Aviation
As flights are cut, airfares go up, at least at first
NEW YORK – In the past eight years, as the airline industry experienced a flurry of mergers, escalating fuel costs and a global recession, many airports that experienced deep cuts in service have seen steep spikes in fares.
A USA Today Network analysis of the top 100 airports in the 48 contiguous states found that on average, those that lost at least a quarter of their domestic seats since the start of 2005 saw nearly twice the average fare increase.
That trend worries some industry watchers as American Airlines heads to court Monday to get what will likely be the final approval needed to close its merger with US Airways.
Past mergers have resulted in the new partners shedding some hubs and cutting flights at some airports as they focus on more profitable routes and portals.
“You see flight reductions, personnel reductions, service reductions and fare increases,” says Brent Bowen, dean of the College of Aviation at Embry-Riddle Aeronautical University’s Prescott, Ariz., campus. “When these airlines merge and combine … you’ll see former hubs not being hubs anymore.”
Merger imminent
Representatives of American Airlines, which has been under bankruptcy protection since November 2011, are scheduled to head to bankruptcy court Monday in New York City to get approval for the company’s restructuring plan. A green light would clear the way for it to finalize its merger with US Airways, a deal that will create the largest airline in the world.
The two airlines reached a settlement this month with the Department of Justice, which sued to block the tie-up but backed down when the airlines agreed to give up dozens of take-off and landing slots at New York’s LaGuardia and Ronald Reagan Washington National airports.
American and US Airways said they would maintain their hubs in Los Angeles, Charlotte, New York’s JFK, Miami, Chicago O’Hare, Philadelphia and Phoenix for three years. They have committed to keep their merged headquarters in Dallas-Fort Worth for the same time period.
The cutbacks in service that have hit most of the top 100 airports in the past eight years reflect an industry that’s been transformed as it’s tried to stay afloat. Onetime rivals have merged, allowing them to focus on bigger, more profitable hubs, and airlines have become extremely disciplined, careful not to fly more seats in a market than they can profitably fill.
“That’s what consolidation has allowed them to do, because they can generate the same amount of revenue doing less of the flying,” says William Swelbar, a research engineer with MIT’s International Center for Air Transportation.
Fewer flights in a market generally means higher ticket prices.
“Inevitably, fares get squeezed, and they rise,” says Henry Harteveldt, a travel analyst with Hudson Crossing.
Flights disappear
Cincinnati remains a Delta hub, but its domestic flights have shrunk in the wake of Delta declaring bankruptcy in 2005 and then merging three years later with Northwest, which had an overlapping hub in Detroit.
USA Today’s research found that Cincinnati/Northern Kentucky International Airport saw its seats plummet 80 percent between the first quarter of 2005 and the first quarter of 2013, as Delta slashed flights and the airport lost service from Northwest as well as Continental, which merged with United in 2010.
Fares spiked 26 percent during that eight-year period, to an average ticket price of $519 — the highest of the 100 airports reviewed.
“Delta was using Cincinnati in the same way Northwest used Detroit,” Swelbar says. “They consolidated those (traffic) flows around Detroit.”
Indianapolis International Airport saw domestic fares increase 23 percent between the first quarters of 2005 and 2013, and its domestic seats plunged 39 percent.
The airport suffered deep cuts in air service and saw fares escalate after ATA, a dominant carrier there, went into bankruptcy and eventually folded. Cutbacks continued when Northwest shrank its Indianapolis mini-hub after joining forces with Delta.
High jet fuel prices, a key reason airfares increase, also had an effect in Indianapolis. But this year ticket prices finally started to stabilize and several carriers are adding new routes, including non-stop service between Indianapolis and Los Angeles, San Francisco and Trenton, N.J.
The agreement by American and US Airways to give up slots at LaGuardia and Reagan National will reduce some service between those airports and smaller cities. But they might add flights between those communities and their other hubs, such as Philadelphia, Harteveldt says. Additional service could lead to lower fares, and wherever American and US Airways exit, lower-cost carriers could enter.
When all is said and done, some industry experts say, airline tickets can only surge so high.
“Airlines know they can push fares only so far,” Harteveldt says.x
The Nigeria Civil Aviation Authority (NCAA) has announced stringent measures against pilots and crew members who work for multiple airlines concurrently, a practice it describes as a serious safety violation.
In a letter dated November 6, 2024, Acting Director-General, Chris Nojomo warned that pilots operating for more than one airline without specific safety protocols pose significant risks to Nigeria’s aviation sector.
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The directive, titled “Prohibition of Ad-Hoc Flight Operators for Multiple Airlines,” noted that NCAA surveillance reports revealed multiple cases of unauthorized cross-airline work by flight crews, which the agency now plans to address.
According to the NCAA, simulator and proficiency checks endorsed on a pilot’s license are valid only for the specific airline and training program under which they were issued.
The letter stated, “With effect from the date of issuance of this directive, all operators and holders of pilot licenses are informed that this action will be treated as a violation of the Nigeria Civil Aviation Regulations.”
The NCAA’s new policy, effective November 11, 2024, warns that violators will face strict enforcement actions. Moving forward, simulator renewals will also be filed directly with individual operators, further tightening the agency’s oversight.
In a bold step to strengthen Akwa Ibom’s position in Nigeria’s aviation industry, Governor Umo Eno announced the addition of two new Bombardier CRJ900 aircraft to the fleet of the state-owned airline, Ibom Air, on Friday.
The two aircraft, registered as 5N-CED and 5N-CEE, mark a milestone in the state’s commitment to strategic investment, with the governor stressing that the acquisitions were fully funded by state resources without loans from financial institutions.
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At a welcoming ceremony attended by local officials and residents, Governor Eno emphasized his administration’s mission to drive revenue-generating ventures for Akwa Ibom rather than relying on debt.
He called the move a step toward breaking the cycle of government investments that only serve to pay off loans, vowing that the state’s funds would go towards projects that bring returns to the people.
The governor challenged Ibom Air to turn a profit by 2025, stating that the airline’s management should ensure routes in and out of Uyo remain dependable to prioritize the needs of Akwa Ibom travelers.
“As long as I remain governor, we will continue to use state funds for the benefit of all, not for private gain,” he said, noting that his administration aims to ensure that public investments deliver real value to the state.
Governor Eno also provided updates on several ambitious state projects, including an 18-story commercial complex underway in Lagos and an upcoming 4-star hotel in Abuja, both designed to generate revenue for Akwa Ibom.
Plans for an international market in Ikot Ekpene and the phased opening of a new terminal at the Victor Attah International Airport were also announced, with the airport terminal set for partial operation by December and full activation in early 2025.
Speaker of the Akwa Ibom State House of Assembly, Udeme Otong, commended Eno’s financial management, highlighting that the administration has avoided seeking loans over the past 18 months despite launching significant development projects.
Ibom Air’s Chairman, Pastor Imoabasi Jacob, expressed appreciation for the state’s investment in the airline, which has seen its fleet grow to nine aircraft.
Jacob credited the governor’s support with enabling Ibom Air to boost flight capacity, meeting demand on popular routes such as Uyo-Lagos-Abuja.
Captain Mfon Udom, CEO of Ibom Air, stated that the expanded fleet will improve efficiency and allow the airline to scale up its operations in time for the Christmas travel season.
Udom also noted that the airline anticipates the delivery of nine additional Airbus planes, which will further strengthen Ibom Air’s market presence.
Traditional leaders, including HRM Edidem Ita Edet Okokon III of Okobo Local Government Area, lauded the governor’s leadership, pledging continued support from the traditional institutions.
Anie Essienette, Group Manager for Marketing and Communications at Ibom Air, noted that demand for the airline’s services has surged nationwide, with the new CRJ900 aircraft helping meet this increasing need while the airline awaits further fleet expansion.
Nigeria’s Minister for Aviation and Aerospace Development, Festus Keyamo is of the view that there’s no cause for alarm over the approval of a private airstrip for a religious organisation, which attracted the attention of the House of Representatives.
He took to his verified handle on micro-blogging site, X, on Friday morning to shed light on the subject, and explained that it could be a great source of revenue for Federal Government.
Keyamo asserted that the issue was raised by an honourable member at plenary, out of ignorance, but was “unanimously referred to the Aviation Committee to look into.”
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Keyamo expressed confidence that by the time his Ministry was done enlightening them, “they will be satisfied”.
He added that “the privates air strip owners pay the Federal Government handsomely for these services.”
Keyamo wrote, “I think this is not correct. The House of Reps. as a body did not call on the Minister to revoke the license of any private airstrip.
“I think what happened is that someone moved a motion in that regard and it was unanimously referred to the Aviation Committee to look into it.
“Whilst the intention of the Hon. Member who moved it is very patriotic, it was based on a complete lack of knowledge of the aviation sector.
“By the time we explain to them how private air strips work and the processes they undergo by our agencies before the final approval, they will be satisfied.
“The responsibility of the owners of private air strips is just to build the runway and terminal building. But after they build the control tower in particular, it is completely handed over to the Federal Government through NAMA (Nigerian Airspace Management Agency) which is in complete control of the entire airspace in Nigeria. An MOU is usually signed with NAMA in this regard before the airstrip is approved for operations.
“It is NAMA that provides the Air Traffic Controllers and Engineers in ALL AIRPORTS and AIRSTRIPS IN NIGERIA. And the privates air strip owners pay the Federal Government handsomely for these services.
“No object flies into Nigeria without the prior clearance by NAMA and without filing a clear flight plan, eg, where it is taking off from and where it intends to land.
“And I have recently directed that all aircraft coming into the country MUST first land at our international airports where they would be properly processed and checked before they make their local flights into whatever airport or airstrip they intend to go. So, it is COMPLETELY AND TOTALLY impossible for any private airstrip owner to just jump on an aircraft and fly in and out of the country through that facility. The Federal Government does not permit that. You will not be cleared for take off or landing without prior request and authorisation.
“I thank the Member for his patriotism, but I wish he contacted us first to explain to him before rushing to move such a motion.
“I attach herewith for public consumption the NAMA Act that gives exclusive control of the Nigerian airspace to the Federal Government through NAMA.”
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