Summer air service for valley set to take off

JSX ramped back up last weekend

By Katherine Nettles 

The local air service market has begun, with United and boutique air carrier JSX offering an array of flights between their two schedules that cover Denver, Houston and Dallas. Air service contractors who work with the Gunnison-Crested Butte airport (GUC) gave a rundown to the Gunnison Valley Rural Transit Authority (RTA) board during their regular May meeting, and said while passenger counts are lower than last year, they are still holding up compared with the year prior. 

Spring/summer air

This spring, United ran one daily flight through Denver but returns to twice daily flights beginning June 2 and reintroduces Houston flights on weekends only. 

JSX is returning to GUC, having entered the market last year operating two flights per week from Dallas, thanks to a subsidy from the RTA. According to Airplanners, LLC managing partner Bill Tomcich, JSX did very well last summer, going to four flights per week and running almost a 90% load factor for the entire summer. With that success, Tomcich said they have increased confidence in the market and are operating at their own risk this summer. They resumed operating through GUC on May 25 with a return to four flights per week. 

Tomcich echoed the predictions from Gunnison Valley Tourism and Prosperity Partnership (TAPP) director John Norton in saying that the outlook for summer air service is a little bleak. 

He reiterated Norton’s assessment that domestic travel is way down so far, while international travel is up and most domestic travel is serving those international connections. 

While Tomcich said that prices across the board had been way up this spring, as much as 18%, he speculated that prices might have passed their peak, and since demand is not performing the rates might go back down.

Winter recap

In a review of the 2022/2023 winter air service, Tomcich said passenger counts are down slightly this year. “We had really good months in December, January and February. And this compares not only against last year, but the year prior as well. I think it’s important to look at this in context of a longer-term trend line rather than just year over year,” he said. 

Tomcich reminded the RTA board that 2022 was a very strong winter for air travel to GUC, followed by “an extraordinary March” with record-high passenger numbers. “So, when you compare this March against last year, yes, we are down about 14% in terms of passenger numbers.” But he noted that GUC was up 25% from March 2021. 

“Overall winter passenger numbers were down 3.5% from last year, which was the strongest year we had in the past 10,” he said. 

Tomcich explained that passenger capacity was also down because United had switched from running three daily flights in March of 2022 to operating three flights on the weekends only, plus two flights daily from Denver during the week in addition to their daily Houston service. 

“While we were behind last year in terms of total passenger counts, compared to the last decade it was still a very good winter. And the load factors were quite good as well,” he said.

The minimum revenue guarantees (MRGs) for Houston did much better than expected. Tomcich said while he and RTA director Scott Truex had discussed in late March their expectation of up to a six-figure loss, the Houston flight ended up making money. Even with a soft load factor (66% for Houston), the fares were stronger than usual and fuel prices went down. 

On the other hand, American out of Dallas Fort Worth (DFW) hit the $300,000 MRG loss cap in January. “We still don’t have the February and March numbers yet,” said Tomcich, but he advised that the RTA will be obligated to a significant cap payment for the winter because the American load factors were not met.

GUC has generally performed in the middle of the pack among its market peers such as Montrose, Telluride and Jackson Hole, and Tomcich said if Airplanners finds that the DFW flight stayed in the middle of the pack again this year, they will have a sense of future stability for the Dallas route despite the major loss this year. 

JSX, which had entered the GUC market for the first time last summer and done very well, had tried running Dallas and Austin flights out of GUC last winter, but the Austin flight had very low load factors and the air carrier ran only 17 flights despite a contract with the RTA for 40 flights. Tomcich said just this month a final reconciliation tally has been reached, and JSX will refund $103,500 to the RTA.

Looking ahead

Truex said they would like to approach JSX about Austin again for next winter, with encouragement to start loading flights earlier in the season. 

“We don’t feel like it was a real, true test for whether Austin would work,” he said, because JSX didn’t start loading flights until just before Christmas. Tomcich agreed that last winter’s timing was not good. The board supported the idea, and a proposal will likely be ready for board consideration at the June meeting.

JSX has five flights per week through Dallas already scheduled for next winter, and Tomcich said although they do not have the terms yet for United or American MRG contracts next winter, all the traditional flight schedules are set across United and American.