One month after landing nonstop service to Los Angeles, Missoula International Airport officials on Monday announced plans to unveil a second nonstop route next week, hinting heavily at a destination in Texas.
Airport Director Cris Jensen, joined by Destination Missoula, reaffirmed the airport’s commitment to increase local air service, saying it will drive down fares while boosting local tourism and business.
“We need new air service because our community demands it, whether it’s your business or your pleasure,” said Jensen, addressing City Club Missoula. “We all want to experience the world, and we want the world to experience Missoula.”
Over the past year, Jensen and deputy airport director Brian Ellestad have courted both American and United airlines for nonstop service to Texas, with eyes on either Dallas/Fort Worth or Houston.
Along the way, the airport has partnered with a coalition of local groups in Take Flight Missoula to build a pot of revenue to guarantee the success of any new route. While doing so marks a change from the old ways of working with airlines, Jensen said it’s now essential when competing with other cities.
“We find ourselves in a position of bidding, essentially, against all the other communities in the U.S. that also want service,” Jensen said. “Airlines have a limited number of assets they can fly, and that means we now have to put together incentive packages. It’s a completely different game than it used to be.”
Last June, Missoula International Airport received a $600,000 air service development grant from the U.S. Department of Transportation to help land nonstop service to the Texas market.
As part of that, the community was required to provide a $400,000 match. When combined with fee waivers provided by the airport, the package amounts to a revenue guarantee valued north of $1.2 million.
Beth Burman Frazee of Windfall, the company contracted by the Missoula Economic Partnership to head the Take Flight effort and raise the community match, said her fundraising efforts have netted around $200,000 thus far. Once fully established, the revenue guarantee will be used to court new or expanded routes.
“In this new model, airlines are incentivized to bring new or expanded air service into Missoula,” said Burman Frazee. “This cannot be an airport function – it has to be a community function. When we’re negotiating with a new airline, we can help mitigate the risk.”
Increasing service as a means to bring down fares has proved successful both in Missoula and other communities. When Bozeman landed American Airlines with service to Dallas, the average cost of one-way fares dropped $22 out of Bozeman.
The same held true in Missoula when Delta began competing with Alaska Airlines with service to Seattle. After six months, one-way fares fell $15.
“Competition in the market absolutely has an impact on the fares we pay,” said Jensen. “Competition is how we get those fares even lower, and it would help to get additional air carriers into our market.”
The Missoula airport has already established itself as a competitive option for flagship carriers like United and Delta, and discount carriers like Frontier. The number of local passengers flying from Missoula is up 8.6 percent over last year, and it’s likely the airport will set a new passenger record by the close of December.
The airport’s cost per enplanement, or COE, also stands at just $5.42, less than half the national average. The fee represents the cost to an airline operating at an airport.
“That makes us competitive, because airlines of course are interested in what it costs to operate in our market,” Jensen said. “The other thing that works to our advantage is that we have the highest load factors in the state of Montana. Those are things that help us when we talk to airlines about additional service.”
As it stands, Jensen added, airfares out of Missoula are the lowest in the state, with an average ticket going for $409. That’s down from the $424 average recorded two years ago.
“Believe it or not, we’re more or less the cheapest airport in the state,” Jensen said, attributing the figures to the U.S. Department of Transportation.
While Missoula currently offers flights to 12 nonstop destinations, the bulk of those sit in the western U.S., with the exception of Chicago, Atlanta and Minneapolis. Service to Texas would fill the lack of service into the central southwest, and it could have an impact on local fares.
Hinting at new service, be it Houston or Dallas, coincides with the trends Destination Missoula has observed on its website and in its call center.
Barb Neilan, executive director at Destination Missoula, said Texas now stands near the top of all out-of-state inquiries seeking travel and tourism information on Missoula. Tapping into the Texas market could serve as a boon to local businesses.
“Tourism is a major market in Missoula,” Neilan said. “Out of the 12.4 million people who come into the state every year, 4.5 million actually come through Missoula. It’s a large number of people who actually do visit Missoula, so it’s one of our big industries.”