Thomas McKenna Assistant Director of Aviation - Marketing.
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Transcript of Thomas McKenna Assistant Director of Aviation - Marketing.
Thomas McKenna
Assistant Director of Aviation - Marketing
FAA Economic Forecast
• 2.0 percent increase in domestic enplanements for 2003
• 3.5 percent increase in domestic enplanements in long run (2004-2014)
• Traffic returns to Pre-911 totals by 2006
• Low fare carriers increase market share == falling fares
• 5.0 percent increase in air cargo for 2003 and beyond
Industry Overview - Airlines• Bankruptcy – Chapter 7 or 11
• Vanguard• US Airways• United
• “Who’s Next??”• American • Delta• Midwest• Northwest
• Capacity Cuts• Layoffs/Unions• Reduction of flights/destinations• Regional Jets/Low-cost carriers• Alliances/Partnerships/Merges
Regional Jets
• 91 Regional Jet Airlines
• 1/3 of U.S. commercial airline fleet
• Fastest growing segment in commercial aviation
• 1 out 8 domestic airline passengers flies on a regional airline
• 82.8 million passengers boarded in 2001; double 1991 totals
Source: Regional Airline Association; April 2002
Industry Overview - Airports
• AIR-3 Reauthorization• Establish a new federal – airport partnership
• Protect capacity investments
• Increase airport financial flexibility
• PFC streamlining
• Essential Air Service• Small Airports – affordable access to Air Service
• Security Mandates• Expand federal reimbursement
Economic Impact of KCI
• $3.2 billion to the Kansas City Economy
• 67,400 total employment
• $1.5 million in total payroll expenses
• Headquarter Relocation Program
• Geographic Location
• Life Style
• Air Service
IAHIAHIAHIAHIAHIAHIAHIAHIAHAUSAUSAUSAUSAUSAUSAUSAUSAUSSATSATSATSATSATSATSATSATSAT
SJCSJCSJCSJCSJCSJCSJCSJCSJC
OAKOAKOAKOAKOAKOAKOAKOAKOAKSFOSFOSFOSFOSFOSFOSFOSFOSFO
SMFSMFSMFSMFSMFSMFSMFSMFSMF
Kansas CityKansas CityKansas CityKansas CityKansas CityKansas CityKansas CityKansas CityKansas City
FOEFOEFOEFOEFOEFOEFOEFOEFOE
OMAOMAOMAOMAOMAOMAOMAOMAOMA
MSPMSPMSPMSPMSPMSPMSPMSPMSP
EWREWREWREWREWREWREWREWREWR
MDWMDWMDWMDWMDWMDWMDWMDWMDW
DFWDFWDFWDFWDFWDFWDFWDFWDFW
TULTULTULTULTULTULTULTULTUL
MHKMHKMHKMHKMHKMHKMHKMHKMHK
SEASEASEASEASEASEASEASEASEA
PDXPDXPDXPDXPDXPDXPDXPDXPDX
GBDGBDGBDGBDGBDGBDGBDGBDGBD
DENDENDENDENDENDENDENDENDEN
SLCSLCSLCSLCSLCSLCSLCSLCSLC
LASLASLASLASLASLASLASLASLAS
LAXLAXLAXLAXLAXLAXLAXLAXLAX
SANSANSANSANSANSANSANSANSANPHXPHXPHXPHXPHXPHXPHXPHXPHX
ABQABQABQABQABQABQABQABQABQ
DDCDDCDDCDDCDDCDDCDDCDDCDDC
OKCOKCOKCOKCOKCOKCOKCOKCOKCATLATLATLATLATLATLATLATLATL
BNABNABNABNABNABNABNABNABNA
BOSBOSBOSBOSBOSBOSBOSBOSBOS
BWIBWIBWIBWIBWIBWIBWIBWIBWI
CLECLECLECLECLECLECLECLECLE
CLTCLTCLTCLTCLTCLTCLTCLTCLT
CVGCVGCVGCVGCVGCVGCVGCVGCVGDCADCADCADCADCADCADCADCADCA
DSMDSMDSMDSMDSMDSMDSMDSMDSM
DTWDTWDTWDTWDTWDTWDTWDTWDTW
INDINDINDINDINDINDINDINDIND
LGALGALGALGALGALGALGALGALGA
LITLITLITLITLITLITLITLITLIT
MCOMCOMCOMCOMCOMCOMCOMCOMCO
MEMMEMMEMMEMMEMMEMMEMMEMMEM
MHTMHTMHTMHTMHTMHTMHTMHTMHT
MKEMKEMKEMKEMKEMKEMKEMKEMKE
MSYMSYMSYMSYMSYMSYMSYMSYMSY
ORDORDORDORDORDORDORDORDORDPHLPHLPHLPHLPHLPHLPHLPHLPHLPITPITPITPITPITPITPITPITPIT
PVDPVDPVDPVDPVDPVDPVDPVDPVD
RDURDURDURDURDURDURDURDURDU
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SGFSGFSGFSGFSGFSGFSGFSGFSGF
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TPATPATPATPATPATPATPATPATPA
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Source: Official Airline Guide, schedules for the week of March 10 – 16, 2003, February 2003, Max edition and announced new service.
Nonstop Destinations
55
Daily Nonstop Departures
212
Daily Nonstop Seats
23,811
NEBRASKA
IOWA
OKLAHOMA
MISSOURI
ARKANSAS
KANSAS
DMA = Designated Market Area.Source: Sales & Marketing Management, Survey of Buying Power, September 2002
NEBRASKA
IOWA
OKLAHOMA
MISSOURI
ARKANSAS
KANSAS
Sioux City
Omaha
Lincoln
Des Moines
Waterloo
Iowa City
Cedar Rapids
Davenport
Wichita
Columbia
St. Louis
Springfield
Joplin
Lawton
Enid
Oklahoma City
Tulsa Fayetteville
Ft. Smith
Little Rock
Pine Bluff
Memphis
Texarkana
DMA’s of Kansas City, St. Joseph and Topeka
Dubuque
KCI
DMA Populations = 2,780.0
Income (EBI in billions) = $49.9
Approximate Population of San Diego
Southwest35%
American15%
Delta11%
United9%
Northwest8%
US Airways7%
Midwest Express5%
Continental5%
Frontier2%
America West3%
Year Ended March 2002, Enplanements
Note: Includes only U.S. carriers reporting T-100 data.
Source: U.S. DOT, T-100 data, via Data Base Products.
KANSAS CITY IS NOT DOMINATED BY A HUB CARRIER
PROFILE OF THE KANSAS CITY DOMESTIC MARKET(Year Ended March 2002)
Domestic O&D passengers
Average yield
Average passenger haul
Sources: U.S. DOT Origination-Destination Passenger Survey, year ended March 2002, via Data Base Products,
8,885,500
13.0¢
930 miles
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
16,000,000
18,000,000
20,000,000
92Q1 92Q3 93Q1 93Q3 94Q1 94Q3 95Q1 95Q3 96Q1 96Q3 97Q1 97Q3 98Q1 98Q3 99Q1 99Q3 00Q1 00Q3 01Q1 01Q3 02Q1
Seats
Source: U.S. DOT, T-100 Data, via Data Base Products.
Passengers
Year Ended
Load factor has improved by 6 pointsto 64% over the last ten years
Seats/Passengers
KCI Over 150,000Nearly 50,000
Nea
rly
60,0
00
Nearly 80,000O
ver
60,0
00
Europe
Mexico
Asia
Canada/Greenland
Caribbean/Central America/South America
Over 430,000 international passengers in YE June 2001
Source: U.S. DOT Origination-Destination Passenger Survey via Data Base Products, YE June 2001.
KCI PROJECTS
• Terminal Improvement Project
• Consolidated Rental Car Facility
• Economy Lot
• KCI’s $258 million Terminal Improvement Project will:
– Better distribute passenger traffic among the three terminals
– Widen walkways in all terminals
– Improve information displays for flights and baggage
• The short curb-to-gate distance of 75 feet will not change
TERMINAL IMPROVEMENT PROJECT
• KCI’s $258 million Terminal Improvement Project will:
– Provide unique baggage claims areas for all airlines
– Add many PC outlets and establish a new business center
– 50% more concession space
• Expected completion: 2004
B A
C
New Employee Lot
KCI’s $62 million Economy Lot will provide:
– Dedicated terminal lots & shuttles
– Real time parking& airport information (Kiosks)
– 15,000 new low cost parking spaces
– Additional security cameras for patrons’ safety
– Faster travel time from new lots to terminal
Economy Lot
• Expected completion: 2003
Consolidated Rental Car Facility
Benefits to the airport user:
– Customer convenience
– Closer to the terminals
– Flight information display
– Additional on-airport rental choices
• Expected completion: 2005
• Expected cost: $86 million
Air Cargo
Air Cargo means business at KCI !
• All Cargo Carriers (20 flights per day)
– Airborne, BAX Global, DHL Worldwide, Emery Worldwide, FedEx, Kitty Hawk, UPS, and United States Post Office
• Largest cargo airport in six-states – (NE,IA,MO,KS,OK,AR)
• Air cargo buildings on airport - 6
89% of all air freight is processed by the eight all-cargo carriers
FTZ Attributes at KCI
• Zone No. 15 - Site 3
• One of Largest FTZ airports in the US
• Benefits including: Deferral payment of duties until goods are entered in the commerce of the United States
• Works with Greater Kansas City Foreign Trade Zone, Inc to attract companies that need airport location and FTZ benefits.
Types / Modes of Distribution
• Pipeline
• Water
• Rail
• Truck
• Air
Cost of Modes
• Pipeline
• Water
• Rail
• Truck
• Air
0.02 per ton mile
0.02 per ton mile
0.03 per ton mile
0.40 per ton mile
0.90 per ton mile
What percentage of World Commerce goes by Air?
• About 2% of World Trade by Volume
• About 40% of World Trade by Value– About 2.5 trillion dollars of goods are uplifted by aircraft each
year
What types of commodities move by Air?
Limits of Air Cargo
• History
• Belly Cargo
• Weight
• Size– 747 today = 100 tons (total Aircraft load)
(118 inches high, 96 inches wide, 240 inches long)
Intermodal Air Cargo
• Air - Truck
• Sea - Air
• Air - Rail
Air Cargo Information Flow
Freight Fowarder
Custom Hose Broker
Air Carrier
Banks
Customs Service
Dept. of Agriculture
Shipper
Consignee
ACS (Automated Customs System)
Not Just Jets
Remote location (Helicopter)
Airships (lighter than Air)
Rockets (Satelitte Delivery)
DISCUSSION