Sunday, March 02, 2014

Consultant: Air service between Pittsburgh and Northeast Pennsylvania would be profitable

Resuming commercial air service between Wilkes-Barre/Scranton International Airport and Pittsburgh would probably be sustainable if an airline were willing to try it, aviation consultant Mead & Hunt found.

But that doesn't necessarily mean it will happen anytime soon - even amid the natural gas boom that would seemingly give carriers incentive to reconnect the eastern and western parts of the state.

US Airways began eliminating flights between Pittsburgh International Airport and intrastate regional airports shortly after it dropped its hub status at Pittsburgh in 2004.

Almost a decade later, the Allegheny County Airport Authority sought Mead & Hunt's study, which examined reconnecting Pennsylvania's second-largest city to the rest of the state.

The Sunday Times obtained a redacted version of the report through a Right to Know Law request.

"The three non (essential air service) markets that have significant local passenger traffic to PIT, Allentown, Harrisburg and Wilkes-Barre/Scranton are projected to be sustainable to PIT, especially when combined with the essential air service communities," the consultant's researchers said in the report.

Wilkes-Barre/Scranton International Airport had five daily flights to Pittsburgh through 2003, four daily flights in 2004 and three daily flights in each of 2005 and 2006 before US Airways pulled the plug.

Mead & Hunt's researchers examined several scenarios involving an airline initiating service between Pittsburgh and 13 connecting airports throughout Pennsylvania, including Wilkes-Barre/Scranton.

In every scenario involving the Pittston Twp. airport, the consultants projected an airline would make money flying between the Steel City and Northeast Pennsylvania.

Estimated annual profit margins ranged from $35,853 to $366,790 after about $3.8 million to $4.2 million in expenses associated with the route.

"If an airline is willing to do it," airport Director Barry Centini said. "Those are the key words."

Mead & Hunt also found several routes on which major airlines could lose substantial sums of money, including a possible $2.34 million loss on an unsubsidized route to Williamsport.

In that scenario, connecting to seven smaller airports would put an airline in the red $6.27 million even if flying to Northeast Pennsylvania were a profitable part of the venture.

Even just reconnecting the profitable routes has some significant challenges.

"The key issue to implementing the proposed service is finding a carrier that has the available aircraft to serve these markets profitably," the report said, citing contract agreements that have locked airline resources into certain markets.

Local airport officials tried to recruit the former Gulfstream International Airlines to resume the route, but Mr. Centini said the company was not interested.

Mead & Hunt had the same instinct, describing the company - now called Silver Airways - as "the top candidate" for the initiative and "one of the few airlines identified that could operate ... markets profitably."

Silver Airways officials told Mead & Hunt they "had no desire" to participate for now, and they instead prefer to focus on United Airlines hub cities where passengers can book flights on either airline interchangeably, the report said.

Still, Mr. Centini has hope of restoring service to Pittsburgh.

The city is one of several destinations to which airport officials can seek service with a $575,000 grant from the U.S. Department of Transportation.

The grant money's potential uses include providing revenue guarantees to airlines to ensure they don't lose money on new routes or offsetting startup costs like infrastructure upgrades.

Mr. Centini said he believes the airport has a realistic chance to gain service to any of the targeted places, which also include Washington, D.C., Tampa and Fort Lauderdale, Fla., and Myrtle Beach, S.C.


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