August 1, 2006
Fare increases soar as discounters leave PTI
On their face, the numbers are stunning, especially since Greensboro is not near the North Pole or the tropics. Piedmont Triad International Airport is surpassed only by five airports, including those in Alaska and Hawaii, as places where airfares increased by the biggest percentage from 1995-2006.
And in the past year, Greensboro saw the second-largest percentage increase of airfares in the nation between the first quarter of 2005 and the first quarter of 2006, according to a recent federal study of airfares.
But don’t let the numbers fool you: plenty of airports, like Roanoke for example, have higher fares, say people who prepare and interpret the figures.
“The fact that you lost … low-cost airlines and have zero today is your big problem,” said Tom Parsons, the founder of www.bestfares.com, an Internet travel site. “Other airports probably have worse airfares than you but because they never had the low-cost airlines in the first place, yours just shows very very high.”
Beginning in 1994, when Continental Airlines established a hub here that offered “peanuts fares,” prices dropped at PTI and passenger boardings soared to nearly double what they are today.
That drew AirTran, another discounter. Despite the fact that Continental dropped the hub in 1996, AirTran — and, later, Independence Air — helped keep fares low.
In late 2004, AirTran dropped service to PTI. A year later, Independence went out of business.
What’s left are the traditional airlines with fewer discounts, including United, Delta and US Airways.
At airports like Raleigh-Durham International, where Southwest Airlines offers consistent discounts, the other carriers must keep prices lower to compete. Here, they’re not facing the same competition. On top of that, those carriers have raised fares 19 times since January 2005, Parsons said.
“Raleigh has experienced fare hikes too,” Parsons said, “but those fares only stick where there is no competition from low-fare carriers.”
Passengers who fly out of PTI, then, are keeping prices low for other airports by paying higher fares here.
“You’re one of those airports, what we call a small regional airport, that subsidizes the rest of the USA,” Parsons said.
The overall increase here happened despite US Airways’ strategy to lower fares on many flights out of PTI in February.
PTI’s staff and board meet with the airlines often.
“We’re very mindful of the fact that fares are important to people,” said Henry Isaacson, chairman of the Piedmont Triad Airport Authority. “They’re important to us and we are ever vigilant about that and we do what we can.
“The airlines will do what they want to do in the final analysis. But we put a lot of pressure on them to keep their fares competitive and stay somewhat in line with our sister airports.”
The lack of competition is even worse in Anchorage, said Parsons. And Hawaii’s prices are high because it’s such a popular tourist destination, said Steve Anderson, a transportation specialist at the U.S. Bureau of Transportation Statistics, who prepared the fare surveys.