Whether they know it or not, every business is impacted by the cost of flights at the airport.
Local businesses whose employees never travel are still impacted because their customers travel regularly. Those customers might decide to stop buying donuts for the weekly staff meetings, for example, if their flight costs increase. Legal, accounting, or I.T. service fees can increase when flight prices go up.
And when new businesses decide to move here, local businesses may have no idea it was due to a new direct flight offering at CVG.
The airport dramatically impacts all businesses, large and small. That’s why business leaders talk about the airport on a regular basis.
Changes to the air travel landscape had a huge impact on our region over the years.
Ten years ago, 11 airlines controlled over 85% of air traffic in the United States. Today, 4 airlines control over 85% of air traffic.
Most of us now acknowledge it is highly unlikely we’ll get back hub status and the number of direct flights we once enjoyed.
But the fact that flight costs out of CVG were previously the most expensive in the country was tough to take.
That’s no longer the case.
With a strategy of introducing more competition, improved service, and lower costs, CVG’s CEO Candace McGraw and her team have been steadily making improvements. We now see a regular stream of new direct flights from low cost carriers.
They may not have hit any “home runs,”, but there have been a lot of hits.
June was the 22nd month of year over year passenger growth at CVG, and the 15th straight month of double digit growth in local passengers.
Local CVG air traffic is up over 10% year-over-year.
Frontier Airlines (traffic improved 19%) announced direct flights to Los Angeles, San Francisco and Houston.
Allegiant Air (traffic improved 23%) announced flights to Baltimore and Destin.
Ultimate Air Shuttle has an absolutely fantastic VIP travel experience to Chicago, New York, Charlotte and Cleveland. If you haven’t tried it, you owe it to yourself to go at least once. They currently have a special $199 promotion for first time flyers!
As a result, CVG went from the most expensive airport in the country, to one that doesn’t even crack the top fifteen!
In case you didn’t notice, the average fare at CVG declined 20% year over year in the 4th quarter.
The average fare at CVG is now slightly more or slightly less (within a few bucks) than regional competitors. While costs crept up a bit in the 1st quarter this year they are, on the whole, competitive. On average, if a flight is $427 out of Dayton, it’s only $430 out of CVG.
Because of its strategic location in the country, freight was made a big part of CVG’s focus. Today, 50% of air traffic out of CVG is cargo. DHL now employs over 2,400 people directly, and indirectly impacts local businesses throughout the region.
And CVG still has more direct flights than Louisville, Dayton, Lexington, Indianapolis or Columbus, including the only direct flight to Paris, France.
These accomplishments have not gone unnoticed by the Economic Development community.
Dan Tobergte, president and CEO, Northern Kentucky Tri-ED told me, “Without a doubt, CVG is an all-star asset for this region and for our economy. The recent successes the airport is enjoying – the expansion of the DHL hub, the expansion of low-cost carriers, lower airfares – are all assets we use to attract industries and people to the region.
In terms of attracting people – especially younger people – we know that an important relocation consideration is being able to fly home for the holidays or being able to hop on a plane and be at a vacation destination. CVG has done a great job of driving us in that direction and I think we will see that trend continue as CVG makes planned investments in the future.”
At the Kentucky Chamber of Commerce Business Summit a couple of weeks ago, the subject of travel came up, and all the comments about CVG were positive.
“I love the look of the terminal. It’s so much nicer than other airports we go through.”
“We got back from D.C. and had Graeter’s Ice Cream as we got off the plane.”
“Did you see the $200 flights to Denver, D.C., Orlando and Las Vegas?!?”
It seems to me this is a good time to recognize the good things that are happening, and congratulate the CVG staff and board of directors on their accomplishments. Let’s encourage them to keep going.
We need a growing and thriving airport to help our economy soar.
Brent Cooper is president and CEO of C-Forward, based in Covington.
Brent,
We still have a lot of work to do. Being ranked in the top 16 of the top 100 “highest fare” airports in the country isn’t a good thing. I’ll grant you it is better than our previous standing as being the worst, but getting excited about getting a “D”, simply because we failed for so many years previously, doesn’t give us bragging rights.
The entry of the low cost carriers and their demonstrated stimulatory effect in the discretionary markets suggests that a relentless pursuit of new service should have been the airport’s top priority all along.
We can take a victory lap after we land JetBlue and Southwest to our top “business destinations”. We need to get our economic development teams and our business leaders more integrally involved to expedite that process. The city wide initiative designed by Jim McGraw at KMK worked extremely well. As a result, we were able to get the new management team at Frontier to announce a major expansion in 2014. It will work again.