United daily service: Win for Valley
Contrary to some questioning, yes, a ”Revenue Guarantee” for United Airlines to provide the Mahoning Valley with service from the local Youngstown-Warren Regional Airport is absolutely something the businesses and governmental agencies in the Mahoning and Shenango valleys need to fully endorse, and are endorsing.
The original shortfall of $1.75 million needed revenue guarantees has gone from $550,000 to $246,000 in less than three weeks due to the contributions from local business and governments. They all understand that United would be taking a huge risk to fly from the Youngstown-Warren Regional Airport since there has been no daily scheduled service at the airport in more than 12 years and therefore no recent passenger data from which to compare.
The need for financial assistance is simply a business decision the airline gets to make because it has something we need – daily air service – and the airline doesn’t wish to lose money providing that service to us. The revenue guarantee keeps the airline profitable at a nominal margin. Once the route sustains itself, in this case there is a high probability it will within four to eight months, the subsidy stops, and United is on its own to operate without subsidy.
Any funding we have remaining can either be used for other destinations, or in some cases, possibly returned to the originator. Most cities that have not had daily service for more than 12 years would be grateful to have such an opportunity afforded them by an airline like United.
The service, if approved, actually starts with two daily round trip flights (early morning and late afternoon), and could increase to three daily flights with a mid-day offering if the market proves to be profitable.
Airlines are very risk averse nowadays as a result of tumultuous decades of financial losses and uncertainty. Revenue guarantees for ”risky” markets is how ALL airlines go about their business of providing air service to communities in need of connectivity to the rest of the world. The fact that United earned $1.1 billion in 2013 has no bearing on this business proposition whatsoever.
Is the price too high?
United has agreed to keep the fares the same as can be purchased in Cleveland and Pittsburgh. With the fares at the same cost as Cleveland and Pittsburgh, and only $6 per day long-term parking ($30 maximum per week) and $7 per day short-term parking ($35 maximum per week) at the Vienna airport, not spending gas and paying tolls to get to the other airports one to two hours away, and the time saved (time saved being of the utmost importance), it will actually be cheaper to fly from Vienna to Chicago and the 130-plus, one-stop connecting destinations beyond Chicago. Remember, more than just service to Chicago, this is also service to anywhere through Chicago.
Instead of the vacation-type service that sends people to the South, the daily United Airlines service affords people the opportunity to fly directly into the Mahoning Valley to invest in our community, create jobs for our workers and contribute to our growing economy. These visitors will also spend money staying in our hotels, eating at our restaurants, using local rental cars, shopping in local stores, etc.
Daily air service has a huge economic development impact on the communities that have it through the increased access those flights provide travelers for both business and leisure. Daily air service is so important, in fact, that many companies choosing to invest in a region will only do so if that region has daily air service.
These companies look at daily air service to a community as a standard utility necessary to conduct business much like running water, electricity and paved roads. Bringing United Airlines to the Youngstown-Warren Regional Airport will reconnect the Mahoning Valley to the world in a way that will pay dividends thousands of times more valuable than the $1.75 million being pledged.
We are very close to reaching our $1.75 million revenue guarantee goal . . . we should have a decision from United in the coming months. And hopefully we will not need all of the revenue guarantee funds to sustain it. How can anyone who wants to see this community prosper not support the daily United Airlines service?
Dickten is the director of aviation at the Youngstown-Warren Regional Airport.