WASHINGTON -- Despite a government study touting the benefits of
airline deregulation for most travelers, many medium-size
communities are complaining to Congress about high fares and the
lack of good service.
"Almost immediately after airline deregulation [in 1978],
Chattanooga lost service from both United and Eastern Airlines,"
Hugh Davis, president of the Chattanooga Metropolitan Airport
Authority, told a hearing by the House aviation subcommittee.
Service peaked in the 1980s, Davis said, when Delta, Northwest,
US Airways, American and regionals Eastern Metro Express and Comair
all ran regular service out of Chattanooga.
But the recession and other factors, including the failure of
several carriers and the increasing use of hub-and-spoke systems,
caused a dramatic reversal, culminating with Delta's decision to
cease operations out of the city after 50 years, he said.
"To further exacerbate the already critical situation, three
nearby airports had growing, low-cost airline service," Davis,
which encouraged travelers to bypass Chattanooga to get cheaper
fares out Atlanta, Birmingham and Nashville.
The loss of air service hurt Chattanooga's economy and its
ability lure businesses from other cities, he said.
"Our business efforts have been hampered by consistently poor
air service at Tri-City Regional Airport," testified Fielding
Rolston, vice president of customer service and materials
management for Blountville, Tenn.-based Eastman Chemical Company, a
plastics, chemicals and fiber manufacturer.
"We are trying to attract new customers and suppliers to our
headquarters from literally around the world. And now, more than
ever, we're finding it extremely challenging. It's no problem for
them to get to New York or Chicago or Miami. But getting to
Northeast Tennessee can be exasperating."
Rolston said poor air spurred another Blountville company,
Phillips Consumer Electronics, to relocate to Atlanta.
Other mid-sized communities complained that deregulation has
hindered airline competition, resulting in higher fares.
Robert Hancik, aviation director for the Springfield, Mo.,
Airport Board, said his flight to Washington National cost more
than $1,175, "as opposed to flying into Baltimore, Md., for $214
"Same airline, one airport with low-cost competition, one
without," Hancik said. "A roundtrip Springfield-Dallas ticket, 364
air miles, is $678, but by driving to Tulsa, a flight to Dallas is
Nonetheless, a study of 112 airports conducted by the General
Accounting Office (GAO) found that in the aggregate, airline
deregulation has benefitted the majority of travelers because air
fares have tended to be lower and the quantity of air service has
"Deregulation continues to be an enormous success in bringing
better service and lower fares to the vast majority of consumers at
cities of all sizes," Patrick Murphy, deputy assistant secretary
for aviation and international affairs for the Transportation
Department, told the House hearing.
"The first year when air carriers had pricing freedom, the
average real fare in the U.S. had fallen 37.2%," Murphy said.
Joint testimony by representatives from Northeastern
University's Department of Economics and the Brookings Institution
supported the GAO study, noting "that fares in 1993 were about 20%
lower than they would have been if the industry were
But some experts disputed the GAO's findings as inherently
"By examining average fares [the GAO] produced data that is
meaningless at best, and misleads consumers and this committee at
worst," said Darryl Jenkins, president of the Aviation Foundation
and director of the Aviation Safety Program at George Washington
"GAO's fare analysis did not consider the significant variance
in the mix of service and customer types at individual airports,"
"Nor did it consider the cost impact to the airlines of
short-haul vs. long-haul flights. Such variances produce
substantial regional differences in the average fare per passenger
No easy answers emerged from the hearing, but John Anderson,
director of the GAO's division for transportation issues,
resources, community and economic development, suggested that one
alternative for medium-sized cities may be to take matters into
their own hands.
"As of January 1997, regional jets accounted for only 90 of the
2,127 commuter aircraft in service in the United States," Anderson
said. "Local communities could accelerate this trend by providing
incentives for commuter carriers to serve their airports with