Wheels up: Boise pushes for airport comeback

Negotiations are underway to land more flights and destinations. The good news? Idaho's biggest airport has 'good bones' to build on.

sberg@idahostatesman.comMay 19, 2013 

  • BOISE AIRPORT

    - Sixteen nonstop destinations, with more than 50 commercial departures daily.

    - Six airlines serve Boise: Southwest, with 27.7 percent of the market; Alaska/Horizon, 27 percent; United, 20.2 percent; Delta, 16.7 percent; U.S. Airways, 6.4 percent; and Allegiant, 1.7 percent.

    - In 2007, 13 airlines - some of which have merged or no longer exist - served Boise with 70 departures daily to 20 nonstop destinations, including Missoula and Bozeman.

    Source: Boise Airport

  • ABOUT SVEN BERG

    Sven joined the Statesman in July and covers Boise, city government and commercial real estate. He can't believe how friendly people in Boise are.

Correction: This story has been modified to reflect the conditional status of new flights from Boise.

You can't swing a dead cat in Boise without hitting someone who's complaining about the state of air travel here.

It's less common to hear what the airport, government agencies and business groups are doing to right the ship. Or that there's progress in bringing back flights to the Boise Airport.

Recovery will come, airport director Rebecca Hupp said, but it won't come all at once. An airline will add a flight to an existing destination here, a new destination there. Another will devote a bigger aircraft to an existing flight.

"The way we're going to grow air service is going to be incremental, not exponential," Hupp said.

THE PROBLEM

Everyone has heard the laments: The number of flights has declined. The number of nonstop destinations has shrunk. It takes longer to get anywhere.

That's all true.

The number of flights coming through Boise and the number of seats on those flights has declined about 30 percent since 2007, Hupp said. The number of destinations available from Boise also fell, with airlines canceling nonstop flights to San Diego, Atlanta, Idaho Falls, western Montana, Reno, Nev., and Ontario, Calif.

The decline in service makes it harder for Boiseans to feel proud of their airport.

On a practical level, it restricts business travel for local companies sending people to meetings around the country and for out-of-state companies that want to send people here. Boise's supply - or lack - of air travel options consistently ranks near the top of concerns for Treasure Valley businesses.

"You can imagine the strain on any business across this country, as they now have a global footprint," said Clark Krause, executive director of the Boise Valley Economic Partnership, which works to attract businesses to the Valley. "You know, 20 years ago, they would not have felt it like they do today because their demands of where they have to be overnight has changed so much."

HOW IT HAPPENED

It's also true that some of the doom and gloom is misleading, airport and economic development folks in Boise and Idaho say.

First, most of the factors that led to the decline in service aren't Boise's fault.

The most important factor was the cost of fuel. The price of a barrel of crude oil jumped to $145 a barrel in 2008, pushing airlines' costs through the roof.

"In fact, fuel is their single biggest cost," Hupp said. "So when the price of fuel practically tripled overnight, it had dramatic impacts on air service."

Another external factor was the economic collapse that began in 2008. The double whammy of falling customer demand and rising operating costs brought about a crisis for airlines. Hard times led to the bankruptcy of some airlines and mergers between others.

Today, four carriers supply 85 percent of the country's domestic air service. Before the Great Recession, 11 airlines split that market share. Boise is served by six carriers, less than half of the 13 at its prerecession peak.

"If you recall, 2007 was sort of the boom just before the bust," Hupp said. "And so, air service, just like every other industry, was hit by the recession and perhaps even more so because airlines are so reliant on the cost of fuel."

Boise's in good shape compared to airports its size around the country. Hupp said the Treasure Valley has the second-highest number of available seats per capita of any community of 500,000 to 600,000 people. Fort Myers, Fla., is first by a long shot, but that's because it's a vacation destination and it's where many people fly when they're going to take a trip on a cruise ship. Cities behind Boise include Charleston, S.C.; Little Rock, Ark.; and Colorado Springs, Colo.

HOW TO REVERSE THE TREND

The city, state, airport, private businesses and a host of economic experts are working to build air service back up.

One of the things the airport can do is reduce landing fees, which are basically what Boise charges airlines to use its runways and gates. Hupp said the airport offers a yearlong discount of as much as 75 percent - up to $100,000 - per new destination.

Other tools include marketing events and resources aimed at helping to promote the new flight, Hupp said.

These incentives already have helped. Hupp said Delta Airlines is close to adding another flight to Minneapolis. And she said there soon could be nonstop service to Dallas-Fort Worth (American) and San Diego (Alaska).

Best-case, Hupp said, the new destinations could begin between six months and a year from now.

Those are all big deals, she said.

"Anytime an airline adds service in your community, it's a strong indication of their faith in the economic vitality of the city," Hupp said.

WHAT IT MEANS TO IDAHO BUSINESSES

Direct flights are the key, said Matt Rissell, CEO of TSheets, a Web-based company that tracks employee work time for companies around the world. It's not just the time his employees waste in airports and in the air when they have to catch connecting flights, Rissell said. It's the fatigue they experience just getting to where they have be to do their work.

Together, he said, his employees take dozens, if not hundreds, of flights every year.

"I know specifically of folks that will move their company to, say, Denver or Salt Lake, even Atlanta, because they can get a direct flight to the majority of the cities across the United States, versus in Boise, where you typically have to take at least one layover, sometimes two," Rissell said.

His wish list of nonstop destinations includes Houston, New York City and Washington, D.C. He likes Southwest Airline's nonstop service to Oakland.

"I would prefer it be into the San Francisco airport, but you can't have everything," Rissell said.

MORE AGGRESSIVE OPTIONS

Airports can resort to more extreme incentives to boost service. One such incentive is guaranteeing that a certain number of seats are filled on new flights, particularly as a way to encourage airlines to add a new nonstop destination.

Sometimes that works, Krause said. Sometimes, the group guaranteeing the seats never has to pay because travelers fill them on their own.

But sometimes it doesn't work, Idaho Director of Commerce Jeff Sayer said, and the group - a government, airport or business group - ends up hemorrhaging money until the guarantee period runs out, at which point the airline cancels the flight.

Discounted landing fees, on the other hand, is money the airport wouldn't collect if the new flight weren't established. Reducing those fees isn't a liability. It's a smaller asset for a year that could lead to receiving the full amount down the road.

LOOKING MORE DEEPLY

Sayer said economic development groups are working with businesses to figure out which destinations they want most. For example, he said, a conversation with Hewlett-Packard's leaders in Boise revealed that recovering the San Diego flight was as important to the company as beginning a San Francisco nonstop.

Hewlett-Packard's representatives declined to comment for this story. But officials say they wouldn't have identified the potentially successful route to pitch to airlines if they hadn't decided to take a new approach to recruiting and doing deeper research.

In general, Hupp said, it's hard to convince airlines that if they start a new flight, passengers will materialize to fill it.

"You cannot talk an airline into adding service that they think is not going to be profitable," Hupp said. "They have gone down that road far too many times."

The competition with other airports is intense. After all, Boise isn't the only one that lost flights over the past five years. Even if a new flight would turn a profit, it might not be as much as the airline could derive elsewhere.

"Every other city in the country wants the same thing that we do: more service," Hupp said. "If they add service to Boise, they're taking that plane away from someplace else, or it's a new plane that they could put someplace else."

Airline consolidation particularly affected travel into Boise and the rest of Idaho. These days, Hupp said, airlines are steering clear of the short routes with small airplanes that once expedited travel within the state's boundaries.

While most of the conversation about Boise's air travel focuses on out-of-state connections, declining intrastate travel compromises the connections between businesses in the capital city and other parts of Idaho, Sayer said.

Efficient travel across Idaho "is critical for continued growth in our state's economy," Sayer said.

'GOOD BONES'

Boise does have some advantages in the competition with other airports. One of them, paradoxically, is that it isn't a hub. Being a major hub does bring more flights, but it also makes the airport and community that support it more dependent on the dominant airline. Hubs suffer more when something goes wrong - a strike, bankruptcy, merger or other disruption - with that airline.

The closest thing to dominant airlines in Boise are Southwest and Alaska/Horizon, which together have 55 percent of the market.

Another advantage is the ease of using the Boise Airport. Travelers rave about being able to get into and out of the airport without the snags and long lines of larger cities, said Bill Connors, president and CEO of the Boise Metro Chamber of Commerce.

"If you're trying to grow air service, we've already got good bones. I mean, you've got all the major carriers. We connect to a lot of hubs, which is the key," Connors said. "A lot of these airports we're competing against, they're either dominated by a single carrier or they don't have that kind of hub connection. So we're actually in pretty good shape."

Hupp agreed. Things are starting to look better industrywide, she said, just as they suffered over the past five years. Boise is poised to share the benefits.

"The name of the game three to five years ago was, 'Can we just survive?' " Hupp said. "Today, airlines are starting to think about their strategy for growth, and that's exciting."

Sven Berg: 377-6275

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