SMX flying smoothly despite industry turbulence

As the airline industry recovers from the economic turbulence of the past three years, Allegiant Air will be increasing its flights from the Santa Maria Public Airport to Las Vegas in February.

The added flight is a bit of good news in a mixed report airport General Manager Chris Hastert received from Mead and Hunt, an aviation consulting firm.  The report showed that while the airline industry is still sputtering, the airport’s service with commercial air carriers United Express/Skywest and Allegiant compares favorably to other Western Region airports, which includes those in Arizona, Nevada, California and Hawaii.

The news comes as the industry recuperates from the recession that saw several companies struggle, and others forced to merge to stay aloft.

“I think overall the industry – there’s been a lot of bankruptcies and mergers and a lot of uncertainty of routes – so I don’t see any immediate opportunities for expansion. Although we continue to look for different opportunities and be present in the airlines’ minds if they’re looking at different sites to expand service out of,” said Hastert, who attended a conference in Phoenix earlier this month. “I just didn’t get a good feeling from them that they were looking to do much of that.”

Santa Maria’s commercial passenger carriers’ 2011 third quarter numbers sort of reflect the turbulence in the industry.  The load factor – which represents the number of passengers per available seats – dropped 8.6 percent from the third quarter of 2010, but was up over the second quarter of 2011.  The most startling decline was United Express/SkyWest’s Los Angeles service, which dropped 21 percent during the quarter.  That means fewer people were flying out of Santa Maria, but according to Mead and Hunt’s report, nine of the top 25 markets were down, with Denver, Colorado Springs, Salt Lake City and Sacramento all experiencing declines of at least 20 percent.

Santa Maria ranked 35th in the Western Region in the number of outbound passengers with 42,450 for the fiscal year ending in June 2011. Santa Barbara was 23rd with 340,270 flights and San Luis Obispo was 25th with 123,770 flights.

While passenger numbers have dropped, revenue has increased because fares have risen. The average domestic airfare increased 12 percent over the previous year and in 10 markets it went up 20 percent.  Average fares for flights out of Santa Maria were $176 in 2010-11, the 19th highest in the region. San Luis Obispo ($195) and Santa Barbara ($194) were ninth and 10th, respectively, among the 59 regional airports.  The higher fares mean domestic airlines’ revenue at the Santa Maria Public Airport has increased 11 percent since the previous year.

“On Allegiant to Vegas, unit revenue performance we’re doing well and on United to Los Angeles we’re doing well,” Hastert said. “The airlines, for them to be doing really well in a market, they want to see high fares and high load factors and I don’t think we’re quite at that level.”

Allegiant Airlines is doing well enough to be increasing its number of flights to Las Vegas from three to four per week, beginning in February. The new schedule will feature flights on Monday, Thursday, Friday and Sunday.

Communications Director Brian Davis said the company is also working on extending its service to Hawaii from an unnamed location.  “Yes, we are absolutely making plans to serve Hawaii,” Davis said. “Our goal is to serve Hawaii by some time this summer.”

The company purchased six Boeing 757s in 2011 and is working with the Federal Aviation Administration on getting Extended-range Twin-engine Operations (ETOPS) certification in order to fly to the islands.

Davis said Santa Maria has been a solid stop in its network for a long time with approximately 90 percent sales of available seats. He said the company isn’t ready to reveal its plans for the Hawaiian service, but Hastert said Santa Maria has provided the company the information it requested to be included in the discussion.

Hastert said the airport’s runway extension to 8,000 feet puts it in the position to handle such flights. He said without it, the airport wouldn’t have made the 7,000-foot runway length minimum.  “Hopefully, as the airline industry changes and the market changes we’ll be considered one of the earlier (airports) for expanded service,” he said.

 By Brian Bullock/Staff Writer Santa Maria Times | Posted: Saturday, January 28, 2012

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