Pittsburgh International Airport pins hope on next CEO
Financial outlook for industry grim
March 17, 2014 11:58 PM
A jet approaches Pittsburgh International Airport in partly cloudly skies.
By Mark Belko / Pittsburgh Post-Gazette
With a change at the top, Allegheny County Executive Rich Fitzgerald is hoping to reverse the direction of Pittsburgh International Airport, attract more flights and boost traffic.
But then again, it all may be for naught.
The troubles Pittsburgh International has experienced over the past decade have far less to do with who was running the airport than with the realities of the airline industry, experts said Monday.
"It's very difficult for an airport director to change the mind-set of an industry that is engaged in capacity discipline," said William Swelbar, a Massachusetts Institute of Technology airline researcher and executive vice president of Intervistas Consulting, an aviation consulting firm.
William Lauer, an Allegheny Capital Inc. principal who has followed the airline industry for years, said one of the biggest drags on the airport has been its high cost, among the higher ones in the country, not the personnel running it.
"If they can't do anything about costs, they could hire P.T. Barnum himself and they probably wouldn't attract much attention," he said.
The Allegheny County Airport Authority plans to conduct a nationwide search for a new CEO after removing Bradley D. Penrod, the airport's top administrator, on Friday. Mr. Penrod served as the authority's executive director for six years before being reassigned to the position of president and chief strategy officer in February 2013. In that capacity, he continued to run Pittsburgh International until his ouster. James R. Gill, the authority's chief financial officer, was appointed acting executive director.
Dennis Davin, treasurer of the authority board, said the change was made in an effort to do everything possible to bring in more flights and to better utilize the $1 billion airport terminal opened in 1992.
"We think we need to do everything we can to support the business community and the flying public," he said.
The airport has been in a tailspin for more than a decade, largely due to the decision by US Airways to drop its hub in Pittsburgh in 2004. Since 2001, the number of daily flights has plummeted from more than 600 to an average of 150. In addition, airport passenger traffic has fallen the past two years after posting an increase in 2011.
"We're looking for someone to change the direction of this airport," Mr. Fitzgerald said. "It is at its lowest usage ... and it keeps going down. We need to change that direction, to build capacity."
For the CEO job, Mr. Fitzgerald said he is looking for a "dynamic, charismatic salesperson who wakes up every day" with the goal of attracting more flights and building capacity.
"We have a jewel. This airport is one of the best airports in the country. It needs to be sold and marketed in that manner and that's what we're doing," he said.
Asked what was wrong with Mr. Penrod, Mr. Fitzgerald replied, "Nothing really, per se. It just wasn't working. We weren't moving forward. Anyone who flew into the airport could see how things have changed over the last few years. It didn't look like there was any change in direction."
Mr. Penrod could not be reached for comment. A severance package is still being negotiated.
Despite the desires of Mr. Fitzgerald and the authority, Mr. Swelbar doubted that bringing in a new CEO would make much of a difference in the airport's direction. He pointed out that airports in Cleveland, Cincinnati, Memphis and St. Louis are experiencing many of the same issues as airlines merge and cut capacity.
Kent George, the former airport authority executive director who now heads the Fort Lauderdale-Hollywood International Airport, said the key to attracting airlines like Southwest and Jet Blue to Pittsburgh was community support, not who ran the airport.
"A new airport director is not going to bring new flights to the area," he said. "As long as the community has sufficient passengers for the airline to make money, they will fly to your community. All an airport director is going to do is open up the doors for you."
One airline that rallied behind Mr. Penrod Monday was US Airways, now part of the new American Airlines.
"Brad's been a great partner over the years and we're sorry to see him go," said Michael Minerva, American's vice president, government and airport affairs.
In the last year before Mr. Penrod's ouster, American started a nonstop flight to Los Angeles and Southwest added service to Houston and Nashville.
Mr. Swelbar also noted that the airport had been able to increase its local traffic in recent years.
While he and other experts question whether bringing in a new CEO will make a difference, Mr. Fitzgerald said it's a shot worth taking.
"Let's try something new," Mr. Fitzgerald said, adding he didn't sense confidence in the direction the airport was going under Mr. Penrod.
No timetable has been set for hiring the CEO.
Mark Belko: email@example.com or 412-263-1262.
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