Strategic Development Committee Air Service Development Information Report and Proposed 2015 Annual Air Service Plan December 2014 a 1
2014 Air Service Overview Airlines offered little growth in seat capacity, however, produced overall strong revenues and profits Reagan National is expected to reach an all-time record 20.8 million passengers International air service grew at Dulles International for a seventh straight year Dulles domestic air service declined primarily due to Reagan National drawing flights/passengers from Dulles 2
Reagan National & Dulles International Projected to Serve 66% of Region s Passengers 2014 Forecasted Total Domestic and International Passengers by Airport (Millions) 25.0 20.0 15.0 21.3 20.8 0.4 7.1 22.0 0.7 10.0 20.4 21.3 5.0 14.2 International 0.0 IAD DCA BWI Sources: MWAA forecasts based on MWAA and BWI statistical reports and Diio seat capacity data Domestic 3
Dulles Attracted New and Expanded Airline Service In 2014 New Airline Beijing April Est. Annualized Revenue = $2.7M No Overall Flight Reductions New: Las Vegas, San Diego November New Airline Began first phase of ultra low cost air service in August expanding to 17 domestic markets Est. Annualized Revenue = $2.2M New Markets Madrid, Spain June 4 September 6 Nassau, Bahamas June 7 August 17 Est. Annualized Revenue = $865K 4
Reagan National Experienced Seat Capacity Increases in 2014 Dulles International Airport 1. DOJ slot divestiture causing airline market share shifts 2. Low cost carriers increasing market share 3. DCA Airlines using larger aircraft to maximize slot usage 5
DCA Slot Ownership Changes Have Impacted Seat Capacity at Both Airports 10% Total Seats Percentage Change 8% 6% 4% 2% 0% 2% 4% 6% 8% 7.6% 5.1% 5.4% 0.3% 0.1% 0.5% 1.1% 2.1% 2.1% 2.7% 2.8% 2.2% 2.7% 3.6% 3.6% DCA Total IAD Total 6.9% 1 2 3 4 1 2 3 4 2013 2014 Chronological by Quarter and Year DCA increases in seat capacity with corresponding decreases at IAD January- September 2013 were due to US/DL Slot Swap and FAA Reauthorization. DCA decreases in seat capacity January- September 2014 resulted in a gap between American eliminating service and Low Cost Carrier (LCC) beginning service with larger aircraft Source: Innovata Schedules via Diio Online Portal 6
25.0 Reagan National Passenger Traffic Total passenger traffic at Reagan National estimated to reach 20.8 million in 2014 Passenger totals projected to further increase in 2015 by up to 2 million Passengers (millions) 20.0 15.0 10.0 15.9 13.3 12.9 14.2 15.9 17.8 18.6 18.7 18.0 17.6 18.1 18.8 19.7 20.4 20.8 5.0-2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014* Source: MWAA data. * forecast 7
Other 5% Southwest 4% JetBlue 6% United 9% Delta 14% Reagan National Airline Market Shares Southwest now the second largest airline at Reagan National November 2013 Seat Capacity Shares United 8% American American & US 59.4% (+ US Airways) Delta 14% 59% Southwest 16% November 2014 Seat Capacity Shares Other 5% JetBlue 7% American 50% Source: Innovata Schedules via Diio Online Portal. 8
30.0 Dulles Passenger Traffic Changes Due to declining domestic traffic, total passenger traffic decreased at Dulles International for the fourth consecutive year. 27.1 Domestic Int'l Passengers (millions) 25.0 20.0 15.0 10.0 20.1 4.2 15.9 18.0 4.0 14.0 17.2 17.0 4.1 4.0 13.1 12.9 22.9 4.7 18.2 4.9 22.1 23.0 5.2 17.8 24.7 5.9 18.8 23.9 6.2 17.6 23.2 23.6 23.2 6.2 6.4 6.5 17.0 17.2 16.7 22.6 6.7 15.9 21.9 7.0 15.0 21.3 7.1 14.2 5.0-2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014* Source: MWAA Data. Figures may not sum due to rounding * forecast 9
Dulles Continued International Growth in 2014 Beijing Air China Madrid & Nassau United Source: Innovata Schedules via Diio Online Portal 10 10
Air Cargo at Dulles International Air cargo at Dulles is projected to grow overall in 2014 due to strengthening international cargo outweighing domestic freight declines. 400 Freight Tons (thousands) 350 300 250 200 150 100 50 304 129 175 348 338 296 289 267 191 191 142 144 118 149 154 145 147 157 320 184 136 323 283 196 164 119 127 291 278 177 165 114 113 254 270 160 186 94 84 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 est. Domestic International Source: MWAA Data 11
2014 Dulles Cargo Overview Dulles International total cargo tonnage increased 7.1% (YTD October 2014 vs. YTD October 2013) International air cargo increased 16.9% (YTD October 2014 vs. YTD October 2013) driven by additional and enhanced utilization of belly cargo capacity from international wide-body passenger services Cargo tonnage grew due to strengthening demand for international air cargo as global trade accelerates Domestic air cargo continued on a downward trend, decreasing by 9.3% (YTD October 2014 vs. YTD October 2013) Modal competition from trucking continues to negatively impact domestic air cargo volumes at Dulles International and other U.S. airports, in general 12
2015 Annual Air Service Plan Strategies Strategy #1 Grow domestic and international passenger air service at Dulles International through new competitive methods and effectively utilizing internal and external partnerships. Strategy #2 Grow existing passenger air service at Dulles International through marketing support and external partnerships. Strategy #3 Grow air cargo freight volumes at Dulles International through programs targeted to airlines, freight forwarders and all-cargo carriers. Strategy # 4 Grow air cargo at Dulles International through expansion of cargo facilities to include both additional warehouse space and a perishable (refrigerated) center. 13
Action Requested Committee concurrence on proposed 2015 Annual Air Service Plan 14
Ronald Reagan Washington National Airport Dulles Corridor Metrorail Project Dulles Toll Road Washington Dulles International Airport 15