Airlines shift focus to profitability
WASHINGTON – Medium and small hub airports across the country have fewer flights and fewer seats than they did five years ago, according to a study released this week, but it wasn’t a struggling economy that caused it, according to aviation experts.
The declines were mainly the result of higher fuel prices, industry consolidation and a new focus on profitability over market share, experts said. And though cities of all sizes consider their airports engines of economic growth, many will find it hard to keep the service they have, much less attract new airlines.
Debby McElroy, executive vice president of policy at the Airports Council International-North America, an industry group, said airlines have become risk-averse. Most major carriers have been through bankruptcy. They endured a major terrorist attack and a major recession. In recent years, they’ve begun to enjoy stability and profits.
“Airlines are not adding a lot of new aircraft or new services,” she said. “That strategy has proved successful for them.”
According to the Massachusetts Institute of Technology study, departures at medium hub airports declined 26 percent from 2007 to 2012, and the number of seats declined 21 percent. Small hubs fared only slightly better: Departures declined 18 percent and seats declined 13.5 percent.
The trend coincides with the deepest economic downturn in decades, a real estate-fueled crisis that pushed millions of Americans out of work and out of their homes. Air travel declined 9 percent from 2007 to 2009, according to the Bureau of Transportation Statistics. Though it has rebounded since, airlines cut their domestic flights 13 percent from 2007 to 2012, according to the Department of Transportation’s inspector general.