Is Dulles Airport Shrinking Too Much?

Dulles airport has been my home airport since the late 90s when I relocated to Northern Virginia.  Right around that time, the airport saw a big step towards modernization with the new B concourse.  Since then, there hasn’t been much in the way of modernization other than the AeroTrain they installed a few years back.

A recent article is now wondering if Dulles has passed the point of relevance and is on a downward trend:

Blame Congress. Blame the airline industry. Blame sequestration. But Washington Dulles International Airport is in trouble. The most alarming evidence: Sometime next year, more passengers will travel through Reagan National Airport than Dulles — an airport 14 times National’s size.

….Dulles has long been billed as the region’s international hub, but recent days have been unkind to the airport. Although the number of international flights has grown significantly (Air China and Brussels Airlines are among the international carriers that launched service this year), analysts say that the steady erosion of domestic connections could prompt some carriers to move their business to other hubs such as Newark Liberty International and John F. Kennedy International airports, which offer passengers more domestic connections.

So, is the article’s headline right?  Is Dulles struggling, beyond a point of repair?  It’s hard to give a definitive answer, but I don’t see a lot of good news on the horizon.  Most of that is due to some combination of incompetent and corrupt management by the MWAA (Metro Washington Airport Authority), the organization that operates both airports.

For starters, the way that MWAA has characterized the debt, it’s actually a lot more expensive on average for airlines to operate flights at Dulles vs. National (in some cases, more than twice as much).  This article from a couple of weeks ago talks in more detail about the cost differences between the airports.

One of the details that was new for me from this article was the reference to international airlines paying more than domestic airlines to operate service at Dulles.  There isn’t much MWAA does that makes sense, but since most of the international folks operate out of the newer B concourse, it makes sense they should pay more for the better facilities.

And, on its face, it doesn’t make much sense that MWAA seems to be arbitrarily assigning some debt from Dulles to National to close the gap on passenger fees, or CPE (cost per emplaned passenger).  But, as the GGW article suggests, airlines are pretty eager to fly out of National.  So, if you’re MWAA, and you somehow dug yourself a hole where the airport you need to grow is shrinking while you get complaints about growth at the other, charging a premium for airlines to operate at the place they want most isn’t the worst idea to help get Dulles on the right track.  Train service to Dulles from downtown will certainly help, but that’s still at least 3 years away.

United Airlines is the biggest carrier at Dulles, averaging about 2/3 of the traffic there.  They’re “shrinking seasonally” by 14% in the first quarter, but I don’t think all of those seats are coming back in the summer.  They already dropped JFK-IAD service just recently and I wouldn’t be surprised to see them squeeze more flights out of the system.  I doubt they’ll kill more destinations but I do think they’ll reduce frequency and/or seats.

They have a number of destinations they serve nonstop that they continue to charge sick premiums on, so those are likely safe.  They’re also on record as believing it’s pricey to operate out of old, tired facilities at Dulles (they’re right), so they don’t seem to be a likely source of funds for any improvements.  That means United and MWAA are likely both betting that a bit of lipstick on a pig will cause passengers to choose one airport over the other.

And, there is some lipstick, some new restaurants that are coming to the C and D concourse (more on this in future posts).  Still, if the goal is to make Dulles more appealing, announcing a billion dollar construction plan at National doesn’t quite seem to be the right path.

Bottom Line It For Me, Ed

Dulles has had issues for over a decade.  The train between concourses was a welcome addition but was long overdue, just like the renovations needed to the C and D concourse.  New bathrooms and restaurants are nice as well, but Metro can’t come soon enough to connect the airport to the rest of the region that deals with heavy traffic on a daily basis.

United is too schizophrenic to be relied upon for a cohesive strategy, and MWAA isn’t any better.

But, at the end of the day, there’s a lot of international traffic at Dulles, and United provides connections for a decent chunk of it.  That’s unlikely to change significantly.

That leaves us with a net status quo at Dulles.  Some things will change, many will stay the same.  Until there are significant incentives (or customer sentiment) to drive business to Dulles, it will remain where it is.  Low-cost carriers already target BWI for the cheaper operating costs and everyone wants to grow at National.

When all the airlines (and customers, for the most part) see one partner who’s cheaper (BWI) and one who’s sexier (National), why settle for the date that’s sitting at home on a Friday night, waiting for the phone to ring?

The post Is Dulles Airport Shrinking Too Much? was published first on Pizza In Motion.

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  1. As a DC part-time person (thank god only for work, I’d shoot myself if I lived in that area full time), to watch the region get sold on that bogus six billion dollar Metro line was hilarious, the locals gobbled it up and actually believe that will make more people in DC use Dulles. Nobody likes Dulles. Nobody uses Dulles unless they absolutely must. And certainly nobody in their right mind will wake up and say “wow, I’m so lucky, I can go ride the Silver line for over an hour to get to an airport that takes and hour to get to my gate once I’m there–gee what a great investment this was to make the MWAA cronies rich”. Hope the NoVa folks have fun paying for that white whale for years to come.

    1. Robert, I mostly agree with you. I do think there are people that will use Dulles more frequently if the Silver line drops them off, but nowhere near the numbers being projected. As it stands now, it’s almost $5 to ride from Reston to Arlington. Those fares won’t promote too much incremental ridership given the tolls are cheaper.

    2. And, I definitely hear your frustration about living there full-time. When we sold a local business some years ago, I told my wife she could draw a 15-mile circle around Dulles and pick a neighborhood somewhere in that circle, with no Beltway crossings. If the schools were good enough inside of the Beltway I may have considered it. But, driving in this region is pretty darn bad.

  2. Other places with multiple airports have similar situations, where fees for landing & facilities should be charged on a market basis rather than some cost accounting. The more crowded facilities are usually older and built when costs were lower making for an inherent problem. Below the surface, without market pricing, any allocation of the gates and slots is inherently via some form of political corruption.

    1. VG, or political ineptitude, as in the case of the forced divestiture of slots at DCA by AA and US that resulted in less total destinations served by DCA. I have no problem with the airports setting fees based on demand, since the demand at DCA is what’s leading to a billion dollar expansion. Why shouldn’t airlines and passengers pay those fees if they want to fly out of DCA. It’s no different than charging a toll on a highway.

  3. I love DCA – no matter how old or crowded. When you land you are just minutes from the Metro or a short walk to rental cars.

  4. The Silver Line to IAD will help some, assuming it ever gets built (I’ve lived here my whole life and refuse to believe it will happen until it actually does), but I can’t ever see anything affecting the popularity of DCA. Even with the Silver Line, IAD will still be too far from downtown DC for many people, and the C/D concourses look like they date from the time of the First Crusade. All things being equal, a great many people will choose DCA before schlepping out to IAD.

    1. Brian, even with a helicopter IAD will be too far for folks from DC. It’s more about all the folks in NOVA just on either side of the beltway. Not a lot of incentive to go to IAD right now, and not much coming soon.

      1. The major reasons I can think of where it would make sense for me to go to IAD for a paid flight (I live in Montgomery County, MD) are 1) to get a non-stop flight to a beyond perimeter destination 2) to get a non-stop flight to an international destination 3) the airline I’m flying doesn’t serve IAD. And even in those cases, I may be willing to take a connection out of Reagan, depending on the circumstances. IAD is a black hole.

        I should emphasize that the above applies mostly to paid flights – for award flights, I’ll take whichever of the two airports I can get.

        1. IAD is really most useful now as an intl departure city. As United has trimmed flights nobody has really moved in to fill the gaps and compete. That goes back to the days of Independence Air. They have serious competition on so few routes that they can likely maintain status quo and still make money at IAD. Without a serious challenge to that, things aren’t likely to change.

  5. “it’s actually a lot more expensive on average for airlines to operate flights at Dulles vs. National (in some cases, more than twice as much).”

    That’s the crux of the issue. The cost gets passed on to passengers in the form of higher ticket prices anytime a landing or departure at IAD is involved. The airport is also too remote. You have to pay tolls to get there. For people who have to be in DC, National is cheaper and closer. For anyone who isn’t on a time crunch, BWI is not that much further away and is dramatically cheaper. I have family in the area, but why pay up to hundreds of dollars more to fly into Dulles when travel times to BWI are about the same?

    1. coyote, you actually don’t have to pay tolls to get to IAD, but the rest is true. Frontier is trying to do at IAD what Southwest did at BWI. They’ve got a long haul.

  6. Dulles and BWI are great opportunities for upstarts. Hopefully they will gain more of a foothold if traffic slacks off at Dulles. I like it that airlines like Alaska are able to try routes to all three airports, and stop the routes if unprofitable, I.e. Didn’t Alaska fly out of iad for a bit after 9-11?

    Hopefully someone new will be able to create another hub in Dulles like SW at BWI.

    I look forward to metro. We live a short bus ride from the pentagon and already ride the 5A bus to Dulles for long haul flights. Metro might be slower but it should depart more frequently.

    1. Alaska did operate out of IAD for a bit iirc. I remember having a choice between a direct flight SEA-IAD or flying through STL back when AA still had a presence there (and flew to IAD from there as well). I’m fairly certain someone will take a stab at building routes out of IAD. Who knows? Maybe it’ll be Frontier.

  7. At National, you get upset if your luggage takes longer than 30 min.
    At Dulles, you consider yourself lucky if your luggage takes only 1 hour.

  8. I think it all depends on where you live. This area is so big that not only can it sustain 3 airports but it also needs them. If you live and/or work in DC or its immediate area, of course you’re going to prefer to leave out of DCA and if you live/work in MD, BWI may be your best bet. I live in NOVA and IAD is by far my preferred airport. I can get there faster than if I had to drive to DCA because I’m going against traffic – away from DC; faster because there’s an exclusive lane for airport traffic on the tollway; and it’s free to get there, as airport bound cars are exempt from any and all tolls.
    I have used all three airports several times in the past and I find DCA to be very crowded in comparison and BWI too remote for me. My point is that we all prefer the airport that’s closer to us, right?

    1. Gigi, proximity is the answer in a vacuum. And, IAD is closest to me as well. But, I’m disappointed JetBlue chose to move most of their operation to DCA. Moves like that and the death of Independence Air and retreat of AA on routes like ORD make the pricing out of IAD higher than it might be if there were more robust competition. DCA is fine, but I find the concourses too small and crowded as well.

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