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Cincinnati airport expanding services, lowering prices in effort to compete

By Megan Alley, Sun Publishing Staff –

Cincinnati/Northern Kentucky International Airport is expanding its air service, facilities, operations and footprint, according to CVG CEO Candace McGraw, who spoke to business leaders during the Clermont Chamber of Commerce Business Breakfast on Feb. 17.
“Our goal is to make travel through CVG an unforgettably positive experience for you,” McGraw said in her opening remarks. “We want to be the airport of choice to work for, fly from and do business with.”
Staring June 4, Southwest Airlines will offer five flights a day to Chicago Midway International Airport and three flights a day to Baltimore Washington International Airport.
“They are excited, and they are enthused about being here,” McGraw said. “We knew we had to have them at CVG.”
She added, “They’re going to start with these eight flights and they’re going to be wildly successful, and they’re planning growth already.”
In that vein, officials at CVG have been making “a very concerted effort” to diversify the airport’s carrier base.
“Why? Because, it’s not good for any business to have a monopoly on anything,” McGraw said. “We need to provide all of you with options in terms of travel, in terms of destinations, in terms of price points, in terms of service.”
Nine passenger airlines operate out of CVG, including Air Canada, American Airlines, Delta Air Lines, United Airlines, Southwest Airlines, Frontier Airlines, Allegiant Air, Sunwing Airlines and OneJet.
In 2012, CVG air carrier service was dominated by Delta Air Lines. In that year, the airline took 74.7 percent of the capacity share pie.
In 2016, Delta Air Lines’ capacity share diminished to 53.9 percent, with ultra-low cost carriers representing about 20 percent of CVG’s capacity share.
Frontier Airlines started flying out of CVG about three years ago. At the time, they offered six flights per week; once a day to Denver International Airport. Now, they fly to 17 destinations and offer 93 flights a week, starting in April, according to McGraw.
More specifically, Frontier Airlines will fly daily from CVG to LaGuardia Airport, staring April 21, four times a week to Minneapolis – St. Paul International Airport, starting April 21, and three times a week to San Diego International Airport, starting May 16.
Other airline carriers are also slated to expand their West Coast services.
“Now we’ll have daily low-cost service into San Francisco, Los Angeles and San Diego, so great connectivity west at a lower cost,” McGraw said.
She went on to note that carrier diversity now means price stability.
“Traditionally, CVG has always ranked one, two or three in the airfare rankings that are put out by the Department of Transportation,” McGraw said. “I want to take a step back here, and I always have to say, the airfares have no correlation to airport costs, right. An airport’s cost to an airline is only maybe between 4 and 6 percent of its costs of doing business. But, what was contributing to high airfares was the lack of carrier diversity.”
She added, “Well, I’m pleased to say the last DOT report that came out, we were number 44 … on average, your tickets are costing you $170 less today than they did this time two years ago.”
With regards to growing airport facilities and operations, Terminals 1 and 2, which were determined to be obsolete, were recently demolished, and a consolidated rental car facility will be built in their place.
“If you’re coming in to rent a car, using this, you’ll be able to walk from the terminal building, baggage claim or ticketing, right into this customer service building,” McGraw explained. “We’ll eliminate all that busing, all that excess traffic on the curb front from those shuttles.”
The project, which is slated to be finished by 2021, is currently in the design process, according to McGraw.
As part of the project, the airport entrance roadway will be redone.
“As we get more local traffic in, the roadway system wasn’t sized for additional local traffic,” McGraw said. “We don’t want to have you congested at the curb front.”
The project will include straightening out the entrance roadway and traffic splitters for parking, guest pick up and more.
Utility work on the project is set to start next year, followed by the roadway work.
“I apologize now because we’ll have to try to figure out how to get you in during this construction, which is never easy, so there might be a little bit of pain points, but it will be worth it in the long run,” McGraw said.
She went on to review the new building construction projects underway and planned at CVG.
Last year 184 acres were built on, with projects including a 898,560 square-foot fulfillment center for Wayfair Inc., an online home furnishings and décor retailer, that was completed in June 2016. Additionally, in August 2016, construction began on a 260,000 square-foot warehouse for Dermody Properties, and in September 2016, construction began on a 511,000 square-foot speculative warehouse for VanTrust Real Estate LLC.
A goal is set to build on a total of 351 acres by 2021, including future retail and warehousing developments.

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2016 News Democrat