Airlines recovering from scare

DIA passenger figures rebound since plot thwarted in Aug.

Chris Walsh, Rocky Mountain News

Published November 9, 2006 at midnight

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Demand for air travel appears to have rebounded from August's terrorism scare, which resulted in new airport security measures that initially deterred some people from flying.

On Wednesday, Denver International Airport reported a 16.1 percent jump in passenger traffic during September compared with the same period in 2005 - one of its largest spikes this year. That compares with a 5.1 percent increase in August, which was the airport's lowest monthly percentage increase in 2006.

At the same time, several carriers, including Denver heavyweights United Airlines and Frontier Airlines, announced solid October growth after reporting weaker- than-expected demand the previous month.

"The industry was hurt by what happened in August, and DIA's numbers probably would've been up even more if it weren't for that," said Evergreen-based aviation consultant Mike Boyd. "But the industry is recovering. It looks like it's going to be a very strong 2007."

DIA's September surge is somewhat surprising, considering airlines nationwide reported lower demand after authorities in the United Kingdom foiled a plot to blow up U.S.-bound flights. The move led to new rules banning liquids, gels and creams from being carried aboard flights, creating confusion and delays. Those rules have since been relaxed somewhat.

The 4 million passengers who traveled through DIA in September set a record for the month, soundly stomping the 3.45 million figure for the same period in 2005. DIA's traffic is up 10.4 percent through the first nine months of the year and is on pace to smash the record set in 2005.

"September was just huge," said DIA spokesman Chuck Cannon. "Normally you notice a dropoff after Labor Day, but it just kept going even into October."

DIA was somewhat insulated from the effects of the security changes as heated competition kept fares low, helping drive demand. The airport's two largest tenants - United and Frontier - have been adding new flights and routes. And newcomer Southwest Airlines has grown as well.

But local airlines were affected to some degree nonetheless.

Frontier, for instance, said demand in September didn't keep up with the carrier's capacity growth, meaning its planes were less full and its flights less profitable than it expected.

"Part of it was that we weren't attracting the passenger numbers we though we would," said Frontier spokesman Joe Hodas.

The slowdown tempered Frontier's earnings in the quarter. But demand picked up again in October, helping the Denver-based airline boost its occupancy even as it faced continued financial pressures in the low-fare environment. United, Southwest and other airlines also reported solid passenger growth nationwide in October.

"Demand has absolutely come back," Hodas said, "and we see it continuing to outpace growth."

Flying high

• DIA's 16.1 percent spike in passenger traffic in September ranks as one of the airport's largest this year.

Percentage increase over the same month in 2005:

January 8.2 percent

February 10.5 percent

March 10 percent

April 17.7 percent

May 12.9 percent

June 7.9 percent

July 6.9 percent

August 5.4 percent