John Brantley Airport Director

RDU's Year In Review
Editorial

Another year has drawn to a close and a new one begins. 2005 concluded to somewhat mixed reviews at RDU. On the positive side, 9.2 million airline passengers traveled to or from RDU, 120,000 tons of cargo were shipped through RDU, 248,500 aircraft flew in or out and 2 million vehicles parked in the public lots at the airport. The number of passengers originating or ending their air trips at RDU was the largest in its history by about 4 percent.

The dry weather during the summer and fall aided in completing several major construction projects including the eight-year-long redevelopment of the airport's general aviation area, and in initiating several early components of our Terminal C redevelopment program. In addition, thankfully we were spared any major weather events during the winter or the fall. The TSA security screeners continued to improve their performance, even with fewer personnel, and wait times in the checkpoint queues rarely exceeded 10 minutes. Even the temporary closure of much of the parking garage across the street from Terminal C for renovation didn't greatly inconvenience our customers.

Unfortunately, 2005 was the fourth year in a row in which the U.S. airline industry suffered heavy financial losses. Among the major airlines serving RDU, two sought the protection of the bankruptcy court, one remained there and a fourth exited bankruptcy by being merged into one that managed to avoid that fate. An outgrowth of the airlines' financial problems has been a continuing reduction in the extent of service provided by mainline (large) aircraft transfer of many mainline routes to regional affiliates operating 37-70 passenger aircraft and elimination of services that don't touch their hubs or major metropolitan centers by most legacy carriers in an effort to curtail costs.

A focus of most of the legacy carriers in 2005, especially during the last half of the year, was reducing the supply of seats in the marketplace and attempting to raise fares and thus revenues, particularly in the face of the rapid rise in fuel prices. The first half of 2005 saw a gain of 11.5 percent in available seats at RDU, but that was followed by a loss of 6 percent during the second half of the year, the extent of decline growing each month to over 12 percent in December. From a high near 250 in the early summer, the number of weekday flight departures declined to 215 in December and three more were lost the first of January as Independence Air ceased operations. Nonstop service in six markets (Asheville, Columbus, Denver, Greenville-Spartanburg, New Orleans and Providence) was lost during the year.

What is the outlook for 2006? Frankly, it depends upon your perspective. With the legacy carriers concentrating flights even more heavily on their principal hubs and trying to refocus themselves on transcontinental and international service, RDU likely will continue to see two out of every three of its flights operated with regional jets, thereby limiting seat availability in most of its primary markets. On the other hand, the transition from 37-50 to 70-100 seat regional jets is underway and gaining momentum, and the 70-100 seat aircraft is just the right size for those markets.

Delta's ability to regain its feet and continue the service expansion course at RDU it was on prior to filing for bankruptcy is most important to a good year here in 2006. Attracting another low cost/low fare carrier to offset the loss of Independence Air also is a difference-maker and one we believe will happen shortly. Most important, however, is continuing to fill the seats we have (71 percent were filled during 2005, 75 percent during the last quarter). That is the key to achieving improvement in service.

The Triangle region has a great record in using the service that is provided at RDU. Continue to do so and 2006 and the years thereafter will all be good ones. Your support is greatly appreciated by RDU and all of its tenant businesses.

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