,” said George Ferguson, senior aerospace analyst for Bloomberg Industries. “Then 50- seat jets grew until the increased cost of fuel stopped the growth.”

The small-airliner fleet in New York includes a half-dozen turboprops flown by Pinnacle Airlines Corp. (PNCL)’s Colgan Air unit for United Continental Holdings Inc. (UAL), which has a domestic and international hub at Newark Liberty International Airport in New Jersey. At New York’s John F. Kennedy International Airport, AMR Corp (AAMRQ).’s American Eagle flies 44- and 50-seat Embraer SA (EMBR3) jets, and 37-seat Embraers at LaGuardia.

The decline of 50-seaters may quicken with AMR in bankruptcy. Michael Boyd, president of consultant Boyd Group International Inc., predicts that Eagle will dump all its jets with 50 or fewer seats, which make up 70 percent of the regional unit’s 284-plane fleet. Eagle hasn’t detailed its plans.

Fuel, Age

“In the end, fuel consumption and aging aircraft will hurt the 50-seater market,” Tim Hoyland, a partner in the aviation practice at consultant Oliver Wyman, said by e-mail.

Delta is culling half the fleet of its Comair regional unit by year’s end, including 53 of its oldest planes such as 50-seat Bombardier CRJs. The carrier already got rid of the last of its 34-seat Saab 340 turboprops at the end of 2011.

Using bigger jets at LaGuardia will let Delta fly longer routes with more passengers, part of the airline’s strategy to grow in New York after its 2007 bankruptcy exit. For Eric Mower, chairman of advertising agency Eric Mower & Associates in Syracuse, a Delta hub at LaGuardia will mean bypassing connections he now makes in cities such as Atlanta.

“I can go to New York for meetings, and then fly Delta to other cities,” said Mower, 67, whose firm’s clients include Georgia-Pacific LLC (GP)’s Dixie products and Fisher-Price. “That’s a big improvement.”

Delta Markets

Delta’s new nonstop flights from LaGuardia include business markets such as Dallas, Cleveland and Milwaukee. The Atlanta- based carrier is spending $140 million to renovate the majority of the US Airways terminal at LaGuardia that it will control, and link the facility with the adjacent one it already operates.

Some short-haul flights will be shifted to LaGuardia from Delta’s international hub at Kennedy, making way for new connections to airports such as Austin, Texas, that will feed overseas routes, the airline’s Grimmett said.

Jeff Terhune, president of Warren & Panzer Engineers PC in Manhattan, is ready for bigger planes at LaGuardia. He commutes weekly from Syracuse and expects to switch almost exclusively to Delta after splitting flights between US Airways turboprops and larger JetBlue Airways Corp. (JBLU) jets at more-distant Kennedy.

“Flying into LaGuardia is going to save me a couple hours a week, every week, and to me that’s a big deal,” said Terhune, 45, who has been making the trip for 10 years. “With the turboprops, they’re so cramped that you’re kind of stranded there for the flight. You can’t work, you can’t really read, and don’t even bother to pull out the laptop.”

Source:  http://www.bloomberg.com

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