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Lehigh Northampton Airport Authority. Managing LVIA Through Uncertain Times George F. Doughty, Executive Director March 18, 2005. Governance. Lehigh-Northampton Airport Authority Pennsylvania Municipal Authorities Act Nineteen Members Appointed by Lehigh and Northampton Counties

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Lehigh northampton airport authority

Lehigh Northampton Airport Authority

Managing LVIA Through Uncertain Times

George F. Doughty, Executive Director

March 18, 2005


Governance
Governance

  • Lehigh-Northampton Airport Authority

    • Pennsylvania Municipal Authorities Act

    • Nineteen Members Appointed by Lehigh and Northampton Counties

    • All Municipal Powers – Except Power to Tax



Expenses 2005 budget
Expenses – 2005 Budget

Total - $15,859,187


Lvia market 2 5 million people 40 mile radius
LVIA Market - 2.5 million people (40 mile radius)


Our chronic issue most of our passengers use other airports
Our Chronic Issue – Most of our passengers use other airports

Real potential of LVIA Market is not known, but probably is at least 5 million passengers

  • Frequency

  • Nonstops

  • Price


Why have major airlines not exploited the potential of lvia
Why have major airlines not exploited the potential of LVIA? airports

  • Yield – not volume

  • Premium price for convenience

  • Hub concentration – PHL, EWR

  • “If you don’t want to pay us $1,000 at ABE – then we will take $500 from you at PHL.”


Historical successes
Historical Successes airports

  • Major Carriers

    AC, CO, DL, NW, UA, US

    Scheduled Charter

    Southeast Airlines

    Initiated Service - August 2002

    Carried 516,048 passengers through 11-30-04 (PIE, SFB, FLL, LAS)

    Service reliable and well received

    Saved LVIA passengers over $10 Million

    Brought $2 Million Income to LNAA

    Proved LVIA to FL market


Historical successes1
Historical Successes airports

  • Southeast terminated on 11-30-04

  • 30% of market replaced with:

    TransMeridian Airlines (started on 2-10-05)

    Lehigh Valley Air (start on 3-24-05)


More bad news possible
More Bad News Possible airports

  • UA, US in Chapter 11

  • DL Weak

  • Continued flat growth by majors

  • Loss of short haul business traveler


Strategies
Strategies airports

  • Cost Containment

    • Staff Reductions

    • Defer Capital Projects/Expenses

    • Focus on Mission Critical Items

    • Debt Refinancing/Restructuring

    • Moving Functions In-House

      • Fixed Base Operator (FBO) - LVAS

        • Ground Handling Services

        • Aircraft Fueling


Strategies continued
Strategies - continued airports

  • Revenue Management

    • Vehicle Parking Lot Rate Adjustments

    • Hangar Rental Rate Adjustments

    • Airline Fee Adjustments

    • Verification of Full Cost Recovery


Future options
Future Options airports

  • New Service

  • Expand LVAir

  • Real Estate Development


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