If you hope to attract a low-cost carrier to Savannah/Hilton Head International Airport, you need to be rooting for JetBlue to be successful in Charleston.
That’s the message air service consultant Brad DiFiore had recently for members of the Savannah Airport Commission, who had asked him to look at Savannah’s prospects for attracting new air service after JetBlue — a low-cost carrier Savannah had been courting for more than a year — chose to begin service this year in Charleston.
“JetBlue is still a great fit for Savannah in terms of business model and network,” said DiFiore, managing partner of Ailevon Air Service Consulting in Atlanta.
“JetBlue customers are generally more discriminating leisure travelers than other low-cost customers, and its network would focus on the key Savannah markets of New York and Boston.
“The recent addition of Charleston indicates an interest by JetBlue in our kind of market,” he said. “JetBlue’s success in Charleston should bode well for Savannah.”
It was one of the few positives DiFiore had to offer, as bankruptcies and consolidations have reduced the number of large legacy carriers, domestic routes continue to shrink and the growth of low-cost carriers remains stagnant.
“The U.S. domestic market is basically mature,” DiFiore said. “We’re looking at no growth in 2013 and into the immediate future.”
What is growing, he said, is the interest the airlines are showing in overseas destinations.
“U.S. carriers are seeing real opportunities in international markets right now and as they continue to explore those options, domestic flight capacity continues to shrink.”
Traffic to short haul markets — defined as up to 250 miles — has dropped 46.5 percent since 2000. Traffic to markets from 250-500 miles away was down 18 percent and traffic to markets between 501 and 750 miles away was down less than 1 percent. Meanwhile, traffic to markets more than 751 miles away was up 15.2 percent.
Most of Savannah’s markets are less than 750 miles away.
With 83 percent of all passenger traffic now controlled by five airlines — projected to be down to four within the next year — the smaller hubs are disappearing, DiFiore said.
“Fewer hubs mean fewer options for Savannah and most other airports its size,” he said. “There was a time when Savannah had flights to such secondary hubs as Cleveland, Pittsburgh, Milwaukee, Memphis and Cincinnati.”
Among other trends DiFiore discussed:
• Re-fleeting is about to take off. Delta is swapping its 50-seat regional jets for larger airplanes; both United and American plan to start using more large regional jets with 70-90 seats, and even low-fare carriers are converting to larger aircraft. For Savannah, this will likely translate to fewer flights with larger planes.
• Major U.S. carriers will continue to focus on international markets with little to no growth in domestic service.
• Low-cost carriers have moved away from the small-market model and continue to focus on large markets.
So what are Savannah’s best strategies?
“Like much of the rest of the country, Savannah’s passenger traffic is where it was 10 years ago,” DiFiore said. “While the recession affected everyone, Savannah also suffered from the loss of AirTran.”
In this air-travel climate, home runs are unlikely, he said, so Savannah should focus instead on getting some base hits.
“That means seeking new destinations from existing carriers, pushing for capacity improvement in existing markets, developing and maintaining long-term relationships and looking at recruiting a niche carrier,” DiFiore said.
“These are smaller carriers that service a group of particular destinations,” he said. “Frontier, Spirit and Allegiant are ones to consider.”
Patrick Graham agreed.
“We’ll continue to be diligent in our efforts to recruit new airlines, as well as new destinations and increased levels of service from our current carriers,” said the executive director of Savannah/Hilton Head International.
As far as recruiting a low-cost carrier, Savannah would do well to direct its attention to JetBlue, DiFiore said.
“The ‘Southwest Effect’ has been greatly diminished by higher fares,” he said. Savannah is currently the sixth largest market not served by Southwest. That, coupled with existing service in Charleston and Jacksonville, pushes Savannah way down on the airline’s priority list, he said.
Going forward, DiFiore said Savannah would be well-served to concentrate on bringing in JetBlue, an option he still considers viable.
“But we are behind the curve, so we must be persistent,” he said. “Community involvement and buy-in is critical. Incentives the airport can offer alone are not adequate.”
Finally, Savannah shouldn’t feel bad about “losing” JetBlue to Charleston.
“From an air-service perspective, it makes perfect sense,” DiFiore said. “Charleston is a much larger market,” he said.
“But it also bodes well for Savannah in that the demographics are so similar.
“If JetBlue does well in Charleston, it can only be good for Savannah.”