Airports set lures for non-stop flights

Boston has some of the best universities in the world, a robust medical sciences industry and an increasingly diverse population.

Yet, Boston Logan International Airport doesn't have a single non-stop flight to Asia, Latin America, Africa or the Middle East, forcing many of the region's residents to connect in New York or other hubs when traveling abroad.

Officials at Boston Logan are vowing to tackle the problem, joining a growing list of airports that are offering special financial incentives for airlines to begin or expand service.

Tom Kinton, CEO of Massachusetts Port Authority, which runs Boston Logan, says high fuel prices are a key factor in the changing way that airlines are looking at service expansion. "Without assistance," says Kinton, "airlines are reluctant unless it's a slam-dunk (route)."

In recent years, U.S. airports of all sizes, including Dallas/Fort Worth, Miami, San Francisco and Fort Lauderdale, have cut landing fees and rents and chipped in money for advertising to court new flights, particularly to attractive international destinations.

Airport executives say the incentives help broaden customer choices, stimulate the local economy and, ultimately, lower fares by increasing competition.

Beyond the economic benefits, a new non-stop service to a foreign gateway enhances an airport's prestige. Direct flights to Asia or Europe are on the wish lists of nearly all major airports.

More rivalries

Financial incentives have been around for years, but airlines are seeing more of them recently as competition among airports gets more heated, says Jon Ash, president of transportation consulting firm InterVistas-ga2. "Each year in the last five or six years, it has become a more aggressive practice."

Communities are realizing that there is a lot of economic value in new international service. Airlines don't make decisions on new routes based solely on incentives, says American Airlines amr spokesman Tim Wagner. "It's no secret that airlines accept incentives, but we only do if it is a route we think has a chance of long-term success," he says.

Incentives can "tip the scale" in airline service decisions, says Gary Franzella, deputy aviation director at San Francisco International.

Optimistic that airlines would be drawn to its location and the local economy, San Francisco finished a new international terminal in late 2000, only to be hit by a dramatic industry slowdown from 9/11.

"When we invested in the new terminal, we had had some growth in international service, and we expected that to continue," Franzella says.

The airport, which competes with Los Angeles International, introduced its incentives in 2003, partly as a way to fill the terminal. They have helped, says Franzella. The incentives, which provide a 50% discount in landing fees for a year, helped bring four new routes: Air New Zealand service to Auckland; United uaua service to Nagoya, Japan, and Guangzhou, China; and Aer Lingus service to Dublin.

The total value of incentives to date is $725,000. The program continues, and the airport most recently received commitments from India-based carriers Jet Airways and Kingfisher for service to South Asia.

Paying the piper

Boston Logan estimates it will cost about $200,000 for the first year of service for every new international route it attracts.

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