July 4, 2008

D/FW Airport Expects Fewer Passengers Next Year

By Terry Maxon, The Dallas Morning News

Jul. 4--With airlines nationwide cutting back on flights this fall, officials said Thursday that they expect passenger totals at Dallas/Fort Worth International Airport to drop to 54.1 million next year.

If true, the airport will see a decline of 4.2 million from 2008's numbers and a drop of 5.6 million passengers from 2007.

D/FW Airport executives attributed the decline to American Airlines Inc.'s decision to reduce flying at the airport as well as cutbacks and bankruptcies by other airlines.

Joe Lopano, the airport's executive vice president for marketing and terminal management, said the staff expects passenger totals to drop about 7.2 percent in the new fiscal year, which begins Oct. 1.

The capacity reductions planned for this fall by American and regional partner American Eagle -- which carry about 85 percent of D/FW Airport's traffic -- and by other airlines should account for about a 5 percent drop in passengers, he said.

And for the rest of the 7.2 percent, "2 percent is due to what we call economic weakness or demand softness," Mr. Lopano told the D/FW Airport board at a briefing on the airport's proposed 2009 budget.

"We're already seeing a 2 to 3 percent decline in year-over-year passengers, and we haven't reduced any seats," he said. "We believe this is probably a correct estimate."

The airport staff recommended that the board adopt a $640 million budget for 2009, the same size as in 2008 and the first time in the airport's 35 years that the budget has not grown.

Even so, airlines will have to pick up a bigger portion of the airport's cost because passenger-related revenue such as parking, concessions and rental fees will decrease because there'll be fewer passengers spending money at the airport.

The staff projected that the airline cost per enplaned passenger will increase to $7.18, up $1 from what the airlines are paying in 2008. In all, airlines will pick up 37.4 percent of the airport's costs, compared with 35 percent this fiscal year.

While published schedules indicate that the daily seats flown from D/FW will decrease 6.5 percent in November compared with a year earlier, Mr. Lopano noted that some airports will see even bigger declines.

New York LaGuardia will see a decrease of 7.5 percent, Chicago O'Hare will be down 9.8 percent and Houston Intercontinental will be down 11.1 percent.

"For us it really hasn't been that bad," he said.

The airport's budget estimates assume that two airlines will go bankrupt and that the airport will lose several months' airline revenue from nonpayment.

The staff suggested no candidates for bankruptcy, although officials said American should make it through the current industry crisis.

The airport board will review the budget in greater detail at a special meeting July 24.


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