In an undeclared war, Miami and Fort Lauderdale airports increasingly chase the same customers.
By JEAN HELLER
Published May 1, 2004
Separated by just 20 miles and imbedded in the same metropolitan sprawl, they watch one another's moves, compare themselves in growth and passenger counts and, to some extent, covet one another's business.
It sure looks like a rivalry.
Miami International Airport is interested in adding low-fare carriers, which is Fort Lauderdale's strength. Fort Lauderdale-Hollywood International Airport is welcoming more international service, Miami's bread and butter.
Officials at both airports deny the competition, but aviation experts beg to differ.
"I'm sure they tell you they don't compete, because that's their story for public consumption," said Brian Streeval, an air service marketing consultant with the Boyd Group in Denver. "I'm very familiar with the situation there, and I know those two airports, Miami and Fort Lauderdale, don't like to work with each other.
"It's a very competitive situation."
In some respects, it brings to mind the Tampa and Orlando international airports, though these two facilities serve two distinct population centers. Neither airport claims the other is a rival, but they angle for much of the same business.
The proximity of the South Florida airports produces a real choice of flight schedules and fares for consumers. The question is whether both Miami and Fort Lauderdale can thrive by sharing a population of 4-million, while West Palm Beach International Airport sits just to the north.
At the moment, all advantages seem to be Fort Lauderdale's. In the last three years, Miami has lost business - 23 percent fewer flights and 13 percent fewer seats - while Fort Lauderdale has been the fastest growing airport in the country.
Fort Lauderdale has eight low-fare carriers doing land-office business and a handful of airlines that serve destinations in the Caribbean and in Mexico.
And now American, Miami's flagship carrier, is starting flights from Fort Lauderdale to the Caribbean, blurring the distinction between the two fields.
According to Stuart Klaskin of KKC Aviation Consultants in Coral Gables, there are two reasons airlines are taking a fresh look at Fort Lauderdale.
"The population of South Florida has definitely shifted north from the Miami area toward Fort Lauderdale, which gives the airport a larger base to draw from," Klaskin said. "As demand increases, service increases. And the cost to an airline of doing business in Miami is prohibitive for many carriers."
Miami's strength is that it remains a gateway international airport, with hundreds of flights a day to the Caribbean and Latin America. The airport has four low-fare carriers - AirTran, ATA, America West and Alaska Airlines. According to Streeval, three of the airlines have small operations, and Alaska Airlines is there only because of its partnership with American Airlines.
"Together, they can take passengers from Anchorage to Brazil," he said. "The revenue associated with that is phenomenal."
But, flying into and out of Miami is an expensive proposition. An airline's cost of doing business at any given airport is a many-factored thing. Landing fees, gate fees, gate maintenance and facilities rentals all figure into it. And not all airports charge for the same services the same way.
Nonetheless, for every passenger who boards an airplane in Miami the airline must pay the airport $18.61. In Fort Lauderdale, the cost is $4.63. Multiplied out over 250 seats, a fully booked airplane flying into Miami costs an airline $4,652.50, compared with $1,157.50 to fly the same plane into Fort Lauderdale. Carriers have to recoup the money somehow, and some of it comes back in the form of higher ticket prices.
On Friday, the lowest nonstop round-trip fare on Expedia for a coach ticket in two weeks from Fort Lauderdale to Washington's Reagan National Airport was $146. The same trip from Miami cost $344.
From a passenger standpoint, Fort Lauderdale has two things going for it: lower fares and user friendliness.
"If I use Fort Lauderdale it's because it's less expensive and much less chaotic," said Amie Thomasson, a philosophy professor at the University of Miami who travels frequently in the United States and abroad. "We're a good bit closer to Miami ... (but) Miami is terrible about posting signs for parking, terminals, where flights are arriving and departing. It's impossible to get around easily."
Some of the chaos in Miami is endemic: more passengers, more baggage, huge Customs and immigration operations. But a good deal of the mess is due to the airport's $4.8-billion capital program that, when finished in 2006, will have produced terminal space of more than 8-million square feet, the size of 139 football fields, including the end zones.
If there is a chance for a clear-cut winner in this rivalry, the scenario could look like this: Miami International starts losing airline service because it's so expensive, which in turn makes it even more expensive for the airlines that remain. Those airlines cannot then compete with rivals at Fort Lauderdale. In this era of fragile airline economies, experts say that could drive even more carriers away, triggering a snowball effect that could threaten the airport's survival.
On the other hand, if Miami can lower its costs, it could draw service away from Fort Lauderdale, leaving that airport exposed and overextended.
But neither scenario is deemed likely.
"Any time you incur a lot of debt in a bad economy, and both of these airports have done that, there is risk of the world shifting under you," Streeval said. "But neither has a knockout punch, and the likelihood is they'll both thrive."
Officials of the two South Florida airports are dismissive of the notion of competition.
"We target entirely different markets," said Cynthia Paul, spokeswoman for Miami International. "Half of our traffic is international. Fort Lauderdale focuses on low-cost carriers. And while our fees are higher, we provide some services to the airlines that others don't."
Those services include assigning gates and maintaining, managing and cleaning terminals, Paul said. Tampa International also maintains, manages and cleans its terminals, and airline costs of operating at TIA are one-quarter what they are in Miami.
Jim Reynolds, spokesman for Fort Lauderdale-Hollywood International, said, "We are not in competition. We are not trying to steal Miami business. It would be stupid to try to steal Miami's business, and we couldn't do it even if we wanted to because we're hemmed in by development all around us. We can't get much bigger."
Fort Lauderdale's longest runway is 9,001 feet. Officials are considering building a new runway, but it will be somewhat shorter. That means that long international flights aren't possible there year round. In the hot summer months, when the air is thin, the longest runway isn't long enough to allow a large, fully loaded and fueled jetliner to take off safely.
Moreover, Fort Lauderdale doesn't have the space to build big Customs and immigration facilities that would be required if they started taking on a lot of international service.
The situation in South Florida is not unique, but it is unusual. New York City has three huge airports grouped tightly together, but the market there is large enough to tax all three. Los Angeles International is so big that it has nothing to fear from the smaller competitors that surround it. Nor does O'Hare International in Chicago.
Aviation experts say the best analogy to the South Florida situation exists in only one other place in the country: the San Francisco Bay area. There, San Francisco and Metropolitan Oakland international airports are rivals for airline service.
In South Florida, Streeval said he expects to see more incursions into the Caribbean and northern Latin America by airlines flying out of Fort Lauderdale. He sees Miami's future deeper inside South America.
"I think the situation is definitely more favorable to Fort Lauderdale than to Miami," he said. "I don't see Miami shrinking and going away by any means, but I think the good future growth is farther north."
