New Air Service for Salem?

The Salem City Council is considering a joint grant application with Coos Bay and Klamath Falls to the state to underwrite airline service to the three cities. Both of the latter cities already have state-subsidized service to Portland and San Francisco on United Express using SkyWest 19-passenger turboprops shown in the picture. If approved, the new grant would fund service to/from Portland via Salem to San Francisco via Coos Bay and Klamath Falls. Whether this would work for Salem remains to be seen.

A study done before the Delta service began to Salt Lake City showed that the Bay Area and Southern California were by far the largest markets from Salem. The study also showed, however, that because Salem is close to PDX it is very price sensitive. Salem area passengers will pay a premium of $50 or so to avoid the hassle of driving to PDX and paying for parking but not much more. There also have to be enough frequencies to make it convenient. Delta did fine out of Salem when it priced its service within this guideline but in the winter, it let its fares get much higher than PDX and (no great surprise) passengers responded by saddling up and driving to Portland. Even so, Delta flew over 46,000 passengers to/from Salem in its first year. Convenient service to San Francisco with its myriad connections should generate substantially more passengers.

Which brings me to the second problem with Delta's service and the new service being proposed - the type of aircraft used. Delta used 50-seat commuter jets that even if 100% full usually could not generate a profit on the relatively long route to Salt Lake City. They were nice aircraft, albeit small, but simply not economic. Regarding the proposed new service, it remains to be seen how many people will be willing to strap into a noisy turboprop for the flight to San Francisco with an intermediate stop. If loads to/from Salem ramp up to the levels of the old Delta service, I think you will see SkyWest, the new carrier, match it with 70-seat jets and probably some nonstops, but they will need to see the sustained demand first. As an example of what could happen, Eugene and Salem generate similar traffic levels and Eugene has 5 nonstop flights per day to San Francisco on 70-seat jets.

Each journey begins with a first step, and this clearly is a first step. Hopefully Salem area passengers will realize this and use the service knowing that bigger and better things are ahead once the demand is established.


www.statesmanjournal.com/article/20091109/NEWS/911090326/1001/news