NOT QUITE TAKING FLIGHT
While businesses in town may have seen an uptick in customers and sales during the holiday season, dismal passenger enplanement numbers served as a reminder to Mammoth Lakes Tourism, the town’s marketing arm, of the importance to rethink air service to the Eastside.
Over the course of what Mammoth Lakes Tourism Director John Urdi referred to as “a tough December”, Mammoth Yosemite Airport saw eight out of a total thirty-one flights from Los Angeles cancelled.
“That’s 26%, that’s terrible,” said Urdi. “We lost roughly 500 passengers.”
“I think I was on every one of those flights,” MLT Board Vice-Chair Scott McGuire quipped.
While load factor (percentage of the plane filled) was at 65%, up 2% from the year before, December as a whole was down 557 total passengers from the previous year. Urdi chalked the decrease in passengers up to those cancellations.
Those 557 passengers contributed to decreased overall business of nearly 1,000 passengers for the entire season to date. Urdi noted that the pacing was “not as bad as it looks but that month of December really hurt us.”
McGuire said that in his experience with the canceled flights in December, some groups chose to rent a car and drive up to Mammoth instead of waiting in Los Angeles for the weather to clear.
He also explained that he’d experienced significant ticket price jumps; whereas in the past he’d seen prices in the $300+ range, this season, “I haven’t found a ticket for less than $850,” McGuire said.
“What happened was we asked [the flight companies] to swing the pendulum,” explained Urdi, “and they swung it the wrong way or they swung it way too far.”
By pendulum Urdi was referring to pricing.
Price gouging
Post-meeting, The Sheet contacted MLT to see if there was any written language that prevented the airlines from hiking rates two to three times what they previously were.
The answer: “No. They have a cap on how much subsidy they can receive but not on price increases,” said MLT communications director Lara Kaylor.
She also explained that the airlines are following a revenue guarantee model “which actually has nothing to do with empty seats and everything to do with … profit margins being covered.”
The subsidy cap that MLT could pay for Burbank and OC flights is $375,000.
As JetSuiteX offers a season total of 4,080 seats (as calculated by crack Sheet staff), the subsidy per seat (if no passengers flew at all) = $92/seat.
Is there any incentive for JetSuite X or United to lower prices?
“The airlines want to make money and balance the supply and demand as well as the competition for pricing. The goal is to cover costs and make a profit,” said Kaylor.
The companies can make the same amount selling half the seats on a plane that they would filling the plane completely. If you have the cash to spring for an $800 dollar seat, you may as well; you could even have an entire section to yourself.
Analyzing the numbers
Service between San Francisco and Mammoth Lakes began on December 19, with 2 cancellations during the final days of the month.
Urdi explained load factor out of SFO was at 63%, up from 57% the previous year. Neverthless, those flights were behind 136 passengers for the year.
“What’s really interesting is it’s literally like thirty passengers a month, every month, and we’re behind where we were last year,” said Urdi. “There’s no huge chunk, no month that’s either way behind or way ahead.”
He referred to service from Burbank and Orange County as “interesting,” explaining that delays in the contract process with JetSuite X pushed back the booking window by close to a month.
While there has been a rebound since, Urdi explained that missing a month of flight booking “hurt us.” Load factor out of Burbank was “exceptional,” landing at 72%.
Orange County saw a 26% decrease in load factor, down to 44% from 70%. According to Urdi, price increases played a role in the decrease in passengers, something that MLT would have to stay on top of in order to make those flights financially viable.
Burbank and Orange County saw one cancelled flight each, explained by the fact that a single plane would fly to Mammoth-Yosemite from Burbank, then to Orange County, back to Mammoth and finally return to Burbank.
If a plane can’t make one of the flights, then the rest have to be cancelled. Those cancellations resulted in a total of 33 lost passengers.
While flights out of California performed near or slightly below expectations, the air service out of Denver, a program still in relative infancy, was “the huge winner” for December.
Flights out of Denver tracked 1,016 passengers ahead of last year, with a load factor of 55%, up from 44% in 2018. Looking ahead, bookings out of Denver for February are up by 445.
Urdi attributed this increase to a focus on East Coast marketing, noting that those efforts “were really getting that Denver flight to pop,” with an increase between 185-445 passengers per month.
