Does the airport have your full attention?

By Josh Pichler • jpichler@enquirer.com • January 29, 2011

Since I moved into the Business news department last summer, I’ve had the opportunity to meet with many of this region’s business leaders to find out what issues are most important to them and their companies.

I’ve also asked executives what concerns them most about the region going forward.

Almost without fail, the two concerns are attracting and retaining businesses, and increasing the number of flights at Cincinnati/Northern Kentucky International Airport.

It makes sense; the two are intertwined.

But I’m not sure that connection is obvious to everybody. Because when the airport comes up in my conversations, it’s always – and I mean always – put in this context:

What are they doing to fix it?

They refers to management at CVG. And it’s the wrong question. The right question is this: What are we doing to fix it?

CVG is the region’s biggest challenge to economic development. And to paraphrase CVG chief executive officer John Mok, we all have skin in this game.

Cuts by Delta Air Lines have meant drastic downsizing the past five years. There are 473 daily fewer flights since 2005, and there haven’t been direct transatlantic flights to London, Frankfurt, Amsterdam or Rome since 2008.

The potential impact is frightening. In the past few months, The Enquirer has reported several stories about how CVG’s flight reductions threaten the long-term business community in Greater Cincinnati and Northern Kentucky.

Chiquita, for example, says it has begun a search for a new headquarters outside the region because of reduced air service. Realtors say fewer international companies are looking at this area to grow. That’s of particular concern given that the downtown vacancy rate is expected to be at its highest in 25 years with the new Great American Tower at Queen City Square coming online.

All that vacant space doesn’t have to be a concern. It should be an opportunity. But this region isn’t going to capitalize if companies aren’t convinced they can get employees from Point A to Point B in a timely, cost-effective manner while based in Cincinnati or Northern Kentucky.

So back to the we versus they discussion. Mok told The Enquirer this month that he needs help from the business community to attract airlines or persuade existing carriers to add flights. Mok has said a new carrier will come to CVG sooner or later – but he thinks a smart financial incentive package could expedite the process.

Pennsylvania, Maryland, Kansas and Utah have launched programs to attract new service with incentives ranging from under $2 million to more than $11 million in public and private funding. Maryland’s program helped land a British Airways flight from Baltimore to London.

To be sure, there are risks involved with incentives. Pittsburgh was burned when it offered Delta a $5 million guarantee, split between private business and state funds, for a Paris route. The flight missed revenue targets, and the community had to pay the difference.

Beyond that, there is a chicken-and-egg problem: Companies want to know what routes a prospective airline will serve; prospective airlines want to know what the incentive package is going to be. And everybody agrees that any incentive is pointless unless the airline is convinced it will make money in this market over the long run.

Expanding air service takes time even in the best of economic times. But the challenges don’t make this any less of an urgent issue. Just the opposite.

The good news is that the Cincinnati USA Regional Chamber and the Cincinnati Business Committee are engaged and working with CVG.

The less-good news: Recently, Mok felt compelled to remind our business community that it needs to put “some skin in the game” to increase the airport’s offerings.

His statements, along with the number of times I still hear the question, “What are they doing to fix the airport?” suggests that perhaps a greater level of urgency is needed to address this problem.

If I’m wrong, tell me. More importantly, if John Mok comes calling, open the door and listen to what he’s saying.

Josh Pichler is The Enquirer’s executive business editor. He can be reached at 513-768-8500 or jpichler@enquirer.com.

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