Regional Airport Feasibility vs. Competing Transport Modes

Introduction

The global economy is recovering from the recession caused by the COVID-19 pandemic. International air travel came to a standstill after borders closed, leading to large losses and limited growth for both international and regional airlines. Nevertheless, global air travel is expected to grow (Gelhausen, Berster, and Wilken, 2021). The pace of that growth, however, is shaped by the maturity of demand in a given region. In markets like the United States, where the propensity to fly is already high, demand is mature and growth rates are expected to be lower than in emerging markets. Changes in the strategic role of air travel within local economies have accelerated planning for more integrated transport systems that are not heavily reliant on aviation for connections between major transport hubs.

In line with the National Plan of Integrated Airport Systems (NPIAS) (2021), future development will focus on core transport hubs, while traffic at regional airports is expected to decline, resulting in lower capital investment in those facilities. To complement declining regional air traffic, resources will instead be directed toward infrastructure and operational improvements in other modes of transport — rail, pipeline, and road — to prevent latency in the flow of goods (Goyal, Reiche, Fernando, and Cohen, 2021). The capital investment required for infrastructure expansion and capacity building to meet growing demand by 2025 will result in higher operating expenses, part of which will be passed on to customers.

Delaware Regional Airlines and Competing Transport Modes

The Delaware Valley Regional Planning Commission (DVRPC) oversees the Philadelphia metropolitan area and is accountable to the Federal Aviation Administration (FAA). The DVRPC is responsible for intercity and intercounty planning and for guiding the long-term vision for growth in the Delaware region. The Delaware region includes Bucks, Chester, Delaware, and Montgomery Counties, as well as the cities of Philadelphia and Burlington (DVRPC, 2001). The agency provides technical assistance, research services, and market analysis to identify demand changes and market trends. It also fosters cooperation among constituent bodies, facilitates private-sector operations, and ensures public awareness.

The FAA collaborates with the NPIAS to identify core public-use airports that are central to transport hubs. Both commercial service airports and general aviation airports may qualify under the NPIAS, and those identified by the DVRPC are included in this framework. The NPIAS governs approximately 65% of public-use airports. Its primary functions are to oversee operations and raise the capital required to maintain or develop airports (NPIAS, 2020). Airports listed under the NPIAS are eligible for developmental funding through the Airport Improvement Program (AIP), Passenger Facility Charges (PFCs), and reinvestment of airport revenues. The DVRPC operates under the Regional Airport System Plan (RASP), which evaluates airport demand, existing facilities, and all necessary enhancements.

In 2020, the DVRPC revised the RASP for the Delaware region in response to market, physical, and policy changes at both the regulatory and community levels. Among the most significant trends is the continued growth of urbanization and the concentration of population in suburban areas (DVRPC, 2001). This demand increase has generated market needs that capital development allocations have failed to match, leaving existing airports undersized. The gap between air travel demand and available capacity has produced congestion and has reinforced the case for more efficient transport alternatives.

Substitute Modes of Transport

Different transport modes are designed to carry freight, passengers, or both. The allocation of infrastructure resources is determined by the technical, commercial, and operational characteristics of each mode and its suitability for a given region. Technical characteristics include speed, motive technology, and capacity (Sentance, 2014). Operational qualities encompass speed limits, safety conditions, and operating hours. Airlines, however, face challenges that go beyond congestion and coverage — environmental compatibility and safety must also be weighed.

Air Travel. The challenges facing airlines are multidimensional, including weather conditions and infrastructure limitations, which create pressure to rely on other means of transport. Competition among modes is determined by cost, frequency, accessibility, safety, comfort, and speed. As established, the COVID-19 pandemic produced a significant decline in air travel (Goyal, Reiche, Fernando, and Cohen, 2021). The NPIAS forecasts a return to 2019 levels of air travel by 2025. The Delaware region is served by 25 publicly accessible airports and six private airports. Given the extensive geographic area these airports must serve, alternative transport modes are critical to meet demand.

Since 1980, a series of airport closures has increased congestion at remaining facilities. For example, the closure of the Warminster Naval Air Development Center in Lower Bucks County created a service deficit for the approximately 5,000 operations previously handled there. The lack of capital investment to expand local airports has driven residents and freight operators toward other modes of transport. Air travel demand is expected to grow by 30% (Gelhausen, Berster, and Wilken, 2021); however, the current RASP plan encompasses only six aircraft and still does not meet projected demand. Capital investment in airport expansion offers lower economic and operational returns for regional residents compared with equivalent investment in road, rail, or pipeline infrastructure.

Conclusion

The comparative advantage of different transport modes depends on how well they connect with one another. At the regional level in Delaware, air travel primarily serves business travelers and is not the dominant mode for the general resident population. Rail and road transport, by contrast, offer users tangible benefits — low costs, accessibility, and flexibility — that air transport cannot match at the regional scale. Consequently, the recovery from the impact of COVID-19, projected to be largely complete by 2024, is expected to produce a slower growth trajectory for air travel than was anticipated before the pandemic (Gelhausen, Berster, and Wilken, 2021). The high capital and operational costs associated with maintaining and expanding existing airports compound this challenge, particularly given the mismatch between current airport capacity and the region's population growth. These factors collectively position road and rail transport as the preferred areas of capital expenditure for the DVRPC, making regional airlines a less viable investment priority in the Delaware Valley through 2025 and beyond.

References

DVRPC, 2001. 2025 Regional Airport System Plan for the Delaware Valley Region. [eBook] Philadelphia, PA. Available at: https://www.dvrpc.org/reports/02003.pdf [Accessed 7 February 2022].

Gelhausen, M., Berster, P., and Wilken, D., 2021. Post-COVID-19 Scenarios of Global Airline Traffic until 2040 That Reflect Airport Capacity Constraints and Mitigation Strategies. Aerospace, 8(10), p.300.

Goyal, R., Reiche, C., Fernando, C., and Cohen, A., 2021. Advanced Air Mobility: Demand Analysis and Market Potential of the Airport Shuttle and Air Taxi Markets. Sustainability, 13(13), p.7421.

NPIAS, 2020. National Plan of Integrated Airport Systems (NPIAS) 2021–2025. [eBook] NPIAS Publication. Available at: [Accessed 7 February 2022].

Sentance, A., 2014. Connectivity and Growth: Directions of Travel for Airport Investments. [eBook] PwC. Available at: https://www.pwc.com/gx/en/capital-projects-infrastructure/publications/assets/pwc-connectivity-growth.pdf [Accessed 4 February 2022].