Passengers depart a Northwest Airlink flight at Barkley Regional Airport in July. Three flights daily will shrink to two in August.

A few months ago, Ginny Chipps canceled a flight out of Barkley Regional Airport because the $600 fare was more than AmeriSource Bergen wanted to pay to send her to Atlanta.

She ended up driving to Memphis, Tenn., early one Monday morning to catch a $99 flight to Atlanta, which made her boss happy.
Fares in 15 of Barkley’s 25 top markets have dropped since January, but passengers sometimes find better deals by driving to Memphis or Nashville, Tenn., said Richard Roof airport manager. The airport has no control over fares.

Cost is one thing, but now Delta Air Lines has decided to cut daily Barkley flights from three to two in August. Delta connector service Mesaba Aviation filed notice July 14 to pull out of Paducah and seven other airports in five states by Oct. 12 unless it receives federal subsidies.

The move was a necessary first step for the airline to seek federal help, Delta spokeswoman Betsy Talton said. "We intend to continue service without interruption."

Two days after Mesaba’s notice, the U.S. Department of Transportation ordered the firm to maintain essential service at the eight airports. DOT’s order also sought subsidy proposals from Mesaba and other carriers by Aug. 17.

“Our goal is to come out of this — whether it be with Mesaba or a better proposition — with three flights a day, with or without DOT’s assistance,” Roof said.

Chamber action

Just three years ago, Barkley officials contemplated working with the Paducah Area Chamber of Commerce to ask the business community to help subsidize a third carrier such as Delta that wouldn't otherwise come to Paducah. The idea was considered to boost revenue and open routes particularly critical to business flyers, who make up 51 percent of Barkley ridership.

Then in 2007, American Connection pulled out of Paducah, blaming high fuel costs and planes less than half full. That left Barkley with one carrier, Mesaba, for the first time since 1951.

The latest developments have worried chamber leaders enough to appeal to Gov. Steve Beshear and the Kentucky congressional delegation.
In trying to get Delta to reconsider, the chamber polled its member travelers about the implications of losing the daily midday flight. Many use it to leave town later or get home earlier, saving money and lost work time.

Bob Gossett, one of the more than 1,300 survey respondents, said losing the midday flight means arriving home from Philadelphia five hours later. He also works for AmeriSource Bergen and lives only 1 1/2 miles from the airport.

“It impacts whether I decide to fly out of Paducah or drive to and from Nashville and still get home earlier,” said Gossett.

Losing Paducah air service altogether might mean deciding to move to Nashville, even though he bought a new home in September.
“I can’t even think about that,” he said. “It would be so disturbing to me.”

click image for pdf version Annual parking lot surveys suggests people from four states use Barkley Regional Airport

Financial decision

Mesaba flies out of Barkley as Delta Connection. Starting Aug. 1, Delta Air Lines, which recently acquired Northwest Airlines, will trim three round-trip flights between Paducah and Memphis to two on Monday, Tuesday and Saturday. A cutback to two flights on other days follows Aug. 16.

The cuts will result in the least number of flights out of Barkley in more than a half century, Roof said.
Delta blamed the reduction on declining yields — revenue per seat per mile — and traffic throughout its system. The company said the Barkley cuts were part of capacity reductions of more than 10 percent system-wide, according to Jackie Jones, Barkley marketing director.

“The airline industry is flying fewer planes and trying to fill more seats,” she said.
Stressed by rising fuel prices, declining passengers and lower fares, airlines have cut the number of domestic seats to 66.5 million, the lowest since 1984 and down from a peak of 84.4 million in 2001, the New York Times reported. Among the five major carriers, Delta had the biggest decline this decade, from more than 12 million seats to fewer than 6 million.

Paducah’s plight

Flyers check in at the Delta Airlines counter at Barkley Regional Airport in July. Mesaba Aviation seeks federal subsidies to continue commuter service for Delta out of Paducah.

Roof said the late-January ice storm also greatly hurt business, but he was encouraged by an upswing in June to nearly 67 passengers daily. The load factor on three 32-seat Saab flights rose to 70 percent.
“Every week after the ice storm our cumulative load factor has gone up,” he said. “That’s why we’re frustrated about the Delta decision to cut flights.”

Northwest was willing to operate regional feeds at a loss if passengers continued flying Northwest from the Memphis hub, allowing Northwest to more than recoup the feed losses, Roof said.

Delta, which recently acquired Northwest, looks only at the profit-loss ratio along the feeds, Roof said. That is despite Barkley’s advanced bookings for the fall being equal to above last year.

“Historically, Paducah has been one of Northwest’s top 10 Saab markets served by its Memphis hub,” Jones said.

Neighboring airports

Barkley is the only airport of comparable size in the region without federally subsidized flights. The money comes from the Essential Air Service program that pays up to $200 per passenger for flights largely with empty seats.
Owensboro, Marion, Ill., Cape Girardeau, Mo., and Jackson, Tenn., have struggled in recent years to keep airlines, even with annual federal subsidies ranging from $900,000 to $1.4 million.

Most recent DOT figures show that 19-seat planes flying out of St. Louis to places like Cape Girardeau and Marion are averaging a mere 14 percent full. Cape Girardeau, which hasn’t had reliable air service for a whole year since 2006, averaged only 1.3 outbound daily passengers during the year ending March 31. Marion averaged 7 daily riders.

Contracts of Marion and Cape Girardeau with Great Lakes Aviation expire Oct. 31. DOT on July 9 sent out a request for proposals for continued subsidized service. The order referred to a letter from U.S. Sen. Richard Durbin and Rep. Jerry Costello urging improved air service for Marion and Quincy, Ill. They said the communities had struggled to find reliable air service, and that Great Lakes didn’t have a critical price-sharing agreement with American Airlines out of St. Louis.

Owensboro has had consistent commuter service only for about six weeks since the Federal Aviation Administration shut down RegionsAir in March 2007. In August, Pacific Airlines is expected to start flying 9-seat, single-engine planes to Nashville, with optional continued flights to Atlanta.

Pacific is scheduled to serve Jackson in a similar manner.

Barkley subsidies

Carriers serving Paducah already qualify for subsidies because of ridership and the fact Paducah had air service when the 1978 airline deregulation act was approved, Roof said.

"The problem is, Delta can't just go in and negotiate for financial assistance," he said. "They have to go through this long process."
Ozark Airlines was the last carrier at Barkley to receive a federal subsidy. It ended service in 1981 after other small regional airlines began to provide service.

Assuming Delta gets subsidies, Roof is confident Paducah won’t wind up like other nearby airports with little or no commercial service. That’s because Barkley draws from a broad area and has many more passengers than its neighboring counterparts.
“On an average day, we put 20 more people on an airplane than Great Lakes does in St. Louis for six cities,” Roof said. “Our 30-seaters can fly 75 to 100 miles farther, plus they have a restroom on board.”
He said his biggest concern, regardless of subsidies, is seeing increasingly more hubs disappear as airlines continue merging and cutting costs.

In ordering Mesaba to continue flying at Paducah, DOT left the door open for various sizes of aircraft and number of flights.
“However, we would not dismiss any proposal out of hand without first consulting with the community officials,” the order said. “We encourage any proposal that would simultaneously satisfy the community’s needs and minimize taxpayer expenditures.”

Business concerns

Having experienced a broad swing in fares, Chipps worries that eliminating the 11:40 a.m. flight will drive more riders to her normal 6:30 a.m. flight.

“What’s the price going to be when you have more demand?” she said. “I think naturally they’re going to raise the price.”
Some companies may ultimately decide to do business elsewhere if there aren’t enough reasonably priced flights out of Paducah to important destinations, Chipps said.

She also is concerned about retaining frequent-flyer miles, depending on who ends up with the contract at Paducah.
Gossett, her co-worker at AmeriSource, said he recently switched from a morning to an evening flight to Philadelphia because the round-trip ticket saved several hundred dollars.

Delta’s decision coincided with the Paducah chamber’s Buy Local campaign to promote local and regional patronage, notably at the airport. The chamber commissioned a study last year that showed Barkley pumped about $43.4 million into the regional economy in 2007.

In surveying members about the effect of the flight cuts, the chamber will use the results to try to pressure Delta to reconsider. Barkley, like other businesses, heavily depends on customer loyalty, which in the airport’s case heavily hinges on convenience, said Susan Guess, chamber chairwoman.

“We’re that glass-half-full kind of community,” she said. “We just don’t give up.”

Joe Walker can be contacted at 575-8656.