It looks like increased competition among airlines serving Missoula has meant lower ticket prices for travelers flying to and from here.
The Missoula Economic Partnership and the Missoula International Airport crunched U.S. Department of Transportation airfare data and found that since American Airlines entered the market last summer, the price of tickets declined for most destinations from Missoula, saving an average of $20 per round trip.
Round-trip ticket prices to Chicago and Dallas have dropped by $130 and $40, respectively, compared to a year ago. Domestic travelers going to and from Missoula paid a combined $2.8 million less in the third quarter of 2018 compared to the same three months in 2017 for all markets.
“With the addition of American Airlines, you can see firsthand that competition directly relates to lower airfare in a community,” said Jeff Roth, Missoula International Airport board chair. “It’s fantastic to see so many members of our community supporting Take Flight Missoula, and we especially want to thank Missoula Economic Partnership, Destination Missoula and our Tourism Business Improvement District for helping bring American Airlines to Missoula.”
Missoula businesses and organizations ponied up $400,000 to match a federal grant for an $800,000 revenue guarantee to entice American Airlines to enter the Missoula market. The daily, year-round, nonstop service to Dallas/Fort Worth and summer seasonal nonstop service to Chicago O’Hare began on June 7. Since then, there have been 116,000 more departure seats leaving Missoula compared to 2017.
Brian Ellestad, the deputy director for the airport, said airport managers were focused on reducing costs for major travel corridors that connect to popular destinations.
“We really wanted to reduce south and east-of-the-Mississippi travel costs to the East Coast and this shows we accomplished that goal,” he said.
The price to fly to Denver, Portland, San Francisco, Oakland and Boston dropped, but the price to fly to Seattle and Las Vegas increased.
"Having American really helped lower prices to the East Coast, Midwest and South where we had less competition in the market," Ellestad explained.
He said it's important for people to realize they didn't have to fly to Dallas to take advantage of lower fares.
"Places like New Orleans, prices dropped $125 round trip, or business destinations like Chicago dropped $130 or Detroit (dropped) $100," he said. "That ends up being real dollars. Cities like Louisville, Kentucky, that use to be a two-stop connection went to a single connection and the priced dropped $140 round trip."
The airport is in the midst of a $110 million renovation and expansion that should be complete by 2021.
Take Flight Missoula is the umbrella group that includes many local business entities and other contributors that rounded up the money to match the federal Small Community Air Service Grant. One of the businesses that wrote a check was ALPS, a company headquartered in Missoula.
“Being a Montana-headquartered company doing business in 47 states means ALPS typically has multiple employees flying in and out of Missoula each week,” explained ALPS CEO and President David Bell. “Expensive airfare creates a challenge basing traveling staff in Missoula. Using the revenue guarantee to attract more airline competition, which lowers ticket prices, reduces that challenge. This allows ALPS to hire more staff based in Missoula who fly all around the country for work.”
And that wasn’t his only reason for participating.
“There’s another reason, and I think it’s even more important,” Bell added. “With high average airfare prices and low per capita income relative to the rest of the nation, Montanans are forced to spend more of their income flying to see family, on vacation or for emergencies. That’s a regressive impact, and since this can be combated by stimulating airline competition and bringing down airfare prices as a result, I believe we have a moral obligation to make this investment.”
Barb Neilan, executive director of Destination Missoula, said more flights and cheaper tickets are better for the entire economy.
“Bringing more non-stop destinations and flights into our market is important to keep our tourism economy growing and strong,” she said. “The increased competition in the market has spurred existing airlines to bring in larger airplanes, increase the number of flights, and drop their fares. All of this is great news not only for our visitors, but also for our Missoula citizens and businesses.”