Joplin Essential Air Service

Feb 08 2011 Joplin Essential Air Service BY admin TAGS Fares

 

We received this email from Chad:

"I just stumbled across an article stating that American Airlines will now offer daily flights to DFW from Joplin.  I travel weekly for business and just booked 3 flights departing SGF yesterday.  My trip to Portland on American totaled about $900 after taxes and fees, however, I checked the same flight dates from Joplin and the fare totaled about $350.  How does the airport plan to compete with this new Joplin service?"

The American service out of Joplin is new (starts this week) and it’s Essential Air Service (EAS). EAS is a federal program that pays airlines to fly into markets that otherwise would not have air service. In other words, the service is subsidized by the federal government—it gives American a revenue guarantee. That’s one reason the fares out of Joplin are lower than Springfield.

Also…It’s our understanding that the previous EAS airline in Joplin did a good job of running off customers. American finds itself in the position of having to rebuild the service from the ground up. We suspect American’s low inaugural fares are part of its attempt to rebuild. Bottom line: we expect the fares to go up after a financial quarter or two.

EAS is something of a political hot potato these days. This week Senator John McCain proposed a bill that would eliminate the program. Here's part of what the Juneau Empire reports:

"Although this program is called the Essential Air Service, in my view it’s far from essential,” he said. He said the program’s expendability stems from that most Americans live within 120 miles to major hub airports and so bypass EAS flights. He said the program originated because airline deregulations inspired Congress to subsidize carriers to service small communities “at a loss because otherwise no sane business would serve a market at a loss."

By the way, our airport does not qualify for EAS funding — we're too big and the airlines can make money here without subsidies.

 

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