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Argus Leader
Sioux Falls, SD
Sunday, September 30, 2001

Air Service across state putting growth on hold

By Rob Swenson
For The Argus Leader

published: 9/30/01

Smaller jets are trend for future as airlines recover from tragedies

Although problems in the economy and airline industry were coming into focus, passenger boardings at the Sioux Falls Regional Airport were on course through early September to reach a record high for the year.

On Sept. 11, when terrorists crashed four hijacked jetliners into the World Trade Center, Pentagon and Pennsylvania countryside, the chances of the airport eclipsing the local boarding record set in 2000 all but disappeared.

"We probably won't break a record this year," said John Luisi, chairman of the Sioux Falls Regional Airport Authority. "Some people may have a fear of flying and won't be back for a while. But, by and large, people will return to flying."

The attack on America is changing more than boarding forecasts and security procedures at airports in Sioux Falls and elsewhere in the region. Cost-cutting by some air carriers has intensified and accelerated trends in the industry.

The long-range repercussions the shake-up will have on flight service in Sioux Falls and other airports in the region are not all known, but some trends are evident. Among them:

Emphasis is shifting from recruiting new airlines to retaining and strengthening the service of existing carriers.

Major carriers are relying more and more on smaller subcarriers to haul passengers to and from larger hubs.

Smaller, regional jets that seat about 40 or 50 passengers and fly more frequent routes will continue to replace regular-sized jetliners that seat about twice as many riders.

"The future of service in Sioux Falls is regional jets," Luisi said. "They're not just singling Sioux Falls out. That's their game plan. The smaller airports will be served by regional jets."

So will some larger airports.

The recent purchase of Trans World Airlines by American Airlines, a major carrier, will make the trend toward subcarriers and smaller jets even more evident in Sioux Falls.

TWA has been providing three daily round-trip flights between Sioux Falls and St. Louis. In December, American will turn over the route and ground operations in Sioux Falls to Indiana-based Chautauqua Airlines, which will fly under the name American Connection.

Chautauqua will start with four daily round-trip flights and increase to five, if traffic warrants, said Warren Wilkinson, the airline's vice president of marketing and corporate communications.

It's too early to say what the future might bring in terms of additional routes, Wilkinson said.

"I don't think you can speculate until the traveling public starts flying again, and they need to. The ripple effect the airline industry has on the economy is significant," he said.

Minnesota-based Northwest Airlines, the busiest carrier serving Sioux Falls, recently reduced the number of daily round-trip flights to Minneapolis from nine to seven. Some flights are provided in regular jets by Northwest, and some in turboprop aircraft by Mesaba Airlines, which flies under the name Northwest Airlink.

Decisions about plane sizes and frequency of routes are driven by passenger demand, said Northwest spokesman Kurt Ebenhoch.

"Sioux Falls has been a very important market for Northwest. We've been very pleased with our main line (jet) service, and we hope that continues," Ebenhoch said.

The company hopes a combination of returning customers, corporate cutbacks and federal assistance will help the company grow again, he said.

Northwest Airlines is the only major carrier that will continue to serve Sioux Falls directly in the foreseeable future.

Sioux Falls also is served by Air Wisconsin and Atlantic Coast Airlines, which both fly under the name United Express in cooperation with United Airlines, a major carrier. Air Wisconsin and Atlantic Coast provide service to Denver and Chicago.

Mike Masterson, chairman and chief executive officer of Midland National Life in Sioux Falls, is among the frequent travelers who does not like seeing the city lose direct services from major carriers.

"I think it's disturbing that the Sioux Falls area is having air travel either reduced or being converted from the major airlines to the regional operators," Masterson said. "Even though they fly under the same logo, I think anyone who flies a lot will tell you the standards are not the same."

Regional carriers just don't seem to be as dependable, Masterson said.

Airport officials defend regional carriers, saying smaller jets fly about the same speed or even faster than larger jets and are giving travelers the option of more flights and departure times.

"It's the wave of the future for our size market. In fact, it's the only growth going on in the airline industry," said Mike Marnach, executive director at the Sioux Falls airport. "It's certainly the size airplane for our size community."

More regional jets would be a step up for some smaller airports in the region that are served largely or exclusively by turboprop aircraft.

A new terminal and other improvements are planned for the Aberdeen Regional Airport, which currently is served only by Mesaba. Airport Manager Tom Wylam gives Mesaba good marks but said the community would like to have expanded airline service.

"After construction is complete, we'd like to try to attract another carrier," Wylam said. "It will not be as easy as it was three weeks ago. With the airlines struggling to make a profit, they will probably feel the impact for months and months to come."

Only seven South Dakota cities have airports that offer scheduled commercial flight service. In addition to Sioux Falls and Aberdeen, they are: Rapid City, Watertown, Pierre, Brookings and Huron.

Bruce Lindholm, program manager for the Office of Air, Rail and Transit with the state Department of Transportation, said he doesn't know how many South Dakota cities will be able to preserve flight service in the coming years.

"Certainly Sioux Falls, Rapid City, Pierre and Aberdeen will be able to retain service. The smaller cities, I don't know."

Current services provided by airlines in South Dakota are in flux, Lindholm said.

"We don't know what service is going to look like. I would guess within a couple months we'd know for sure. But right now, everything hasn't been decided," he said.

Tory Richardson, operations officer at the Rapid City Regional Airport, said the community wants to retain at least the three carriers it has now.

"The emphasis is on trying to keep what we have rather than get additional airlines," Richardson said.

The Sioux Gateway Airport in Sioux City, Iowa, also hopes to retain the services of its three carriers during this period of turbulence.

"Certainly, airlines' plans to go into new markets has been put on hold," said Glenn Januska, airport director at Sioux City. "We don't envision anyone announcing a new service coming into Sioux City anytime soon, just because the airlines aren't expanding any more."

Stephen Wagner, a principal with the airport consulting firm Coffman Associates in Kansas City, Mo., and Phoenix, said he expects Sioux Falls to see more regional jets but also retain some larger jets. He is helping the airport authority in Sioux Falls update its long-range master plan.

"I still feel the regional jets will open up some opportunities for some new markets, but that's all delayed now," Wagner said.

Flight service in Sioux Falls shut down entirely for three days after the terrorist attack on the World Trade Center and Pentagon. Air travel here and across the country is still trying to rebound.

"This is a temporary thing we're in right now," Wagner said. "Business depends on it (air travel). Discretionary travel depends on it. These people are going to come back."

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