Increase Flight Revenues
THE INCREASE OF FLIGHT REVENUES CAN INCREASE FLIGHT PROFITABILITY TO THE AIRLINES AND HELP MAKE YOUR AIR SERVICE MORE SECURE AND SUSTAINABLE!
Below is a data summarizing how even the most basic air service support services can positively impact flight revenues, local and guest flight usage (Pulling back leakage), reducing cost of incentives or revenue guarantees and other community benefits. When you increase flight revenues it can lead to a more secure and sustainable air service.
Investing in air service support services can really pay off!
Note that the below example for Montrose (MTJ) airport is occurring in an inbound leisure dominated airport market where some of the economic impact benefits noted will likely be higher than in more local/business markets without a large volume of inbound visitors.
Additionally, the below represents the winter seasons in the base year (20042005) before Community Flights arrived and instituted air service support measures and then in Community Flights 1st year (20052006) when air service support efforts began.
| What Air Support Services Can Deliver | ||||||||
| Example: | Montrose – (MTJ) | |||||||
| Year | Capacity | LF% | Pax | Flight Rev | ||||
| 20042005 | 121749 | 66.70% | 81175 | $10,522,778 | ||||
| 20052006 | 114293 | 74.10% | 84741 | $11,818,560 | ||||
| Change | -7456 | 7.40% | 3566 | +$1,295,782 | ||||
| Air Support Actions: | ||||||||
| > Pulled back some of the local origination leakage from other regional airports | ||||||||
| > Pulled back some of the Inbound guests from other regional airports | ||||||||
| > Increased revenue on flights by about $1.3 Million (12.3%) | ||||||||
| (Rev increased despite reduction in capacity) | ||||||||
| > Increased LF% by 7.4% | ||||||||
| > Increased Passengers carried by 3566 | ||||||||
| > Estimated increase of $3,423,360 in direct guest spending locally | ||||||||
| > Estimated increase of $10,270,080 in total economic activity locally | ||||||||
| > Estimated increase of 37 jobs related to increased visitor usage of flights | ||||||||
| (In this community it’s estimated 96 visitors create 1 job) | ||||||||
| > Estimated increase in Sales Tax Collections-$154,051 via Direct Guest Spending | ||||||||
| > Est. increase in Lodging/Restaurant Tax Collections-$30,810 via Direct Guest Spend | ||||||||
| > 20042005 paid 66.6% of revenue guarantee risk | ||||||||
| > 20052006 paid 28.5% of revenue guarantee risk | ||||||||
| > 307% reduction in revenue guarantee incentive paid | ||||||||
| Strategic Air Support Strengthens Flights/Increases Revenues! Contact scott@communityflights.com for Air Support Services! |
||||||||
Some might say the above results, with a 7.4% load factor year over year increase, seems unrealistic for most airport improvement situations. Additionally they might note that many airports are not leisure dominated airports and not likely to see such large year over year improvement. Below are some basic benefits that you can expect to see with a more modest increase in load factor on one flight with a 50 seat aircraft.
The below situation will only need one more passenger daily, or a 2% increase in load factor on one flight, to deliver the estimated community improvement of air service performance and benefits:
| What Air Support Services Can Do | ||||||||
| Example: | XXXXXXXXX – (XXX) | |||||||
| Year | Capacity | LF% | Pax | Flight Rev | ||||
| 2012 | 36500 | 70.00% | 25550 | $9,198,000 | ||||
| 2013 | 36500 | 72.00% | 26280 | $9,290,250 | ||||
| Change | 0 | 2.00% | 730 | $92,250 | ||||
| Air Support Actions: | ||||||||
| > Pulled back some of the local origination leakage from regional airports | ||||||||
| > Pulled back some of the Inbound guests from other regional airports | ||||||||
| > Increased revenue on flights by about $92,250 (0.30%) | ||||||||
| > Increased LF% by 2% | ||||||||
| > Increased Passengers carried by 730 (Used 25% flyers as inbound guests) | ||||||||
| > Estimated increase of $100,375 in direct guest spending locally | ||||||||
| (Used $550 average spend per national statistics from USTravel.org) | ||||||||
| > Estimated increase of $301,125 in total economic activity locally | ||||||||
| > Estimated increase of 5 jobs related to increased usage of flights | ||||||||
| (Used National avg. of 141 passengers creating 1 job) | ||||||||
| > Est. increase in Sales Tax Collections: $4,517 via Direct Guest Spending | ||||||||
| > Est. increase in Lodging/Restaurant Tax: $903 via Direct Guest Spend | ||||||||
| > Just a 2% increase will add to or create a profit of $92,250 on the flight. | ||||||||
| Above is a very conservative estimate on impacts for just one more passenger (+2%) | ||||||||
| for just one flight daily on a 50 seat RJ. The flight is more profitable, more secure | ||||||||
| and sustainable and it’s driving more spending by visitors locally, more taxes | ||||||||
| etc…multiply this times the total number of flights and note that there is often | ||||||||
| an even larger impact per flight with an even larger pull-back of local and visitors | ||||||||
| and you can see very significant local benefits with air support. | ||||||||
| Strategic Air Support Strengthens Flights & Increases Revenues! | ||||||||