Blessed Are They With Three Airports

May 21, 2012
By The 2030 Group

Leo Schefer is the President of the Washington Airports Task Force.

Anyone who thinks Dulles and BWI are competitors is unaware of the sheer and growing volume of the region’s air service demand, nor are they aware of the changing structure of the air transport industry and its relevance to our regional economy and employment growth.

As the airlines merge into fewer, larger companies, carrier concentrations have tended to dominate service at the nation’s hub airports.  For our region Southwest and Air Tran (now merged) today carry about 70% of the travelers using BWI, US Airways after its slot swap with Delta is projected to serve about 60% of the passengers using National, and United and its express carriers currently serve 64% of the travelers at Washington Dulles. The airports themselves are not competitive, but the airlines serving them are.

Cities served through only one major hub airport tend to find their choice largely limited to the dominant carrier.  The Washington-Baltimore area with three airports thus has the ability to sustain a much higher level of competitive choice, provided there is reasonable access to at least two of the three airports from every part of the region.  Such access was generally available 20 years ago; it is no longer available due to the region’s failure to implement planned highway improvements.

Since 1990, the combined region’s air travel demand has grown 77%, and the Federal Aviation Administration (FAA) projects it will increase another 65% by 2030.  Air transportation facilitates economic growth, and the region will need the combined capacity of all three airports to sustain its economic prosperity into the future.

Why Bother?

Business has always gathered at the crossroads of the world’s caravan routes. Today that’s a major international airport. Over the last half century the jet airplane has compressed all the time and cost barriers to long distance travel expanding trading horizons, catalyzing cultures, enabling an international tourism industry, and generally bringing us face to face with one small world.  Not surprisingly the quality of our aviation services today has a profound, if largely unrecognized effect on our region’s economy and evolution.  For every job in the National Capital Region, regardless of its nature, 10 airline tickets are sold each year.  High tech companies which form the core of our employment in the Washington region have a 50% higher demand for scheduled air service than more traditional companies. The tourism industry expects most of its future growth to come from overseas but largely from those countries to which we are linked by nonstop service as the visitor spends most of their money where they get off the plane.

Many companies today serve world markets so localities with good access to Dulles with its nonstop services to 80% of world GDP currently are the clear winners. That is why some 70% of all the new jobs created in the national Capital Region over the last 30 years have located where they have or had good access to Washington Dulles.

Each Airport Provides Unique Virtues

Each of our three airports has its own unique characteristics and its own market niche.  National primarily serves downtown Washington’s short-haul travelers1, Washington Dulles provides the bulk of the region’s transcontinental and international services and BWI is noted for its low-fare domestic services2.  BWI serves the largest number of domestic Origin & Destination travelers, while Washington Dulles provides the gateway for the majority of the region’s international passengers.

The three airports have significantly different runway capabilities and operational capacities.  A runway’s length, elevation and prevailing weather determine an aircraft’s performance from that runway under any given set of daily circumstances.  For example, few if any aircraft types in service today can lift an economic payload from BWI and carry it nonstop to transpacific destination with year round regularity. Dulles has the longest runways, National the shortest.

How Do We Use Our Airports?

Regular surveys of travelers using the region’s three airports conducted by the Metropolitan Washington Council of Governments show that travelers:

a)      Prefer to use the airport most accessible to them.

b)      Will use a less accessible airport to get a lower price or a service not available at their most convenient airport.

From the international Origin & Destination data available from the U.S. DOT, we can see that a large number of international travelers prefer to take a domestic connecting flight to another U.S. gateway from BWI or National, rather than fight the time uncertainty of congestion to use a nonstop flight from Washington Dulles. For example, over half a million local international travelers took a domestic flight from BWI to another U.S. international gateway in 2010, while nearly one million used National Airport for the same reason. Domestically, BWI’s low fare services attract the largest number of the region’s domestic flyers, a volume only inhibited by the airport’s lack of access to Northern Virginia.

Economic Development Considerations

Many companies locate in the National Capital Region to be close to the federal government, its agencies and research facilities.  Where they locate in the region often is determined by ease of access to the international gateway at Washington Dulles, as these companies also serve world markets.

Office Space Inventory in Relation to Distance from Air Service

Millions of square feet

Distance To Air Service

1994

1999

2004

2009

0 to 10 miles

127.82

145.04

169.34

187.96

10 to 20 miles

78.61

91.41

104.07

114.7

20 to 30 miles

0.81

0.88

0.96

1.39

30 to 40 miles

0.31

0.35

0.45

0.54


 

 

Most Class A office space is located within 10 miles of one of the region’s three airports, as today’s employers are dependent upon air service to serve their customers.

 

Washington Dulles also has most of the region’s airport growth capacity. Excellent long range planning by the Federal Government in the 1950s gave the region Washington Dulles, still only using half its flight capacity, and the Dulles Corridor which is part of the Airport property. How we use the expansion capacity at Washington Dulles will have a profound effect on the regions evolution as well as its future prosperity.

The key question is: Does the region’s leadership want to see new high tech jobs created more evenly across our region? If so they need to get serious about airport access and in particular access to the international gateway at Washington Dulles and at least one other airport, National or BWI.

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[1] Federal statutes enacted in 1986 formalized a service perimeter that limits nonstop airline flights from DCA to destinations within 1,250 miles.  The perimeter prioritizes DCA’s limited capacity for the downtown Washington short-haul traveler to whom the ground segment is a high percentage of total door-to-door time.  A high density statute limits flight operation from DCA to 60/hour, balances flight operations with neighborhood noise concerns and directs growth to BWI and IAD.

[2] As the airlines continue to evolve, we can expect to see low fare airlines reach from Europe to connect with the low-fare hubs on the East Coast at BWI (Southwest), JFK (JetBlue), and Boston (JetBlue).  Condor, a low-fare German Carrier, plans to inaugurate service twice a week between Frankfurt and BWI in July 2012.