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February 10. 2012 3:00AM

HIA search continues for AirTran successor

Southwest not interested in serving small airports, former director says

By Jim T. Ryan

Harrisburg International Airport is working toward finding the next airline to fill AirTran Airways' spot when it leaves in August, but the airport isn't willing to release airline names yet, said Tim Edwards, executive director of the Susquehanna Area Regional Airport Authority, HIA's operator.
File photo


Local business leaders and analysts said they were doubtful Dallas-based Southwest Airlines Inc., AirTran's parent company, ever intended to stay at HIA in Lower Swatara Township, Dauphin County. Edwards said the airport thought Southwest could be a larger partner.

However, if the writing was on the wall, they moved quickly to begin talks with possible replacement airlines.

In January, Southwest announced it was discontinuing AirTran service at HIA and five other mid-sized East Coast airports Aug. 12. The scale-back is part of restructuring efforts for the two airlines following their 2011 merger.

"We looked at it optimistically, and thought we had an opportunity to have a discussion with Southwest Airlines," Edwards said. "We believe this market could stand on its own and be an asset to them."

Some local business leaders weren't so sure it was ever a real opportunity for Southwest to continue service here.

"We met (with airport and Department of Transportation officials) to just gather support, and say we think (a pullout) is going to happen," said Dave Black, president and CEO of the Harrisburg Regional Chamber and Capital Region Economic Development Corp. "This started right from day one when Southwest said it was buying AirTran because their business models were so different."

The chamber even called Southwest to try scheduling a meeting and outline the business angle for staying in Central Pennsylvania, but the airline didn't seem interested, he said.

"We do have regular conversations with the communities we serve, including local businesses," Southwest and AirTran spokeswoman Brandy King said in an email. "Ultimately, we must base our decisions to serve a market on passenger demand and cohesiveness with our route map."

There have been modest efforts to get Southwest to change its mind, including an online petition at Change.org from Dillsburg resident Kim Binaso-Stwalley. The petition had 667 signatures as of Feb. 6. U.S. Sen. Bob Casey Jr., a Democrat representing Pennsylvania, also made a plea to Southwest to change its mind.

Southwest's response indicates it's not going back on the decision.

"AirTran Airways can no longer support service to Harrisburg due to the realities of the challenging economic environment and especially sustained high fuel prices," King said. "We've had to place a keener focus on aligning our service with customer demand and making capacity available for future opportunities without growing the current fleet."

When it became apparent Southwest would pull AirTran from the midstate, Black said the chamber was more concerned with helping HIA find another airline. A revenue guarantee program started for HIA in 2011 was part of that effort, he said.

In August, HIA chose the Dauphin County Industrial Development Authority to manage the revenue guarantee, a program to lessen the risk of airlines starting new service at the airport. SARAA, the airport's governing body, is prohibited from guaranteeing revenue, but it contributed $100,000 for advertising and marketing expenses associated with new service.

In April, the Dauphin County commissioners authorized up to $375,000 from the county's share of casino tax revenue to match every dollar from private donors for the program.

Not using the guarantee is more the goal, HIA officials said. It gives airlines an insurance policy to get them here, at which time they'll likely find the new service profitable.

That's what AirTran found when it landed at HIA in November 2008: the airline had 90,134 passengers in 2009, its first full year of operation, and that increased to 110,182 in 2010, according to airport statistics. Last year, total passenger count dipped slightly to 101,661 because AirTran stopped its flights to Fort Lauderdale and Atlanta, said Scott Miller, an HIA spokesman.

No one expects a replacement airline to materialize instantly. Although talks with other airlines are productive — some discussions more so than others — it may not be known for some time who will replace AirTran,
Edwards said.

"Air service development takes years," he said. "It's not something that happens overnight."

AirTran is a good example, he said. HIA officials began courting the airline in 2003. It took more than five years for AirTran to add flights to Orlando in 2008.

In 2003, HIA's executive director was Fred Testa, who today is an independent aviation consultant living in Florida. It's never easy selling a mid-market airport to the airlines, he said. HIA tried to get Southwest in the past, particularly when the airline was more focused on smaller airports near large markets, he said.

That strategy helped Southwest grow, but now the airline has presence in big markets such as Philadelphia, New York and Boston, Testa said. The AirTran acquisition was about expanding the big-market presence in places such as Atlanta and Washington, D.C., he said.

Bankruptcies, fuel costs, plane replacements and consolidation forced many airlines to forsake smaller airports for the sheer passenger numbers in larger markets, he said.

"It's a tough world out there," Testa said.

Black agreed that airlines are bottom line driven, and management styles at Southwest and AirTran just didn't agree with each other, he said. Airlines rarely go into markets and build passenger bases, he said.

"The airlines are not aggressive by nature," Black said.

Airline consolidation also is important. Southwest bought AirTran last year, Delta Air Lines Inc. bought Northwest Airlines in 2009, and United Air Lines Inc. merged with Continental Airlines in 2010. As the companies streamline operations, passengers could benefit at the ticket window, but airports are competing with each other for fewer airlines, Edwards said.

Southwest's decision to pull AirTran from HIA was made in the best interests of the company without malice toward Central Pennsylvania, he said.

"I don't feel that we were just tossed aside," Edwards said.

Now boarding: AirTran passenger counts


Dallas-based Southwest Airlines Inc., which last year acquired AirTran Airways, announced Jan. 20 it would discontinue AirTran service at Harrisburg International Airport by Aug. 12.

AirTran started commercial service at HIA on Nov. 20, 2008, after a five-year courtship by the airport's operator, Susquehanna Area Regional Airport Authority.

From 2009 to its second full year in 2010, AirTran's passenger counts increased more than 22 percent, according to airport statistics. Added flights to Fort Lauderdale, Fla., and Atlanta helped those increases. Cancelling the flights in 2011 contributed to a 7.7 percent drop in passenger counts.

Here's a look at AirTran's midstate passenger numbers:


Source: Susquehanna Area Regional Airport Authority


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