The URL can be used to link to this page

Home My WebLink About5/16/2007 - STAFF REPORTS - 1.A. I� iiiiritii � iilii • liiiiiiiiiiii � i �i � ii � iiii � i Palm Springs International Airport y ��'I , * '^' a Ew� � r..rr4i. _.� "`_ e , RSy � _. . - . ,�'..w . _ __ �r nN!' .•qd� Palm Springs International Airport City Council Meeting May 16, 2007 J Prepared by: S FIT&E v Presentation Outline O Overview of Air Service Marketing at Palm Springs International Airport O 2007-2008 Strategy for Air Service Marketing Section 1 •r'•F^_�� PR — Overview of Air Service n nr rv..a 'vrn� Marketing at r lm Springs International Airport hlm SprinO% -- I�IJmellond nlrppd 2 Air Service Marketing Provides Palm Springs Airport with Support to Increase Service OO Provide strategic advice and direction to Palm Springs management team concerning air service development O Maintain relationships with carriers, providing contact information and market knowledge of carrier strategy OO Follow markets similar to PSP to understand air service developments O Develop list of target carriers and potential new service that fits the needs of passengers and strategy of carriers SH&E Provides Market Knowledge to Promote Air Service Marketing O Develop carrier forecasts and presentations representing possible future markets for various carriers OO Maintain carrier database to provide market research information O Represent Palm Springs at conferences and with carriers explaining the attractiveness of the Palm Springs market, as well as passenger and revenue potential OO Work with community organizations to form a cohesive g marketing plan to best represent the City of Palm Springs and the Coachella Valley Y � � � SH&E's Organizational Structure Utilizes Staff and Resources to Optimize Experience Within the Firm Deborah Meehan Sarah Stock Dick Murphy Project Manager Christina Cassotis Senior Advisory Team Rich Ridolfo Danielle Belanger Matt Godfrey Andy Goldman Derek Marazzo IT Specialist Analysis!Strategy Analysis/Strategy Graphics I i l A L SH&E has Helped Palm Springs Gain Additional Service over the Last Six Years O Carriers began nonstop service from new markets to Palm Springs --- Alaska (operated by Horizon) began Sacramento nonstop service year-round — Delta initiated nonstop Atlanta seasonal service — Allegiant Air began service to Bellingham and Las Vegas O Seasonal service extended to year round service for several markets: -- United reinstated year round service from Denver — Delta extended Salt Lake City service to year round OO Canadian service by WestJet and Air Canada Jazz began from: — Vancouver, Calgary and Edmonton Today Palm Springs has Service to 18 Nonstop Destinations by 12 Carriers Edmonton i ? / Year-Round •� `Calgary Van4cuver ` Seasonal Bellingham ep le Tacoma PC and Minneapolis/ 1—� ') ------ St.St.Paul ff '5 f Salt Lake City i Chlca ORU` Sacra I I ,I r i• 9 San Fralcisco it I •� I ;'"`vim„` 7N.`� Phoenix j j ,,� i ,Azlanra '• ,�� Ft.worth L --- \ Source: OAG Schedule Tapes, February 2007 ��l �` Hou t IAH � • �� Palm Springs Passenger En lanements Have Continued 9 p to Grow, Reaching an All Time High in 2006 Passenger Enplanements CY 1986 — CY 2006 900,000 800,000 1996-2001 1.4% 700,D00 _ _ 2001--2006 5.4% - --- -- -- r— __ f 600,000 1996-2006 3.4% 500,000 - - -------- -�- - 400,000 -- - -- - - - - - - - - - - 300,000 - 200,000 - - - - -- - - - - - 100,000 - - - - - - - - - - - - - - - D T 1- '86 187 188 189 190 191 192 193 '94 '95 '96 '97 '98 199 100 101 102 103 104 105 106 Source: Palm Springs International Airport Data Although the 1 st Quarter of the Year Has the Strongest Activity, the 3rd and 4th Quarters Have Experienced the Strongest Growth in the Last 5 Years PSP Average Annual Enplanement Growth by Quarter 2001 vs 2006 14% - 11..5%.- ...... 10% _— _ — --_---___—_..-- --_--._--_—_—_— ° 4% J 2.7% 3.2% 0% 1 Q 2Q 3Q 4Q Total Source: Palm Springs International Airport Data Since 2001 , Palm Springs O&D Domestic Traffic Has Been Increasing at a Faster Annual Rate Than U.S. Small Hubs Historical O&D Passenger Traffic CY 2001 — CY 2006 Palm Springs US Small Hubs Average 1,400,000 100,000,000 1,200,000 f 80,000,000 i— - --- — — 1,000,000 - — — — i I 800,000 — — — — 60,000,000 I +5,4% +3.2% 600,000 - - At -« 40,000,000 - tron 400,000 Ift I"T --- - t' - 200,000All iY1YlYY #11i IYi YAW ...N4. 0 0 '00 '01 '02 '03 '04 '05 '06 '00 '01 '02 '03 '04 '05 '06 Source: U.S. DOT Domestic 0&D Survey,via Database Products, CY 2006 0000000000000000000000000000000000000000000 * A Given the Strength of O&D Passengers, �ri►i� Opportunities Exist to Increase Markets to Year-Round -and New Nonstop Service Nonstop O&D Average Nonstop Service Palm Springs Top 20 City Distance Pax Fare Peak Off-peak- O&D Passenger Markets CY2006 1 San Francisco 421 154,910 $105 ✓ ✓ 2 Seattle 987 152,350 $132 ✓ 3 Chicago 1,648 93,630 $178 ✓ 4 Portland 873 69,870 $136 ✓ 5 New York 2,372 57,200 $246 6 Minneapolis 1,454 91,680 $180 ✓ 7 Denver 776 36,920 $167 ✓ J 8 Dallas/Fort Worth 1,122 36,580 $236 ✓ J 9 Sacramento 440 29,500 $112 ✓ ✓ 10 Washington 2,183 25,030 $253 11 Philadelphia 2,297 23,530 $194 Potential year round markets 12 Boston 2,517 22,890 $218 13 Las Vegas 173 22,350 $73 ✓ ✓ 14 Atlanta 1,840 10,650 S232 ✓ _ Potential new markets 15 Houston 1,277 18,270 S196 ✓ 16 Kansas City 1,266 17,480 $161 17 Detroit 1,886 16,070 $218 18 Salt Lake City 541 13,630 $175 ✓ ✓ 19 Saint Louis 1,493 13,580 $185 20 Baltimore 2,230 12,870 $209 Subtotal Top 20 886,990 $160 PSP Total 1,326,990 $174 Source: OAG Schedule Tapes, USDOT 00 Survey, via Database Products. i r^'MN'1r4rinnN Section 2 nj:r� i•lil d 2007-2008 Strategy for Air Service Marketing re Rlm dp nr�ga '----' Inlurnelrond • � Alrpnd. ��•� �2 ilk, There are Four Ways to Gauge Air Service Success 9 OO New nonstop service to an unserved market by an existing carrier O Expansion of current service by existing carrier — More frequencies — Larger aircraft O Extension of seasonal service to longer throughout the year or year round service 0 New carrier begins service either to an existing market or a new market ry ; , Current Air Service Marketing Goals for 2007 and 2008 O East Coast service between Palm Springs and Domestic New York O Low cost carrier service (JetBlue, Spirit, Frontier) O Expand seasonal service longer throughout the year O Canadian service continues to perform well and International potential for expansion in the future O New European service most likely from a charter carrier O Mexico service potentially from a new Mexican low cost carrier y VA Ilk Nonstop Service to New York Continues to Be a Focus for Palm Springs New York O Potential carrier markets include: - JetBlue from JFK — American from JFK — Continental from Newark O Developing forecast for twice weekly and daily service during the peak season O SH&E and Palm Springs have met with carriers to propose direct NY-PSP service in the past and continue to maintain contact FIR Detroit Presents Itself as a Future Market Given the Hub Activity at the Airport ___..._.. ._.._._ O Northwest Detroit - Potential peak season service - Northwest only serving PSP from Minneapolis on a seasonal basis -- On hold until Northwest comes out of bankruptcy O Spirit - Route focus on leisure destinations which fits PSP - New aircraft on order - 37 A319s (124 seats) - 7A320s (150 seats) - Beat Northwest to the market Frontier May Be An Option for the DEN-PSP Market Frontier, O Frontier put out an RFP for service to several new markets Regional jets and 0400s will be added to Frontier's fleet — PSP submitted an application to be considered in January 2007 Decisions due at the end of June 2007 Service would have obvious impact on United's Denver service Nt iL North American Expansion Remains an Option O WestJet and Air Canada Jazz have potential to Canada expand to other Canadian cities O Potential service by Air transat, who are looking at new U.S. destinations - SH&E continues to maintain contact with the carrier O Mexico - Low cost carrier growth in Mexico took off in 2006 - Avolar, Click, Aladia, Volaris, Interfet, ALMA, VivoAerobus - Continue to monitor LCC growth in Mexico - Could offer niche strategy to Mexican LCC as they become more stable - Aeromexico serves Ontario and believes in building presence there before expanding to any other markets iii � iiiiiiiliriiiiiiiii �► iiiiiiiiiiiiifiiir �l► .. European International Expansion Presents p p Another Option O Untapped market for European carriers Europe Continue to stay in contact with interested charter carriers — Martinair—possible 2009 service — MyTravel and Thomas Cook combining — Condor and LTU currently not interested— worth touching base in 12 to 18 months O Establish contact and set up meetings at Routes r Securing New Air Service Requires Long Term Dedication OO Considerable amount of education is required to educate carriers and potential passengers about the Palm Springs market OO Marketing to new and existing serviced cities needs to be spearheaded by the CVA and the Bureau of Tourism in conjunction with the airport O Most efficient method of acquiring new air service involves cooperation among all interested parties O With long term commitment and vision, air service will continue to expand at Palm Springs ossss000ssoosssoosMsosoMosos000sossos000s • • T Establish Processes with All Community Groups with a Vested Interest in Increasing Tourism to Palm Springs Define g UnMcm Qznp11ACECGT YL//'!r T E6a P-Ec oC50 O Determine the best way to package PSP with other city agencies O Establish working relationship with CVA and Bureau of Tourism O Encourage city visits to Palm Springs and surrounding area — Establish potential partnerships and funding OO Possible hotel partnerships — New and existing hotel chains l��V•I V ` 10 0 NpL Ali? IR �R 9� %P w 'O � O z � SH&F DNS U LT P TAAOMM VA L V Palm Springs International Airport Materials to Follow May 16 , 2007 Item 1 .A. Item IAN