PIT passenger growth slowed sharply in December and January

Summary: While last December’s and January’s passenger numbers at Pittsburgh International Airport (PIT) were very disappointing, there are signs that the national pace of travel picked up markedly in the last half of February.  This should bode well for a February pickup at PIT as well. Nonetheless, with the war in Ukraine having a major effect on fuel prices, and perhaps on consumer sentiment as well, the air travel industry is facing another round of headwinds and uncertainties. Early March national passenger data suggest some negative impact on travel is already happening.

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PIT passenger count changes over the last year 

The number of passengers enplaning and deplaning at PIT fell in recently released January data (456,076) compared to the January 2019 level (654,886), a decline of 30.4 percent. In December 2021, the passenger count was 22.3 percent below December 2019. These two months follow a much better performance last November when the passenger count, compared to the November 2019 count, was down only 16.1 percent. This was the best recovery month to date following the near halting of air travel in April 2020 when PIT passengers totaled only 32,447 with virtually no international travelers.

Looking back at travel data for 2021, improvement in the monthly passenger count last year relative to the same month in 2019 was dramatic through November. Bear in mind that in January 2021 the number of passengers was still 66.4 percent under the January 2019 level. However, by June, the passenger level compared to 2019 had improved markedly from January to stand just 30 percent below June 2019. July continued the improvement as restrictions were being loosened further with the decline from July 2019 to a much lower 22.2 percent.

As noted earlier, gains continued through November with a passenger count reading of 16.1 percent below 2019 but momentum did not continue as December slipped back to a drop of 22.3 percent from the 2019 reading. In January the downward slide continued with the passenger count down 30.4 percent from 2019.

To be clear, the bigger shortfall in January 2022 compared to the December 2021 decline was not due to seasonal factors. The January 2022 count was lower compared to January 2019 thereby accounting for normal seasonal factor impacts. Clearly, the problems that caused December’s numbers relative to 2019 to perform much worse than November were still having an effect in January 2022. While the COVID variant no doubt affected January travel, it is not clear why December saw such a large drop.

Comparison to national air travel statistics

Official Department of Transportation statistics on air travel passenger counts lag several months; making direct comparisons to U.S. data for recent months not possible.  However, the Transportation Security Administration (TSA) reports daily the number of passengers entering airports at their security checkpoints. This number is a good and timely measure of the volume of air travel nationally. 

It does not match up perfectly with the monthly national enplanements and deplanements that are available much later because those stats include connecting passengers who do not pass through a checkpoint going from flight to flight at the same airport.  At many airports—such as Atlanta, Dallas-Fort Worth, Chicago, Denver and other large city airports—a huge proportion of travelers are connecting passengers.

But for smaller airports without major hub carriers such as PIT, the TSA checkpoint data are a reasonable proxy for national air travel and to use for comparison to passenger counts at PIT.   

How do the checkpoint data showing percent changes from the same month in 2019 compare to the PIT experience over the last year?  Interestingly, the pattern of improvement of TSA data and PIT passengers through the months of 2021 relative to 2019 was very similar through December.  The table compares the national and PIT performances in 2021 as measured by the percent change from the same month in 2019.

Throughout 2021, until December, PIT passenger gains improved almost in lockstep with the national increases in passengers. In December 2021, PIT’s performance fell behind the national numbers and in January, as the national count failed to sustain the improvements of earlier months, PIT experienced an even worse setback, dropping 30 percent below the 2019 figure. There are no obvious reasons for PIT’s pattern of tracking national performance to have suddenly disappeared.

Note that national air travel also had a setback in January, dropping 22.5 percent below the 2019 reading. No doubt the COVID Omicron variant played a significant role in the decline. PIT passengers fell in January in tandem with the national setback. But PIT numbers did not reflect any recovery that was greater than the national drop in December.

On a more positive note, TSA data show a significant upturn in travel in February with a shortfall of 15.6 percent compared to 2019 with a daily average of 1.73 million people going through check points (January daily average was 1.48 million).  Even more encouraging, February showed much stronger gains in the second half of the month with travel from Feb. 18 to Feb. 28 averaging 1.99 million—only 10 percent below the 2019 level.

These national data are somewhat encouraging for PIT, at least for the February count. With a return to travel as robust as the late February figures show, there is reason to believe that PIT passenger counts will see marked gains compared to the December and January experience as well. Unfortunately, March is likely to pose a new set of difficulties for air travel.

The reality is that non-hub airports must rely on the local market for travelers, whether local residents flying out or visitors coming to the region for business, family or tourist reasons.  In a region with little population or employment growth, the prospects for air travel passenger growth will be much weaker than for areas that are growing rapidly, such as Nashville, Austin or Raleigh, for example.      

PIT has been incredibly and uniquely fortunate to have had access to a large sum of gaming tax revenue—as provided by the state Legislature—and to have natural gas reserves on the property that are accessible through fracking that generates additional revenue. And in recent years, it received a special dollop of federal funds from COVID stimulus spending.

But what of the future? The war in Ukraine and its impact on fuel costs and the economy and demand for air travel, especially international travel, could be substantial over the coming months. At the same time, with the effects of COVID waning, there is reason to expect an increasing willingness to fly.

In short, the future for travel in the near term is facing a combination of unusual and hard to assess factors.  At the same time, the fundamentals for passenger growth near term and long term at PIT are not very encouraging compared to many other areas of the country.

Passenger counts in 2019 have weakened abruptly at Pittsburgh International

Summary:  After posting very strong growth between August 2016 and August 2017, with further good gains from August 2017 to August 2018, passenger counts, especially for international passengers, at Pittsburgh International (PIT) have slowed dramatically through August of this year, the latest monthly data available from the Airport Authority.

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In August 2019 the international passenger count fell an astonishing 37.3 percent compared to the same month in 2018 despite the heavily touted arrival of British Airways (BA) in April. Note that changes comparing data to the same month a year earlier are methodologically necessary because of significant seasonal variations in international passengers for which summer counts typically dwarf those in the winter months.

Although international passengers make up only 3 percent of total passengers, the 37 percent drop, combined with a tiny domestic increase, resulted in a decline in total passengers in August, albeit small, at 0.7 percent.  Year-to-date the August domestic count is up 2.2 percent compared to the 5.9 percent increase posted a year earlier. 

The year-to-date international count in August was down 21.9 percent—a major reversal from the 15.8 percent increase for the first eight months last year. International passenger counts have fallen every month this year compared to 2018 except in April when they rose with the advent of BA flights. However, during each of the last three months of available data, June through August, international passenger boardings and deplanements have plunged by more than 30 percent from their 12-month earlier readings.

This abrupt slowing is not due to an overall weakening nationally. Nationwide, domestic enplanements through August are up year-to-date by 4.1 percent, down slightly from 2018 but stronger than 2017. Meanwhile, international enplanements through August are up 4.4 percent which is actually much better than 2018’s 2.6 percent.

Thus, the PIT passenger count weakening must be attributable to other factors, especially the huge drop in international passengers.  Virtually all the international gains at PIT made in 2017 and 2018 are gone. The August 2019 count of 25,951 is down almost 16,000 from a year ago and stands just above the 2016 reading.

Note that PIT releases data for combined enplanements and deplanements. Keep in mind that while these two counts might vary slightly in the very short term at an airport, over a month or year they will be virtually the same as FAA data shows. Thus, using either enplanements or combined data will yield identical percentage changes. 

Bear in mind too that while much was being made of PIT’s success in recent years, the success at PIT was not unique. For example, in 2015 PIT was ranked as the 47th-largest airport in the United States measured by enplanements. In 2018 it had moved up to 45th –a good result. However, over the same three years, Cleveland moved from 46th to 44th and Cincinnati climbed from 53rd to 48th.  And just as impressive, Nashville jumped from 35th to 31st.  In short, good growth was occurring at several mid-sized airports.   

It is also important to remember that nationally there were 890 million enplanements in 2018.  Thus, Atlanta, the biggest airport, with 51.9 million enplanements accounted for only 5.8 percent of the national total. The top 20 airports account for 52 percent of all enplanements with all above 20 million. PIT with 4.7 million in 2018 was only 0.53 percent of total. Of course, most of the top airports are hubs and a large share of their passengers are connecting. Still, the local area economic impact of an airport, in terms of direct employment and income, will depend on total passengers. When USAirways dropped PIT as a hub and flights were cut dramatically, several thousand employees at the airport lost jobs in the years following.

The important question is what happened at PIT that caused the big drop in international passengers, especially in light of all the great hoopla surrounding the coming of British Airways. Through December of last year, the international passenger count posted gains year-over-year and had done so in all but a couple of months during 2018, ending the year with a nice annual pickup of 13.5 percent.

But in January of this year things started to go sour with a near 17 percent drop from the level in January 2018. As noted earlier, 12-month changes in international travel at PIT have been down each month in 2019, except for April. The declines in January through March most likely reflect the cessation of WOW Air service in January as that carrier succumbed to financial pressure. WOW was also a recipient of a PIT subsidy.

The big declines since May are no doubt due to Delta’s ending its flights to Paris. Once the months of Delta’s seasonal flights have passed this year, the monthly year-over-year passenger declines should become smaller. But what has been revealed is that the British Airways flights are not carrying nearly as many people over the June through August period as Delta apparently was. 

Whether their passenger count in the offseason will be enough to make up for the Delta loss remains to be seen.  But it probably won’t since international travel volume drops substantially after the summer season. Keep in mind too that BA is receiving $3 million dollars from PIT over two years to operate four weekly flights—an additional factor in the net benefits calculation of having BA at PIT. As was noted in previous Policy Briefs (Vol. 18, No. 31, Vol. 19, No.14), British Airways does not get subsidies to operate in Florida airports, Los Angeles, New York or any high-volume U.S. airport. And it operates in 26 U.S. airports currently.

Also not known at this point is how many Pittsburgh-to-London or other European destination passengers BA has siphoned off from other carriers such as American Airlines’ one-stop service to London. And because the data are not available it is unknown what percentage of passengers on the BA flights are local citizens and how many are foreign visitors.

These percentages are important to know since the regional economic impact projections presented by BA depend heavily on the number of foreign visitors brought by the carrier—projections the Institute has shown to be overly optimistic. Besides that, the British Airways impact calculation does not look at net benefits in that it ignores the dollars leaving the region through BA ticket purchases and expenditures by regional residents abroad.

The apparent slowing of domestic gains in 2019 compared to both the two previous years and nationally could be the result of several factors. If that trend continues over the next several months, the Allegheny Institute will analyze possible causes and likely effects. For now, suffice to say that the sizable gains in 2017 and 2018 have made it more difficult to continue exceptionally fast growth. Moreover, the seven-county Pittsburgh metropolitan area is still losing population, the labor force has shown no net increase since the early 2000s and jobs gains are slowing. All of which make it hard for local demand for air travel to keep growing at very strong rates.