The Hampton Roads Chamber of Commerce hosted the Hampton Roads Air Service Forum on Tuesday, April 12 at Clark Nexsen. Michael Boyd, an internationally known aviation expert discussed the current state of the airline industry and how Norfolk fits in and Robert Bowen, the Executive Director of the Norfolk Airport Authority presented airport growth plans.
Michael Boyd started with the top three questions people ask. Question One: Why don’t we have more airlines and more flights? Question two: Why don’t we have more nonstop flights to more cities? Question three: since the price of fuel is so cheap, will the prices go down? All very good questions, but why aren’t any of those things happening? Well, the US airline industry is consolidating, the US airline fleets are changing, and within the next five years there will be a constriction on pilots making it costly to get the required number of hours you need to be a pilot or co-pilot.
The meaning of more air service is the more flights that come into town, not out of town. We want more people to come into our area and spend money. Air service is measured by the amount of access that the rest of the nation and the globe have to Norfolk. It is not all about having airplanes or people, it’s can it deliver the world to your community?
There are five factors that Norfolk-Virginia Beach faces. One factor is that new fleets will shift the entire air transportation system; factor two is there are only nine full-scheduled national airlines left; factor three is the traffic levels are only what airlines want to capture; factor four is that “more passengers” are not the airline goal anymore; and lastly, factor five is air travel economics are changing its communications value.
There a lots of airplanes, but not enough pilots. Stated earlier, there are new safety requirements for pilots that require them to have a certain amount of pilot hours, more than before, and most candidates are not able to afford it. Because of that, airlines do not have and will not have sufficient pilots to operate schedules. This will first affect the small communities without any real passengers and in the future it will reduce the capacity for mid-sized airports.
Boyd said Norfolk’s airport is very strong and the access to it is exceptional. To most destinations, fares are comparable with other regional market. When it comes to regionalization, Boyd said Norfolk is emerging as the region’s gateway. The biggest challenge of Norfolk is that the airlines are full, but they are at capacity faster than the national average.
The main question everyone asks is why doesn’t Norfolk have more direct flights? The answer to that question is there is not enough traffic demand to support nonstop flights to certain points.
After Boyd was done with his presentation, he took questions from the audience. One of the questions asked was, “Is Newport News Airport going down”? Boyd responded with, “Every community wants to make airports work. The consumers determine whether the airport stays alive. It will be very hard for Newport News to get additional airport service but let the consumers or airlines make that decision.”
Robert Bowen followed Boyd at the Air Service Forum and gave updates about the Norfolk International Airport. He presented the strengths, weaknesses, opportunities and threats to the audience.
There is good inventory of available facilities and adequate public parking. They have great relations with the airlines and other tenants and they have a very good bond rating of A3. Norfolk International Airport is in a very good financial position with positive operating cash flow generating a surplus each year and they have a very stable, experienced management team. Those are some examples of the airport’s strengths.
With a lot of strengths, come a very few weaknesses. There were three weaknesses according to Bowen. There is only one carrier runway. The rental car return facility is in an opening parking lot with an uncovered walkway to the Departures Terminal. Lastly, there is a lack of non-stop service to the west coast and some major east coast cities.
Some opportunities consist of available land to build a parallel air carrier runway and a multi-level rental car facility which would also accommodate an employee parking lot that would save the airport money. They also have the opportunity to improve the local economy since the Great Recession and the Federal budget has delayed further Sequestration which made the Hampton Roads area more attractive to the airlines and there have been an increase in flights and seats. A threat is that the economy could slow if there are future federal budget cuts and the re-instatement of the Sequestration.
Robert Bowen also presented an update on the expansions and renovations happening at the Norfolk International Airport. Norfolk International Airport is expanding Concourse “A” Security Checkpoint; they are putting in new skylights, restrooms, wall treatments, graphic murals, carpet, ceiling and lighting.
The Hampton Roads Chamber of Commerce would like to thank Michael Boyd and Robert Bowen for their informative presentations. We would also like to thank our venue sponsor, Clark Nexsen, and our bronze sponsor, Vandeventer Black.