Is change in the air? For airlines, yes

BY DICK SAUNDERS AND BOB FRISKNEY

MAC has begun construction of an $11-million environmentally-controlled skyway linking Humphrey Terminal passengers with the lightrail transit station at the Orange parking ramp across the terminal approach roadway. It is to be completed this fall—for a price, MAC notes, that is nearly 50 percent below first estimates, due to recessionary conditions in the construction industry.

A number of recent developments in the Minnesota and national airline industry point to some dramatic changes coming soon to MSP.

Among upcoming local changes:
On paper, you won’t have to endure more than three hours waiting on a tarmac to take off before your plane will be required to return to the gate.

The FAA has instituted that regulation effective in April in response to the continuing national uproar since several hundred passengers on a Northwest flight were delayed from deplaning by a large snowstorm in Detroit in 1999.

(Delta’s senior Minnesota executive, Bill Lentsch, outlined its new “passenger rights” policy before the Metropolitan Airports Commission (MAC)
Feb. 15. Sen. Amy Klobuchar (D., MN) was one of those leading Congress’ call for change.)

A Delta spokeswoman told Southside Pride that Delta plans to buy and upgrade 13 used McDonnell Douglas MD90 jets from China Eastern Airlines for about $18 million each. The MD90 jets will replace some of the smaller Airbus models that Delta will transfer to its Salt Lake City hub by mid-summer. This step could further reduce passenger capacity at MSP, SMAAC believes.

Delta’s remaining Minn-esota management team and some employees of its regional subsidiary Compass Airlines have moved into the remodeled former Republic Airlines headquarters at the northwest corner of Hwy 494 and 34th
Avenue South. The unmarked building was fixed up by MAC at a cost of about $10 million and leased to Delta for 750 corporate and regional airline employees relocated from the former NWA headquarters building in Eagan or Chantilly,
Va. Before the 2008 merger with Delta, the Eagan office housed nearly 4,000. The building has been listed for sale since 2009.

Likewise, new highway signage on Hwys 494 and 5 identifying the Lindbergh Terminal as “Terminal 1” and the Humphrey Terminal as “Terminal 2” is to be completed this spring at MAC expense of $1.4 million vs. an earlier estimate of $2.2 million. MAC claims more than 25,000 passengers a year get confused by the fact that the two terminals require separate entry points.

Southwest Airlines added twice daily roundtrip service from Humphrey to St. Louis in November, bringing its total daily MSP turns to 24. The airline began MSP service with Chicago Midway and Denver in March and May 2009, respectively, and says it is pleased with the Minnesota market’s response. Many expect more routes to be opened in the coming year if economic conditions justify it. Reflecting the so-called “Southwest effect,” a U.S. Dept. of Transportation report Feb. 26 said MSP fares dropped 32 percent in the third quarter of 2009 from a year ago.
The price tag for MAC’s proposed 2010-2030 construction plan to accommodate 56 million passengers was placed at “$2-$2.4 billion” by Jeff Hamiel, MAC executive director, at a Minnesota House committee hearing Feb. 24. The plan encountered notable opposition from legislators such as Rep. Sandra Masin (D-Eagan) fearing additional noise impacts and roadway congestion in 20
years.

Minneapolis Mayor R. T. Rybak renewed his call for a “win-win” statewide transportation policy that would redistribute more flights and related economic benefits to smaller communities to be tied into future heavy-rail routes such as St. Cloud, Willmar and Rochester. Rybak and new Minneapolis 11th Ward Council Member John Quincy also urged MAC to reopen planning soon for a new airport on a 35,000-acre site like the one rejected by the 1996 legislature in Dakota County. “With 2030 runway usage forecast at 98 percent of capacity, you are well past the FAA guideline of 65-70 percent to start that planning,” Rybak warned. SMAAC has suggested a planning moratorium until more research is undertaken to verify projections.

Nationally, and maybe most important for the MSP hub-spoke model long term, two of the four remaining national carriers—US Airways and United Airlines—announced Feb. 24 they were again “open to discuss mergers” with other U.S. carriers or, in United’s case, a foreign carrier as a way to stem some of the $50 billion in losses sustained by world airlines in the past decade.

US Airways CFO Derek Kerr added that “further consolidation of airlines (into three) and fewer hubs in the U.S. market is necessary,” even though U.S. seat capacity has been reduced by an unprecedented 20 percent in the past three years, and airline jobs have dropped by 170,000 since 2000.

So, is more airline industry change in the air? We’d say it’s all over the place.

Editor’s Note: Bob Friskney and Dick Saunders are directors of the South Metro Airport Action Council (SMAAC), a citizen-based airport watchdog group.