Northwest: TC will take a bigger hit

TRAVERSE CITY – Northwest Airlines' bankruptcy woes have finally landed at Cherry Capital Airport. The carrier announced plans last month to reduce the number of flights, and as a result the number of seats, in and out of Traverse City.

"Some markets are getting hit more than others," said John Caldwell, managing director of corporate and agency sales North America. "Traverse City got hit a little more."

Caldwell detailed the planned cutbacks at a meeting of Chamber of Commerce members last month as part of an airline industry update for the business community. Saying the airline is looking at emerging from bankruptcy sometime in 2007, he unveiled steps the company is taking to meet that goal, including "right-sizing" its aircraft fleet and "labor-related cost-saving measures."

"Northwest is going to be a low-cost legacy carrier," said Caldwell. He emphasized that Northwest Airlines (NWA) will remain a global airline with 670 destinations in 130 countries.

The reductions in the Traverse City market, planned to take effect in February, are significant with projected service levels down 38 percent. The number of weekday flights between Detroit and Traverse City will drop from seven to five, cutting the available seats from 395 to 286. Flights between here and Minneapolis are slated to drop from three to one a day with 50 seats available.

Airport director Stephen Cassens was discouraged to hear the proposed schedule reductions that will clearly impact both business and leisure travelers across the region.

"As far as Northwest Airlines goes, it carries approximately 56 percent of passengers that we have come through Cherry Capital Airport," said Cassens. "They are a long-standing carrier here in Traverse City. That is a disappointment as far as seeing that kind of reduction."

The cuts in service come on the heels of increased passenger traffic through Cherry Capital Airport the past year. Through October 2005, there was a 10 percent increase in traffic over 2004, according to Cassens.

"Obviously the reduction in seats in the market will cause us some concern," he said. "It's hard when there are less seats."

And as veteran business travelers know, the fuller the flights are, the harder it will be to get the cheapest seats. There will be fewer of them to begin with, and they will be snatched up even more quickly.

"Northwest's connections through the Detroit hub and the Minneapolis hub give us great connections throughout the country and around the world," Cassens added. "That's an important service."

Cassens said those in the airline industry have been hearing that nationwide airlines are looking to pare down capacity by 20 to 25 percent.

"There is too much capacity, and 50 percent of that capacity is in bankruptcy," he said. "They're taking capacity out and unfortunately Traverse City took a bigger hit than some other places."

The hope, Cassens added, was that the reductions were going to come more out of NWA hubs.

"We would hope that numbers (of flights/seats) will increase with summer travel numbers, maybe by using larger aircraft, but we don't know that right now," Cassens said.

In July, NWA had an 88.8 percent load factor (percentage of seats occupied) leaving Traverse City and a 91 percent load factor on planes arriving here. The average for the entire summer was 80 percent.

"It seems like they are going to have to take those load factors into account," said Cassens.

While the official announcement of NWA's schedule change is expected this month with the changes set to be effective sometime in February, Cassens said he wouldn't be surprised if the announcement comes close to when the changes are to go into effect.

"It depends on the number of aircraft and what they will have…and that's all subject to change," he said. "I think they are trying to give us a worst-case scenario. It could come out better in the end."

As of mid-December, Cassens didn't know of any plans by the airport's other carriers, American Airlines or United Airlines, to make changes to their own schedules in response to NWA's planned reductions, but he didn't rule them out either.

Cassens pointed out that while the type of facility and air service available to travelers in this region is of a high level, the airport's operational costs per passenger are very low. "The incentive is to continue to serve Traverse City because our costs are reasonable." BN