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Will $1 Million Help Improve Air Service Prospects At Delta’s Memphis Hub?

12 Jun

A Northwest Airlines Airbus A330 lands at Memphis International Airport. Photo courtesy of Scott Sherrin via Flickr.

At the beginning of my career, I wrote for a newsletter that covered economic development among other things.  I wrote regularly about the efforts of states, counties, regions and cities to bring new companies, which, in turn, bring in more jobs.

On some of those stories, airlines were included in presentations to show how well a new business could get to the places they needed to be as part of the business.  But it was inevitable that they’d want a piece of the action, either to expand existing flights or add new ones.

So I say all this to comment about an article in the Memphis Commercial Appeal about the efforts of that city’s airport to keep the service they have and expand to more cities.  You may remember that Memphis was one of three hubs for Northwest Airlines (No Town, Snow Town (Minneapolis) and Motown (Detroit)).

But after the Minneapolis-based carrier merged with Delta Air Lines, it was no surprise when the carrier started balancing its combined route network, which included cutting one-third of its service out of Memphis.  The airport has also seen average fares rise to the point where locals are complaining – vociferously.

So the airport authority decided to hire DC-based INTERVistas, a firm that specializes in travel and tourism, to help it bring in new service and lower air fares.  In a report presented last month, the firm recommended creating a $1 million fund to offer incentives to airlines for new domestic and international service including free landing fees and terminal rent, along with cooperative advertising aid.

The Commercial Appeal article included quotes from airline consultant Mike Boyd of The Boyd Group that really hit a note with me.  He noted that while the incentives might speed up efforts by Southwest Airlines to expand or maybe JetBlue to start service out of Memphis, it wasn’t likely the city would get enough service to replace what Delta has cut.

According to the Commercial Appeal, the new incentives were called “the right response at the right time,” by airport president and CEO Larry Cox and “bold” by Memphis Convention and Visitors Bureau president Kevin Kane.  But what else would they say? Their backs are up against the wall with locals getting angry about the service cuts, as outlined in this article.

I don’t entirely disagree with these new incentives.  I think targeted correctly, Memphis could see some new service — but it will never be at the levels it had when it was a Northwest hub. My recommendation is that they let go of the past and look at what other dehubbed airports — like Pittsburgh, Raleigh-Durham and San Jose — have done to survive when their major carriers — US Airways and American Airlines, respectively — have made cuts.

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