Airlines and Indianapolis International Airport and Transportation, Distribution & Logistics

Airport survey: Businesses want nonstops to Western cities

June 18, 2007

Better air access to Western cities key to Indiana's technology and bioscience industries is high on the wish list for executives and travel managers who responded to a survey commissioned by Indianapolis International Airport.

Among those most difficult to reach: San Diego and Austin, Texas--both cities that lack regular nonstop flights from Indianapolis. The airport has nonstop service to coveted destination Seattle, but it's seasonal.

High-tech companies in central Indiana that seek partnerships and financing from afar increasingly have sought convenient access to these markets.

A lack of air access is "a real inhibitor to growing the tech sector," said Jim Jay, CEO of TechPoint, the Indianapolis-based group representing technology companies, research universities and economic development leaders.

Not only is lack of convenient flights a disincentive for local firms to go west to build relationships, Jay said, but it's also a problem "if a potential funder says, 'You know what? It takes me too long to get out there. I'm not going to go [to Indianapolis].'"

Airport officials would say little about their efforts to secure nonstop service to the West Coast and other U.S. destinations, other than that they continually and aggressively make their case to airlines.

Initially, they refused to release the results of the Mayor's Air Service Task Force Survey. IBJ obtained the 2006 survey only after filing a public records request under Indiana's Access to Public Records Law.

Earlier, Mayor Bart Peterson willingly rattled off a list of cities in the wish list but deferred to airport officials for particulars.

Kirk Lovell, air service director for airport manager BAA Indianapolis, said the survey was deemed "statistically insufficient/inconclusive" due to the relatively low number of respondents.

According to the report, the Survey Research Center at IUPUI mailed 1,000 surveys to executives and travel managers and received 116 completed surveys. The roughly 10-percent response rate was low, but higher than a 7-percent rate in a 2003 survey.

Lovell said his secondary concern was that competing airports in the region could do a Google search to read about Indianapolis' intentions and pursue the same markets.

Airport officials for years have said a number of travelers drive here from Ohio and Illinois to catch flights--and vice versa. At one point, they counted license plates in airport parking lots.

The Mayor's Office and economic development leaders hatched the periodic survey about a decade ago.

Michael Boyd, CEO of Evergreen, Colo.-based aviation consulting firm The Boyd Group, doubts that managers at other airports in the region would be plotting to pick off destinations important to the Indianapolis market.

He also called the whole idea of a survey of business wants "amateurish."

"If there's an opportunity in Indianapolis, an airline will go after it. It doesn't make any difference what the business community wants," Boyd said.

Seeking better access

Case in point is the push by Jackson, Miss., where Nissan recently built a new automobile plant. Leaders there sought Boyd's help in landing nonstop service to Nashville, Tenn., home of the Japanese company's principal U.S. operations.

No such luck--airlines wouldn't start the route just to fill a couple of planes to Nashville. Generally, airlines look for a much bigger and broader opportunity than individual routes offer.

Take Northwest Airlines' major route expansion in Indianapolis, announced in 2004. Back then, the busiest carrier in Indianapolis, ATA Airlines, was spiraling toward Chapter 11 bankruptcy reorganization. Some said Northwest smelled blood.

But ultimately, the Indianapolis expansion also fit within Northwest's overall strategy, Boyd said. Carriers don't want to fly much off the beaten path of their hub system, and Indianapolis turned out to fall within its triangle of hubs in Minneapolis, Detroit and Memphis.

Whatever the airline economics, city leaders say it doesn't hurt to buttonhole the carriers.

Peterson noted that Indianapolis has landed new routes sought by businesses in recent years, including nonstop flights to Raleigh-Durham, N.C., and Hartford, Conn., plus additional service to Atlanta.

The recent mayor's air task force survey, however statistically insufficient, produced results similar to TechPoint's Indiana Technology Index 2006 report. It said the city needs better access to tech centers Atlanta, Austin, Raleigh/Durham, San Diego, Seattle and Portland, Ore.

The mayor said he'd like to see additional flights to Seattle and more flights across the board. The airport lately has been averaging 185 daily departures; about 40 of those are nonstop flights.

Getting air access without the time-consuming entanglements of multiple connecting flights has become even more of an issue lately, with BioCrossroads' new strategy of increasing ties with life sciences firms in San Diego.

IBJ reported June 11 that BioCrossroads on May 30 hosted a conference outside San Diego with that region's most prominent life sciences economic development organizations.

Possibly attractive to San Diego research firms is Indiana's expertise in pharmaceutical and medical-device manufacturing. Numerous flights are available from here to San Diego, but passengers have to fly through other cities to get there.

Bypassing Indianapolis

Western cities weren't the only underserved routes, however, according to the survey.

Nashville, Tenn., led the list of cities most difficult to reach by air--with no nonstop flights from Indianapolis. Passengers have to cool their heels for hours catching connecting flights in out-of-the-way places like Detroit or St. Louis.

John Aplin, managing director of Indianapolis-based venture firm CID Capital, remembers the headaches of visiting a Nashville client.

"Half the time, I was debating whether to drive down there ... it was almost easier," he said.

Other Indiana companies bypass Indianapolis International entirely.

Employees of West Lafayette-based medical diagnostics company QuadraSpec Inc. often drive to Chicago airports to get better connections, said Joerg Schreiber, chief operating officer.

Indeed, the survey said central Indiana employees who departed in the past year from different airports most frequently used Chicago's O'Hare or Midway. Those were followed by Cincinnati, Louisville and Dayton, Ohio.

What Indianapolis lacks in nonstop service to certain markets it makes up for in lower prices than some surrounding airports, however.

Fares here averaged $329 in the fourth quarter of 2006. That compares with $337 for Dayton, $340 for Louisville, and $503 for Cincinnati, according to the Bureau of Transportation Statistics.

Lovell noted that Indianapolis has a broad mix of scheduled-service carriers here--about a dozen. By contrast, pricey Cincinnati is dominated by Delta Air Lines.

Many of the routes Indianapolis-based ATA Airlines dropped when it ended scheduled service here in 2005 were picked up by Northwest and by newcomer AirTran.

At least one other airline said it's considering launching service here within the next few years--upstart Virgin America.

The cousin of Sir Richard Branson's Virgin Atlantic Airways received U.S. Department of Transportation approval last month to begin operations. It first plans service between San Francisco and New York, but the Burlingame, Calif.-based carrier listed Indianapolis among 30 cities where it is considering service within five years.

But critics--including Joe Brancatelli, publisher of business traveler Web site JoeSentMe.com--are dubious about the new carrier's ambitious plans, citing numerous delays and Branson's braggadocio.

Airport officials also would like to land low-cost carrier JetBlue.

Ultimately, economics rule the day. Despite Indianapolis' growth, the city does not have the passenger load to justify a number of nonstop routes--particularly those to Europe.

"You have to maintain the service you have and grow that service," said BAA's Lovell. "All the numbers have to be in line."

Some executives said they hope the new midfield airport terminal--scheduled to open next year--improves the city's chances of luring new carriers and service. However, to pay for the $1 billion project, the Indianapolis Airport Authority had to raise airlines' landing fees and rents.

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