By Keith Benman
October 2, 2011
A succession of on-the-ropes commercial carriers have bit the dust at Gary’s airport, but private jets are flying in and out like never before.
A Times analysis of the Wall Street Journal’s Jet Tracker database shows private jet flights have almost doubled at the airport in the past four years, despite the headwinds offered by the deepest economic recession in decades.
“We are in the right place,” said Wil Davis, owner/operator of the Gary Jet Center, the airport’s fixed base operator. “It’s all about real estate.”
Gary/Chicago International Airport is benefiting from congestion at O’Hare and Midway airports, as charter operators and corporate jet owners look for faster ways to get in and out of Chicago, Davis said.
In all, there were 4,290 private jet landings and takeoffs at the Gary airport last year, compared to 2,214 in 2007, according to the Jet Tracker database.
Charter operators account for much of the increase, but jet-owning tenants at the airport also are driving it.
The Boeing Company, which bases its corporate jet fleet there, has more than tripled its flight activity during the past four years, according to the Jet Tracker database. In 2010, the aircraft maker notched more than 1,000 landings and takeoffs there for the first time.
Those aircraft include a Boeing 737 airliner outfitted as a flying office suite and a number of Bombardier jets. Other companies with jets based in their own hangars at the airport are Fortune 500 utility company NiSource Inc., White Lodging Services and Burrell Professional Labs.
“It affirms that is a place we should be spending our energy,” said Bill Hanna, executive director of the Northwest Indiana Regional Development Authority. “It also affirms the strength of the Chicago aviation market.”
The recession-proof surge in jet traffic may help Hanna and others make their case even after last week’s debacle where a “major airline announcement” was scheduled and then abruptly canceled. The airport has not had scheduled commercial air service since Skybus Airline folded after flying out of Gary for only 23 days in the spring 2008.
The RDA is putting more than $50 million into the Gary airport’s runway expansion project, which will lengthen its main runway to 8,900 feet from its current 7,000 feet. The airport’s strategic business plan pinpoints corporate jet and leisure charter travel as offering the greatest potential for growth there, with commercial passenger service to follow.
Private jet traffic began to grow exponentially in the United States at the beginning of the last decade as the idea of fractional jet ownership caught fire, according to Kyle Kuebler, Porter County Regional Airport director. Fractional ownership gives individual companies access to jets, which they can use for a certain number of hours per month, by purchasing a share in an actual jet.
It’s still not cheap. Fractional ownership in a nicely fitted-out eight-passenger jet can be had for less than $1 million if only limited use is required, but it can cost up to several million dollars for heavy users.
By using private jets, corporate executives can get almost exactly where they have to go and avoid the long security waits and other disruptions that have become common at large commercial airports like O’Hare and Midway, Kuebler said.
“You can go to 5,000 airports around the nation on your schedule, not on someone else’s,” he said.
Porter County Municipal Airport saw steady growth in its corporate jet traffic until the recession hit, Kuebler said. Jet traffic remains about what it was four years ago at the airport, with 550 landings and takeoffs last year, according to the Jet Tracker data base.
It’s a business the airport definitely wants to grow, Kuebler said.
“We have a great mix of traffic, but it is our corporate traffic that foots the bill here,” he said.
Fuel sold directly to plane owners accounts for about one-third of the airport’s self-generated income, Kuebler said. Land leases to jet owners that maintain hangars at the airport also generate income.
Gary/Chicago International earned $302,650 in 2010 from fuel, landing and parking fees, according to airport records.
Although the value of jet travel to the local economy is not tallied at each airport, the airports are known to generate significant economic activity overall. The most recent report from the Aviation Association of Indiana tallies the Porter County airport’s overall economic impact at more than $27 million and Gary’s at $153 million.
The airports also generate significant employment, with about 50 people working on the airfield at Porter County Regional and more than 160 at Gary/Chicago International. About 120 of those at Gary work at two jet-servicing facilities, the Gary Jet Center and the Boeing flight center.
Still, both airports have a way to go if they want to enter the jet port big leagues. Chicago Executive Airport, in Wheeling, Ill., hosted 12,604 jet landings and takeoffs last year, a 13.8 percent increase over pre-recession levels, according to the Jet Tracker data.
Not all region airports have seen jet traffic increase in recent years.
The recession cut jet traffic by more than half at Lansing Municipal Airport, according to the Jet Tracker data. But the airport remains confident that jet traffic will come back and grow as the recovery takes hold, according to Airport Manager John DeLaurentiis.
“People are not flying just to look at the clouds, DeLaurentiis said. “There has to be enough economic activity to generate trips.”
Lansing has substantial plans for expanding the airport, but has settled on a philosophy of letting increased flying activity drive those improvements, DeLaurentiis said.
“Most airports are going with a build-it-and-they-will-come philosophy,” he said. “Here, we are working it the other way around.”
http://www.nwitimes.com/business/transportation/article_e6917432-da95-50f8-ae86-d30aec11a62e.html
Source: NORTHWEST INDIANA TIMES
Date: 2011-10-02