Monday, May 16, 2005
New Haven Wins RAN's First Airport Award
Just a few short years ago, Tweed New Haven Regional Airport in southern Connecticut was a ghost of its former self.
In 1993, when several network carriers using mainline aircraft provided regular service to New Haven, Tweed had 130,000 enplanements. Ten years later, it had just 16,527 enplanements - its lowest point - as its US Airways Express service dwindled to three daily flights to Philadelphia on a 37-seat turboprop. In 2004, the year for which Regional Airline News is honoring Tweed with its first Regional Airport of the Year award, enplanements rebounded to 40,660.
The turnaround was badly needed. While the seeds of the turnaround were first planted in 1997, Tweed reached its first goal last May when Delta Air Lines [DAL] began daily service to Cincinnati on a 40-seat RJ. Comair is providing the Delta Connection service. Not to be outdone, US Airways [UAIRQ] quickly upgraded its service to six daily flights to Philadelphia on a 50-seat Bombardier [BBD] Q-300. Meanwhile, service to Detroit by Northwest Airlines [NWAC] on a 44-seat RJ could be in the cards.
State, federal and private dollars provided the financial incentives to attract the new air service to the city-owned airport.
In recognition of the civic leadership that raised more than $1.6 million from the business community and the goal-driven leadership of the airport, Tweed New Haven Regional Airport was chosen by a panel of four independent judges.
Representatives of the airport, its governing authority and the business community will be honored on May 18 at the annual Regional Airline Association convention in Cincinnati.
Established in 1931, the airport for 67 years was a direct operation of the New Haven city government. After the last of the network carriers, Continental Airlines [CAL], pulled out in 1997, it was obvious that changes were needed, said Larry DeNardis, chairman of the authority's governing board and president-emeritus of the University of New Haven. Long-time Mayor John DeSteffano Jr. wanted the airport transferred to a regional authority focused on improving air service. Connecticut lawmakers, who agreed to provide both operating dollars and capital improvement funds to supplement the city's expenditures, created the regional authority.
A report by the consulting firm of SH&E provided the authority with the leverage to convince the carriers that New Haven was an untapped market. Within a 30-minute drive of the airport, the report found a population base of 1.4 million who purchased 4.4 million airline tickets in 2000. "Suddenly all the light bulbs went on - this is a huge untapped market," said Rick Lamport, the airport's manager. In 2000, there were only 37,900 enplanements at Tweed. Area residents were traveling either north one hour to Bradley International Airport or south to the New York airports.
In its efforts to attract new air service over the years, carriers have complained about the limitations of Tweed's 5,600-foot runway. A fully loaded narrow-body jet could not make a flight to Chicago, Orlando or Atlanta because of weight limitations on the short runway, Lamport said. "There was a history here, but not a good history, [so] our first task was to convince everyone that it was a new day. Everyone knew there was a market here, but the runway was a problem," Lamport said in an interview with Regional Aviation News.
The runway length remains an issue, but the airport is working to alleviate it. To date, the latest avionics have allowed carriers to use some larger equipment. But the future master plan calls for the airport to add an additional 1,000 feet of buffer space at the each end of the runway, DeNardis said. State environmental officials are currently reviewing the plans because they involve encroachment on wetlands. The next step would be to extend the working runway by 600 feet.
As the airport authority was struggling to market the airport with its short runway, Lamport said aircraft technology was changing with the introduction of the regional jet. A fully loaded RJ with 40 to 44 seats can reach most of the desired markets identified in the SH&E study. Lamport added that with recent changes in technology, the 70-seat RJs might be able to utilize the runway to reach major hubs in Atlanta or Chicago.
The new team almost landed Midway Airlines, which would have provided RJ service to its hub in Raleigh-Durham, N.C. However, the plan was scrapped in the wake of the Sept. 11, 2001, terrorist attacks. Midway encountered its own financial problems and eventually went out of business.
Delta was the first to sign a letter of intent in December 2002. However, Delta wanted New Haven to underwrite some of the risk. As the community began to assemble a revenue guarantee, Lamport said Delta cancelled its plans due to the invasion of Iraq and the outbreak of severe acute respiratory syndrome (SARS). The industry was too unsettled, he said, so Delta sought to put the plans on hold.
"Delta decided there was a market, but New Haven did not have a good history. It asked us to share the risk.
"We wanted to make sure it was the right airline," Lamport said of Delta. "The last thing we wanted was a failure. Delta was a good fit. The 'dating period' was four years."
As the worries about war and SARS began to die down, airport officials continued to work on Delta to convince the carrier it was time to fly to New Haven. In December 2003, Delta said would start service in May 2004 with three daily flights to Cincinnati - provided there was a guarantee.
The airport authority was able to provide an incentives package, but it could not legally provide the revenue guarantee. The business community eventually stepped in to provide a revenue guarantee. The airport authority was able to suspend its landing fees and terminal rents for six months. In addition, it built Delta's ticket counter area. It also spent $1 million to set up a Transportation Security Administration-mandated passenger and baggage screening area.
Mayor DeSteffano tapped Bruce Alexander, Yale University's vice president of New Haven and state affairs, to lead the drive to raise the revenue guarantee money from the local business community. Alexander raised $1.6 million for the revenue guarantee and $250,000 for a marketing campaign. The 20 businesses and institutions that contributed to the effort were either based in the city or had a major presence in the community.
Last year, New Haven successfully applied for a $250,000 federal Small Community Air Service Development grant to match the local dollars.
"Most of the people who took this on did so as a matter of civic importance," Alexander told Regional Aviation News. "The airport is a key part of the economic infrastructure that supports economic development. We had looked at ticket buys before, but frankly, it looks complicated compared to a straight revenue guarantee."
"Until they got Yale on board, there was no way they were going to keep this airport viable," one of the award judges said in support of Tweed's honor. "That is exactly what they did. They got the community support and the support of Yale. They have expanded even with their short runway."
Yale took the leadership role because it is one of New Haven's largest employers, with 11,000 employees and 10,000 students, Alexander said.
A strong airport is needed to foster job growth, especially in the city's budding biotech sector - 20 of the 35 biotech firms in the region are based in New Haven. "These biotech companies have advisory boards of the top scientists from all over the country," Alexander said. "We want to say to these scientists that you cay fly to New Haven as a matter of convenience. That was the notion that prompted people to give to this effort."
Delta and the New Haven community will reconcile Delta's first year expenses in June. "The passengers were clearly there," Alexander said. "The revenue guarantee may well be called upon because of the competitive nature of the fares."
Delta's New Haven cost-model was put into place before Delta began lowering its fares. The guarantee was a one-year startup incentive. "After the first year, Delta is on its own," Lamport said.
At the same time Tweed was trying to convince Delta to begin service, Lamport said the airport was trying to get US Airways to improve its service. After reducing its operations to three daily flights, Lamport said the service declined further as fares were hiked.
US Airways, he said, assumed that the New Haven passengers would drive to Bradley to get the better fares. As US Airways exited its first bankruptcy and tried to remake itself into a low-fare carrier, it started to adjust some fares. After the Delta announcement, US Airways agreed to post the same fares at Tweed as it was at Bradley. "They started to throw bones our way in terms of air fares," Lamport said. "We were able to start to market them and the numbers started to change.
US Airways now flies six flights each day on either a 37-seat or a 50-seat turboprop. Piedmont Airlines is now providing the service.
Tweed almost landed Northwest as its third carrier. Last December, Northwest sent a letter of intent to start RJ service between New Haven and Detroit. However, Northwest backed out of the deal after posting an $878 million loss in 2004.
Tweed is still courting Northwest. As an incentive, DeNardis said Tweed would try to tap state funds to make a revenue guarantee instead of relying entirely on the local community.
>>Contracts: Larry DeNardis, airport authority, (203) 932-7000; Rick Lamport, Tweed, (203) 466-8833; Bruce Alexander, Yale, (203) 432-8611.<<
Tweed New Haven At A Glance
- Owner: City of New Haven
- Management: Tweed New Haven Regional Airport Authority
- Operator/Employees: Avports/140
| Usage | |||
|---|---|---|---|
| Commercial | Air Taxi | Local | Transient |
|
8%
|
15%
|
33%
|
42%
|
| Load Factors - Airlines Combined | |||
|---|---|---|---|
| Jan. 2004 | Jan. 2005 | March 2004 | March 2005 |
|
32%
|
55%
|
41%
|
60%
|
| Enplanements {U: US Airways; D: Delta} | |||
|---|---|---|---|
| December '04 | January '05 | February '05 | April '05 |
|
U: 2,663
|
U: 1,857
|
U: 2,773
|
U: 3,080
|
|
D: 1,934
|
D: 1,681
|
D: 1,914
|
D: 2,240
|

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